The Art of the Pivot
The easiest way to explain it, Ted Curran says, is to borrow a term from martial arts. The “indomitable spirit” is one of the core tenets of Taekwondo. Without getting too mystic, it refers to a refusal to give in, an internal drive to settle for nothing less than success; it’s that “it” factor, the term so many use to define those undefinable, unexplainable moments of achievement.
“It’s the mindset that you wake up every morning ready to slay the dragon,” Curran says with a slight laugh. “To think what we’ve all been through, all of us who’ve built businesses and seen it through, I think you know what I mean.”
“When you’re struggling, and struggling, and struggling, you can lose desire,” he adds. “It would be way easier to give up. But you won’t. You can’t. You’re going to make this succeed because you have to. You have no other choice but to work every day to succeed.”
Curran is the owner of Monkey Wrenches Inc., a once-dismally performing shop in Brentwood, Calif. “A bad situation,” is how Curran understated his description of the shop’s performance when he took over ownership in 2005. But we’ll get to the details of that later—and that of another California repair business that also orchestrated its own complete turnaround. Before that, let’s define another key term: pivot; in the startup world, this refers to a shift to “Plan B” after an existing business model begins to fail.
The indomitable spirit and the pivot—these are the tenets of this story.
“What it all comes down to is that you need a plan and you need that unrelenting belief in yourself that you will make it work and do whatever it takes to succeed,” says Curran, who apart from delivering motivational quotes is himself a black belt in Taekwondo. “You can turn it around. You have to believe that for it to happen.”
How the Sevim brothers focused on “necessity” in overhauling and growing their family’s business
There was a long stretch at the beginning of 2004, where it was just Eric Sevim and his brother, Adam, in the shop. No one else. The two new owners of A+ Japanese Auto Repair originally had two employees (two techs) when they took over Jan. 1, but both quit within the first two months.
They didn’t want to work for the Sevim brothers.
In hindsight, Eric understands.
“Well, at the time, I was 18 and my brother was 21,” he says, matter-of-factly. “I can see why they might not have really believed in the shop’s future at that point.”
The Sevims did, though, and that may be the reason they were mostly unphased by the defections. Yes, Eric was 18 at the time, but he’d spent the entirety of his teenage years in that shop, helping his father and mother run the family business they started in 1997. He shadowed his dad on repairs, receiving an old-school apprenticeship before even being old enough to go to tech school. Adam, affable and more interested in the finer points of running a business, was not just ready but itching to take the helm of the shop’s front end and customer service aspects. And both served directly under their parents in 2003, as the eldest Sevims slowly transitioned responsibility and ownership to their sons.
It’s a common auto industry narrative of family succession, and to boot, the small, San Carlos, Calif., shop was reasonably healthy at the time of transition. As a four-person operation, it grossed nearly $600,000 in 2003 with a strong, loyal client list and solid margins across the board.
Still, that was as a four-person operation, and with two experienced business owners. In mid-2004, there was just the Sevim brothers, green and overloaded with jobs. But the Sevims didn’t panic. Instead, they laid out a plan.
This is where A+ Japanese’s pivot comes in.
Eric Sevim starts with an example: Let’s say you order a medium Coke with your meal at McDonald’s. The employee grabs a medium cup right next to the fountain machine, places it in a grooved slot, presses one button for a medium Coke, and walks away to fill the rest of your order. Meanwhile, the machine fills the cup halfway up and pauses while the fizz from the carbonation settles; then it fills it up the rest of the way.
This is an anecdote from the book Fast Food Nation, one that Sevim says does an incredibly good job at explaining the importance of searching for efficiency in businesses. And this is critical here, as it’s the central idea that the Sevims replicated in their business.
“It’s about using technology to create better efficiency,” Eric explains. “How can you save time by using the tools available to you?”
As Eric and Adam looked at the resources around them in 2004, they saw very little. All ROs were written by hand. All accounting was done by hand. Every marketing report, every financial statement—they were all manually created on a one-off basis. The Sevims spent hours upon hours each week writing. And that’s on top of their actual workloads. They kept the doors open most days until 6 p.m., and then worked well into the night to catch up on paperwork.
“It just wasn’t sustainable,” Eric says. “We were young and had no problem working hard, but we needed better ways to do it.”
The traditional methods of business management simply weren’t going to work. The Sevims knew they needed to modernize their operations, utilize new technology, systems, processes and philosophies to ensure they could stay viable for the long run.
They started simply.
“The first thing we did was purchase Winworks, an RO-building software,” Eric says. “You could basically can the jobs. Once you built it in once, you could can it. We were able to start printing invoices, and it had reporting features. All that stuff we were doing by hand, we could do quicker and it would come out more professional.”
