Joined: 15 May 2007 Posts: 774 Location: Baton Rouge, LA
Posted: Fri Jun 29, 2007 7:56 pm Post subject: Where Does Such Thinking Come From?
Like most shop owners, I started out working as technician. Also like most, I was good at what I did but desired to do things “my own way,” hoping for a better future.
Starting out, money was at a premium and [my own] time was my least expensive asset. When it came to selecting a building, again price was the primary concern. Whether to rent or make mortgage payments, price was the deciding factor. The exact layout and even the location was less important than whether the payments could be met.
This type thinking was a fact of life. Without it I would not have lasted to reach a more mature and profitable stage. Unfortunately the same thinking greatly limited me as a more mature and profitable company.
For instance, the building chosen because the rent was affordable, was really a bottleneck to production. The location was also wrong to attract my target clients. Moving would be a large investment and large investments represent large risk.
The losses of production from inefficient layout were a recurring expense, day in and day out. The cost to attract people to an out of the way location was also an ever escalating cost. In contrast, the cost of a new building would be a one time investment, depreciable for tax purposes and normally appreciating in value over time.
From an uninvolved perspective the losses from staying in place are apparent. Being involved in the situation, the fear of the unknown loom far greater than the intangible benefits of moving. Add to this the tendency to make no choice when the choices are difficult and the result was failure to act.
Failure to act was also a choice and had ramifications. Yet my past experience made it difficult to act in another manner. The people from whom I sought advise also shared many of the same thought processes. For example other shop owners in the same situation, family members and friends. Their well-meaning advise was always to stay put and avoid risk.
While I realized caution was in order I also realized the nature of business is risk. Speaking with successful businesses owners, I came to realize, no business succeeds by risk avoidance. I believe most successful businesses get where they are by risk management.
Risk management is the science of examining as many factors as possible and making logical decisions based on odds. My problem was the type thinking I developed in the startup phase greatly limited my view of a bigger picture. Fear made the day to day losses seem more acceptable than the risk of change.
Overcoming my fear, was greatly eased by speaking with people who had already done what I wished to do. I found, making a practice of speaking with successful people and seeking their advise has greatly enhanced my efforts.
For me, risk management has been a learned behavior, the more I practice it, the more comfortable I am with it. In each case I have been far better off for the effort. The losses have been very minor and the gains have been great. Each person has a tolerance of risk with which they are comfortable. Only a fool takes unnecessary risk, but I have found taking no risk could be equally foolish if the aim is to advance.
Joined: 20 May 2007 Posts: 20 Location: South Australia
Posted: Sat Jul 14, 2007 3:44 am Post subject:
Louis,
Every successful workshop owner I have met so far has started very small with little cash. They have also moved to larger and more prominant locations over the years.
I am second generation in a business my father started. I bought him out four years ago and have never experienced having to move my business. My father however did move once and I now have the benefit of a great location.
Even the thought of movng my business now sends my mind to a panic. It would be a very worrying time for any shop owner going through it. But as I said, all the successful shops I know have been through it.
_________________ David Vidler
Owner/ Manager - Seaside Automotive
South Australia
Joined: 15 May 2007 Posts: 774 Location: Baton Rouge, LA
Posted: Sat Jul 14, 2007 9:47 pm Post subject:
Hi David,
Seaside wrote:
Louis,
Every successful workshop owner I have met so far has started very small with little cash. They have also moved to larger and more prominant locations over the years.
I am second generation in a business my father started. I bought him out four years ago and have never experienced having to move my business. My father however did move once and I now have the benefit of a great location.
Even the thought of movng my business now sends my mind to a panic. It would be a very worrying time for any shop owner going through it. But as I said, all the successful shops I know have been through it.
My present location is my forth since 1974 and each move was a challenge. I think the final move went far more smoothly and with less disruption than any of the others. Maybe I'm getting better at it.
