Southeast Tire Co.

I really liked this one Joe. We are currently in the process of transferring from a small, "fix what's broke" shop to a complete car facility. This helps my perspective and I shared it with my manager and service writer at our weekly meeting. Your wisdom is much appreciated and useful.

I really liked this one Joe. We are currently in the process of transferring from a small, "fix what's broke" shop to a complete car facility. This helps my perspective and I shared it with my manager and service writer at our weekly meeting. Your wisdom is much appreciated and useful.

We upgraded from the same Visualiner you mentioned to the John Bean Prism. It is faster to setup than the Visualiner and very easy to use. We only do 20-25 alignments per week so it fits our needs nicely. If you are looking for something to handle higher volume, the Hunter setups that Joe mentioned are tough to beat.

I see what you are saying but maintain my position that you cannot look at your overall spending in this way. What if your sales doubled this year? You would obviously have to spend more on parts and labor while your overhead expenses would remain largely static. Looking at it using your method you would have spent a much larger percentage on parts and labor. This would not be a bad thing though, it means you made more money. You need to monitor what you are making on the sale of those parts versus what you spent on them. What you are spending on them as a percentage of total expenses is unimportant. What is your Gross Profit percentage on parts sales?

I don't see how you can have a set a percentage of overall spending using this method. Part and Labor are costs of sales and will increase according to sales volume. If you have a phenomenal year, you will have to spend much more on parts and pay more for the labor to do the work while your overhead will remain basically the same. The will skew these percentages as you have them laid out here. I think you are looking at this in a overly simplistic manner. You need to at least divide your expenses into Cost of Goods Sold (COGS) and overhead. You need to know your break-even number. What do you have to make every year/month/week/day to keep the doors open. You then adjust your gross profit (money left from sales after deducting cost of parts and labor) to cover your overhead and provide the owner with a salary. Rather than looking at what you are spending on parts and labor as a percentage of expenses, you need to be looking at what your gross profit is on your parts sales and labor. That is the important number. I don't know if this clears anything up for you.

I have printed out the last few of your articles and gave them to my service writer and lead tech. You manage to make a tiny lesson into an interesting anecdote. Keep em coming.

I use Mitchell1, I have looked into their CRM program. It seems to me that it is geared more toward customer retention than it is to attracting new customers. Mudlick just uses demographic lists to target potential new customers, they do not use your existing data. Does Mitchell1 offer something similar?

Where do you guys draw the ethical line on recruiting employees? Is it unethical to pursue a competitor's employee and make him an offer? I had a lively debate recently with a friend about this and it got me thinking. It is my position that there is no problem with trying to hire a talented technician away from his current employer if it is done in an upfront manner. If I can offer him a better opportunity and I don't resort to dishonest means in offering it, then I feel that I acted ethically. I recently heard that one of my competitor's top mechanics was a little discontent with his job. I heard this through one of my parts supplier reps. I did not solicit the information nor did I ask how he found out this intel. He knew that I was looking for an additional mechanic and he casually brought it up over a morning coffee bull session. I have a mutual acquaintance with said mechanic so I contacted that person and told them to let the mechanic know that I had a proposal for him if he had an interest. A few days later the mechanic called me and we set up a meeting. I was impressed with the guy and I made him an offer to come and work for me. He thought it over for a few days before calling me back and declining, stating that he had come to an understanding with his current boss. He thanked me for the offer and I told him to let me know if he ever changed his mind. The end. Did I do anything wrong in this case? My friend seems to think that I did, that I was unfair to my competitor. Its not like I walked into the guy's shop handing out business cards. I feel like I went through the proper channels. Agree or disagree?

Anyone know anything about this direct mail company? Mudlick Mail. They are a direct mail service specifically for auto repair shops. I requested some information and they seem to have some good programs. Anyone have experience with them? Disclaimer - I have no affiliation nor am I trying to promote this service. Just looking for opinions.

We sell a ton of tires and use a whole lot of wheel weights. I'm in Louisiana and, by reputation, I'm sure we will be one of the last to adopt the ban. I have priced the alternatives and I have not found anything on the market that is as cheap as lead. We will price accordingly and pass the cost on when the time comes. I got a free demo of the 3M system a while back. I think it is excellent but more than double the price per ounce of lead stick-on weights, which are already more expensive than clip-ons. We are being forced to use more and more stick-on weights due to modern wheel design which is driving up costs. We try to offset this cost by only making 2 bulk purchases a year for our wheel weights. I have found that there is quite a bit of flexibility in pricing when dealing with the major tire supply companies (Myers, McGee, American Tire Distributors). We have each supplier submit bids and pick the lowest. We are able to get a 35-40% price reduction off their list prices using this method. I would assume you could do the same in the future with alternative weight options to drive costs down.

As a lifelong Louisiana boy and bonefied Cajun, I can state without a doubt that this is not filmed in Louisiana. Sounds like the guy is speaking Spanish. Amazing nevertheless.

Do you guys also deal with those third-party warranty providers much? Being a growing shop, we tend to take whatever is out there. We seem to get quite a bit of business from these providers clients and, although I have not done much insurance work, I can't believe insurance adjusters could be worse than them.

I actually played baseball against this guy in high school. I don't think I even fouled one off in my two at bats against him. It takes a lot of integrity to walk away from guaranteed money like that. He has my respect for sure.

