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Joe Marconi

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Blog Entries posted by Joe Marconi

  3. Joe Marconi
    As shop owners, we get consumed with the day-to-day routine of running our businesses. When we are young, we think we have all the time in the world to plan for our futures.  When we hit middle age, we think about our end game, but too few of us do something about it. And when we reach retirement age, we wonder if we did all the right things to prepare for life after owning an auto repair shop.
    The reality is that life can throw you a curve ball at any age. This means you need to prepare today. You have responsibilities to yourself, your family, your loved ones, and those you employ.
    Ask yourself, “What if something happens to me today that would force me to retire? Would I have everything in order so my family would be protected?  Would my business survive without me not being there?”
    No matter what stage you are in your business career, my advice is to do this: Set up a series of meetings with a financial advisor, your accountant, an attorney, and an insurance agent. And your business coach, if you have one. Tell them that you are concerned about your eventual exit from the business and to plan for the unexpected. They will help you to get all your priorities in order.  
    Remember, when it comes to life’s curve balls, age does not matter.
  5. Joe Marconi
    Tomorrow is the bank closing for the construction loan. A construction loan is different from a bank loan for property, home or condo. Let’s say you looking to buy a home that sits on an acre of land and the agreed upon price is $500,000. The bank will do its due diligence to determine if this is a sound investment. The bank will also insure that your income qualifies you for that particular loan. With a construction loan such as mine, where I am erecting a 4 bay facility on property that I already own, I go to the bank with a plan. My plan must include projected costs of the project, projected increase in business and details on how I will grow the business. The bank does an analysis to see if the plan makes financial sense.
     
    For a construction loan, the bank will need to see detailed estimates from the builder, plumber, electrician, excavator, etc. The bank will also perform an appraisal to determine the value of the property and business at the present time and the projected value after the completion of the project. This is extremely important. If the loan amount you’re asking for is $500,000, the bank will use the property and building as collateral against the $500,000.
     
    Another major difference with a construction loan is how the money is disbursed. Let’s go back to the example with the purchase of a home. The bank will lend you the full amount at closing for the home less closing costs and any money you put up. You start paying back the loan with interest usually the following month.
     
    With a construction loan, money is disbursed in stages. The bank oversees the project and distributes only the money to pay for the portion of the project that has been completed. So, let’s say the excavator’s work is complete and his bill his $75,000. The bank will release the money to pay that part of the project. You pay only the interest on the portion of the money borrowed. The actual loan (principle and interest) does not begin repayment until the project is complete.
     
    This is why it is extremely important to work with the contractors and vendors to get hard figures and calculations. You don’t want to go over budget and be left with less loan money then what you projected. AND, always build in a contingency figure of 10% or 15% to cover unexpected expenses. Believe me, there will most certainly be unexpected expenses.
     
    Also remember to factor into the project all the expenses you incurred prior to putting a shovel in the ground; Architect fees, site work, attorney fees, consulting fees, town fees and any other expenses incurred prior to and not including the actual building construction.
     
    A word of advice when dealing with contractors and vendors, get everything in writing. Don’t rely on the “good old handshake”. Another piece of advice, when you make a mistake, and you will along this tough process, put it behind you. Mistakes are unavoidable.
     
    Stay tuned!
  6. Joe Marconi
    We are now in our 6th month of construction. The building is completely framed with the electrical work almost done. The windows, doors and siding should be complete by the beginning of December. This coming week will be a challenge. We need to put the binder coat of blacktop down before the blacktop plants close for the winter. This will mean loss of at least one to two workdays. And with Veterans Day on Tuesday (a usually great sales day), I do not want to loose much needed revenue. We will probably have to schedule around the blacktopping and make up for it later on in the week or on Saturday, with longer days, possibly into the night if needed.
     
    The past six months have been filled with excitement, anxiety, fear and anticipation. We finally got approved for our new signage, which completes all town permits. We need a DOT inspection of the driveways, which I don’t see any foreseeable issues.
     
    Probably the biggest concern is going through the winter months. We are located in New York, about 45 minutes north of NYC and the weather can be unpredictable at best. You can have 60-degree days in January and 3-foot snow falls in February. This can delay construction and consequently delay our opening.
     
    Other concerns of mind are the details of the project. Every aspect of the project: construction, finance, equipment purchasing, financial forecasting, advertising, marketing, branding and goals are being reviewed and tweaked.
     
    They say experience is the best teacher. If that is so, I have the best instructor in the area.
     
    Stay tuned!
  7. Joe Marconi
    This past week the foundation for the new building was completed and the land is now being graded in preparation for the new blacktop. The process of constructing the walls will start within two weeks. The dream is slowly becoming a reality.
     
