Shop Owner

 Success Strategies For 2013

 No-Pressure Sales Tactics

 Customer Service Myths March/April 2013

Weathers Motors, Inc. Inaugural Federated ‘Shop of the Year’

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March/April 2013

Shop Profiles

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22 Weathers Motors, Inc., Media-Lima, PA 46 Westside Auto Pros, Des Moines, IA No-Pressure Sales Tactics

Features 6

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Shop Profile: Weathers Motors, Inc.

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Sales/Marketing: -No-Pressure Sales Tactics

18 Shop Operations: -Strategies For Success 34 10 Mistakes To Avoid When Selling Your Business, Part 2 Success Strategies for 2013

Sponsored by

Shop Profile: Westside Auto Pros

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Departments Shop Owner Staff

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Executive Interview: Nick Jacquez, Affinia Global Chassis

Publisher

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Contributors

Colleen Brousil, ext. 272 cbrousil@babcox.com

Finance: 2012 Tax Changes

Customer Service: Common Myths Exposed

Jennifer Clements, ext. 265 jclements@babcox.com Tim Fritz, ext. 218 tfritz@babcox.com Denise Koeth, ext.274 dkoeth@babcox.com Andrew Markel, ext. 296 amarkel@babcox.com Ed Sunkin, ext. 258 esunkin@babcox.com

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Director of eMedia/ Audience Development

Brad Mitchell, ext. 277 bmitchell@babcox.com

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Maryellen Smith, ext. 288 msmith@babcox.com

Babcox Media, Inc. 3550 Embassy Parkway Akron, OH 44333-8318

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President

Bill Babcox bbabcox@babcox.com

Vice President/ Chief Financial Officer

Greg Cira gcira@babcox.com

Vice President

Jeff Stankard jstankard@babcox.com

Controller

Beth Scheetz bscheetz@babcox.com

In Memoriam

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Founder of Babcox Publications

Edward S. Babcox (1885-1970)

Chairman

Tom B. Babcox (1919-1995)

䊚2013 by Babcox Media, Inc.

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Sales|Marketing|

by Steve Ferrante, CEO, Sale Away LLC

No-Pressure Selling Is A ‘No-Brainer’

As I pinball across North America training independent tire and auto service businesses on sales and customer service, it has become clear that many salespeople are under the impression that they must aggressively work to close the sale when interacting with customers, or they will lose business.

This old school “A-B-C” (always be closing) approach can work to win some sales for short-term gains, but, in the long run, this aggressive routine seldom produces the lasting customer relationships that pay long-term dividends.

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One of the ultimate truths of sales is that most everyone loves to buy, but no one likes to be sold.

Contrary to this, I’ve seen far too many salespeople in and out of the tire/auto service industry who take on an aggressive sales effort that would have them heading out the door if they were in their customers’ shoes.

Extensive consumer research has proven that there’s a direct link between positive customer experiences and greater sales results. Research also reveals that when there’s a disconnect between the way businesses go about selling their products, and the way consumers want to buy them, sales suffer.

A major dilemma that contributes to the use of aggressive sales methods is that, frankly, sometimes they work. And, when they do, it promotes a

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counterproductive mentality where sales managers often push harder and salespeople believe the hard-nosed approach is the right thing to do — unaware that they ultimately are losing more business (sales and profits) than they are gaining.

Case Study Example The massive new car industry presents a great case study to understand the cause and effect of high- and lowpressure methods on customer satisfaction and long-term sales performance and profitability.

New car salespeople have traditionally been trained to play a game of

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“cat and mouse” with the customer and operate under the misguided philosophy that customers don’t really leave the dealership to think about it and return to buy, so they must sell hard during the initial interaction, given that this is their only perceived chance.

Want to know how much that car you’re interested in costs? They can’t tell you. Not happy with the price you’re quoted? They’ll have to “see the manager” to get a better price approved and, all the while, you’ll be held hostage at the mercy of the dealership.

This unaccommodating process often leads to customers who are not

satisfied with their shopping experience, depart the dealership without purchasing and do not return to buy, often leaving management to instruct their salespeople that they must push harder for the sale when the customer is there — a vicious cycle.

As documented in the book Satisfaction, by J.D. Power and Associates, low- and high-pressure sales methods are drastically different in terms of producing customer satisfaction and sales/profits results. In its analysis of the automotive industry, J.D. Power evaluated the impact of customer satisfaction on sales and profitability, and concluded that the high-satisfaction group increased sales by more than 40%, while the low-satisfaction group actually lost sales.

Beyond manufacturer concerns of product quality and execution, a major contributing factor to customer satisfaction ratings was the customer’s feelings toward the sales and service experience at the dealership. Brands like Lexus and Acura, which excelled in dealership sales and service ratings, performed dramatically better in both sales and profit performance, than did brands like Ford and Dodge, which scored low in customer-satisfaction ratings.

but they can (and should) proactively manage the customer experience. In the automotive industry, the dealerships that rank at the top in sales performance had the best customer experience ratings — and included a process in which customers did not believe they had to play a game or feel pressured into buying. Instead, they were made comfortable by an environment with accommodating and informative salespeople who helped them buy — rather than trying to sell them.

A good friend of mine recently took his car to a local auto service center for a state inspection and commented to me that it was a great experience, saying that unlike several previous shops to which he had taken the family vehicles for their annual stickers, this place did not try to sell him anything.

