By Joe Marconi
We, automotive shop owners of America, must take the opportunity of a lifetime and turn it into a bunch of success stories. What opportunity? Look around you. The world is in turmoil. COVID-19, social unrest, uncertainty about the presidential election, the economy, how are we going to get out kids back to school, on and on and on.
While the world is spiraling out of control, we have the power to make big changes to our auto repair shops. And it can all be positive!
First, the average age of a car in the U.S. is about 12 years old, attaining well over 200k on the clock.
Second, Uber, taxis and limo companies are suffering. Guess why?
Third, the motoring public in the foreseeable future will be traveling by car, taking road trips like they have never did before.
Fourth, the roads are packed with motor vehicles, as more and more people prefer their own car as their primary means of transportation.
Fifth, as the cars get older and older, more of them will be out of factory warranty.
Sixth, independent auto repair shops have a vast amount of training, resources and replacement parts.
Seventh, the overwhelming majority of cars being build and sold today are still internal combustion engine powered cars. If you factor in the expected average age of car these days, we can safely bet that those gas engine cars being sold today will still be on the road in 2033 and beyond!
Eight, You need more? That's not enough!
Get your plan in place. Get your prices in line with making a profit. Don't give anything away anymore (I am mostly referring to checking, testing, diags of any sort!) Offer world class customer service. Be a leader of your employees. Show the world what you are made of!
Thought it would be a good conversation to understand how your shop is doing through the COVID-19 pandemic. Thought the best way to get a grip on it all would be to get your response to these 3 questions.
1- How was your shop doing in early March - pre-pandemic? Were your numbers better, worse or about the same as last year.
2- What’s the biggest challenge you faced when the pandemic spread?
3- What’s your forecast for your shop moving forward?
Is business getting better? About the same - like nothing has happened? Or are you struggling to get customers through the door?
Look forward to hearing your BEFORE-DURING-AND AFTER to understand where the industry is at. Hope this generates a better “picture” of what’s going on.
“The Car Count Fixer”
P.S.: Join my on YouTube at Car Count Hackers
Grabbed this shot of a crazy 68 Camaro (with wild Mickey Thompsons!) at a car show last week! Thought I would share it to help you remember "where we came from!" - Enjoy!
By Joe Marconi
Due to COVID-19, many repair shops experienced a severe economic downturn, some with a drop in sales over 50%. Without a strong cash reserve and/or SBA funding help, many shops would have gone under.
My 40 years as a shop owner has taught me to always have a cash reserve. However, never would I have ever imagined a downturn like the one with COVID-19.
So, how do we plan for the next financial crisis. And, it will happen. Perhaps not as bad as the the virus crisis, but it will happen.
Here are a few things to consider: Have a separate, and hard to access, cash reserve bank account that has least two months of expenses. Also, secure a line of credit for at least one to two months of expenses. Also, know your numbers, keep payroll in line, and make sure your prices are fair to you too, not just your customers. Keep in good standing with all your vendors and keep your credit score high!
The bottom line here, is truly the bottom line. To weather the next financial downturn, you need a strong balance sheet and net profit to the bottom line.
What other strategies are you considering or implementing?
By Joe Marconi
As part of our debt reduction, I revamped all of our usual marketing and advertising and put those dollars into customer service and social media. For example, we ramped up our shuttle pickup and delivery service, extended our hours of service, made sure we spend a lot of time with each customer and made sure we called as many customers as possible. We also stepped up our meet and greet process and made sure will followed up with customer after the repair. Lastly, we increased our social media posts and increases ads and boosting. This has made a huge impact on our customer and already starting to pay dividends.
What changes have you made to your marketing strategy since the Virus Crisis hit?
Has the Coronavirus (COVID-19) impacted your auto shop business? If it hasn't yet, it has the potential to do so soon. Please share what you are currently doing, how your business is impacted, what plans you have in place, etc.
Some things to consider:
Do you have a plan in place should you or one of your employees become ill? With school, event, and business closures, how will this affect your shop? Are you sending anything to your customers in terms of sharing your plans around keeping your customer and employees healthy and doing your part in your community? Many small and large businesses have been sending email communications to their customers. Are you marketing to your customers in terms of not delaying car repair, should there be a need to temporarily close? Are your parts suppliers sharing their plans, should the pandemic affect supply chains? Are you stocking up on business and shop necessities? Please share your experience in this topic and stay healthy!
In the media:
The coronavirus and its growing tally of sick and dead victims around the world have been roiling financial markets, prompting countless hand-washing reminders and ruining more than a few vacations, and that’s before anyone knows exactly how widespread the effect will be on the automotive industry, including your local repair shop. Source
“By mid-March, the shortage of supplies will be felt and members are projecting they’ll experience disruption through May or June,” even if operations in China soon get back to normal, said Stacey Miller, senior director of communications at the Auto Care Association, a trade group representing 150,000 auto aftermarket and service businesses. Source
Similar Tagged Content
A new law in New Jersey forbids the sale of unsafe used tires. The legislation, signed by Gov. Chris Christie on Aug. 7, 2017, was supported by the U.S. Tire Manufacturers Association (USTMA), Tire Industry Association and the New Jersey Gas Station-C-Store Automotive Association.
The law fines businesses that sell tires that exhibit any of these unsafe conditions:
— tread depth of less than 1/16 inch measurable in any groove;
— damage exposing the reinforcing plies of the tire, including any cuts, cracks, bulges, punctures, scrapes or wear;
— improper repairs, including, but not limited to:
any repair to the sidewall or bead area of the tire; any repair made in the tread shoulder or belt edge area of the tire; any puncture that has not been sealed or patched on the inside and repaired with a cured rubber stem through the outside of the tire; any puncture repair of damage larger than 1/4 inch; — evidence of prior use of a temporary tire sealant without evidence of a subsequent proper repair;
defaced or missing tire identification number;
— inner liner or bead damage; or
— signs of internal separation, such as bulges or local areas of irregular tread wear.
Violators will be subject to a fine up to $500 for a first offense. A second offense will be considered a violation of the Consumer Fraud Act and subject to a penalty up to $10,000. Additional violations will be subject to a penalty of up to $20,000.
Anne Forristall Luke, CEO and president of the USTMA, said, “New Jersey has taken a bold step to protect motorists from high-risk used tires that have no business being put back into service on New Jersey roads."
The USTMA says its research shows more than 30 million used tires are available for sale nationally. The legislation does not ban all used tire sales. It targets used tires that have specific, well-established, unsafe conditions
The National Highway Traffic Safety Administration (NHTSA) says worn-out tires are three times more likely to be involved in a crash than tires with sufficient tread depth. NHTSA crash statistics indicate about 200 fatalities and 6,000 injuries are attributed to tire-related causes annually.
The law was sponsored by Democrats Shavonda Sumter and Raj Mukherji.
Sumter said, "What initially seems like a good deal ultimately can be deadly in the market for tires. Retailers who sell damaged tires to consumers endanger not only their customers but also everyone else on the road. Banning the sale of damaged tires simply is a common-sense matter of public safety."
Mukherji said, "Drivers in New Jersey should be able to buy tires and rest assured that the items they've purchased are safe. The lower cost of used tires does not warrant putting lives across the state at risk. Damaged goods that put consumers in danger simply should not be on the market, especially when it comes to tires."