    Earlier in the week I met with the general contractor, bank project manager, electrician, plumber, architect, excavator, the building inspector, Hunter Alignment rep, Rotary Lift rep, advertising agent, overhead door company and the company that will be installing the bulk oil tanks and pumps. By Thursday night I was shot! I didn’t sleep that night at all.
     
    I am now in the phase of the project that you begin to second guess yourself. Did I make the bay sizes correct? Did I pick the right equipment? Did I pick the right people do construct the building? Did I get the best rate for the bank loan? Will I be able to increase the business to repay the loan? Question after question I asked myself into the wee hours of the morning. I was a walking Zombie by Friday.
     
    The excavator needed to break up the driveway to run power lines and drains and decided to work through the weekend so as not to disturb my business. This morning, Sunday, I picked up coffee and donuts and brought it down to the crew. There were very thankful.
     
    Do you think I am scared? You bet! But I can’t quit now and need to put my faith into the belief that all the preparation to this point will pay off. Did I make mistakes this past year? Tons of mistakes! Mistakes that cost me dearly. But that’s all part of the process.
     
    All I can say is, if it were easy everybody would be doing it. Fear keeps people from sometimes achieving their potential. It kept me from growing my business for years until I asked myself what’s the worst that could happen? Actually the worst would be to loose everything, but I don’t think that will happen. After 28 years in business, this is something I need to do and want to do.
     
    Stay tuned!
  8. Joe Marconi
    28 years ago I made the choice to become a shop owner. For years prior to starting my business I worked hard to become a skilled mechanic. By the time I was 24 years old I was rebuilding engines, transmissions, solving the most complex electrical problems and became an ASE Master Tech. How did this benefit me when I went into business? NOT VERY MUCH!
     
    How did this help me with expanding the business and creating a new business model? NOT AT ALL!
     
    I opened in 1980 and after struggling for years it dawned on me that being skilled mechanically just wasn’t enough. I needed to become skilled with the mechanics of business.
     
    I needed these new skills to design my new business model. I will outline my steps in future entries and share the process. One thing is certain; you need to have a business mindset to create vision for your company. You need to become a leader. Why? You can’t do it alone. You need great people around you to help you build your empire.
     
    Stay tuned for more!
  9. Joe Marconi
    After working for more than 2 years, we finally have all the approvals for our expansion project. My business plan has been submitted to the bank and hope to hear from them soon. Our next step is to have the building designed approved, which we do not anticipate a problem.
     
    We now have 6 bays and will be adding four more bays, which will be a stand alone facility. This facility will accommodate all our while you wait customers and light service work. The repair work and bigger jobs will be done in the original 6 bay facility.
     
    A lot of work went into this project (many sleepless nights) to get to this point and it's not over yet. We broke ground last month and looking at 6-10 months for completion.
     
    I have to admit, creating a business plan and new model was not easy and out-of-my-comfort zone. It's like starting a new business. It's both fun and scary!
     
    I will make periodic updates as the project progresses and will share the step by step process needed to build and create something new.
     
    Please contact me with comments. I will share the experience with all.
     
    Stay Tuned!
  10. Joe Marconi
    My first step in making the decision to expand the business was to overcome fear. Fear holds people back from achieving their potential. For me, it was the fear of failure and fear of the unknown. This project was doing something that was out of my comfort zone.
     
    For over a year I thought of every excuse NOT to expand the business: Where do I find more techs? How will I afford the new mortgage? Why do I want to start this at my age? Do I really need to do this? Why do I want the additional headaches? Aren’t things fine the way they are now?
     
    The project would involve demolishing and old building and constructing a new one. The new building will add an additional 4 bays and new customer waiting area.
     
    I had multiple meetings with the site engineer asking question after question. Finally he told me, “Joe, you have been going back and forth on this project for over a year, either sh_ _ or get off the pot”. At that moment I decided to go for it.
     
    I guess it’s easier to live in your comfort zone. It’s harder to move forward into the unknown.
     
    In future entries I will outline “The Plan” for the new building.
     
    Stay tuned!
  11. Joe Marconi
    Where is your daily focus? This is a question I ask myself constantly. If your daily focus is fixing and servicing cars, then that is what you will accomplish on a daily basis. But, as the leader of your company, is this where your focus should be?
     
    We are in the business of repairing and servicing the motoring public. But in order to grow and be successful, the leader of the company must work on insuring the success of the business. The leader of the business must work on marketing, advertising and creating systems that, when followed, will allow the business to run on its own. I tell my people that our company can only be a success if it runs without me.
     
    To have a company run on its own requires systems and policies along with the adequate training to insure that all procedures are followed. All systems and policies must be written and explained in detail to every member of the company. Constant review is vital. A system of checks and balances must also be put into place.
     
