Real World Retail

A.C.T. Audio increases revenue by diversifying into ignition interlocks, detailing and motorcycle audio while strengthening infrastructure for the coming year.

WORDS BY ROSA SOPHIA

In 2019, James P. Smith became sole owner of A.C.T. Audio—which stands for Automotive Concept Technology—in Vernon, Connecticut, when his business partner decided he didn’t want to be involved anymore. The shop’s most recent accomplishments involve diversification into ignition interlocks and motorcycle audio, which Smith plans to continue growing in the coming year. With six total employees including the owner, diversification is the new focus. Smith’s resolution for the new year is to turn A.C.T. Audio into a one-stop-shop for automotive aftermarket needs.

The past year, however, was fraught with tragedies: Smith’s brother passed away in February, and sales manager Dan Holben—who has been with the shop since the beginning—was diagnosed with cancer and started treatment. Rather than hire someone else, Smith took on additional duties. Slowly, Holben was able to return to work, and for about a month he’s been on a part-time schedule. Meanwhile, the company grew faster than anticipated. Despite many challenges, A.C.T. Audio made the Top 50 Retailers list and continues to focus on diversification to grow the business.

Diversifying Opens New Doors, Increases Revenue

Two years ago, the store moved to a new location and created a separate entrance for the breathalyzer / ignition interlock department, giving those customers privacy. The increased business in the category also exposed these customers to other services A.C.T. Audio offers. They don’t have to come into the showroom unless they want to, Smith noted. “Doing that was a big deal for us. This year we brought on two more companies,

and I just signed a contract with another one. We have seven breathalyzer companies we work with, and it provides consistent revenue.”

The shop has also started offering light detailing as an add-on service, but they plan to offer it as a separate category. “We

have a back room we’re in the middle of altering that we’re hoping to use just for detailing,” he added. Additionally, the team is building a wood shop, and an area just for motorcycles. The shop began working on more motorcycles after Smith acquired his own bike.

“If customers with motorcycles come in and see you have your own, they’re more likely to trust you,” he said, adding that he feels this accounted for a steady increase in business. “Last year we did a lot of motorcycles, and we’re hoping to continue growing that category.” Next, the shop will be expanding into paint protection, and Smith said an employee will be sent to a training program to get started. After that, he added, they’ll tackle vinyl wrapping.

Customers who come in for remote starts—a category that brings in much of the store’s revenue in the winter months—are exposed to other categories they might be interested in, as well. Roughly 24 percent of the business’s revenue overall is derived from the remote start category. “The more people we can expose to the store,” Smith said, “the

more potential repeat customers we can get.” Every December, business triples, and the week before Christmas brings in the most revenue.

Creating an Employee Handbook to Strengthen Infrastructure

When Smith and his business partner ran things together, policies and procedures were all in their heads. As the business grew and hired new employees, it became clear the infrastructure needed to be stronger. Smith realized a lot of the ways in which the business had been managed wasn’t written down. As a result, employees had to come to him with the same questions on how certain things were handled.

“A really good example is our discount policy. My employees would come to me to ask if we could give a certain discount that a customer asked for,” he explained. “So I established standard discount policies, like a Military Discount, or up to 10 percent off in other situations. Now my sales guy knows he can go up to 10 percent off to close a sale, no question, because it’s in our policy.”

Smith also implemented a checklist which highlights everything a salesperson needs to complete during their shift. In

the new year, he said, the sales manager will be submitting a sheet each day that lists customers, what they came in for, where they heard about the business and whether or not the sale was closed. The checklist and the store procedures reflect the responsibilities of the salespeople, who are required to check emails, clean and do follow-ups on estimates. Installation policies also ensure that anything the salesperson promises to the customer is relayed clearly to the installer, so everyone is on the same page.

While there was a three-page store policy, Smith said, they never had an official employee handbook. “That was my biggest downfall. Now that I have a big business, it’s hard as a technician to monitor all the departments,” he explained.

With the help of a business coach, Smith is working on an employee handbook that is halfway complete, though he admitted he wished he’d done it sooner.

Analyzing the Sales Process for Continued Improvement

When Smith observes a sale, he said there are things he might notice which the salesperson might not because they’re directly involved with the interaction. Even changing one word can make a difference, and the staff is continually fine tuning sales pitches. “We have developed our sales approach to make it simple for the customer and consistent for us,” Smith said. “We modify it as we go.”

When selling speakers, for example, the sales team focuses on the foundations of

creating good sound. They explain amplification and what will make the speakers sound best, no matter the brand the customer chooses. Then, he said, they allow the speakers to sell themselves. “When it comes to remote start, we sell mostly two-way with add-ons. The average ticket price has drastically increased over the past five years on remote starters—I’d say close to 50 percent, maybe 40—just by employing sales techniques and recommending add-ons.”