Relationship-Based Sales Like automotive dealerships, independent repair shops do not manufacture their product offerings,

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Instead, he told me they simply provided a printout of all the recommended service items for the vehicle and advised him using a “just so you know” consultative approach. “That’s what I want. I don’t want to be sold anything, I just want to know what the car really needs, then I can decide to buy on my terms,” he said, adding, “I’ll bring my cars there from now on.”

The reality of the situation is that both this business and the shops he had visited in the past all sought to sell him their services. However, as is so often the case, it’s not what you do, but rather how you do it, that matters most. Rather than trying to close the sale, the service advisor properly executed a consultative approach, successfully opening the relationship and creating a long-term customer who has bought — and will continue to buy — from the shop.

If you were in the business of

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selling products to people once and never had to interact with them again, then relationship-based selling efforts would be far less important. That is not the case in the automotive service business.

People like to do business with people they like. As your shop’s products and services often are identical to those of your competitors, and everyone is in the same price ballpark, the relationships you create and maintain are your true competitive differentiators. SO Steve Ferrante is the CEO of Sale Away LLC and has more than 20 years of successful sales, sales management and sales training experience. He is the producer and host of the Pinnacle Performance sales and customer service training program that helps independent tire and auto service businesses improve customer relations and produce greater sales results. Steve can be reached at 866-721-6086 ext. 701 or steve@saleawayllc.com.

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Corporate|Spotlight|

New Bosch Programs Support Service Industry Efficiency and Profitability Bosch’s Diagnostic Business Unit continues to provide the aftermarket with programs that support efficient and profitable service. Two such programs introduced recently are the Bosch National Wheel Service Promise, and the new technical support hotline.

1. Bosch National Wheel Service Promise The Bosch National Wheel Service Promise guarantees that a Bosch authorized Wheel Service repair provider will restore Bosch branded wheel service equipment – tire changers, wheel balancers, aligners or brake lathes, purchased on or after January 1, 2012 – to operating condition within 48 hours of repair being scheduled by calling 1-855-BoschTech (1-855-267-2483).

The National Wheel Service Promise guarantees that: • Tech support will call back within two hours of a problem being called in. If the hotline tech is unable to diagnose the equipment repair needed, the call will be transferred to a Bosch Technical Support specialist.

• Once diagnosed, repair will be scheduled within 24 hours, and completed within 48 hours from the time it was scheduled.

• Service parts will be available 100 percent of the time and will be delivered within 24 hours.

• If Bosch determines that the equipment cannot be repaired within 10 days, Bosch will provide loaner equipment at no charge.

• Bosch will offer or extend the equipment’s labor warranty for six months if the equipment cannot be repaired within 48 hours of the repair

being scheduled. Visit www.boschdiagnostics.com or call 1-855-BoschTech for details.

2. Technical Support Hotline Bosch has also launched a hotline for all technical questions regarding Bosch parts, equipment and services. The new toll free technical support number is 1-855-BoschTech (1-855-267-2483).

“Our new hotline will field technical questions on parts, diagnostic tools including wheel and tire service equipment, scan tools, ESI[tronic]™ software, as well as catalog questions, consumer complaints and warranty issues and Bosch training availability and scheduling,” said Michael Loth, Director of Technical Support and Services for Bosch.

Robert Bosch LLC www.boschautoparts.com www.boschdiagnostics.com

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Executive|Interview|

Nicholas Jacquez Vice President of Marketing & Product Development, Affinia Global Chassis With the sale of Affinia’s brake division, Nicholas Jacquez became the Vice President of Marketing and Product Development for Affinia Global Chassis. With an even stronger focus on chassis parts, Jacquez explains how he and his team plan to refresh the relevance of the Raybestos chassis brand and increase the efficiency and profitability of its customers.

The spin-off of Affinia’s brake parts business is complete and Affinia is now focused on its filtration and chassis businesses. As you enter a new phase in your brand’s history, tell us what your chassis customers can expect from the Raybestos brand this year.

There are six things our customers can expect. First and foremost are chassis products that deliver the Aftermarket’s best steering performance and ride quality.

Raybestos chassis parts always deliver the best design for the application. Aftermarket chassis suppliers can’t keep doing what we did ten and twenty years ago. Cars are more advanced now and the mix of cars is different. There is a story behind each new application and a real-world reason why we

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do what we do when we produce that replacement part.

There is still a misconception in the marketplace that synthetic bearings aren’t as good as traditional metal on metal designs. That may be true in cases where you need to accommodate for high load capability… but almost 80% of new vehicles use synthetic bearings in their low-friction steering and suspension systems. In order to restore original steering control and ride quality, you need to use a design that matches the applied science of the original part. Otherwise, you risk creating unacceptable ride characteristics, unhappy customers and comebacks.

We keep up with the technology of new vehicles to be sure we match their steering and suspension specs. The design that goes into every Raybestos chassis part is driven by the technology of that vehi-

cle. We have low-friction designs for optimal turning torque, but we still make accommodations for more demanding situations. When the application calls for it, we use metal on metal for high load-bearing and to take up road shock.

We also put our money where our mouth is and back every Professional Grade chassis product with the industry’s best parts and labor guarantee. If any Raybestos Professional Grade® chassis part ever fails… the cost of the part… plus the expense of your labor will be refunded.

Beyond product, what else differentiates Raybestos chassis as a brand?

That brings us to the other five things I’d like to discuss.

