Growing a Shop in Alaska
Below-zero temperatures are the norm for residents of Fairbanks, Alaska.
The second largest city in the state sits just 10 miles from the town of North Pole and regularly only sees four hours of hazy daylight during the winter solstice.
It’s in this harsh environment that Mike Simard runs a thriving shop that generates upwards of $2.1 million annually, with further growth on the horizon. The owner of Simard Automotive is tasked with working in a location he refers to as an island.
“The next biggest town is Anchorage,” he says. “And that’s 360 miles away.”
While the isolation has a few perks—there are few competitors (Simard counts about 10 independent shops in the area), no dealers, and plenty of business thanks to the gold mines, oil patches and two army bases—the challenges are equally significant. Hiring, staffing, training and keeping up with industry trends are all difficult in virtual isolation. But that hasn’t stopped Simard.
“There are a lot of shops here that are happy with maintenance,” he says. “But I don’t like to stand still. I believe there are always improvements that we can make in customer service, establishing relationships, finding better service and technology. I truly enjoy doing that.”
And his resolve has paid off. The shop is poised to expand for its sixth time early this year.
Building a Culture of Service
Simard was only 19 years old when he hopped in his beater truck and drove from northeast Vermont to Fairbanks.
“I know now it was providential for sure,” he says. “But I didn’t know it at the time. I had pipe dreams. I had big dreams of making money in a fishing boat, gold mines or oil wells up north.”
Simard had been working on cars since he was 13, and quickly found a job in Alaska doing “bush work,” repairing service vehicles for gold mines, oil support rigs and other heavy equipment.
Eventually, he came back to traditional car repair and opened his own one-bay shop in 1997. In two year’s time, he expanded to his current facility, which he has had to expand an additional four times.
“I pretty much said I wanted to be all things for all people if I could,” he says. “I wanted to be able to service the entire family fleet: the kid’s car, the mom’s and dad’s, and the dad’s truck.”
Simard also found that gaining customer loyalty in the family-friendly, middle-income area was not as difficult as he had previously experienced.
“We were told that it’s really hard in Fairbanks to find good service,” he says. “As long as you communicate with them, are honest with what you’re doing, get pre-approval for all your work and articulate your expectations for the customer, they love your service.”
What this meant, however, was a daunting challenge to find employees who could carry out Simard’s dream of a progressive, high-efficiency shop.
“To have the kind of technician who can work on all makes and models [and perform] all-inclusive service and repairs, is very difficult,” he says, not to mention “somebody who can keep up with our extremely progressive, rapidly growing shop. In order to maintain that, you have to have some high-production, caring people. Plus, you also have to have the person who wants to live in Alaska. It’s about one in 1,000.”
To find that caliber of employee, Simard created his own custom human resources program that includes recruitment, interviewing, selection and training. With help from his RLO Training Bottom Line Impact Group facilitator John Wafler, Indeed.com and TheResumator.com, Simard set up an online application process, which allows him to receive résumés from all over the world.
This approach has resulted in recent hires from California and Colorado.
While Simard conducts most of the interviews over the phone, he also uses knowledge-based tests and personality quizzes to get more information about the candidate.
“It helps paint me a picture, but I am finding that it’s still not adequate,” he says.
To ensure that he doesn’t make a bad hire that could cost him thousands of dollars and countless hours of wasted time, Simard has started offering each final interview candidate a half-price plane ticket to Alaska, room and board, and a three-week trial period at the shop.
Paulie Stroup, 29, was one of those candidates. An avid dog musher from Colorado, Stroup applied for a technician job through an online posting in November 2012, and he participated in a series of interviews with Simard for more than a month before driving all the way to Fairbanks.
“Mike assisted me in getting up here a lot,” Stroup says. “I loaded up all my dogs on a truck and trailer, drove to a ferry up in Washington and hitched the ferry on up to Alaska.”
To ensure he’s always recruiting, Simard also started one of the few federally registered apprenticeship programs.