    To create a self-run company takes a great of time, and trail and error. Take for example the work-flow process. Every detail of the work-flow process must be detailed and itemized in writing: Customer write up, dispatch, reviewing the work order with the tech, road testing, the checklist, up sells, the actual repair, reviewing the completed work order and car delivery.
     
    With my expansion project, I have taken every segment of my business and broken it down into categories. For each category, I have written a series of procedures so that every employee understands what his duties are. Check lists and reports are generated and reviewed to insure that things are getting done properly.
     
    Years ago I was the hub of my business and every action required my involvement; from obtaining parts, to diagnosing jobs, to making payroll, cleaning the shop, road testing, selling work, etc, etc, etc. This is the most inefficient way to run a company and was doomed to fail. I needed to change and I did.
     
    Build a business that runs without. Empower your people to act with authority with the ability to make decisions. Create positions in your company where people report to each other and not to you. Relinquish control and watch your company grow.
     
    Stat tuned!
  12. Joe Marconi
    Setbacks are inevitable. Some are controllable. Others are not. Three weeks ago we planned on pouring the cement slab and finish the sidewalks, but the weather turned too cold. With temperatures in the low 20’s and a bone-chilling wind, the mason decided to wait. This past week, Mother Nature cooperated, and with temperatures in the mid 40’s; we finished the slab and sidewalks. The mason and his crew worked till midnight the Wednesday before Thanksgiving. I have a deep respect for people in the trades.
     
    A major setback occurred this week and is yet not resolved. It threatens the project and may delay the opening of the new facility. This setback has to do with the Department of Transportation. (DOT). First of all, you cannot build anything in this country without intervention from government agencies. And I swear, the pyramids would probably still be in the planning stages if we had government intervention back then. As a matter of fact, I’m not sure if the word “intervention” is correct. It’s more like government “interference”.
     
    Before a shovel is put into the ground you need the approval of the Town Planning Board, Town Zoning Board and the Architectural Review Board. The Department of Transportation gets involved, along with the Environmental Protection Agency. If you survive this, there’s the bank loan process to add a few more gray hairs. This process for me took about 2 years. So, as you might have guessed by now, I have had it with regulations and government agencies. But anyway, here’s what happened…
     
    The DOT has their input with respect to the driveways and curbs out on the road. I had to get a DOT permit and issue a bond before any work was started. In the permit are certain specifications that the site engineer must conform to when he draws his plans. The excavator follows the plans, grades the property and constructs the curbs in accordance with the approved site plan.
     
    Before work is started we needed to inform the DOT and ask for a meeting, which we did. When we called the DOT, the agent assigned to our case said, “Just let me know when it’s done and I will come out and inspect the site”. That was our first mistake.
     
    Our second mistake occurred when we called the DOT agent just before we did the actual excavation work on the DOT section of the property (the driveway and curbs). The agent again told us to call him when the job was complete. And that’s exactly what we did.
     
    We completed the curbs, blacktop and driveways and called the DOT agent. After repeated calls to his office he finally came out and guess what he said? You guessed it… The work is not acceptable. There’s a problem with the driveway grades. The shoulder of the road needs to slop away from the center of the road according to the specifications stated in the permit. This was Wednesday before Thanksgiving. The same day the mason worked till midnight to finish the concrete slab. What’s more annoying is that the DOT agent was out to site on Monday and never said anything to anyone. No one knew he came out. No one saw him. I had to finally call him Wednesday afternoon, only to find out he did come and he would not approve the work. And to top things off, he is leaving early for the holiday. Early for the holiday! I guess it’s nice to have a cushy government job these days, while the mason has to put in a 16-hour day just to have off on Thanksgiving!
     
    The DOT SOB never came out when we asked for a meeting at the start of project, never came out when we asked to meet before we started the work on the DOT section of the property and we had to beg him to come out to inspect the work once competed. And he did not even identify himself when he did come out and never called me. I had to call him.
     
    What’s the lesson in all this? Cross every “T” and dot every “I”. Do your due diligence. In the DOT permit, it is advised that a meeting be set up with the contractor and site engineer. Don’t listen to a lazy DOT agent. Insist on the meetings, go over the site plans and get everything in writing. I blame myself only because I am the one who needs to overcome this obstacle. After all, the DOT agent went home to a nice early holiday weekend. I know he enjoyed his holiday bird while I ended feeling like a turkey.
     
    Stay tuned!
  13. Joe Marconi
    There’s an expression that states, “You are who you associate with”. I have learned from this expansion project that this is brutally true. In order to grow and achieve the best for yourself in life you need to associate with people who share the same dreams, goals and aspirations. It’s amazing how many business people, including other shop owners, question the rationale behind my desire to grow my business. Maybe it’s a touch of jealousy? On the flip side, it’s remarkable how many customers wish me the best of luck and are behind me 100 percent.
     