Affinia is dedicated to maintaining its First-to-Market status in the Aftermarket. We provide our customers with increased sales opportunities by offering exclusive access and extensive coverage for the latest import and domestic VIO applications.

We also offer easy-to-use E-Cat, Web and paper catalogs… we maintain an informative web site… and we offer robust data attributes, like line drawings and schematics to help identify parts, and regular tech service bulletins to round out our full range of customer support.

Affinia offers world-class training

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and dedicated technical support. The Raybestos ACE™ Tech Hotline, Training Center and Field Clinics give our customers access to the industry’s latest technical information.

We also provide marketing with proven results. Our programs and promotions have industry-wide appeal. This spring, we have a sweepstakes promotion that specifically rewards counterpeople and professional technicians. And later this summer, we’ll combine forces with Raybestos brakes, Joe Gibbs Racing and Toyota Racing Development to present a 2014 Toyota Tundra vehicle build and sweepstakes on the same caliber as last year’s Raybestos ROUSH® Stage 3 Mustang promotion.

Before you became Vice President of Marketing and Product Development for Affinia Global Chassis, you served as the Director of Market Science. What past experiences are you carrying over into your new role with Affinia?

Market Science has always been a passion of mine. Affinia has developed a cutting edge analytic tool that can help our customers “Stock to Demand.” Very simply, our program helps WDs and shop owners stock according to the vehicle populations

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and demand/failure rates in their specific market(s).

As vehicle populations change, this easy to use web portal will help WDs and shop owners make sense of changing demand to help them determine their correct inventory mix. A combination of zip code level VIO, survey data and proprietary analytics help us predict failure rates by year, make, model and state.

How is what you offer different from other category management tools?

Traditional category management tends to focus solely on historical data. Sales history is certainly important, but history doesn’t always do a good job of predicting what will sell.

Our tool analyzes repair rates and market opportunities to give our customers the information they need to optimize their inventory for their specific region of the country at specific times of the year.

Large amounts of working capital are tied up in excessive and unnecessary inventory. But in just a couple of minutes, customers can learn the most popular chassis part numbers in their market. Combined with sales history, this helps them calculate the true demand for their area. They can then tailor an inventory…location by location…to satisfy existing needs

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and satisfy future demand.

This “predictive inventory” benefits customers by allowing them to spend less time managing inventory and more time selling. It gives them increased opportunities for strategic business planning, which can help them customize assortments and marketing campaigns for their region.

Affinia’s Market Science group also offers its customers other business intelligence tools. We offer Business Consulting for channel partners, sales and product teams…Planning and Tactical Resources to deliver custom data on end users, channels and the marketplace…Demand Forecasting to identify marketplace trends and opportunities...and Proprietary Market Research for guidance with methods and spending.

In 50 words or less…Why Raybestos Chassis for today’s shop owners?

Raybestos quality chassis parts match OE designs to deliver like-new performance, happier customers and fewer comebacks. They are competitively priced, with superior, first to market coverage. You get the industry’s best warranty and our exclusive inventory optimization tool, plus industry leading data management, technical training and marketing support! SO

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Shop|Operations|

by Bob Cooper, president, Elite Worldwide, Inc.

Strategies for Success In Building World-Class Automotive Repair Shops in 2013 If you want to ensure that 2013 is your shop’s best year yet, there are a number of things you need to consider. Vehicles are being built better, and service intervals are constantly being extended.

Accordingly, you will be seeing your customers less frequently.

We are also in an era whereas with each passing day technology is making pricing more accessible to the general public, customer expectations of transparency are at an all-time high, and social media is providing your customers with a platform for sharing their opinions. Miss just one of these, and you will struggle to grow your business.

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So here are our recommendations at Elite Worldwide: With the understanding that you will be seeing your customers less frequently, let’s start with keeping the customers you currently have. As soon as possible, have a meeting with your entire crew and discuss the future of your business, and how you are going to constant-

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ly work on improving the customer experience. Then, schedule the time to review every customer touch point, from incoming calls, all the way through car delivery and customer follow-up. Although there are many customer reward and loyalty programs, I am sure you will agree that the best way to generate repeat business is by providing your customers with extraordinary service at every touch point.

Secondly, you need to ensure you have a marketing plan in place that not only brings in new customers, but, more importantly, the right kind of customers. The top shops that we work with at Elite know who their targeted customers are, and they target their marketing programs directly at those potential customers. In addition

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to knowing who your targeted customers are, you will need to ensure that you direct at least 50% of your marketing budget toward nontraditional marketing programs.

With the growing number of advertising mediums that are available, and with the fragmentation of the different media, you will need to invest in non-traditional campaigns that will not only reach your targeted customers, but will resonate with them as well.

These non-traditional campaigns should include advertising at local events, getting involved in fundraisers and charities, participating in community organizations, etc. When people know that you care about your community, and the people within your community, they will view you as

having the values that they are looking for in a service provider.

There has never been a more important time to build one’s brand in the automotive repair business. You need to ensure that your name is everywhere, and that you deliver a consistent message. Knowing your targeted customer is one thing, but providing them with a consistent message, and delivering on that message, is brand building. The top shops in America understand this, and they will certainly be using a well-executed brand-building strategy in the coming years.

As we move through 2013 and forward, you will also need to ensure that your service advisors are well trained when it comes to helping your customers make good decisions in taking care of their vehicles. With service intervals being what they are, it may be a good while before you see that customer again, so as you well know, the recommended services that aren’t performed during their visit to your shop, may never

be performed.

