What the 2025 Collision Repair M&A Data Means If You Own 1-5 Shops

Every year, Focus Advisors publishes a detailed breakdown of M&A activity in the collision repair industry. It's one of the best annual snapshots of where this industry stands, and David Roberts and his team consistently do excellent work on it.

I read through the full 2025 report and wanted to share the findings that stood out to me, especially for operators running one to five shops. Here's what caught my eye.

2025 Was a Slow Year. Then One Deal Changed Everything.

By most measures, 2025 was a quiet year for collision repair M&A. Total loss frequency was up, parts costs were climbing due to tariff pressure, and a mild winter meant fewer hail events and, in many markets, softer volumes. Many shop owners saw revenue flatten or decline. That slowdown rippled through deal activity. Buyers got more cautious. Due diligence timelines stretched out. A lot of sellers decided to wait.

Then in late 2025, Boyd Group/Gerber acquired Joe Hudson's Collision Centers, all 258 of them, in a single deal. That one transaction added 258 locations to Gerber's portfolio and created a 1,301-shop enterprise overnight. It also turned the "Big Five" consolidators into the "Big Four" by absorbing one of the largest independent chains in the country.

Outside of that deal, the rest of the year was slow. Caliber added 34 locations (1.9% growth). Crash Champions added 8 (1.2%). Classic Collision added 36 (11.6%). Among the mid-sized, PE-backed groups, results were mixed. Brightpoint grew from 13 to 36 shops. CollisionRight added 25. VIVE added 19. Some groups barely moved at all.

The headline is a tale of two markets. One blockbuster deal in a year that was otherwise sluggish.

Why Valuations Fell (And It Wasn't the Multiples)

This is the part that surprises most shop owners who haven't been watching the numbers closely.

When people assume their shop's value dropped in 2025, they usually think buyers got stingy. That buyers started offering lower multiples because the market cooled. That's not what happened. Multiples stayed stable, right around 7x EBITDA. The problem was the denominator.

EBITDA is the number that gets multiplied to calculate what your shop is worth. It's your earnings before interest, taxes, depreciation, and amortization. Think of it as a cleaned-up version of what your shop actually makes. Here's the thing about EBITDA: it doesn't move one-for-one with revenue. When revenue drops, margin percentages tend to compress too, because your fixed costs don't disappear.

Here's a concrete example from the report, using an MSO-sized operation to keep the math clean. Say a group does $30 million in revenue at a 15% margin. That's $4.5 million in EBITDA. At a 7x multiple, that business is worth about $31.5 million.

Now say revenue drops 10%, to $27 million. But margins compress to 13.5% because the fixed overhead didn't shrink. That gives you $3.65 million in EBITDA. At the same 7x multiple, the business is now worth $25.6 million.

That's a 19% drop in value from a 10% revenue decline. The percentages work the same way at every scale. If your single shop does $3 million and revenue drops 10%, the math hits your valuation the same way.

The flip side works the same way. A 10% revenue increase, with margins expanding slightly, can drive roughly a 23% increase in what your shop is worth. The leverage cuts both ways.

What this means in practice: if you're thinking about selling in the next one to five years, your top-line revenue and margin management right now are directly shaping what you'll be worth when the time comes. Buyers didn't pay less per dollar of earnings in 2025. There were just fewer dollars of earnings to buy.

PE Firms Are Now Looking at Shops Like Yours

This is the shift I want to make sure you don't miss.

For most of the history of PE involvement in collision repair, private equity firms weren't interested in you unless you were running a serious multi-shop operation, generally $30 million or more in revenue. Small operators were too small, too much work, not worth the diligence.

That changed in 2025.

Three new private equity firms entered the collision repair space last year, joining the 14 already active in the industry. More importantly, the target profile shifted. PE-backed buyers are now actively pursuing operators with as few as one to three locations.

This matters for a few reasons. First, it means there are more potential buyers in the market than there were a few years ago. Second, it means competition among buyers for quality shops is increasing, which generally supports valuations for sellers. Third, it means that if you've been running a tight operation and have thought even vaguely about selling someday, you are probably more relevant to buyers today than you were two or three years ago.

Three more new PE entrants are expected in 2026. The consolidation isn't slowing down.

Many Sellers Held Back in 2025. That Sets Up 2026.

Because volumes were down and EBITDA was lower than owners wanted, a lot of prospective sellers chose to sit out 2025. The logic was reasonable. Wait for a better year, get better numbers, get a better price.

The Focus Advisors report expects that backlog of sellers to come to market in 2026. Consolidators have capital. PE firms are active. The industry fundamentals that make collision repair attractive to buyers haven't changed: vehicles are still getting in accidents, the work requires skilled labor and specialized equipment, and scale advantages are real. The buyers are ready.

If you were one of the shop owners who paused last year, 2026 is worth paying attention to. And if you're earlier in your thinking, understanding what drives your valuation before you're ready to sell gives you time to actually do something about it.

What This Means for You

I want to be straightforward about something. Understanding this data doesn't require you to be close to a decision about selling. It requires you to understand your business.

The valuation math above isn't just relevant at the moment you're thinking about selling. It's relevant every year you're running your shop. Revenue trends, margin management, and operational discipline are not just good business practices. They are the inputs that determine what your business is worth when the time comes. That might be next year. It might be in ten years. Either way, the fundamentals are the same.

The Focus Advisors report is a good read if you want to go deeper. You can find it at focusadvisors.com. David Roberts and his team do solid, honest work on this.

If you want help understanding what your shop is worth, and what's actually driving that number, that's what I do. Start by scheduling time with me.

Doug Higgins is the founder of Collision Advisory. He works with collision repair shop owners on valuations, exit planning, and understanding the financial dynamics of their business.