CEI Reinvents Itself On Eve of Silver Anniversary
Twenty-five years ago, the concept of third-party accident management was new. And in June 1983, in a 10-by-10-foot office staffed by two people above the East Coast Fleet body shop in northeast Philadelphia, Collision Experts International was born.
The company’s immediate goal was to drum up more corporate fleet collision repair business for the family body shop downstairs. But the vision was bigger — to handle corporate fleet accident repairs across North America, through a coast-to-coast network of body shops.
“We were two families in the body repair business with the bright idea of targeting corporate fleets in the Philadelphia area,” according to Wayne Smolda, CEO and CEI founder. “But when we went after the business, we found out that to get it, we had to offer more services.”
Within three years and with a few more employees, CEI added the services that define third-party collision management: taking First Notice of Loss reports, arranging for temporary rental cars, and pursuing damage payments from third parties. To avoid being perceived merely as repair specialists, the company changed its name to The CEI Group, Inc.
CEI founder and CEO Wayne Smolda, center, in a light-hearted moment with employees. The company celebrates its 25th anniversary this summer.
Sedan Fleet Market Matures
Today, CEI is the largest provider of collision management services in North America, with more than 230 employees who handle some 100,000 claims a year. While accident management remains the company’s bread and butter, in the face of increasingly stiff competition, CEI has been reinventing itself.
“The market for accident management services for large sedan fleets is mature,” says Smolda. “A group of us is essentially chasing the same 1,000 fleets and trying to take market share from each other. At the same time, the trend is for corporations to reduce the number of vendors they deal with by consolidating services. We intend to remain competitive in our core market, but we realized that to continue our growth trajectory, we had to look for new opportunities.”
To increase the scale of its accident management business, CEI formed alliances with leasing and insurance companies as a private-label collision management and claims services provider. “We’re also committed to continuous technological and service improvements in our collision management product to meet changing customer requirements and stay ahead of the pack,” Smolda says.
But the company’s defining reaction to a maturing core market, Smolda explains, is a three-pronged diversification strategy to expand into new markets defined by geography, sector, and product.
“Our first thrust was to bring our accident management services overseas,” Smolda notes. “Today, CEI Europe is taking claims in Spain, Belgium, and Germany. We’re looking to expand both within and beyond Europe to support our existing multinational accounts and appeal to prospects.”
CEI’s second initiative targets truck and government fleets. “To these markets, the concept of third-party collision management is new — just as it was to corporate fleets 25 years ago,” Smolda observes. “It’s a challenge to communicate your value proposition in a new marketplace, but we’ve done it before. We’re gaining traction in both trucking and government, but these markets are in their infancy, so there’s huge potential.”
Smolda notes that CEI had been managing several hundred truck collision repairs a year since the early 1990s. However, he says, last year CEI managed more than 5,000 trucking claims, and the number is growing quickly. Meanwhile, the number of government fleets CEI serves nearly doubled last year.
CEI Enters Additional Markets
According to Smolda, the biggest difference between the CEI of the past and the CEI of the future is its entry into the driver safety and risk management business. “Accident management is still the foundation this company is built upon, but our fastest growth will be in services that prevent accidents,” he says.
CEI introduced DriverCare Risk Manager, its flagship safety and risk management product, to the corporate fleet market in 2001. A Web-based service, it collects driver motor vehicle violation and accident history data, calculates driver risk ratings, automatically assigns and delivers remedial training, and includes a quarterly newsletter to reinforce the safety message. Smolda says its customers report up to a 20-percent reduction in fleet accident rates.
This spring, CEI extended its safety brand with the launch of DriverCare Web-Based Training. “Now, anyone can access our training directly and pay by credit card,” Smolda says. “This is a new distribution channel for us. It allows us to reach smaller fleets, while opening the door to retail markets, such as schools and non-fleet drivers.” More new products are also in the works, Smolda says. “This is the information age, and we’ve recognized we’re a vast repository of data relating to accidents and safety,” Smolda remarks. “We’re creating new ways to help our clients tap into our data, analyze the information, and discover meaningful connections that enable them to manage their fleets with more precision.”
Information Technology Key to Future
For some time, Smolda has emphasized the importance to CEI of harnessing the power of emerging information technology, to leverage both itself and its clients within their own organizations.
“Fleets are increasingly perceived as strategic assets with a direct impact on the bottom line,” Smolda says. “Fleet and safety administrators are being asked to do more and more. They need solutions to cope with that challenge, and we’re all about discovering and delivering those solutions for them, such as the industry’s first accident and risk management dashboard and seamless Web integration with our repair providers.”
He adds, “That’s why we maintain an in-house staff of developers and why our information technology budget increases every year. Technology is the cornerstone of our future.”
Smolda takes visible pride in the distance CEI has traveled over the last 25 years, but is even more enthusiastic about what he sees ahead. “Our future has never looked brighter,” he says.