In summary, here is what you are going to need to do to make sure that 2013 is your best year ever.

1. Set your goals, and have a meeting with your entire team. This is where you need to discuss your goals, and how you will be reviewing every customer touch point to ensure it’s a positive experience.

2. You will also need to ensure that you have a well-thought-out marketing plan in place that brings in the right kinds of customers on whom you will need to focus your brand-building efforts.

3. You will need to ensure that you have extraordinary people working with you who are well trained, and who live by a principle that they will never put money ahead of people.

You have my promise: Apply these recommendations to your business, and you may very well find that 2013 is your shop’s best year ever. SO Since 1990, Bob Cooper has been the president of Elite Worldwide Inc. (www.Elite WorldwideStore.com), an ethics-based company that helps both struggling and successful shop owners take their businesses to new levels through one-on-one coaching from the industry’s top experts. The company also offers shop owners sales, marketing, and management seminars, along with service advisor training. You can contact Bob at contact@eliteworldwidestore.com, or at 800-204-3548.

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Larry Weathers III, owner

Shop|Profile|

by Debbie Briggs, contributing writer

Weathers Motors, Inc. Federated ‘Shop of the Year’

What some shop owners might consider a negative has actually been a positive for Weathers Motors, Inc. in Media-Lima, PA. At its current location since 1922, the business started as a repair shop, servicing Model T Fords and Packards, but now repairs any make and model of vehicle. For many years, Weathers Motors was a new car dealership selling and servicing Chrysler vehicles.

“We started out with Plymouth, then transformed into a Dodge dealership also doing repairs,” says third-generation Owner Larry Weathers III. “Then in June 2009, Chrysler went through bankruptcy and cut 789 dealers out of the network.

We were one of the dealers that got cut. But repairs have continued from 1922 to now.”

Losing the Chrysler franchise, Weathers says, actually worked in the shop’s favor since it’s now free to work on all makes and models. Add to that a large customer base, and the business is still going strong all those years after Larry Weathers Sr. started the shop.

“My grandfather (pictured at right) was just so fair and honest from day one,” Weathers says. “His honesty brought people back. People talked about it and by word of mouth told other people, and then they would come here, too.”

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Weathers Motors is now providing service to fourth-generation customers. Those kind of long-term partnerships are key to the success of any shop, and with the transition to an independent repair facility, Weathers

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Left to right: Joshua Sellers, Paul Curley, Bill O’Brien, Chris Mattero, Jim Walsh, Larry Weathers III, Dave Byrd, Evelyn Devito, Jim Mitchell and Rich Dominico

says the shop’s partnership with local family-owned parts supplier, Berrodin Co., was vital to its success. Berrodin Co. is one of the charter members of the Federated Auto Parts program distribution group, a member since 1985.

“Working with Federated member Berrodin has been great — great parts value, availability and outstanding service,” Weathers says. “Parts deliveries are very efficient and dependable.

Berrodin has been very helpful with monthly specials, on-time deliveries, clinics, expert counter service, and they respond to questions and problems quickly; they provide great customer service and quality products.”

It’s no surprise that the excellent customer service Weathers Motors has come to expect from Berrodin is the

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same top-notch service they offer their own customers.

“We have been able to deliver a quality product to our customers, efficiently and effectively,” Weathers says of the shop’s affiliation with Federated and Berrodin. “There are no problems with parts returns or faulty parts. The time that a customer’s car is down has been held to a minimum.”

Federated ‘Shop of the Year’ It should come as no surprise that out of hundreds of nominated shops, Weathers Motors, Inc. was chosen as Federated’s first-ever “Shop of the Year” award winner. Federated was looking for a top shop to honor for its knowledgeable, professional service technicians, along with superior

Both critical to winning the inaugural top shop award and providing quality repairs is a staff of seasoned technicians who know how to repair a vehicle right the first time.

customer service and repairs.

“It was quite an honor and a surprise to be selected out of the entire country,” Weathers says, adding that he’ll definitely promote the honor in his advertising and on his website.

“This is an award that leaves an impression on people.”

Both critical to winning the inaugural top shop award and providing quality repairs is a staff of seasoned technicians who know how to repair a vehicle right the first time. Add an

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attractive benefits package and positive work environment, and it’s easy to see why the shop attracts new talent mainly through referrals and word of mouth.

“We employ four full-time technicians and one part-time technician,” Weathers says. “All are ASE-certified and have GM, Ford, Chrysler, Honda and Toyota training.

We treat employees fairly, and we stay competitive with current pay scales, we keep the shop safe, and offer a 401K and profit sharing plan and health benefits.”

Community Involvement Among the criteria for the inaugural top shop award was active involve-

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ment in the community with a track record of achieving excellence.

Weathers Motors more than fits the bill, with involvement in several local groups, including the local Middletown Business Association and the Pennsylvania Automotive Association.

“We also belong to the Rotary Club of Media and sit on the Board of Riddle Memorial Hospital, Neumann University and the Red Cross,” Weathers says. “We’re active in Boy Scouts and the local high school sports and music programs. They all help to integrate us in the community and promote goodwill.”

In addition to being well known in the community, Weathers says the shop attracts customers by cable TV,

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internet and direct mail — and by treating customers with respect.

