IGA News

Major factors impacting the independent sector: Garage work provision

Major factors impacting the independent sector: Garage work provision

29 March 2019

The IGA is releasing a series of bulletin articles detailing factors affecting the independent garage sector in today’s modern age. This time, we’re discussing the advent of work provision, or “skimmers”, and how they can impact smaller garage businesses.

The digital era has brought with it many advantages and disadvantage and is driving wedges through our traditional buying habits.

Aggregators, disruptors, intermediaries, and comparison websites are virtually part of our everyday lives. They entice the user into believing they are getting the best deal available, while in reality they place themselves between the buyer and the seller. These intermediaries are funded by taking a cut from either the buyer or the seller, to the detriment of the transaction.

It is logical therefore that one of two things will happen; either the seller will increase their pricing to cover their additional costs, or they discount the costs of their good or services which reduces their margin. This could in turn result in a reduction in the quality of the goods or services being sold.

For the large multi-national organisations such as insurance companies who sell very similar products in a price sensitive market, aggregators are less of a business risk. For the smaller local business, these web based disruptors at best will be reducing their margin or at worst driving their customers to a competitor. Either way, there is business interference and the potential that the end buyer may not be getting the deal they think they are.

For the independent garage sector these intermediaries have the potential to divert once loyal customers from local businesses, with the enticement of saving a few pounds on their motor costs as well as, in some instances, even placing themselves into the payment process.

The IGA’s 2019 Garage Work Provider Report, which provides an in-depth exploration into work provision for the independent garage, is coming soon. For any further questions or guidance, please call the direct member helpline number or 0845 305 4230.