This month, I met with shop owners across the country about what worked for them in the retention of their current customers. One of the items that came up a few times was a company that sent out rebate checks for their best current customers that had not been in the shop in the last 60 days and spent more than $250. The customer would get a rebate check to use on a future visit based on past spending. The numbers were amazing: a 15–20% response rate. Of course, I wanted to meet the person that came up with this program, why it works so well and how they were doing it.
Meet Tommy Nickelson, the owner of Advanced Auto Repair in Denton, Texas. Today he has an eight-bay shop doing over $2.6 million per year in sales for repairs alone and has a customer retention company called Rebate Checks. Tommy first came up with the idea while working with the late Bob O’Connor at RLO Training. The first item that Tommy addressed with his 20 Group was not only how to generate new customers, but also how to get his current customers to come back because none of the CRM systems worked how he wanted them to work.
Then he had a vision while at the counter one day. He started to see how, when mail came in, the only thing that stayed on his desks were checks. All mail, junk mail, letters and advertising ended up in the trash, but those checks stayed right there on the desk! Voila! That’s how rebate checks were born! He worked on improving the marketing piece with his 20 Group to put together the right letter and check program based on a customer’s previous spend amounts to give them a rebate in the form of a check that customers could use. Today, the rebate check section of his business does this process with little work from the shop owner at all and a return rate of 15–20 percent. Not only did this help other shop owners, but it also caused Tommy’s shop sales to increase by another $200,000 per year.
Next, a tire shop down the street came up for sale. Tommy decided to purchase the business, customer list and equipment. This expanded their business to almost $2 million in sales overnight. What he found was that with the right team mix of one service advisor up front to four technicians in the back, the back of the house to push the front of the house sales. After seven years, the building for the tire shop was eventually sold and he made the decision to combine both stores into the auto repair location. They were able to retain all the customers, managers and technicians into his eight-bay advanced auto repair facility taking it to $2.4 million without even expanding his footprint.
Finally, Tommy still saw opportunities for growth and he contacted AAA to become a AAA location. Now, he has two full-time AAA vehicles in the area making up another $300,000 or more in revenue.
Tommy’s story is extraordinary and continues to be today. I love seeing motivated shop owners continue to find innovative ways for not only their growth, but also helping each other along the way! There are many lessons learned from the 20 Group process that have made a difference that Tommy says he could never have been anticipated. For example, the importance of solid SOPs and job descriptions unfolded in a way Tommy never could’ve imagined. He had been dragging his feet on implementing a management structure and standard operating procedures for all positions within the company. Letting go and trusting others to take care of your business was not easy or comfortable.
After a few nice, followed by not-so-nice, nudges from his peers, they were finally finished. He now had a solid manager in place, everyone knew their job and was able to solve unexpected issues without needing guidance from Tommy.
This couldn’t have happened at a better time. Within a few weeks, Tommy learned that his dad had wasn’t going to be around much longer. He had only six months left of multiple camping trips to the lake, fishing, trips to doctors, chemo, lunches, dinners and so much more. Tommy says it was the best quality time they spent together. Had he not implemented the suggestions from the 20 Group, Tommy believes he would have been forced to choose between spending quality time with his dad or providing for his family and the 19 other employees at that time.
Luckily, the group’s insight of what needed to happen within the business allowed Tommy and his wife to step away for extended periods planned and unplanned during those last six months.
“I can’t thank them enough for that time they gave me,” Tommy says. “With that lesson, I feel compelled to help others or pay it forward. I know there are owners that, one day, will have a similar issue with a sick child, parent, or spouse and I would hope that they have the structure set up to be there for them just as I did.”