“We keep them by giving them great service at a great price,” Weathers stresses. “We do not oversell, we do not do work that doesn’t have to be done, and we recommend work and ask for approval.”

Consistent specials for oil changes, with combination pricing along with other services, are very popular, and tires are offered at a very competitive price. Rebate programs on select parts and a quarterly direct-mail program that goes to all customers in targeted zip codes also works well.

“We also drop customers off and shuttle them where they need to go,” Weathers says. “We try to really listen

“We keep customers by giving them great service at a great price,” Weathers stresses. “We do not oversell, we do not do work that doesn’t have to be done, and we recommend work and ask for approval.”

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to the customer and be flexible in their needs and accommodate them.”

In addition to more traditional ways to keep customers coming through the doors, Weathers says a strong internet presence has given business a boost. Social media is something shops can’t afford to overlook.

“Our website from awardwinning designer Dealer.com acts as our billboard, and we also regularly post on Facebook,” Weathers says. “We post service specials, and people do click on them and bring their vehicles in. We’ll also post service tips, such as the importance of oil changes. It’s an image builder, and it makes people think about their car.”

So what’s been the secret to Weathers Motors’ longevity?

According to Larry Weathers, it really comes down to happy customers.

“The number one thing is having qualified technicians,” he concludes. “Right up there with that is parts availability and the quality of parts — good parts and having them delivered on time. Customers want their cars back quickly.

You need great communication between the tech, the service advisor and the customer.”

It’s been a winning combination for this long-running shop — one that’s worthy of an industry accolade like Federated “Shop of the Year.” SO

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Green Is Good Weathers Motors Inc. believes in instituting “green” initiatives and it has been a plus for the shop and the environment.

The shop recycles all plastic, cardboard, glass and oil, plus it uses a shop heater to recycle waste oil. “Recycling has raised the awareness level of how important it is to protect our environment,” says owner Larry Weathers III. “It sends the message in-house and to customers that we are responsible business people.”

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|Finance|

by Richard Lipton, Richard L. Lipton CPA & Associates, LLC

2012 Tax Changes For Businesses

It’s that time of year again: tax time. Whether you file as a corporation or sole proprietor, here’s what business owners need to know about tax changes for the 2012 tax year.

Standard Mileage Rates: The standard mileage rate in 2012 is 55.5 cents per business mile driven, 23 cents per mile driven for medical or moving purposes, and 14 cents per mile driven in service of charitable organizations.

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Health Care Tax Credit for Small Businesses: Small business employers who pay at least half the premiums for single health insurance coverage for their employees may be eligible for the Small Business Health Care Tax Credit, as long as they employ fewer than the equivalent of 25 full-time workers and average annual wages do not exceed $50,000. The credit can be claimed in tax years 2010 through 2013, and for any two years after that. The maximum credit that can be claimed is an amount equal to 35% of premiums paid by eligible small businesses.

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Credit for Hiring Qualified Veterans: The maximum credit that employers can take for hiring qualified veterans in 2012 is $9,600 per worker for employers that operate forprofit businesses, or $6,240 per worker for tax-exempt organizations. See Facts About The Veterans Opportunity to Work (VOW) to Hire Heroes Act of 2011 at www.liptoncpa.com/newsletter.php?date=1 22012#2

Section 179 Expensing: In 2012, the maximum Section 179 expense deduction for equipment purchases is $139,000 ($174,000 for qualified enterprise zone property) of the first $560,000 of certain business property placed in service during the year. The bonus depreciation is 50% for qualified property that exceeds the threshold amount.

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by Art Blumenthal, MBA CBI

Buying & Selling|An Aftermarket Business

10 Mistakes to Avoid When Selling Your Business An Insider’s Guide, Part 2 The majority of challenges and frustrations experienced by sellers can be avoided with solid information about the pitfalls of selling a business in today’s market. While there are dozens of challenges to overcome, in the January/February 2013 issue the first five most common mistakes were discussed that can have drastic repercussions and cause both stress and loss of value on a business sale.

The five mistakes already discussed were: Mistake Mistake Mistake Mistake Mistake

1…Failure 2…Failure 3…Failure 4…Failure 5…Failure

to to to to to

Prepare and Properly Package Your Business Properly Price the Business Sell Your Business Before You Need to Sell Your Business Leverage the Right Professionals Maintain Confidentiality During the Sales Process

Mistake 6 … Failure to Play a Positive Role in Interacting with a Buyer As an expert in your business, you can play a valuable role in staying engaged and working in partnership with your broker.

While some brokers, especially those who previously sold real estate, go out of their way to keep buyers and sellers from directly interacting, this is rarely the best method to achieve a successful sale in the shortest amount of time.

Although your broker will work hard to find qualified buyers for your business, no one has more motivation to sell, or inside

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knowledge of the business, than you do. You can play a key role in instilling confidence in the buyer that the business can be purchased and managed successfully. A buyer who can visualize himself running the business is more apt to have a comfort level after interacting directly with the seller and developing a sense of rapport.

