Making Collaborators of Competitors

Feb. 20, 2024
How Fifth Gear Automotive built a lucrative profit center on shop-to-shop referrals.

About four years ago, John Miller bought 12 dozen bagels and began taking them to auto shops, tire shops, and used car lots around him.  

Miller, director of business development for Fifth Gear Automotive, delivered an innovative pitch with those treats: If you ever have a job you can’t handle, please refer that customer to us rather than to a dealership.  

Today, referrals account for 40% of total revenue for Fifth Gear, a Texas-based, family-owned and operated company with five locations in the Dallas-Fort Worth area. The program helped the business weather the COVID-19 pandemic and has fueled the addition of three new shops in the past two years.  

Fifth Gear’s three-member Outside Business Development Team has built a portfolio of about 1,400 shops that know they can pass along the company’s business cards if a job seems too big or complicated.  

“I understand it sounds bizarre,” says Ceasar Cordon, who heads the Outside Business Development Team. “I get asked often, ‘Why would I send you cars? You’re my competitor.’ But we’re really not. We’re not there to poach anything from anyone. We want to take unwanted work off their plates and help the entire network of independent local auto shops succeed.”  

Cordon and his fellow team members, Connie Clover, and Scott Luce, visit about 900 to 1,200 shops in any given month—basically, anything that has a lift on site. Between them, they rack up 5,000 to 7,000 miles and run through an average of 4,000 business cards monthly.  

Established in 2004, Fifth Gear began in a humble three-car garage at the side of an old Texaco station. The full-service company accepts all makes and models of vehicles, with an emphasis on European cars and heavy repairs.  

“Many cars that come to us are very broken,” Cordon notes. “If we can’t fix them, they’re likely going to the junkyard. That’s why we can tell another shop that focuses more on maintenance or lighter repairs: ‘Send your headaches to us, and then we can give that vehicle or that customer right back to you for jobs you can or want to do.”  

Referral programs, then, can also support other shops’ strengths: a tire shop meant to handle small, rapid jobs that doesn’t want to tie up a rack for hours or days, for instance, or a used car dealer that needs help with certain models or mechanical issues as they prepare cars for sale.  

Here are more of Cordon’s tips on creating an effective referral program:  

Just do it. The only way to start is to simply get on the road. Make as many visits as possible to other area shops, even if it might feel a bit uncomfortable initially.  

Be reassuring. Immediately explain that you’re not there to hurt anyone else’s business, only to offer an alternative to dealerships for unwanted jobs. If you construct the conversation right, you’ll likely be surprised at how many shops welcome having that option.  

Don’t bring money ... Referral programs should never involve kickbacks or bribery. They’re not about lining anyone’s pocket.  

… but do bring food. Bagels, cookies, muffins, or other snacks are great tools to open doors–and possibly minds–in the middle of a long workday. Businesses that provide regular referrals or send over a particularly lucrative job could get extra, perhaps even a lunch delivery.  

Leave when asked… If managers or available team members are not receptive to your idea, thank them for their time and head out. Don’t press.  

… but don’t give up on that site. Due to high turnover in the auto industry, a shop’s leadership or staff might look very different in six months to a year. Go back and see if interest has changed, too. Fifth Gear, for one, has a four- to five-week cycle between most visits.  

Emphasize brand awareness. Drive cars with a company logo and leave business cards wherever you can. Become a walking, talking billboard.  

Don’t totally overlook dealerships. Used car departments often buy cars at auction, sight unseen, and might not have the time, knowledge, or correct tools for repairs. Instead, they might outsource work without an eventual buyer ever knowing it had left the lot.   

Be a good partner. Be available to help other businesses at times, whether that’s lending tools, giving advice, or directing customers to them for jobs in their specialty areas.  

Meet with anyone who will talk to you. You don’t necessarily have to score a sit-down with a shop owner or manager. Just getting your name out there with technicians and other employees is valuable. 

Join local business groups. Fifth Gear is a member of 13 different Chambers of Commerce and sends representatives to meetings, ribbon cuttings, and other events. Aim to become ingrained, recognized, and trusted in your community.  

Push your boundaries. Last year, Clover began crossing over the Texas state line to visit shops in Oklahoma, about an hour south of Fifth Gear’s main location. Within a week, cars were coming back over the border as referrals.  

Always look at the big picture. Good referral programs can benefit the entire automotive industry, Cordon believes–one community at a time.   

“There are more than enough cars and trucks out there for everyone,” he says. “We should work together to get rid of negative connotations that people unfortunately have of our industry. We can help make each other better.”  

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