A sign on the wall explains the available add-ons, including the very popular addition of heated seats to a remote start. The sales staff discusses add-ons with customers, including products such as rear defrosters and customizable options, while also seeking a balance to avoid sounding too “salesy,” Smith noted.

With each attempt to fine tune the process, salespeople learn how better to discuss add-ons and products with

clients. Recently, they refined the process again, making it more generic. “I might say, ‘Are you interested in hearing about any of the specials we have available to enhance your vehicle while it’s here?’” Smith said. With any luck, customers say yes. As of now, he noted that about 50 percent say yes and 50 percent say no.

The shop is also considering setting up a pre-check that will be emailed to the customer two days before an appointment, giving them a chance to “a la carte” their remote start installation.

All jobs receive a 48-hour follow-up call, and bigger jobs get another follow-up call six to eight months later.

Email is something Smith plans to improve upon in the new year.

For the past two months, Smith sent out email newsletters to previous customers.

“For both newsletters, I got phone calls. A new product was released, and a couple of people called me about it. Moving forward, I’m going to focus more on keeping up with email newsletters,” he added. “We don’t want customers to think they are forgotten after they spend money with us.”

Finding the Right Customers and Learning When to Say No

The company has refined its focus to specialize on higher-end jobs. Smith said when he first came on board, the shop wasn’t discerning enough about the work they accepted and would say yes to almost any job in order to bring in revenue.

When potential customers come in with products that don’t match the shop’s quality standards, Smith said these customers won’t be happy no matter what the sales staff explains to them. “They

just want it cheaper,” he added, “but we’re going to use the right equipment, or we won’t do the job at all.”

Smith said it was difficult, but the staff learned when to say no. “We stopped accepting all customers,” he explained. “We ended up having happier customers, and happier staff. The jobs were a little more project-based. We take our time, do a good job, deal with better quality equipment, and we have less problems. The customers are happier because the result is better.” Smith added that learning when to say no was the hardest part of the transition.

“A lot of businesses struggle with saying no to work that doesn’t suit their end goals, and we did, too, for a long time,” he said. “But when we finally did it, we never looked back.”

Strict Installation Standards Ensure Customer Satisfaction The shop employs a three-part quality control process for all vehicles that leave the bay, according to Smith. The installer first inspects their own work, and then a second installer looks it over. “It leaves the bay, comes around to the front of the store, and a salesperson will perform a final check before calling the customer,” he added. The car is inspected to ensure everything is put back together properly, and that the installation functions as it should.

“I have a list of standards I require,” Smith said. “For example, if you’re doing a remote start, it can only be grounded in one of three spots. All connections have to be military spliced or soldered. When the customer calls me back and says they’re having an issue, I know it’s not my connection. You can hire installers and they all have different practices, but this is what I want here.”

Seeking the Next Generation of Installers

To help meet future staffing needs, the shop will soon be working with a local tech school with the hope of drawing in new, talented staff. Smith sees this as a good way to attract young people to the industry. “I think it’s the best place for [shops] to go,” he said. “You can hire them as a shop assistant, kids who enjoy working with their hands and like cars.”

One of the latest additions to the staff, Smith said, is a 17-year-old apprentice who is currently handling interlock installations. He monitors the department and is slowly being trained on car audio installations, as well.

“He’s a very promising candidate. I’m really excited he joined our team and I have high hopes for him as an installer,” Smith added, noting that he sees the interlock department as a good opportunity to hire young people who are interested in the 12-volt industry. “If I

think they’ll be a good installer, I’ll move them into that position eventually and hire someone else for breathalyzers.”

Resolving to be Top-of-Mind in the New Year

The shop will put more of a focus on marketing in the coming year, Smith said. Recently a campaign was launched at a local gym which plays an advertisement for the shop on TV screens. The ad says, “Before you buy new, see what A.C.T. can do for you.” The campaign is still relatively new, but Smith is hopeful the results will be positive. “My focus is on upgrading the vehicle with safety and convenience rather than buying a new vehicle and taking on a car payment for that luxury,” he said, adding that he hopes

to maximize the impact of this campaign as springtime nears. “It seems like that’s when people think to buy new cars or upgrade the cars they already have.”

A.C.T. Audio started as an audio and remote start shop, but now, “We’re doing a little bit of everything.” Eventually, Smith dreams of opening a second store. For a large portion of 2019, in the wake of tragedy and illness, he said he mainly focused on trying to keep everything going. “The changes I made, I haven’t been able to monitor like I should,” he said. However, resolutions for 2020 are starting to take shape. “Now,” he added, “we’re moving forward.” it a few more months. I don’t think it was worth it. I think people tend to ignore those ads 98 percent of the time. I know I personally do. I also feel there must be power behind someone seeing your logo. I don’t think it was a full waste [because of that], but I don’t think it was worth it overall.”