    Then, there are the rumors. The gossip that got back to me is actually funny and sad at the same time. People told me that they heard that a major parts company was backing me. Others told me that they heard the only way I could accomplish this expansion was by charging astronomical prices for years past and by paying my people dirt-cheap. The best story is that I am somehow tied to organized crime. While I do admit that I grew up in the Bronx and of Italian decent, this is laughable. I don’t think Tony Soprano would be interested in my auto repair shop in update New York.
     
    I guess what really hurts are the comments from shop owners I have known for years that throw digs my way. Is it that hard to believe that a shop owner, of my caliber, take on a project of this size? Is this too far fetched? Maybe they are reacting to their own inabilities.
     
    The truth is that when I stand back a look at my project, it IS hard to believe that I’m actually doing this. It’s scary and things can go really wrong in a hurry. But the thrill of doing something like this is incredible. I will end this with another saying, “It is better to have tried and fail, than to have never tried at all”.
  14. Joe Marconi
    In business, if your not growing you’re dieing. This may be harsh, but true. All companies need to grow to survive. Whether you have 2 bays or 30, it doesn’t matter.
     
    For the first five in business I grew from nothing, so any growth was positive. After eight years my sales hit a plateau and hard times followed soon after. By my tenth year, I was nearly broke. It took me an additional 2 years to realize that although I could fix cars I could not fix my business. My skills were all mechanical. I needed to learn a new set of skills: The skills of business. It took an additional 2 years to create a plan that would free me from the hole I dug for myself.
     
    By 1994, I created my first business plan. I made major changes to the business and started watching the numbers of the business. I increase the staff to take on duties that I once performed: Every position from lead tech, service advisor, janitor, office manager, shop foreman, receptionist and just about every other position. I needed to give up control of the daily operations in order to gain control of the business.
     
    Changes were made in areas of marketing, branding and advertising. We launched programs that targeted our existing customers and reached out to prospective customers. We experimented with different forms of advertising: some worked, a lot did not. But, you will never know what works until you try. Today, our marketing and advertising is focused on growth.
     
    Once we made the decision to increase the business from 6 bays to 10, we ran the numbers to see what sales we would need to generate the income needed to pay for the expansion and return a profit on the investment. We also learned how many techs will be needed, the number of service advisors and support staff.
     
    Everything is on paper in a detailed business plan. Comprehensive strategy and scenarios were also written to simulate real life conditions. In-house training will be a key component. We compare to this to a football team or baseball team where all players are working in unison toward a common goal.
     
    Growth in business is determined by you particular needs, abilities and desires. All that matters it that you grow. You don’t have to achieve the status of Disney World or Trump Enterprises to be successful.
     
    Everything starts with a plan. And a plan is written. If your goals, dreams and aspirations are all in your head, there’re in the wrong place.
     
    Stay tuned!
  15. Joe Marconi
    We are in the final stages of construction. The exterior siding is almost complete along with the electrical work, plumbing, security system, heating and air conditioning. We expect the building to be complete within six to eight weeks, barring any unforeseen obstacles. Photos of the project will be available soon.
     
    A great deal of time has been spent on the design and layout of the not only the building, but the parking lot layout and the workflow process, as well. One thing I have learned in the past 28 years is that productivity is the key to profit. How your technicians move through the day can be the difference between making money and losing your shirt.
     
    Our old parking lot was a nightmare. We would park 25 to 40 cars in a lot designed for a maximum of 18. We would stack cars 3 to 4 deep and found ourselves on many an occasion moving 2 to 3 cars to get to the one we needed. This killed productivity and morale. We can now park 50 or more cars which greatly improves productivity and traffic flow. Also, an inviting, organized parking area means a lot to customers. They know where to park, and find it easy to navigate in and out of the lot.
     
    Perhaps the most important is in bay design. The existing 6-bay shop will be reserved for the bigger repair and maintenance work: transmissions, engine repair, analysis, timing belts, etc. We will staff this building with 3 techs, a foreman and a service advisor. Each tech will have 2 bays. With this design, a tech can bring a car in one of his bays, diagnose the problem and have the other bay available to start on another car if he needs to wait for parts to arrive. Or, if an unexpected vehicle arrives with a problem, having an extra bay available is convenient. This eliminates having to put cars back together when waiting for parts or having to work on jacks outside the bay due to lack of room. Again, I can’t stress enough that productivity is the key to profit. Keep the techs flowing smoothly throughout the day will make you more money.
     
    The new facility will have 4 bays and will primarily be used for more express-type service: oil change service, tire rotations, state inspections, tires, alignments, batteries, etc. One of advantages of designing a building from scratch is that you design it the way you want. Everything aspect about the new 4 bay shop is tied to productivity: The location of the office, phones, computer information system, inventory, bathroom, tire machine, balancer, floor jacks, jack stands, part delivery entrance and other equipment.
     