Buyers traditionally are significantly apprehensive about the challenges that they face in purchasing a business, and anything that you can do to help the buyer envision himself in your role increases the likelihood that he will have the

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courage to make a problems or deficiendecision to submit an cies are keeping buyoffer and close on ers from seriously your business. considering a The questions that purchase. you get from buyer You and your Art Blumenthal Sales Tip interaction will also broker should have give you insight into defined roles and You can play a key role in responsibilities in the how a buyer perinstilling confidence in the sales process so that ceives your business buyer that the business can there are no misunand their concerns. be purchased and managed derstandings and you Seeing your busisuccessfully. work as a team. Here ness through the are a few suggested buyer’s eyes will help guidelines for the do’s and don’ts of you in future discussions with communications with buyer prospects: prospects and recognizing (and hopefully doing something about) whatever

Do’s

Don’ts

• DO your best to follow the established roles and responsibilities between the seller and broker, allowing the broker to orchestrate the step-by-step process to qualify, educate and close the deal with buyers.

• DON’T allow a buyer to lure you into direct negotiations. It’s OK to participate in the sales pitch about the benefits of your business, but leave discussions about purchase price, terms and financing to the broker.

• DO share with a buyer what you might do differently in your daily operations to increase sales and profits if you were to keep the business. Buyers want to feel that the business has upside potential and recognize that every business owner has ideas that just haven’t been implemented as yet.

• DON’T volunteer “subjective” negative information about your business. Be honest in answering direct questions with accurate facts and don’t misrepresent your business.

Present your business in the best possible light. Focus on the positive when interacting with a buyer prospect.

• DO talk about what you like about your business and the rewards that you feel you have received over the years of ownership.

Most buyers are looking for independence and control over their own destiny.

• DON’T let recent events, trends or other information that are impacting your decision to sell the business get the best of you. Try to focus your thoughts on the positive rewards of business ownership.

• DO allow yourself to judge the background and capabilities of buyer prospects and their likelihood of success if they purchase your business, especially if you are offering seller financing and have a vested financial interest in their ability to make payments to you.

• DON’T think, however, that no one will ever be able to fill your shoes. If you are offering seller financing, you need to accept some level of risk and do your best to find a motivated buyer candidate who’s willing to learn the skills necessary to run your business.

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Consider this…

It is estimated that about 20% of businesses will sell, which means that 80% will not sell! What can you do to increase your opportunity to sell your business? Avoid the Top 10 mistakes when selling your business.

Mistake 7 … Failure to Recognize the Difference Between Serious Buyers and Tire Kickers Did you know that only 2% of the people who inquire about businesses on the Internet “businesses for sale” sites will actually purchase one? The other 98% are suspects who lack the courage and conviction to follow through.

Many are searching for the illusory “perfect” business, while others expect the seller to finance the whole business, have other unrealistic expectations or trouble making a decision.

Wasting time on those who aren’t serious about purchasing a business takes away valuable time from your interaction with those buyers who really do want to buy.

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Many buyers exhibit a great deal of interest and submit a Letter of Intent or Offer to Purchase. Unfortunately, some buyers will then get cold feet and have second thoughts, or will let the smallest of obstacles stop them in their tracks.

DIY sellers can become time constrained in properly managing their business when their time is consumed by unqualified or less-than-serious buyer candidates. Buyers who are not pre-qualified and are not prepared to make an offer will not feel guilty about wasting your time.

A good business broker does not pre-judge a buyer prospect, but is skilled at discerning the serious buyers who are financially qualified to buy your business. It is important to focus time and energy on serious buyers, not

tire kickers who are out to waste your time with “analysis paralysis,” finding things wrong with your business, and making low ball offers to test your desperation.

maximum profitability and stability. Losing a serious buyer after you are already planning your post-closing trip around the world Art Blumenthal Sales Tip can be a gut-wrenching experience. HavA good business broker does ing to re-evaluate not pre-judge a buyer prospect, but is skilled at dis- your Asking Price Mistake 8 … because profits have cerning the serious buyers Failure to Keep dropped in the meanYour Foot on the who are financially qualified time can be like to buy your business.

Gas During the rubbing salt in the Sales Process wound.

Don’t make the mistake of taking It is a mistake to lose sight of what it your foot off the gas during the sales takes to get to the finish line. Finding a process.

Even in good times, it can buyer or even securing an Offer to Purtake a while to find the right buyer chase does not mean that your business and navigate the complexities of is sold. However tempting it may be to getting to the closing table. relax, a sudden fall in sales and profits, In the meantime, keep driving youror a loss of key employees, might trigself and your business on a steady ger a buyer to look for a way out of the course, just as if you were keeping the deal or renegotiate price. Other deals business long term. fall through because of inability to secure financing, unforeseen environmental conditions, family or partnership disMistake 9 … Failure to agreements with the buyer, or not Consider How Your Business getting approval from a franchisor.

Sale Will Be Financed The sales process can be a minefield beset with hidFew buyers will be in den problems. If you a position to be able ever played Chutes & to pay cash for your Ladders as a kid, you business. In today’s know what it’s like to business-for-sale margo backward or start ketplace, all cash the game from the sales are unrealistic, beginning. Losing a unless you are willArt Blumenthal Sales Tip buyer when in sight ing to make the AskA broker who can get your of the closing table ing Price extremely business “pre-qualified” by a can happen with the attractive as comlending institution has providroll of the dice. pared to other availed your business with a sweet able business opporWhat’s important is marketing advantage that for you to remain fotunities. Today’s will attract buyers like bears cused on managing buyers are more liketo honey. your business for ly to need help in

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securing third-party invest, the buyer is financing or rely on more likely to leveryou for seller financage that cash and ing of 50-80% of the purchase a larger Asking Price. business with a higher It is important to cash flow or perhaps consult with your ac- Art Blumenthal Sales Tip an automotive service countant for tax adBe prepared to be flexible and enterprise with multivice on the implicaple locations. available for serious buyers. tions of spreading the sales proceeds over a Mistake 10 … Failure to multi-year period.