It also had advertising features, and allowed the Sevims to print labels—a seemingly minor detail at first, but it eventually saved hours of legwork in writing them out.
But the Sevim’s story isn’t about adding a management system (they’ve actually since switched to Profitboost, which integrates well with the shop’s customer retention and parts-ordering systems); that was just the first step in what turned into a total philosophy switch.
Necessity Above All Else
The Sevims waited a full two months before looking for a new tech after their initial employees quit. This wasn’t masochistic.
They just wanted to ensure they didn’t have a dip in sales or number of ROs before adding more overhead in a new employee.
So here’s that new approach: Make adjustments and investments when they are necessary; make decisions based off need. It helped guide the young shop owners through what could’ve been a tumultuous time.
For example, with two technicians with him in the shop a year later, Eric began noticing that big jobs took away too much of his time from his ownership duties. He couldn’t be trapped under an eight-hour job when he had to also speak with customers, help with marketing and focus on business growth. That’s where the technician structure came in: All of A+ Japanese’s techs specialize in certain makes or repairs. Eric took on diagnostic and electric work at that time, and as the staff grew, the amount of specialties did too. With nine techs today, the shop has specialists in heavy duty, diagnostics, foreign models, electric work and in performing inspections, all determined by skill and experience.
And as far as that growing staff, the Sevims made an effort to only add staff when the workload demanded it. The staff grew proportionately with shop sales, as they added a tech every $300,000 or so in annual sales increases (a number reflective of a solid tech’s workload).
In 2015, the shop did just over $3.9 million in total sales. The facility is the same size, but it now has 12 lifts (compared to four when they took over), laid out in intricate fashion: two rows of six with a wide aisle down the middle where shared tools and equipment can be stored for easy access.
There have been a lot of small changes and tweaks along the way, but they’ve added up to monumental shifts for the Sevims and have positioned the shop for long-term success. Today, neither is required in the business on a daily basis. They alternate weeks, and both live roughly two hours from the facility.
“It’s a little odd, because really, we changed almost everything from small systems and processes to the technology we put in place,” Eric says, “but each change came as we needed it and with a specific reason for doing it. Making those incremental changes can shift everything in a new direction, and we like where it’s going.”
On a Mission
Ted Curran’s focus never wavered—not for 10 years—and step by step, he rebuilt a business that was on the brink of bankruptcy
Curran can laugh about it now, but for years, he couldn’t stand the name of his shop.
Monkey Wrenches is “quirky,” he says, but the real problem was all that came with it. Before 2005, when anyone heard that name in Brentwood, an affluent neighborhood on the westside of Los Angeles, their thoughts went to patch-work repairs, inferior parts, charges for unneeded work and sleazy salesmanship—that dirty, grimy approach to auto repair that for decades sullied the reputation of an entire industry.
“It was the worst shop in town,” Curran says bluntly.
And he would know; Curran worked there for a stint. An 18-year veteran dealership technician, Curran wanted a change in life following the passing of his father. He wanted his own shop, but he says he wasn’t naive enough to think being a dealer tech made him qualified to run one. So, he started working in local, independent shops.
“I didn’t last long [at Monkey Wrenches],” he says. “It just wasn’t the type of business I ever wanted to be a part of. I wanted to be a part of something that really benefited the community and really helped people. This was the opposite.”
But then a strange thing happened. About a year later, the owner called him wanting to sell him the business.
In 2004, the shop grossed less than $100,000 out of a three-tech, 4,500-square-foot operation. The owner was in trouble with the IRS, Curran says, and was in debt.
Taking those factors into account, Curran says it’s a business no one would consider buying. But the facility was a good one—an old Chevy dealership with great visibility on a busy thoroughfare.
“It was exactly the type of location I wanted,” he says. “It had four lifts already, six bays. It had everything I wanted.”
So, Curran developed a plan. Partnering with two of the techs working at the shop, the trio scraped together $62,000 from their savings and purchased only the equipment, tools and customer database (not the business itself), and took over the lease.
“We all knew exactly what the problems were and we were going to change that. We were the ‘Three Musketeers,’ coming to save the day,” Curran says, laughing. “We had a goal of truly connecting with our customers, doing things the right way, being a part of the community. We wanted to help people and have that be the foundation for the business. We weren’t going to let anything stop us.”
They took over Oct. 15, 2015. The day after Thanksgiving, one of Curran’s partners quit. The other gave up six months later, asking Curran to buy him out.
