Managing from Afar
Pamela Gatto agreed to help her father, Mike, with the accounting for his shop’s single location for just two weeks.
Fast forward 42 years, and Gatto, now the president of six Gatto’s Tire & Auto Service locations, has turned those two weeks into a full-blown career full of achievements and accolades in the tire and auto care business: She became the first female president of the Tire Industry Association in 1997; she was named Entrepreneur of the Year by the Founder’s Forum in 2010; and she’s one of three women in the Tire Industry Hall of Fame.
One last accomplishment: Gatto was recently named the Car Care Council Women’s Board’s 2015 Female Shop Owner of the Year.
But when Gatto looks back on her storied career, she doesn’t think of all the awards and recognition. She remembers the person who brought her into the business, who taught her everything she knows, who put her on a path toward success: her father.
Gatto is deeply involved in the success of her six Brevard County, Fla., locations—meticulously tracking KPIs, resolving personnel issues, and performing grassroots marketing—and she credits her father for instilling a leadership style and business sense that keeps her shops growing.
My dad taught me a lot of things. He was the best retail guy in the business—by far. And one thing he taught me was: When you go into the store, they should be happy to see you; and then when you leave, they should have learned something and be even happier. Even if you deliver something negative, you have to deliver something good, too.
I usually visit each shop twice a month. You really need to get out and about, because the employees like to see you. I do a majority of my work in the office, but I balance that with getting to my shops and working in the community.
The guys tease me about being a number nerd. I like to tell them that I can sit here in my office, look at the numbers, and tell exactly what’s going on in each and every store.
I check the figures first thing in the morning. I pull out several reports for the managers: the day-before figures and the month-to-date figures. I have some KPIs and goals, and through those figures I can figure out what they’re hitting, what they’re not hitting, what they’re doing and not doing well.
We have a number of things we look at. Our key stats are tech productivity numbers, bay productivity numbers, tire units, gross margins and ARO. But after many, many years, I realized that there’s one number that means the most, and that’s your daily gross profit. If you can hit that daily gross profit number, do I care as much if you’re selling more of one thing and less of another?
Determining the daily goals for each store is a case-by-case thing. We have one commercial location that also does retail, so of course they have a high daily gross. And then we have a small six-bay location that has the lowest daily gross. The daily gross profit goals range from $2,200 to $6,000. My guys know their daily goals, so they’ll be watching the numbers throughout the day on our Tiremax software system through ASA Automotive Systems that gives us up-to-the-minute sales information.
When you’re talking about the service department, you’ve got technicians, service managers, sales reps—if any one of them is not hitting their numbers, then something is not right. We also track traffic, so if the traffic is there and the dollars per vehicle aren’t, then one of several things is happening: They’re not thoroughly safety checking the cars, or they’re not selling effectively. You look for those outliers.
When the numbers are not looking good and goals are not being met, it’s probably because of a disjointed team. They’ve got somebody who’s bringing them down. Throughout the day we’re trying to pinpoint those issues. I work with my two sons and my son-in-law, and I’ll send one of my sons out to resolve personnel issues. That used to be my department, and he’s not super experienced, so I’m trying to guide him.
I think most managers try to come in tough—that’s never worked for me. I don’t demand to be respected. I’ve always found you can get along with employees better if you sneak up on them. If you don’t force your way in and just learn what they like— maybe make a few sports references—then they’ll just start naturally chatting with you when you visit.
In disputes, I would handle it a lot like when my kids had disputes: Let’s all sit down together, let me hear both sides, and then if somebody is off the mark, I’ll point it out. There are a lot of rough guys in this business. Things can escalate quickly when you go in too strong. I’ve maybe lost my temper three times in 42 years. When I’m a calm third party, I can figure out what’s wrong and fix it.
We preach that we only sell what somebody needs. There’s a billion dollars worth of unrepaired vehicles—we don’t have to sell extra crap they don’t need. We don’t have to make stuff up. Just take the time to look and find what the vehicle does need.
I look at every individual category of statistics throughout the day because you can always spot if somebody is overselling. But over the years, there’ll be one store that sells four times as many shocks as other stores. You know something is not right there. And if you’re paying attention, you can spot it in a short period of time and you can stop it. We want to remain a trusted part of the community, so we have to sell ourselves by our philosophies.
Tracking our return on investment for marketing is also huge. We have a yearly planning meeting where we go over how well certain marketing ploys are working. We know we’ll stick with what works. We know we’ll do TV, we know we’ll do radio. Sometimes we alternate years we’re on billboards, or what kinds of direct mail pieces to use.
TV has played a big role for us for many years. My dad always said, “What do we have different than all these other people?” It was me, because I was the female. So he had me doing the TV commercials and radio from very early on. We had the good fortune to air our first commercial on CNN the weekend the Gulf War broke out in 1990. We were on all day, every day, for a week. Everybody was watching CNN. Everybody in the counties we served saw us. And it was a cable buy, which is cheap.
Because of that, our strategy has always been that we are on shows people watch live. We’re on the news, we’re on sports, we’re on the weather—things that people don’t watch on On Demand and zip past the commercials.
In the commercials, we preach we’re family owned and operated, and that when you spend your money with us, your money stays in the community. We’re always here, we live here, you can call us anytime, you know where to find us, we’re in the phone book, we’re not hiding. If you’ve got a problem, we’re going to handle it for you.
My dad taught me a long time ago that there are 24 hours in every day and everything comes down to time and effort. So at six o’clock, my day doesn’t end.
Being part of our community and branding ourselves as a family-owned business is key to our success. We sponsor a lot of stuff around town. We just try to get into all kinds of segments. Some school stuff, some women’s organizations, health care, the arts, the local university—we try to spread it around so we hit all kinds of people.
There aren’t really measurements for tracking community involvement, but you can see and feel the effects of it. Often I am out somewhere and people I don’t even know come up and say, “Thank you so much for all you do in the community.” The return is very high. The name recognition is high, and that’s what you want: top-of-mind awareness. They should be thinking, “That’s Pam Gatto who’s chairing this event.”