From the Ground Up
SHOP STATS: Advanced Automotive Location: Redding, Calif. Operator: Cody Morelock Average Monthly Car Count: 205 Staff Size: 9 Shop Size: 5,000 sq. ft. Annual Revenue: $1.7 million
Since day one, Cody Morelock has always had an interest in tinkering.
“I started working in the shop with my dad ever since I could carry a screwdriver,” Morelock says. “I would go with my dad to work before he owned his own shop and watch him work on vehicles.”
Once his father opened Advanced Automotive in 1993, he put Morelock to work—sweeping floors, picking up rags, cleaning and simply putting away his tools. At 12 years old, Morelock was working at the Redding, Calif., shop after school and during the summers. Over time, his dad gradually gave him more tasks, starting off with the basics and then more and more tasks involving maintenance and repairs. From a young age, Morelock was invested in the business.
Morelock actively worked in the shop until he was 24 years old when he decided to take out a loan and take the money he had saved up to buy the assets of his father’s business in 2009. To say he took over the business at a difficult time would be an understatement. Unfortunately, right before Morelock acquired the business, it was the victim of embezzlement, leaving the operation with nothing. Two weeks after opening, he had to come up with a gameplan on how to pay his seven employees.
“I worked long hours and did not take pay for a month until things started rolling strong,” Morelock says.
After hitting the ground running and learning more of the business management side of things, he has now reached $1.7 million in annual revenue and has plans in the works on moving his business into a larger, more profitable space. That didn’t come without time, though. To help him find his way, Morelock invested in a coaching company that taught him valuable lessons about running a business.
“Fast forward to today—34 years old—I do not work on cars, I work on the business,” Morelock says.
I usually get to the shop by 7:30 to 7:45 a.m. My service advisors and shop porters hours are 7:30 a.m. to 5:15 p.m., and my techs’ hours are 8 a.m. to 5 p.m., so the shop is fully open and ready to operate right off the bat. We open right at 7:30 a.m. so people can drop off their vehicles before work and we offer rides for their convenience. I first check in with my service advisor on anything that needs my specific attention. I look over the schedule and from there, I take care of any payables needing attention, get a bank deposit ready as well as any outgoing mail. Our front office assistant then takes customers home and makes the rounds to the bank for the shop and post office.
We do daily morning production meetings and also do biweekly lunch meetings. The biweekly meetings are a good platform for everyone to get in good communication and have a voice on how things have been going. We go over and refresh on shop policies and procedures, address any problems that need attention, and basically get everyone on the same page on current and future plans. I buy lunch, then, at the end, we have a little quiz where I give out gift cards for employees that can answer questions that pertain to what we covered in the meeting, which makes it fun and keeps them engaged and paying attention.
Late morning, I check on the status of inspections completed and monitor promised times with my service advisor. We take lunch from 12-1 p.m., but my service advisor and front office assistant stagger their lunch times so the front office can be open, phones can be answered and no opportunities are missed as far as a customer calling.
From there, I occasionally step in and help our service writer and sell some work if my service advisor needs help, float between my desk in the front office and make my rounds through the shop checking on the techs and workflow.
The struggle I’ve had over the years has been getting what I know in my head, as far as how to run an auto repair shop, onto paper and essentially creating a playbook on how my shop should run. I didn’t have a playbook on how my operation should run. I was communicating my expectations verbally and not writing anything down. I recruited a coaching company out of southern California to help get my business more operational. They helped me identify these problem areas in my business and have acted as a compass in guiding me to be successful.
Now, we have those policies and procedures written down in an operations manual. We even have a saying, “If it’s not in writing, it doesn’t exist.” My expectations are now clearly stated and read by everyone in the shop so they know what their job is and what it entails. I’ve learned that in any business, your expectations and standards must be known in order for your employees to perform the way you expect.
Another key area that is priceless is a good certified public accountant (CPA). My shop has one and he keeps us on the level. When it comes to coaching and financial help, I don’t skimp on the cost. It’s worth every penny for good guidance and advice. For several years, we just bounced along with no real direction, just the mundane, fix cars, collect payment then repeat, and through this, I wasn’t paying very close attention to my numbers; my ARO was an average of $350, but gross profit was very low. With the help of the accountant and our business coach, our ARO and gross profit began to really take off. The coaching company, coupled with my accountant, really lit a fire in me. Now, my ARO is $700 with my gross profit margin at 55 percent. Currently we are working on purchasing a larger building so we can further expand and take on more work.
Throughout the day, my main concern is making sure we are meeting or exceeding our customers expectations as far as promised times and commitments. My responsibility is ensuring my staff has what they need and that I am enabling them to take care of my customers. If I take care of my employees, they will take care of my customers. To do this, we focus on providing service in abundance or exchange in abundance. Basically, giving the customer more than what they expect or pay for. We remove all roadblocks and barriers for the customers to do business with us. As an example, we started to offer a pick-up and delivery service, as well as a complementary vehicle washing at no charge. We always leave room in our schedule to take in emergency break downs and are as fluid and flexible as possible. Customers don't want to wait three days for an appointment, and it also gives them a chance to go elsewhere for service and repair. Let's face it, no one looks forward to getting their car worked on. If we can make that easier for our customers, we do it.