“I realized I needed to have a way to have people come up from the beginning to the next level,” Simard says. “I really didn’t have a clear pathway to show them.”
Simard began researching apprenticeship programs and found that the Canadian government had a federally registered apprenticeship program for technicians.
As luck would have it, the program had a contact located in Anchorage, who helped Simard and his brother, Robert, who serves as shop foreman, structure and develop the program for the shop.
“There are very few independents that have a program to take the floor sweepers to master technicians,” Robert says.
The four-year program includes more than 150 hours per year of continued education and 2,000 hours of hands-on work per year. It has room for up to two technicians a year, who apply and interview for the program.
“We kept having these shop helpers who we were hiring young and after a year of sweeping the floor, they wanted to move up and start working on vehicles,” Robert says. “We wanted to teach them our way from the beginning and keep them in the future. We drew up the apprentice plan so they know exactly where they’ll be in three years. They’ll know how much they’ll be making, what we expect out of them, and what they’ll be doing.”
Simard says the constantly evolving program has been successful in finding skilled technicians, whom he is then able to train with the help of his master technicians.
Training from Afar
Upon assembling his team, Simard found he still needed an effective way to keep up with the trends and technology necessary to maintain a high-performing shop. NAPA Auto Parts and O’Reilly Auto Parts offer a few classes in Fairbanks—about eight a year for independent shops, Simard says.
“What we’ve had to do is find a good source for online, in-depth, high-end training,” he says.
Simard was specifically looking for a system with the ability to assess, train and reassess his employees.
“A lot of training I found was just training and I would ask myself, ‘Did they really learn?’” he says. “I didn’t like that.”
Simard spent hours researching and comparing training programs before finding a Canadian company, CARS OnDemand.
“It’s fabulous,” he says. “It’s high-end, online. They do printable lessons, video theory, on-the-car video training, and then they do an assessment quiz.”
Simard regularly uses the program to assess his staff’s knowledge before and after training, and says it’s helped him keep up with the changing OEM repair requirements.
The program has also helped the shop with difficult repairs.
“Their help hotline has been phenomenal,” Robert says. “We fax them a copy of the [repair order] and tell them what we’ve done and then ask our question. They’re usually really quick to respond.”
Creating Lasting Relationships
Simard has always hated the word “sales.” The way he sees it, his employees act as consultants, not salespeople.
“Customers come to us for the information about how to service their car and repair their car,” he says. “I don’t need to sell them anything.”
To create those deep customer relationships, Simard has implemented a strict sales process: interview, inspect, estimate, educate, offer, and follow-up.
He says involving the customer has been the key to his average repair order of $650.
“When you go to the doctor, do they sell you on a procedure?” he says. “They’re going to educate you and steer you to make a decision. We should be professional consultants. We’re consulting people to make good choices based off factual data from master technicians. We have to educate the customer and then we offer [our services]. It empowers the customer to make their own choices. That should build trusting relationships.”
Through interviewing customers and inspecting every vehicle that came through, Simard began to notice a pattern with out-of-warranty vehicles.
“We found after warranty a lot of vehicles would come in with problems,” he says. “There were things like excessive sludge, premature failures. What I realized is that the manufacturers want to sell you a car as quickly as possible—you put gas in it and you won’t have to do anything for 100,000 miles. What we found in an Arctic environment is that 100,000-mile services don’t always cut it.”
To help, Simard partnered with BG Products to offer his own Arctic Service Plan, a lifetime protection program.
Simard shortened the traditional service intervals to account for the harsh Alaskan winters and created four different levels of service based on mileage, which include a number of different maintenance services and inspections.
To qualify for the program, vehicles must have less than 75,000 miles.
“If your vehicle qualifies and you service your vehicle with us, your vehicle will be covered for $34,000 or more, for one million miles or more,” he says.
Simard says the service plan has been extremely successful for the shop and also allows it to get to know each customer’s car.
“Our [monthly] car count is really only 300 to 400 cars. It’s not that high,” he says. “What it is, is that we make every car count.”