Remember that part about the indomitable spirit?
The Turnaround Plan
Fixing cars “is the easy part,” Curran says.
“Making ends meet, keeping the doors open, getting past that first year, the first five years, that’s a lot harder,” he says.
Curran learned that lesson quickly, and it steeled his resolve. His partners had the opposite reaction. Keep in mind that those two partners made up two-thirds of his technician team. Their departures made the business a two-man team, Curran and one other tech. Albeit a bit hurt by their abandonment, Curran decided to look at the departures as a blessing in disguise. He could rebuild starting small, doing things exactly as he wanted. Curran will be the first to admit that he wasn’t an expert in running or turning around a business. (He eventually hired a coach, Maylan Newton of ESi, a couple years in.) But he had a plan that was built out of his core belief in what made an auto service business great, what would allow it to be a true advocate for and pillar of the community it served: “I wanted people to trust that we were looking out for their best interests in all we did and that our purpose here is to help them,” he says.
So, how do you do that? Curran had a four-step plan:
Step 1: Ensure Proper Repairs. One aspect not to be overlooked in all of this was that Curran was a very good, very experienced technician. He understood the proper way to repair vehicles. He understood the importance of proper inspections, and following procedures. And he wanted his team (even if it was just one person at the time) to follow that lead. So, the first thing he did was create a list of “best practices,” standard operating procedures to be followed on each job and shop process. Make things repeatable, Curran explains, and you eliminate much of the margin for error.
“We needed to start by actually offering a value that goes with what we provide,” he says. “It starts with quality work; that’s the very basic expectation of a customer. It’s the baseline to start on.”
Curran also implemented a number of inspection procedures. One is a standard pre-repair inspection on each job. Then he has what he calls a “peace of mind” inspection and a “pre-travel” inspection, which are both complimentary on appointment.
Step 2: Guarantee Your Work. Curran wanted the community to know that he and his team would always stand behind their work, so he instituted a two-year, 24,000-mile warranty on all work performed. Taking over a shop with such a bad reputation, Curran says it was essential to change the public perspective.
“I didn’t want to just give them my word,” he says. “I wanted them to have a guarantee that we were different.”
Step 3: Win Back Customers. Now begins the gut-check moments: You’re better now, you’re different now, but will customers really come back to you?
“Brentwood is a small area, and it’s a loyal area,” Curran says. “I knew people weren’t just going to start showing up because we did better work. They needed a reason to come in.”
Curran started getting involved in the community, offering his time (he still had little to no funds to give) to church events and the local VFW. He held food drives during the Iraq War, offering discounts to those who brought in non-perishable items. Any and every event he could help with, Curran made the effort.
“I wanted people to see that we were dedicated to this community,” he says.
And he began going through the customer database, cold-calling and seeing if he could make good on past poor experiences.
“We swallowed a lot of pride and really looked at the first year or two as our ‘goodwill period’ to win back loyalty,” he says.
Step 4: Connect Each and Every Time. Curran is good with people, but until he took over Monkey Wrenches, he had no sales experience. So, he simplified: How would he want to be “sold” on a job?
“I have a very simple approach,” he says. “We get all the facts, all the information possible, and present it in a way that’s, ‘Here’s what needs to be done for safety; here’s what we can wait on.’ I want to give them the information and let them make the decision. My role is to advise them, not sell them. It helped build trust.”
In 2006, Monkey Wrenches generated $265,000 in revenue with its two-man team. Maybe more impressively, though, the shop was voted as the top repair shop in the Brentwood Press’s annual “Best Of” list.
Curran hired on another technician and the shop continued to build momentum. He experienced double-digit growth each year through 2015, when the shop topped $900,000 for the first time.
One aspect of the business still hasn’t changed, though: its name. It would seem obvious that with its sullied reputation, the name would be the first thing to go. But that’s exactly why Curran didn’t change it—or, really, why he couldn’t.
“Honestly, I didn’t have the cash to change it,” he says without a hint of a joke. “I couldn’t afford a new sign or uniforms or stationary. We had to make do, and it bugged me for a long time. But then, a few years in, people started having the opposite reaction. People would tell me they liked it and it was memorable. I guess I can laugh about it now, but it took a while.”
The whole process overall was grueling, Curran says. Turnarounds, especially as drastic as this, don’t happen overnight, or over the course of a couple short years.
“Doing the right thing is never easy. Staying with it isn’t easy,” Curran says. “But if you believe in what you’re doing, you have a plan for doing it, it’s possible. You just have to believe and not give up on it. Stay with it. Wake up each morning knowing you’re going to get this thing turned around.”