Melbourne, Fla.-based Gatto’s Tires & Auto Service is on its third generation of ownership since Mike Gatto first opened the dealership's doors in 1971.
The company is now in the hands of Mike's grandson, Mike McHenry, who took over from longtime president, Pam Fitzgerald, McHenry's mother, around five years ago. (Fitzgerald is also a past president of the Tire Industry Association, having served in 1997.)
Gatto’s Tires & Auto Service has six locations across Florida and is a full-service dealership, offering tires, suspension work, alignments and mechanical repairs and maintenance services like brakes, air conditioning, engine diagnostics and more.
McHenry, who's always liked cars, told MTD that his grandfather and mother gave him a “positive view of the tire business” when he was growing up, which led to a high school job with the family business.
“In high school, I mostly delivered tires between our stores and to our wholesale accounts. After graduating college, I did work in some other fields. I always knew I would return to the family business at some point. I’ve been here 32 years now.”
Personalization
When asked what makes Gatto’s Tires & Auto Service different than other tire dealers in the area, McHenry said that his dealership offers a “personalized level of service that only a local family-owned and operated business can provide. At the same time, we provide professionalism, industry expertise, warranties and consistency between locations that would be typical of a national chain.
“The other thing is that we are very good at employee retention. Customers like seeing the same faces when they shop with us. In our industry, I think we are one of the best at this.”
However, finding well-qualified people has been the dealership's biggest challenge. McHenry said that for many years, it seemed like young people were getting away from the trades, but he believes this trend may be starting to shift back.
“The good news is if we keep a good employee for a year, they tend to stay. Most of our top techs and management staff have been with us for decades.”
When considering a new team member, McHenry said he looks for proper qualifications for the job, from certifications to past experience. “But beyond that, we want good people ...with a dedication to their customer, their community and our company. It is possible to be people and profit oriented. You can make a nice living in this industry just by offering honest advice and service. Don’t oversell or undersell. I tell our employees, ‘Do what’s right and you won’t have to hide from your customers when you see them in the grocery store.’”
Adding services
McHenry said the number of mechanical services offered at Gatto’s Tires & Auto Service has increased over the years.
When the dealership opened, the majority of the revenue it made was from mechanical services, with almost no “underhood work,” except for oil changes. The company performs zero heavy mechanical or diagnostic work. Currently, the majority of its revenue comes from auto repair service, although tire-related services and tire sales are still a large part.
McHenry has also added new technology and training through the years – key to staying current with new vehicle technologies. “For example, alignments on many newer vehicles require procedures to recalibrate the super cruise or self-driving modes. Also air conditioning refrigerant has changed in the last few years, with different procedures for that.”
Three pieces of advice
McHenry told MTD that one thing people might not realize about running a smaller tire dealership is that small tire dealerships have all the problems of big businesses, but access to fewer resources - “no extra people to move around as needed, tighter cash flow, fewer advertising dollars and mistakes take a bigger toll.”
He offered three pieces of advice for other independent tire dealerships who are trying to grow or improve their operations.
“One, word of mouth is still a powerful tool in generating business. You still need online, Google ratings, etc. But nothing beats an endorsement of a neighbor or co-worker when they’re asked where they get their car serviced and they mention your business.
“Two, treat your employees well and they will treat your customers well. Be known as the best shop in town to work for and the top people will gravitate to you.”
“Three, it seems counterintuitive, but I have found that a tire (dealership) is least known within a mile or two radius” of its location, he said. “Get out into the local community on foot and meet people at their places of work - doctors' offices, stores, restaurants, etc. All their employees probably drove to work, which means they have a car! I have gone on many of these local walks over the years and almost always come back with a new customer’s car to service.”
