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How They Did It

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How …

Aaron Stokes transformed his business and his life

A pivotal shift in thinking led Stokes to build one of the industry’s most respected shop networks

Every business owner has a defining moment—or needs one, Aaron Stokes says.

“Yeah, let’s rephrase that, actually: Everyone needs that one moment that pushes them toward reaching their potential,” he says. “For all of us, there’s something that holds us back. Maybe it was something someone said to us once. Maybe it was a bad experience we had—we failed at one point. Maybe it’s our circumstances, where we came from. All of a sudden, we have this in our head, that this—whatever that this happens to be—is all we are capable of. You set a ceiling for what you’ll accomplish. You put a limit on what your potential is.

“All of us, to reach our full potential, need that one moment where we break down that barrier, where we realize there is no limit on what we can do, when we truly believe in ourselves. Once that happens, man, your whole life changes.”

If this sounds a bit dramatic, well, that’s because it is; Stokes’ story of total transformation is dramatic. At the time of his “defining moment” (and we’ll get to the story of that moment later), EuroFix was sputtering. This was a business that, after Stokes founded it in a residential one-car garage in Franklin, Tenn., in 1999, built its reputation by grinding out work on the dirt floors of an old tobacco barn for five years. Stokes and his wife lived in front of that barn in a single-wide trailer, which was just about as narrow as Stokes’ view of the business’s future. Make this small business successful enough to support my family—that was his goal, and that was the ceiling he placed on his success.

Then came his moment in 2007, and the complete change of course shortly after. His business model changed, he overcame a nearly disastrous expansion, he roughly tripled sales, he quickly built his second location into a powerhouse, and by March of 2011, Stokes no longer saw a limit on his business’s potential.

To quantify it in dollars, in mid-2007, EuroFix (then called The Saab Shop) approached $70,000 in monthly sales. That March of 2011, that original facility did $164,000. The second location (which was roughly the same size as the first) did $224,000. And with his unique operational model in place, Stokes netted roughly $100,000.

“I called my wife freaking out, because we’d just moved out of the trailer and I didn’t even know what to do with myself,” Stokes says. “I was this poor, white-trash kid growing up in trailer parks with stains on my jeans and T-shirts. What do I do now?

“I didn’t know what to do, so I started wearing ties.”

 

STATS: EUROFIX/AUTOFIX  LOCATION: NASHVILLE, TENN., AREA  Size: 2,400–19,000 square feet  Staff: 56 (25 technicians)  Average Monthly Car Count: 1,200  Annual Revenue: $8 million

 

The Moment

Stokes’ laptop died; bad timing. As each of the other nine members of his group took turns, he squirmed, knowing that when his name was called, he’d have to start with explaining the dead laptop.

“We were going up, one by one, and showing him our shop websites and explaining our business models,” Stokes explains. “And I’m just waiting until the very end for my turn to meet with him.”

“Him” was Greg Sands, who at this point in the story wasn’t the same industry celebrity he is today.

“He was like this secret, underground guru or something at the time,” Stokes explains. “His business was already incredibly impressive and he was extremely successful, but it wasn’t really out there in the public then. And our [20 Group] had the chance to go to a special event at his house—just the 10 of us—to meet with him about our businesses.”

When it’s Stokes’ turn, they retreat to an office at Sands’ home (dead laptop, remember?), and in the privacy of a secluded room, Sands pulls up EuroFix’s website and stops abruptly to study a photo of the shop floor. He asks for some numbers; Stokes gives them.

“And he looks me in the eye and says, ‘You’re too smart to go out of business. You have no reason not to be successful,’” Stokes recalls. “It sounds simple, but this was a huge turning point for me to have someone else believe in me. I still remember it like it was yesterday. Having someone else show that confidence in you changes the way you think of yourself, it breaks down all those other limits you placed on yourself. It was what I needed.”

 

The Key to Hiring Correctly

Aaron Stokes refers to it as a “gut feeling” when he knows a job candidate is right for his team. But, really, it’s more tangible than that.

“We look for red flags—bouncing around a lot, or overselling yourself and your abilities in an interview,” he says. “That eliminates people really quickly. Then it just comes down to personality, and the way I look at it is that if they are a person I’d be happy to have a beer with, then they’re the right fit personality wise. And I don’t even drink.”

Stokes also believes in promoting from within. He identifies employees willing to go above and beyond in their roles, and increasingly offers them more responsibility. Today, all six of his store managers started as service writers.

 

A Budding Empire

If you haven’t heard of Stokes before this story, let’s just skip ahead a bit to where his business is today: With six total locations (four under the name EuroFix and two named AutoFix), his business did more than $8 million in 2016 with just 25 total technicians. The business’s net profit sits at 18 percent—and that’s a true net, after accounting for taxes, owner/corporate salaries, etc. He’s considered by many to be among the very top operators in the country, an innovative guru, who now has many shop owners seeking his advice.

How’d he get there? Well, it wasn’t a smooth progression. There were stops and starts—a new location for his original facility, already with the foundation poured, that had to be scrapped when the recession caused the bank to pull its loan in spring 2009. There was a learning curve in managing two facilities. There were bottlenecks that arose in implementing his workflow model.

In the end, though, each of those those potential roadblocks led to new concepts that pushed the business forward. When he lost the new site for his original shop, he decided to open a second location—and it thrived. Juggling two facilities led to him instilling company-wide best practices, and fine-tuning the processes that made the business a success. And each hiccup in workflow led to further innovation.

Today, Stokes says the success of his business comes down to just a handful of things: hiring the right people, putting them in an environment to succeed, and a firm belief in the limitless potential that still exists.

“You can learn anything—processes and systems and things,” he says. “You can know how to do all of it, but at the end of the day, you have to have the belief to go out and make that change. You need to believe that you’ll succeed. The moment that happens for you, everything changes.”

 

A True Production Model

It’s all simple math, Aaron Stokes says. There are efficiencies that can be created on the shop floor, and customer service is crucial, but setting your shop up for success is all about balancing the amount of work your team can handle.

At his four EuroFix locations, his team of techs are to average 55 vehicles per month per person. That number is 95 at the two AutoFix locations, due to its simpler, general repair model. That, he says, puts each tech on pace for roughly $30,000–$35,000 per month in parts and labor. (A-techs often average closer to $40,000; C-techs far lower.)

“You transfer that into effective labor rate, which depending on the market and the location is anywhere from $112 to $128 per hour, and I get my hours from that,” he says.

And by that, he means the amount of hours of work that should be scheduled at each location.

It makes for a high-paced environment, and Stokes says that makes the work of his front desk that much more important. He expects each writer to sell between $100,000 and $120,000 in gross parts and labor each month. To be able to sell that much work, each service writer has an assistant that takes on the more tedious tasks that eat at an advisor’s time.

 

Borrow from the Best

Aaron Stokes’ approach to operations might seem innovative to many, but he asserts that it’s something anyone can make work—in his or her own way.

“I borrow a lot of ideas from other businesses I’ve seen,” he says. “It doesn’t mean I’m going to replicate something, but I look at what others are doing and think, ‘That’s really great; how can I make that concept work in my business?’”
 

 

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