New York, New York: Neighboring dealers take advantage of their bottom-line automotive service opportunities
Remember the aptly-named "service station"? Years ago there were thousands of them across the United States, although anyone under 30 may not know what they were all about. They were general repair garages that did all automotive services and sold tires and also pumped gas and oil.
Most are long gone. Today, they are "gas stations" or "convenience stores." In addition to gas they sell coffee, breakfast sandwiches, groceries, even lottery tickets. But they do not provide automotive service. Consumers are even required to pay for the privilege of filling their tires, which is one reason why they seldom do.
To fill this void, other automotive service businesses evolved. Independent tire dealers may have names like "Jones Tire and Auto" or "Main Street Tire," but they are not just tire stores. They have found a steadily growing customer base by offering additional automotive services. The result? Customer retention is up and dealers are inflating their bottom lines.
This supplement will help you get your fair share of this business. We interviewed two different tire stores that are profitable and have their service bays filled because they are known for outstanding automotive repair work. They are both located within the suburban sprawl that is the New York City metro area. They are 50 miles from downtown Manhattan, and a lot of their customers commute into the city daily.
Through their eyes and experiences, we will touch all the bases and provide some interesting insights into their Best Practices.
Lake Region Discount Tire and Repair Service Inc.
Lake Region Discount Tire and Repair is a family business owned by Mike Lofstedt Sr. and run by Mike Jr., general manager. It is located in Monroe, N.Y. Their location is right across a highway from Home Depot, Wal-Mart and BJ's Discount Store. It is right up the street from the world's largest grouping of factory outlet stores, Woodbury Commons, where 11 million people shop yearly.
Sounds like a great location, but most retailers would not have selected it. It is on a side road that requires knowledge of the area to find, even though it's visible from the highway. Their customers either know where they are or are willing to hunt for them.
Mike Sr. bought it as an operating business. It has grown a lot since then; it earns about five times the revenue of the first year, and is now quite successful. He added a three-story, 50' by 60' shop building with six bays. Where the second floor should be there is just open space for added workshop height. The third floor is a 3,000-square-foot, 10-foot-high warehouse with a tire lifting conveyor that takes inventory straight up.
They provide all automotive services and have first-class equipment to do the job. One of the bays is filled with a state-of-the-art alignment system. They also have a cooling system flush and recovery unit, an air conditioning recovery unit, automatic transmission flush equipment, complete engine diagnostic tools, reset equipment for TPMS vehicles, a Plasma cutter plus tig/mig welders and a lot more. Their tire equipment also is first class: high-tech units that make custom wheels and low aspect ratio tires child's play. The same goes for their balancers.
Lake Region Discount Tire and Repair serves a large group of satisfied customers and fleet businesses.
Dolson Auto & Tire Inc.
Dolson Auto & Tire in Middletown, N.Y., provides complete Goodyear Gemini Certified service, plus a full line of Goodyear and other brand tires. Owner Ed Perry runs a very tight ship with a trained staff of tire changers, ASE-certified technicians and counter people.
And Perry is very hands-on himself. He was an ASE Master Tech at 19 and has earned a Master Machinist certification. He also carries the C, CNG,X1 and Z5 certifications. The rest of the staff has different levels of ASE certifications and are paid accordingly.
The store has eight bays, with alignment equipment taking up one by itself. They have plenty of warehouse capacity for tires and a repair parts stocking program. Their beautiful showroom and customer waiting area features a large screen HD-TV as well as point-of-sale materials for tires and services.
Dolson Auto & Tire offers all automotive repair services except body and paint work. It has all the electronic vehicle diagnostic equipment, as well as the specialized equipment for brakes, chassis and suspension, exhaust, air conditioning, cooling systems, automatic transmissions, battery/electric, tire pressure monitoring systems and nitrogen.
The dealership's location is another anomaly. Like Lake Region Discount Tire and Repair, this is not the standard "location, location, location" scenario!
Although it is based in a heavily trafficked shopping mall, there is poor visibility from the road, and the city will not allow Perry to locate a sign on the street.
How do people find the store? Customers are willing to hunt because of the reputation of Ed and his associates. Their business base of satisfied customers is vast and delivers new customers every day. Perry takes care of customers and rewards those who have recommended him to new customers.
These two dealers are both successful in performing automotive service work. Considering their locations, it's clear that drive-by traffic is not the cornerstone of their success. What follows is their Best Practices.
Computerization required: Tire dealer software programs increase service business
Both Lake Region Discount Tire and Repair and Dolson Auto & Tire use dealer-specific computer software that handles all aspects of the business. It starts with an invoice being filled out or when inventory arrives.
Dolson Auto owner Ed Perry uses the Goodyear "GBMS" program. He thinks it is a bit pricy, but it also provides automatic replenishment of Goodyear tire inventory and helps him keep a tight reign on his business costs and activities.
"It isn't perfect, but I haven't found anything better at any price," he says. "Until I do, I'll use it and let it help me run my business."
Lake Region Discount Tire and Repair owner Mike Lofstedt Sr. tells us that he uses the Auto Tracker Plus system, and although it isn't perfect he says it is very good. He receives improvements on a regular basis. One feature he particularly likes is the increased ability to track and analyze more of the services offered as an independent database.