    Each bay will have overhead access to an air line, droplights, electrical power and metered oil reels. Each tech will have a cart complete with chemicals, rags, oil drain plugs, oil drain gaskets and other hardware. You don’t want techs walking to the far side of the shop for an oil filter and then to the other side for a drain plug gasket and then across the bays for an air line. That wastes time and kills productivity. Everything a tech needs must be within reasonable reach.
     
    The new facility will have three techs and one service advisor. We will install 3 Rotary Lifts: two 10,000-pound lifts and one 12,000-pound lift. The fourth bay will be the alignment bay. A flush-mounted Hunter alignment machine will find its home in this bay.
     
    Although we will promote while-you-wait service, we will not position ourselves as a quick lube. However, contrary to what many people in our industry believe, we welcome walk-ins and actually encourage it. I do realize that smaller shops with 2 to 4 bays may find it difficult to accommodate people walking in without an appointment, but the consumer's mindset has changed the way it expects service. For small shops and larger ones, I recommend developing a system that accommodates customers on their time, not yours. People don’t always have time to make an appointment to drop their car off for service. And they certainly will not make an appointment to drop a car off for an oil change. Performing simple services like oil changes, tire rotations and state inspections will build a customer base that will eventually lead to more profitable work.
     
    To expand your business will require an increase in your customer base and a different business model. At our shop, we no longer tell people when to bring in their car; we ask them when they would like to bring it in. Building a business is about building relationships, one customer at a time. Make it easy for the customer. Don’t get bogged down with a rigid schedule. It will take time to develop and your people may resist change.
     
    Our entire workflow process is designed to maximize productivity in order to boost car counts. An increase in car counts gives us the opportunity to sell more work and prosper.
     
    Find ways to prosper, it’s a lot more fun.
     
    Stay tuned!
     
     
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  16. Joe Marconi
    Everyone needs direction and everyone needs deadlines. We would never conduct business without knowing when parts are going to arrive, when jobs need to be done, how long jobs will take to complete and every other aspect of running a repair business. What’s vital to your business is to understand the amount of work needed (labor hours and parts sold) in order to reach your sales goal, which translates into profit. In other words you establish deadlines and goals on a daily basis. You probably do it so instinctively that you don’t even realize you’re doing it.
     
    Construction is a bit different. Although it’s your project and you have a General Contractor (G.C.), you are at times at the mercy of a particular contractor. I have gotten tough over the past few months and talk frequently to the G.C. about the progress of the construction.
     
    With any construction project, establish goals and deadlines from the start. Meet with the G.C. and the all the contractors and establish a realistic deadline for completion for each contractor. Review those deadlines often and make the contactors accountable. This may be hard. What happens in the construction business is that if they land another contract, they try to do both at the same time, yours and the other job. They don’t want to loose the income so they over extend themselves. I can’t blame them, but your main concern is your project and this needs to be conveyed to the contractor. The General Contractors on my project is extremely good at making sure contractors hold up to their commitments.
     
    My job is to have periodic meetings with the G.C. to review the progress and to make sure we’re still within our budget. Cost overruns and extras can kill you. There will be countless extras that each contractor will want to up sell you. Stick to your game plan. If the extra saves money in the long term, carefully consider it. If it’s a “nice to have”, but not a “need to have”, it might be best to pass on it. There will be enough unexpected expenses for you to worry about.
     
    We are coming down to the wire, with about 2 months to go. Every waking (and sleeping) hour is devoted to this project. Excited? Yes. Scared? A little. Nervous? You bet!
     
    Stay tuned!
  17. Joe Marconi
    Now that we are close enough to pick a date for the grand opening, we need to start the promotion process and make plans for the day of the grand opening. We need to jump start this business with a big splash in the community. Having momentum right out of the gate will be important to the success of the project.
     
    To help promote the business I have greatly increased our advertising and marketing. Prior to this project the only advertising I did was in the local yellow books, sport sponsorships and ads with local charitable organizations. I concentrated mainly with my existing customer base through newsletters, emails, service reminder cards, promotional flyers and specials. In order to increase market share, we need to expand our horizons.
     
    We purchased mailing lists and started a post card campaign introducing our company to people who are not our customers. We target a five-mile radius from our shop. We also use a company to send offerings to all new residents in our area and we are part of the local welcome wagon organization.
     
    Last spring we shot a TV commercial and started airing the commercial the start of the summer. This has been a great success and is more affordable than you might think. We just shot a new commercial last month, which will feature the new facility.
     
    In January we started with radio. It’s too early to tell how affective this will be, but customers and friends tell us they hear us. And if they are hearing us, others are too.
     
    We hired a press agent to help us with getting some free press in all the local newspapers. It’s amazing how newspapers like to promote local businesses. I convinced my bank to feature us in their newsletter. This was a good move. I had a new customer just the other day that walked in for service because of that article.
     
