By Joe Marconi
I know it's not going to be Back to School as usual this year, but there will be increased traffic on the road as more people perform school-related errands. It's your obligation to your customers and the community to make sure the roads are safe.
Many people have neglected their cars the past few months, making a lot of opportunity for your shop.
Get your Fall/Back to School marketing plan in place today!
Want to share ideas? Even Better!
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
By Joe Marconi
I know none of us wants to hear this, but there will be a next crisis of some sort. I have lived through many downturns in my 40 years in business, the COVID-19 was the worst. But, out of every crisis comes lessons to be learned. So create your Crisis Plan today.
Start by understanding your numbers and knowing your breakeven. Then add to your breakeven a percentage of profit you want to earn. Equally important is creating a cash reserve in a dedicated bank account that will be used only in a severe emergency. Set your financial goals and stick to them!
Often overlook is your staff. Assemble the best team around you. This is a crucial part to ensure your future business sucess.
Lower your debt, get your credit rating up and maintain a good standing with all vendors. Lastly, talk to your bank about a line of credit that can remain inactive until you need to use it.
What other key things can we all share to help us through the next crisis?
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Advance Auto Parts Announces Purchase of the DieHard Brand from Transformco
RALEIGH, N.C. & HOFFMAN ESTATES, Ill.--(BUSINESS WIRE)--Dec. 23, 2019-- Advance Auto Parts, Inc. (NYSE: AAP) has acquired the DieHard brand from Transform Holdco LLC (“Transformco”), for $200 million utilizing cash on hand.
This asset acquisition will give Advance the right to sell DieHard batteries, the most trusted brand in the automotive battery category, and enables Advance to extend the DieHard brand into other automotive and vehicular categories. In addition, the deal allows Transformco to sell DieHard brand batteries through its existing channels pursuant to a supply agreement with Advance. Advance is also granting Transformco an exclusive royalty-free, perpetual license to develop, market, and sell DieHard branded products in non-automotive categories.
“We are excited to acquire global ownership of an iconic American brand. DieHard will help differentiate Advance, drive increased DIY customer traffic and build a unique value proposition for our Professional customers and Independent Carquest partners. DieHard has the highest brand awareness and regard of any automotive battery brand in North America and will enable Advance to build a leadership position within the critical battery category,” said Tom Greco, president and CEO, Advance Auto Parts. “DieHard stands for durability and reliability and we will strengthen and leverage the brand in other battery categories, such as marine and recreational vehicles. We also see opportunities to extend DieHard in other automotive categories. We remain committed to providing our customers with high-quality products and excellent service. The addition of DieHard to our industry leading assortment of national brands, OE parts and owned brands will enable us to differentiate Advance and drive significant long-term shareholder value.”
“DieHard is among the most successful and one of the most widely trusted brands in the auto industry, and we have long believed that the brand has even more potential,” said Peter Boutros, President of Transformco’s Kenmore, Craftsman and DieHard business unit. “DieHard revolutionized the automotive battery category when it launched in 1967, and has continued to be a leader in the category. Advance Auto Parts’ acquisition of this iconic American brand will complement our plans to introduce new DieHard products in non-automotive categories such as sporting goods, lawn and garden, authentic work wear and other exciting new categories.”
About Advance Auto Parts
Advance Auto Parts, Inc. is a leading automotive aftermarket parts provider that serves both professional installer and do-it-yourself customers. As of October 5, 2019, Advance operated 4,891 stores and 152 Worldpac branches in the United States, Canada, Puerto Rico and the U.S. Virgin Islands. The Company also serves 1,260 independently owned Carquest branded stores across these locations in addition to Mexico, the Bahamas, Turks and Caicos and British Virgin Islands. Additional information about Advance, including employment opportunities, customer services, and online shopping for parts, accessories and other offerings can be found at www.AdvanceAutoParts.com.
Transform Holdco LLC is a leading integrated retailer focused on seamlessly connecting the digital and physical shopping experiences to serve its members – wherever, whenever and however they want to shop. Transformco is home to Shop Your Way®, a social shopping platform offering members rewards for shopping at Sears, Kmart and other retail partners. Transformco operates through its subsidiaries with full-line and specialty retail stores across the United States.
Certain statements in this report are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, may be forward-looking statements. Forward-looking statements address future events or developments, and typically use words such as “believe,” “anticipate,” “expect,” “intend,” “plan,” “forecast,” “guidance,” “outlook” or “estimate” or similar expressions. These forward-looking statements include, but are not limited to, statements related to the benefits or other effects of the acquisition, statements regarding expected growth and future performance of the Company, and all other statements that are not statements of historical facts. These statements are based upon assessments and assumptions of management in light of historical results and trends, current conditions and potential future developments that often involve judgment, estimates, assumptions and projections. Forward-looking statements reflect current views about the Company's plans, strategies and prospects, which are based on information currently available as of the date of this release. Except as required by law, the Company undertakes no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements. Please refer to the risk factors discussed in "Item 1a. Risk Factors" in the Company's most recent Annual Report on Form 10-K, as updated by its Quarterly Reports on Form 10-Q and other filings made by the Company with the Securities and Exchange Commission, for additional factors that could materially affect the Company’s actual results. Forward-looking statements are subject to risks and uncertainties, many of which are outside its control, which could cause actual results to differ materially from these statements. Therefore, you should not place undue reliance on those statements.
Source: Advance Auto Parts, Inc.
Advance Auto Parts:
T: (984) 389-7207
E: [email protected]
T: (919) 227-5466
E: [email protected]
T: (847) 286-9036
E: [email protected]
This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20191223005397/en/
By Joe Marconi
The Atlanta Business Chronicle is reporting that Atlanta-based The Home Depot is seeing success with its pilot program for the automotive Do-It-Yourself (DIY) market. The company currently is running the pilot program in about 50 stores. Home Depot originally launched the pilot program in 10 stores in 2006. The home improvement retailer has dedicated about 500-square-feet of floor space to auto products, including motor oil and fuel additives.
It is hard to imagine how Home Depot sees opportunity in the DIY market. I was under the assumption that companies such as Advance and AutoZone are working to form a strong alliance with the commercial trade. What does Home Depot know that others do not?
Here is a link to an article and source.