When the recession hit, Laura and Marvin Wilson’s transmission shop saw revenues dwindle. Would changing their business model to full-service repair help them rebound?
EXPANDING HIS TRADE: Marvin Wilson is a veteran transmission specialist, but he wasn’t afraid to broaden his shop’s services to stay in business. Photo by Jill Scott Stewart
As Laura Wilson puts it, her husband, Marvin, “has transmission fluid running through his veins.” He grew up in his father’s transmission shop. He started his own in 1994.
“That’s all he’s ever done,” Laura says. “He breathes and sleeps transmissions.”
And for decades, the need for a transmission expert in Spanish Fort, Ala., breathed life into the Wilson’s business, Advanced Transmission Inc., which the two have run together for nearly 20 years.
But as transmissions in vehicles became more and more dependable and the economy took a turn for the worse in 2009, their business started trailing off.
The Wilsons wanted their shop to grow, not shrink, and they knew they couldn’t do that with their current business model.
They knew they had to adapt—and adapt quickly.
“For any shop,” Laura says, “you have to change if you want to be able to grow.”
So, in 2009, Advanced Transmission started the switch to becoming a full-service repair shop.
Laura isn’t one to settle on, well, pretty much anything. She doesn’t make decisions on a whim, and she doesn’t see the point in doing anything if it’s not done right.
“I think if I were flipping burgers at McDonald’s, I’d want to be the best dang burger flipper there was,” she says. “That’s just my personality.”
And it was her and Marvin’s meticulous planning that led them from their first location—a small, 3,000-square-foot space they first rented in 1994—to their current 10,000-square-foot digs they built across town in 2002, a building Laura jokingly refers to as the “Taj Mahal of repair shops.”
Marvin ran the shop, and Laura ran the business side of things.
And for nearly a decade, the Wilsons’ five-employee shop churned out repairs, generating just under $800,000 a year in revenue.
Marvin kept getting the same phone calls over and over: General repair shops across town, ones that used to refer transmission business to him, were calling to ask for tips on making the fixes themselves.
“And Marvin, bless his heart, would go down there and help them,” Laura says. “But then it dawned on us: These other shops don’t have the same business ethics we do.”
Laura and Marvin always prided themselves on “playing nice,” and never “stepping on anyone’s toes.” All they expected in exchange was for other shops to do the same.
Suddenly, though, they realized that wasn’t happening, and their transmission business started dwindling.
“This was when the recession really hit,” Laura says. “The transmission business was just less and less.
“We had all these customers who kept saying, ‘Well, can’t you please just fix this on our car? Can’t you just do this or that? And we had always said no, but then we decided to start saying yes.”
It was clear that the shop needed to transition to a full-service repair shop, but the Wilsons lacked the equipment, training and facility space to do it.
They started out by doing a few of the small repairs their techs already knew how to perform. If they were doing front-wheel drive transmission work, for example, and someone needed their brake pads replaced, they’d do it for the customer.
In the meantime, Laura was working on adjusting the facility and the shop’s day-to-day management to make the switch.
“We didn’t want to just decide we’re going to do general automotive, then go, ‘Oh, my gosh, we need more computers. Oh, my gosh, we need more bays. Oh, my gosh, we need this or we need that,” she says.
Laura began working with an industry consultant, who helped her hash out a plan. She switched out the shop’s management system, swapped out old computers for newer ones and purchased electronic diagnostic equipment. At the same time, the Wilsons started construction on a new addition to the shop, which would give them an additional 2,000 square feet and two more bays.
With all of the physical tools falling into place, they were just missing one thing: Expert technicians.
“We had really good guys on staff (as technicians), but they were all transmission guys,” Laura says. “It’s like a general practitioner compared to a heart cardiologist. The cardiologist focuses really on one thing. Sure, he could take a splinter out of your finger, but he is better at what he does. That’s the position we were in.”
The Wilsons had already started training their staff at the end of 2009, and the technicians were working toward ASE certifications in early 2010 when Laura slowly began marketing the shop more and more as a full-service facility.
“We were just dumping money into training, and it just wasn’t going fast enough,” Laura says. “We didn’t want to be doing, say, air-conditioning if we didn’t have the certifications, the training, the equipment and were on the up-and-up.
“The only way we could continue on the path we were going was to find (additional) employees.”
Good employees are often hard to find, though, as the Wilsons soon realized. All of the best technicians in the area were already employed at other shops, and Laura and Marvin both felt uncomfortable trying to go behind the backs of other owners.
So, instead, they decided to call up the owner of another shop, explain what they were doing and ask to speak with one of his employees. His response surprised them.
“He says, ‘Well, would you think about hiring me?’” Laura says.
It turns out the shop owner didn’t like the business side of things and wanted to go back to “just fixing cars,” Laura says. So, the Wilsons negotiated a buyout of his shop’s lease, closed the facility, and took on the former shop owner and his two best techs—not to mention a good portion of the shop’s client base.
“They were a shop with a good reputation in the area, a good and honest shop,” Laura says. “People knew them and liked them, and that was the main reason we did the buyout.”
Advanced Transmissions Inc., now a transmission shop only in name, completely transitioned by early 2011.
The switch was no small investment. The addition to the building alone cost $78,000, and then there was the cost of buying out the other shop’s lease, the new equipment and parts, and getting the staff certified and trained for new work. In 2011, the Wilsons spent nearly $14,000 solely on training, and that’s not including any airfare.
But the Wilson’s aren’t in debt. Annual revenue went above the $1 million mark in 2011, and Laura says that doesn’t fully show the shop’s growth, or its increased efficiency.
In the first year of offering general repairs in 2010, the business’s profits rose between 17 and 18 percent, Laura says. In 2011, profit margins rose another 21 percent.
Laura credits as much of the growth in profit to the addition of new repair work as to an overall change in how the business is run. She credits her consultant, Maylon Newton, with showing her new, more productive ways to increase efficiency. Now with eight employees on staff, the shop works on 120–150 vehicles each month, more than half of which are general repair work.
The Wilsons have always meticulously planned every aspect of their business. This last transition simply had to be planned much more quickly. The key, Laura says, is to make sure you’re focused on improvement and have a plan to get there. To grow, she says, you have to be ready and prepared to change.
“We still are experts on transmissions,” she says. “Eventually, though, you have to do what’s best for your business. If you want to grow, you’re going to have to make
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