    Six weeks prior to the grand opening we will start to invite people to the event. We will invite local politicians, bank officials, local businesses, local Chamber of commerce, all the people involved with the construction and, of course, our customers.
     
    We will also hold a series of consumer clinics as a way to showcase the new facility. We will use the clinics as fundraisers for local charities. This is great end around marketing.
     
    The day of the grand opening will be a daylong event. We will have food, door prizes and other products to give away. We will make sure that we obtain names and addresses for all who attend. We will cap off the day with a ribbon cutting ceremony and will drive the first car onto the first lift for an oil change. We will ask selected people to say a few words and I will also present a speech.
     
    Promotion is key. I want to cause a lot of excitement in the community.
     
    Stay tuned!
  18. Joe Marconi
    With two months to go before the grand opening, I reflect back to 7 years ago when I first had the vision to expand. It took a few years to actually begin the process. There were things I needed to learn and a tremendous amount of fear to overcome. I can tell you honestly that the fear never goes away nor does it get any easier to handle. It’s there and I accept it. The hardest part was to pull the trigger. Once you make the decision, only look forward. It makes no sense to look back and second-guess yourself. Mistakes will be made, but that’s how we learn.
     
    The past 4 years were filled with countless hours talking to engineers, bank loan committees, town planners, general contractors, site engineers and architects. But that’s only part of the story. I spent almost every minute that I wasn’t working doing research on the auto industry, quick lubes, franchise models and other large companies. I also studied other companies like Toyota, Star Bucks, GE, General Motors, Disney, South West Airlines, McDonalds, Apple and Microsoft. Thank God for the Internet.
     
    I read books on leadership from great people like Winston Churchill, Benjamin Franklin and Abraham Lincoln. In addition, I studied the works of Dale Carnegie, Jack Welsh (former CEO of GE), Jim Collins (the author of Good to Great), John C. Maxwell and The Art of War by Sun Tzu. Not a day has gone by in the last 4 years that I did not work toward my goal. And reading was a big part of the process.
     
    So once you acquire knowledge, what do you do with it? The answer? You give it away. By sharing knowledge, you make the poeple around stronger, which will only make your stronger.
     
    We hold short meeting at my shop almost daily. These meeting only last about 10 to 15 minutes, but in these meetings I slowly share the knowledge I acquired. My goal is to share every aspect of the project and what is needed to be successful. I share the entire process including the numbers. It’s like a baseball team or an orchestra: although a team or orchestra is made up of individuals, they all work in unison toward a common goal and all the players know each other’s job.
     
    Power point presentations were created and after-hour training sessions were held and will continue to be held on all aspects of the business. From procedure, to policy and basic training on topics such as understanding charging systems, starting systems, ABS brakes, wheel alignments, steering, suspension and other service procedures.
     
    Probably the most important thing I learned the last 4 years preparing for the expansion is that every member of the organization must fully understand our goals and implement the plan.
     
    If the knowledge I gained, remained only in my head, that knowledge becomes useless.
     
    Stay tuned!
  19. Joe Marconi
    In the year prior to making the decision to grow the business and construct an additional 4 bays, I did extensive research in learning about franchise businesses, quick lubes, national chains and also big businesses such as Disney, GE, Starbucks, McDonalds and others. I wanted to find out why these businesses have a higher percentage of success and growth, as opposed to so many general independent repair shops that seem to struggle and plateau after a few years.
     
    I also visited many quick lubes and national chains to learn how they conducted business. I even took my car in for service at a few quick lubes and tire stores, without them knowing that I owned a repair shop. This experience was extremely enlightening and I advise all shop owners to do the same.
     
    What I learned from my research was that all these business differ the traditional repair shop in many ways and that there are many similarities among franchises, quick lubes and tire stores. And these similarities are not just common to the auto industry but common to all successful businesses.
     
    To be successful you need to have a plan, you need to have vision, you need to think like a businessperson, you need to market your business, you need to advertise, you need to create systems and you need to create policy that all in your company must follow. What I also learned is that the more consistent you become the more successful you become. This can only be achieved by creating systems that make your business more automatic and run without you. The more the business runs without you, the more profitable it becomes. If your business is dependent exclusively on you, your business will never grow.
     
    Perhaps the most important thing I learned is that you need to be a leader and that great leaders can't do it alone. Leaders need great people around them to accomplish great things. I created a team of advisors within my company. This team consisted of my service advisor, shop foreman and lead tech. I also recruited the help from my two sons, a financial analyst and a graphic artist. Together, we created a new plan to expand and grow the business.
     