Negotiate A good business broker will have contacts with major national banks Fishing for the right buyer can take that finance business acquisitions and time, even with the best of advertising real estate under an SBA loan guaranand marketing materials to attract tee program. A broker who can get interest. With hard work and luck, your business “pre-qualified” by a serious buyers will find the bait and lending institution has provided your be lured into the opportunity. business with a sweet marketing adHopefully, multiple buyers will vantage. show an interest. You may receive The key to pre-qualification and more than one offer, significantly bank financing are tax returns and strengthening your negotiating posifinancials that demonstrate the ability tion. Nonetheless, you need to be of the business to generate a cash prepared to negotiate and listen to the flow that more than covers the debt advice of the professionals that you service and leaves the buyer sufficient hired to provide guidance. funds to provide reasonable compenThere may come a time when an sation. Yes, the bank will take into offer comes in and you have to act on it. Procrastination or indecisiveness in consideration non-cash expenses like accepting a reasonable offer or negotidepreciation and amortization, as well ating a compromise as the seller’s current compensation can be a mistake, and benefits. However, if you are as you risk losing a planning to sell your business in the serious buyer. SO foreseeable future, don’t make the mistake of being greedy and loading up your tax return and P & L with so Leveraging more than 30 many personal expenses and perks that the business shows no profit or a years of experience as both an aftermarket business big loss. owner and aftermarket If your business doesn’t look good technology executive, Art Blumenthal LLC provides on paper, then it’s time to accept the business intermediary and advisory services to both buyers and sellers of industry businesses of reality of seller financing if you wish all sizes. Art is a member of IBBA (International to get a fair price for your business.

Business Brokers Association, Inc.). For more Keep in mind that even if the buyer information, or to initiate a no-obligation confidential has a significant amount of cash to consultation, visit www.art-blumenthal.com.

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Customer|Service|

by Jody DeVere, CEO, AskPatty.com

Common Customer Service Myths Work As A Team To Ensure ‘Customers For Life’ Ever since the phrase “the customer is always right” was coined, it surely has been the bane of every worker whose title includes the word “associate” or “representative.”

Though front-line employees bear the brunt of customers’ requests, when it comes down to it, we’re all in the customer service business.

Let’s take a moment to break down some of the most pervasive myths of customer service, get into our customers’ heads for a

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moment, and really figure out the best way to serve them and turn a problem customer into a customer for life.

1. The Customer is Always Right. This seems like the best possible place to start. Everyone knows the customer isn’t always right, but if you’re smart, you’ll never remind an irate customer of this fact.

The customer isn’t always right, but he or she is always the customer. An argument about who is right and who is wrong isn’t going to solve anyone’s problems.

Calmly discuss the issue with the customer, and eventually your customer will calm down too. Even if you know your customer is in the wrong, take the time to fully investigate their claims, and let them see you do it. The

“When things get tight, don’t cut prices; add service.” customer may end up being wrong, but if they feel their claims have at least been taken seriously, that goes a long way.

2. Price is Most Important to a Customer. I see this myth all the time in the auto industry. It’s very tempting to assume that price is the most important metric to a customer, but that simply isn’t the case. While many customers do have a budget to consider, and price certainly plays a part, the overwhelming majority of customers, particularly when it comes to vehicle repair, are perfectly willing to pay more for quality products from honest, reputable businesses. When things get tight, don’t cut prices; add service.

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3. Being Friendly and Polite is Everything. You’ve kept your cool, you’ve met every rebuttal and complaint with a smile and a nod, and your customer still isn’t happy. If you find yourself in this situation, it’s sometimes easy to feel like you’re at the end of your rope.

In the end, customers want results.

You can be as nice as you’d like, but smiles won’t diffuse a customer who doesn’t find value in what they paid for. And, if there is a situation when your tech or service writer can’t remedy a situation, they need to make sure the customer understands they’ve done all they can. They should also make an introduction to a manager or the owner, and keep smiling — all the while listening to what the customer

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wants — and do their best to deliver.

4. Front-Line Employees are Responsible for Customer Service.

We’re all in the customer service business, not just the employees at the front counter. Good customer service is a cultural thing, and your business’ culture starts at the top!

Don’t just hire, train and forget it.

It’s up to you to set an example. Make sure customer service stays on your radar by not only taking complaints and negative customers seriously — but by also making a big deal out of every piece of positive feedback you get. Make sure your staff knows how important great customer service is to

you, and strive to maintain the same high standard to which you hold them.

5. Happy Customers Tell Two People, Unhappy Customers Tell Six. I’m guilty of using this old cliché myself, but it’s simply not true. At review sites like Yelp, we find that the overwhelming majority of reviews are positive ones! Not only that, but when customers shop for reviews, they aren’t looking for the negative ones.

They want to know who does great work, not who to avoid. Even one glowing, positive review can have a big impact — and bring in new customers. SO

“Even one glowing, positive review can have a big impact — and bring in new customers.”

Jody DeVere is the CEO of AskPatty.com. Visit www.askpatty.com/getcertified to learn more about how to become a Certified Female Friendly Shop.

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“Our goal is to provide the best customer service experience of any business in our city — not just auto repair.”