You certainly have plenty of scientific data to back up the claim that nitrogen is superior to air. You also cite the fact that nitrogen use will be more widespread in the future. What you do not mention is the public's perception and acceptance of it. You are getting feedback from very successful shop owners who are telling you that they view it is an up-sell item and not a necessity, that customers are not requesting it and, in some cases, are moving away from it. My primary business is tire sales and service. My business is in a large city (600k+). I can think of 2 instances where a customer called or walked in looking for nitrogen in the past year and I service a heck of a lot of vehicles. When I see the green caps, I explain to them that I do not offer nitrogen inflation. It is not something people want or care about and I have never lost a customer because of it. With TPMS technology, proper inflation had become less of an issue. It has made people more aware of their tire pressure and consequently reduces problems that we used to see more of (uneven tire wear, blow-outs, poor gas mileage). I group this gimmick into what I call the "Jiffy Lube" method of up-selling. You go in for an oil change and, before you know it, you need an air filter, wiper blades, a coolant flush, and diff oil change. Sell them everything you can by telling them they have to have it and will suffer the consequences if they don't. I despise that type of sales mentality and so do most customers. I will not sell something that only offers an arguably minimal benefit at a premium price. It is snake-oil sales at its finest and I won't bite on it and neither will the consumer in the long run. *edit - spelling

Competition is certainly the driving factor for me. My main competitors in the area are larger shops or corporate chains. They spend quite a bit on advertising in both mail and radio. I can't afford to do as much of this but I do have a great location on a high traffic street. So I run specials like this to get people in the door. I run oil change, alignment, and free rotation specials all of the time and it really increases traffic and leads to bigger jobs. Because this shop is a newer location for me (just passed 1 year), I am more concerned with growth than I am with profit. My other locations (which sell only tires) generate the profit I need to run my overall business. Therefor, my main goal after break-even with my service location is to build my repeat customer base and increase overall community "buzz". I have found that, by doing this, I am building a loyal customer base and gradually attracting the more profitable jobs. If this were my only location, and I was dependent on it for my livelihood, this strategy would never work. But, since I am able to do this, I feel it gives me a key advantage over my competition and will eventually allow me to grow to the point that I can eliminate some of these lost leaders and realize more profit.

From what I've read on the Schrader and VDO, they are mainly covering domestics. They covers almost no imports with their universal systems as of now. This system is the first I've seen that has such wide coverage. I agree that the website is terrible. If I hadn't put my hands on it at SEMA, I wouldn't even consider it based on internet info.

Sure you can, it is free. www.wibiya.com. It has a nice statistics feature that tracks traffic as well. I like it.

Your site looks good. Guess I'll just go ahead and copy your section and use that. Kidding, of course. Thanks for the feedback.

Thanks. I agree on the print. It is a work in progress. What, specifically, would you suggest on the auto service page?

We just recently added a new website. I am looking for an honest opinion from fellow shop owners. Our business is primarily tires. We do offer full service auto repair at one location. take a look and give me some feedback. All feedback, positive and negative is desired. Southeast Tire Co.

I would have to concur with this assessment. The current commercial lending situation is tight at best. I think it is awesome to have a grand dream but I think you should consider smaller steps in achieving it. You are talking about a multi-million dollar investment before a profit is realized. Dream with your heart but reason with your head.

Myers Tire Supply is pushing a new TPMS solution. I played around with it at SEMA this year and it seems like an excellent and affordable system. Here is the link: http://www.alligator-sensit.com/ Rather than having to purchase a new OEM sensor, they sell an aftermarket replacement that can clone the defective sensor. You program the new sensor using a simple little USB pad that works with any computer. They claim to have about 85% model coverage growing to 90% by the end of the year. They are saying software updates will be free. I guess they are planning to make their money on the sale of the aftermarket sensors and accessories (valve stems, cores, o-rings, etc). It looks like a great system with the total start-up cost around $750. The sensors are supposed to sell for around $25-35 i believe. Anyone have any experience with it yet? If all true, it seems to be an excellent solution with good profit potential.

We personally run a $55 alignment special for most vehicles. We also give a free alignment with the purchase of 4 new tires. It was said above, and I agree, that alignments generate a ton of front-end work. It is also, in my opinion, the easiest to sell. The customer is typically in the waiting room (rather than a drop-off) and I can bring them out there and physically show them the issue. It is a strong selling point and a great money-maker. I view alignments the same way as I do oil changes: A way to get a customer in the door, get their information in the database, and start them on a regular maintenance program.

We use an all-in pricing model. We market this as every tire sale gets a free mount, balance and valve stem(where applicable). We price in the cost of that when we determine mark-up. I have had better success with this method over an itemized breakdown, it is easier for the customer to understand and they seem to respond well to the upfront delivery of the pitch. There is no shock when it is check-out time. When I quote a tire, the price I give is total installation and tax included: "Out the door price". Works for us, about 90% of our business is tire sales

We ended up just with just under 40% total sales increase for the year. This is with the addition of a new location. Same store sales were up around 20%. We are starting a major advertising campaign in 2011. We have done little to no advertising in our first three years so this is uncharted territory. We started with a new website, setireco.com. We are also looking into some direct mail programs and also internet and social networking programs. We have had good response through Facebook in the past and are really looking to build on that.