    Stay tuned!
  20. Joe Marconi
    Our first strategic meeting was held at the local Chili’s Restaurant. Over a few beers and burgers my team and I outlined our future. We talked about the business today and the business yesterday. We talked about our successes and our failures. We talked about how the business has changed in the past 10 years and where we believed the industry was headed. Prior to this meeting we interviewed many customers to find out what they wanted from our company. We asked them what they didn’t like and what changes would they make in our business. We found out that although price is an issue, it’s not at the top of their list. What do our customers want? A friendly face, a fair price, one-stop-shopping, a good warranty and most of all to bring in their car when it was convenient to them. Many customers told us that we were always so busy and having to make an appointment for basic service was not acceptable. Because of this, many times they went to the local quick lube.
     
    Our customers never mentioned ASE certification, or asked what kinds of parts we use. No one asked what kind of equipment we had. I guess they assume we hire qualified techs and are equipped with the right equipment. I think it’s the same as when you go to the doctor; you just assume he’s qualified and has the latest equipment.
     
    Based on our feelings on where we thought the business was headed and what we found out by listening to our customers, we decided to design the new building to handle all the customers who prefer to wait for service. Our new business will market; “You don’t need an appointment, bring it right in”. The existing 6 bay facility will handle all the traditional repairs, diagnostic work and those jobs that require longer times for completion. All basic service work will flow through the new 4 bay facility. If extensive work is found and up sold, the vehicle will flow to the 6-bay facility for completion. The new 4-bay facility will work as a feeder to increase car counts and to satisfy while-you-wait service and emergencies such as flat tires, bulbs and wipers.
     
    We tested out our new plan the beginning of 2007. We began to offer while you wait service. We asked customers when would they like to bring the car in for service. This caused a lot of problems at first and my techs rebelled. Pulling techs off of repair jobs to do an oil change or tire repair caused a lot of tension. But for the greater good we endured. After 6 months things settled down and our car counts went up. Our productivity suffered a bit, but our ARO increased due to more up sells. We pushed the envelope to see how this model would work and it did!
     
    We expect an increase in our productivity once the new 4-bays are up and the repair techs can concentrate on their jobs.
     
    Now that we have the plan, what do we do with it?
     
    Next time I’ll talk about starting the process with the site engineers and the bank.
     
    Stay tuned!
  21. Joe Marconi
    Once we made the decesion to expand, we realized we needed to create a business model that will take us to the next level. One thing we did know. If we continue to conduct business the way we did in past, we would fail. Times have changed and motoring public has changed with it.
     
    There were three factors that we considered when we developed our new business model. First, cars last longer, don’t break down as much and don’t require the same amount of service and repair work the cars did years ago. Two, every segment of the auto industry, from dealership to national chains are car cars centers now. The service and repair pie is being sliced smaller and smaller. Three, we live in fast-paced world. We can no longer expect people to be given a scheduled date for their when it suits us. We have to be accommodating to the customer and book appointments when it suits the customer. In addition, we need to handle walk-ins. Turning away unexpected people who want to wait for an oil change or state inspection is bad business, in my opinion. What’s worse, turning away first time customers. That can be the kiss of death. If you look at all the large chains, tires stores and quick lubes, they welcome walk-ins.
     
    So based on our findings, if we want to expand and add four more bays to our existing six, we need to reach out to a larger customer base in order to increase market share and car counts. This can only be accomplished by accepting walk-ins, allowing customers to schedule the service time for their car that fits into their busy schedule, extend business hours, be open on Saturdays and promote while-you-wait service.
     
    I want to make one thing very clear. I am not say that this is the only model and that the way you conduct your business is wrong. And, I am not saying that we should completely change the way we have been doing business for so many years. This is the model I created based on the changing times and changing demographics from my perspective.
     
    Next entry…how to capture a larger market share and increase car counts.
     
    Stay tuned!
  22. Joe Marconi
    My bank loan for the construction project was approved last Thursday. That is a huge load off my mind. The money is not in my pocket yet; the bank still needs to do the appraisal, review the construction plans in detail and do an environmental impact study.
     
    I will let you in a few key things that made the loan process go smoother than expected. It occurred to me years ago that someday I might want to expand, purchase land or invest. To do this I would need money, lots of it. What I felt was important was to have a business that showed a profit, had growth and was involved in the community.
     
    Each year, for the last ten years I worked to insure that the business showed growth and made a profit. Another thing you need to do is to establish yourself in the community. Get active with the local chamber and other local organizations or church. Sponsor athletic teams and school activities. Get to know the people at the bank, including the loan officer and bank officials. If your bank is local and employ local people find out what functions these people are involved with and get involved. Reputation is also vital and equally important is to have a clean facility.
     
    Perhaps the most impressive thing I did was to create and extensive business plan showing past history, financial charts, employee team and our plans for the future. We outlined the area demographics and showed the potential for growth in our area. We carefully detailed the new business model and illustrated the potential growth we would have once the expansion was complete. There are many great books and computer programs that can help you with creating a professional looking business plan.
     