– Ron Haugen, owner

Shop|Profile|

by Debbie Briggs, contributing writer

Westside Auto Pros

Internet-Savvy Shop Still Going Strong After 16 Years In today’s ever-changing digital media landscape, with thousands of tweets per minute and videos going viral every day, it’s becoming more and more important for shop owners to stay on top of marketing technology. Ron Haugen, owner of Westside Auto Pros in Des Moines, IA, has seen first-hand how a well-mastered, intentional social media plan can attract new customers.

“We have a very comprehensive marketing plan and budget that includes internet, television, direct mail and social media,” Haugen says of his successful 16-year-old business.

“We have focused on branding, which gives us top-of-mind awareness for both first-time and repeat customers.

“People will post on their wall and say, I need a plumber.

Who should I call?” he continues. “Eight people will immediately reply back. People turn to Facebook and other social media; it’s the referral source of today.”

Haugen says he relies on The Buyosphere, a marketing agency with a customer service spin, to handle his social media posting, and advises hiring others who are experts in their field to manage areas that maybe aren’t your cup of tea.

“As far as Facebook, Twitter and LinkedIn, the bulk of that is handled by The Buyosphere,”

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he says. “They do such a good job that, just recently, readers of Cityview, a weekly independent newspaper in the Des Moines area, voted Westside Auto Pros ‘Best Tweeter,’ an honor we’ve won two years in a row.”

Complement that well-crafted social media plan with service reminders and a search engine optimized (SEO) website by AutoVitals, as well as enewsletters by Greenmail, and you’ve got a powerful internet presence that not only strengthens the Westside Auto Pros brand, but also is a force in attracting new customers.

“The vast majority of buying decisions are made with some form of internet search or research,” Haugen says. “A good website with excellent SEO and SEM (search engine marketing) allows any business to be a part of that decision.

Web presence is not an option, it is a must. And, it must be done right.”

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Gaining & Retaining Customers But once you get customers in the door, paramount is a knowledgeable, friendly staff that makes the car repair process a positive one. After all, Haugen says, you have only one chance to make a great first impression.

“If your staff and facility aren’t clean and professional, then the customer perception is that the service and repairs won’t be either,” he stresses. “If the interaction, from the very first phone call to the actual visit, is not professional and friendly, then the perception is the entire process won’t be either. Your shop’s appearance will determine whether or not the customer buys

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and/or returns.”

Haugen feels the staff at Westside Auto Pros sets the shop apart from the competition, and it starts during the new hire interview process.

“From our interviewing and screening during the hiring process, to the weekly customer service training and secret shoppers from The Buyosphere,

we are never done learning and improving,” he says. “Our goal is to provide the best customer service experience of any business in our city — not just auto repair.”

Westside Auto Pros employs six techs who are all ASE Master Technicians; a requirement to work at the shop. Even oil changes are done by a Master Tech. A great work environment, clean facility, wellstructured policies and procedures, and a generous benefit plan all work to ensure employees stay with the shop for many years. But when there is a need to hire new staff, Haugen has his pick of applicants.

“We have technicians apply for positions every month, even though

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we are not looking for someone,” he says.

“We keep the great resumes on file, and if we have an opening, we turn to those resumes. We have a good reputation in town.”

Technicians are also required to complete 40 hours of training every year — but it’s more like 60. And, while it’s mainly on-site classes, techs also attend Bosch Technical Training in Chicago. Haugen himself, along with the front counter staff, also

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Ron Haugen’s Keys to Success #1. Top level staff. These are the people who interact with your customers, fix the cars, and accomplish the goals and objectives you as an owner give them. To compromise on the quality of the people in your business simply does not make sense.

Start with good people, then train and motivate them to be great.

#2. Monitor your key numbers and know the benchmarks. Also understand how to fix them if they are not right. Competition and the cost of operating a shop has made it more important than ever that an owner focus on being an owner, operating his business, not an employee working in it.

#3. Do whatever it takes to take care of your customers and your employees. If you do this, somewhere in the middle it will all happen for you.

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receive solid training throughout the year, including what’s offered at ASA’s Vision Hi-Tech Training & Expo each year.

Shop Owner Training “Some of the most overlooked training out there is for shop owners,” Haugen says. “Most shop owners started out as technicians and grew into owning a shop.

Throw technical out the window; HR, financial management, marketing and how to run a business — that’s what shop owners need to know. I was in the same boat, but then I sought education and training. It made a big difference.”

Haugen points to RLO Trainings Bottom Line Impact Group as the biggest influencer on how to better manage his shop.

“Learning and implementing financial benchmarks, not only on the income side but on the

“If the interaction, from the very first phone call to the actual visit, is not professional and friendly, then the perception is the entire process won’t be either.” expense side, is key,” he says. “You can track your different expenses, but how do they stack up to other shops that are similar to yours? What about your profit margins? The training and accountability you get in a 20 Group is second to none.”

The bottom line, Haugen concludes, is that technology and marketing continue to change, and as a shop owner, you have to keep up with it.

“I compare it to a NASCAR race,”

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he says. “If you’re in the lead and you’re competitors are two or three car lengths behind you, you have to keep the accelerator pushed all the way to the floor or they’ll pass you. If I let off, other shops will pass us in marketing or customer service.”

Given Haugen’s whole-hearted dedication to both, Westside Auto Pros should stay in the lead for many years to come. SO

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