MYOB: The Search for Common Ground

Over the years, as our industry changes, the successful service provider has been forced to change the way he views his business to maximize its profitability.

Even though his primary interest is in his technical ability and understanding of the automobile, thus they became a competent licensed technician, they have learned the math of their business. Now they understand the importance of being up front to meet and counsel their client, coupled with the process of measuring and managing the productivity in the back shop.

Their client relationship has become everything.

They realize that face-to-face interaction, with a focussed discussion, is an incredible way to secure all the business of their chosen client base. They understand that the face-to-face relationship forces the service provider to listen to and understand a client’s needs. They understand they must stay on top of industry technology to counsel that client on the best return on their investment in that vehicle, based on how their client uses that vehicle.

This is probably a much different role than what the owner had in mind when he first bought his business as a licensed technician.

The process of change was dramatic for the service provider to go through. To be honest, many of them fought it until the financial results convinced them that it was the way to go, and their business, and profits, have grown since.

Now, consider the financial status of the average shop that does not embrace that kind of thinking.

In those businesses, the owner is a licensed technician, trapped under the hoist, trying to do everything in the business himself and getting very burned out. His attitude reflects that. He can’t pay his bills in full each month, he constantly complains about the consumer, he has very poor staff relations, he can’t seem to attract or keep good staff, he is very poorly equipped, his facility is less than stellar, he is always seeking low parts pricing from many suppliers as price, price, price is always the issue, and much of the time he lives for “white-box.” He is stuck in a lifelong negative business rut.

Is there, I wonder, a parallel for the jobber?

Consider that the jobber business has changed dramatically as well such as the number of SKUs required to be stocked, the internal and delivery processes to maximize efficiencies, technology changes from green screens to “real” screens, business software–all coupled with the reality that there are too many jobbers for the number of good service provider shops. Successful jobbers have embraced these changes within their business as they have reinvented themselves. Many though have not, and that is coming through loud and clear.

The small jobber usually started out as a darn good salesperson. He loved to sell parts. The problem occurred when too much change was coming into the industry, and he either refused to keep up or didn’t have the resources to.

This owner is now behind the counter taking orders from his customers; he can’t attract good employees. There is no time to manage the business properly. There is no time to meet with customers and turn them into clients to secure first-call-always business–they call that process growing the business. There is no time to listen to clients’ needs and discuss their business strategy and how both parties can work together. There is no time to stay up on client industry issues to help counsel a customer on his business affairs, or even be a competent sounding board.

The jobber’s receivables are too high and out of control. There is no time to go out and secure new and desired service provider business. The jobber is not able to optimize his inventory. These owners are caught in the same life-time negative business rut as their customers. Their attitude reflects that.

The jobber owner has forgotten his primary interest before he got into business: face-to-face interaction, building people and business relationships, listening and working with clients and securing all their business, being self-motivated, and just being excited about this great industry. Now they download face-to-face customer contact to one or two salespeople they send out into their marketplace while they stay in the store behind the counter and fight fires day in and day out.

These jobbers only see things from their perspective. They don’t want to change, but the comments from the marketplace by the better service shops don’t lie:

“I rarely/never see that owner; he actually takes orders over the telephone, as I understand he can’t afford to hire good people.”

“He may come around once a year; his salesman don’t understand my business as they have never talked about real industry issues and how we, together, should be addressing them.”

“That jobber’s salespeople don’t even have any authority to do proper business with me. I only use them as a last resort if I’m stuck.”

These negative perceptions can and will change only when the jobber owner changes. He must re-learn and refocus his business.

Listen to the best shops in the marketplace, because it will be the best shops that will be here in five to seven years. The weak shops are not the profit makers of today or tomorrow; only activity makers. It is questionable as to whether they will be here in five to seven years.

Get involved in the industry associations and listen intently to what they say is changing, and how these changes must be addressed.

You are the jobber owner or manager. It is time you reinvented yourself and your business, for business’ sake. Look around carefully and consider that the successful jobbers in our industry are those who lay a firm foundation with the bricks that others throw at them. Think about it.

Robert (Bob) Greenwood is president and CEO of E. K. Williams & Co. (Ontario) Ltd. and Automotive Aftermarket E-Learning Centre Ltd. Bob has more than 27 years of business management experience within the automotive industry, counseling individual shops in Ontario, and has developed business management courses for the independent maintenance and service sector proven to enhance the shops’ profitability and grow the business. Bob has also worked with wholesale jobbers on how to do a better job for the service provider by providing valuable insight as to the real challenges faced by the retailer today.

E. K. Williams & Co. (Ontario) Ltd. offices specialize in the independent sector of the automotive industry, preparing analytical operating statements, personal and corporate tax return completion, business management consultation and employee development. Automotive Aftermarket E-Learning Centre Ltd. is devoted to developing automotive shop business management skills through the e-learning environment of the Internet at www.aaec.ca.

Bob can be reached by e-mail at greenwood@ekw.ca or greenwood@aaec.ca.