    Another thing a bank loves to see is a great credit rating and equity. Since I own the land, the bank looks more favorable on the project. Investing in your own property has advantages, especially if you can show sustained growth through the years.
     
    Stay tuned!
  23. Joe Marconi
    Since our opening on April 25, 2009 we have increase business by a whopping 29%. We now have to insure that this becomes the norm and not just a grand opening bounce. Just about all our plans are falling into place. The added four bays and increased parking have allowed us to take on more work and become more efficient. We handle just about all walk-ins and refuse no one who calls for an appointment. We are determined to take care of our customers on their schedule, not ours.
     
    There is, however, a down side to the increase. We are starting to get a few complaints from customers on a variety of issues. We track customer service through a CSI cards, phone calls and email surveys. Our scores, although still very good, are not what they were prior to the opening. Our score prior to the opening was around 99.9%. That number has decreased to around 97%. This is unacceptable to me. I called for a team meeting last week to discuss this issue. Out of the meeting we found that we may be understaffed and that our attention to our customers is suffering. Our car counts have increased from 18-20 cars per day to 32 to 40 cars per day. The logistics of handling the increase, phone calls and other daily duties has put a strain on the entire staff.
     
    We need to regroup and analyze every step of the sales and service process: From the phone calls, to scheduling, to dispatching, to the actual service or repair and car delivery.
     
    This is where we are right now. Trust me, I have no regrets. These are good problems to have. Most important is that we maintain what made us successful in the past. And that’s serving the public, providing the very best in customer service and automotive care.
     
    Stay tuned!
  24. Joe Marconi
    With one month to go, we are working hard making all the final preparations for the grand opening. The building is complete and most of the equipment has been installed. Each day starts with a review of our plan list to insure every task will be accomplished before opening day. Ten months of construction and years of planning are nearing the end.
     
    We had a team meeting last week, after hours, to review the workflow process and the elements of the expansion. Adding four bays and another building will bring challenges and we expect a bumpy road in the beginning. Even with all the planning, things will go wrong. But, we are convinced that the additional bays, increased parking lot size and the new business model will allow us to increase efficiency and improve productivity. Customers will also benefit as we promote our while-you-wait express service. Time will perfect the process.
     
    There will be other challenges as well. Additional employees, increased overhead and a big monthly mortgage payment, just to name a few. I have run the numbers countless times and know exactly what we need in terms of sales, car counts and income to support the new business. At the present rate of growth it will takes us a few years to realize any real profit.
     
    The benefits of the expansion far outweigh the risks of the expansion. Our facility and property had many issues that would eventually lead to problems down the road. Our parking area was too small, our facility size would not support future growth, and the building that was demolished was in state of disrepair and hurt the equity value of the property. The improvements made to the property and the addition of a new building, increase the value of the property substantially, even in this economic climate. Plus, the additional 4 bays will give us the opportunity to accelerate our growth rate.
     
    Our opening date is April 25th. It will be filled with events, food, prizes, music, a live remote from a local radio stations and tours of the new facility. Invitations will be sent to our customers along with invitations to local public officials. We hire a marketing agent to handle the advertising, promotion and press releases.
     
    To tell you the truth, at this point, I’ll feel a lot better when those bays are in operation. All the years of planning on paper is one thing, but the real test will be when those first cars start rolling into the bays. I can’t wait for sweet sound of an air gun, the compressor and the clanking of wrenches.
     
    Stay tuned!
  25. Joe Marconi
    Our grand opening was held on Saturday, April 25th. The weather was perfect. Hundreds of people came out to visit our new facility. The affair lasted all-day and ended about 7:30 that evening. All the money spent on prompting the affair was well worth it.
     
    A special thanks to CARQUEST Auto Parts, who provided their barbecue wagon, blow-up racecar, tent, banners and other items.
     
    It was great to see many customers share in the festivities and we had the chance to meet many new people from the community. We had a local radio station broadcasting a live remote that helped bring many people in and created a lot of excitement in the area.
     
    We opened the new 4 bay expansion shop officially on Monday, April 27th. The first week we had an increase of 27% in sales. This bounce in sales is obviously due to the excitement we created with months of promotions. Now we need to maintain the momentum.
     
    The best news is that the techs love the new facility. We had a meeting after the first week and everyone said that although we worked on more cars than usual it didn’t seem has hectic. We have total of 10 bays now and 6 techs, leaving bays open for walk-ins and up sells. Also, if a tech is waiting for parts that will not arrive for an hour or so, he can use one of the open bays, rather than putting the car back together. This increases productivity.
     
    I will keep this blog open to report on the progress of the new shop.
     
    Photos will follow soon too.
     
    Stay tuned!


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