Only time will tell if there will be another move. Fortunatey I purchased enough property to double the size of my current shop, in its present location. Thanks Dave, I appreciate your reply.
Joined: 19 May 2007 Posts: 206 Location: Camp Verde, AZ
Posted: Mon Jul 16, 2007 10:37 am Post subject:
louis wrote:
My present location is my forth since 1974 and each move was a challenge. I think the final move went far more smoothly and with less disruption than any of the others. Maybe I'm getting better at it. :lol:
Only time will tell if there will be another move. Fortunatey I purchased enough property to double the size of my current shop, in its present location. Thanks Dave, I appreciate your reply.
For those of us that have never had to move to another location, please enlighten us as to some of the challenges and how you overcame them. This is my first shop and I can foresee us having to move or open a second location, in a few years.
Also, tell us what happened to your former shops after you sold them. It was amayzing to see first-hand how people can take a pristine, thriving location and turn it into junk, probably with junk earnings.
Joined: 15 May 2007 Posts: 774 Location: Baton Rouge, LA
Posted: Mon Jul 16, 2007 8:29 pm Post subject:
Hi Dave,
Dave wrote:
louis wrote:
My present location is my forth since 1974 and each move was a challenge. I think the final move went far more smoothly and with less disruption than any of the others. Maybe I'm getting better at it.
Only time will tell if there will be another move. Fortunatey I purchased enough property to double the size of my current shop, in its present location. Thanks Dave, I appreciate your reply.
For those of us that have never had to move to another location, please enlighten us as to some of the challenges and how you overcame them. This is my first shop and I can foresee us having to move or open a second location, in a few years.
Thanks,
Any move is stressful, and a business move is perhaps more so. First there is the physical effort of literally moving the mountain. For us this included lifts, frame machines (very heavy,) alignment machines, furniture, tool boxes, inventory, etc.
Perhaps more stressful is “moving” the client base. There is always worry, will present clients follow? Moving the shop I solved by renting several large trucks, with lift gates. Two roll-back wreckers also came in very handy. We allowed one week for the move, closed the old shop on Friday, and opened the new one on Monday a week later.
The actual move took two days, setting up the new shop two additional. The extra two days were for “dress rehearsal” and fine tuning. On the seventh day we rested.
Moving the clients, took a good deal more preparation. First I tried to do a lot of research, before the new site was considered. Things important to me were:
Who is the potential client base?
Where do they live?
Where do they work?
Is the new location visible?
Is there easy access?
Is there a place to test drive?
Is there room for expansion, etc?
Once the location was found, and about a year prior to the move, I started promoting the new location. A large sign on the site announced, Coming Soon The New Home Of AGCO Automotive. A similar sign at the old site also gave the new address and announced the move.
All of our invoices and mail outs had the heading AGCO Automotive, soon to be at 11410 Coursey Boulevard printed on them. We began talking the new location up, with anyone that would listen. An official ground breaking ceremony, brought the local press.
Each week on my radio program I would highlight a segment on the new building. I had the contractor come on as a guess and talk about the special things we were doing. As the time grew closer, we would answer the phone, “Thanks for calling AGCO Automotive, soon to be on Coursey Boulevard.”
Two weeks before the move every client received a mail out with a map. The move was scheduled to fall in early October, one of our less busy periods. By the time we moved, everything went off without a hitch.
After the mover I paid the phone company to have our old numbers “ring over” to the new location for one year. After the first year, I had a recording that would give the new number and address for an additional year.
All in all each move was better than the last and after each I was far better off for the move. Also in each move there were clients that were loss, but far more that were gained. Continually changing locations could be bad for a business. I think occasional moves, to better facilities, may give clients the impression the business is successful and growing. I have noticed over the years, people tend to like doing business with successful businesses. It’s exciting to be part of something that is growing?
Thanks for the question Dave, I hope this helps and wish you luck in your future endeavors.
Joined: 15 May 2007 Posts: 774 Location: Baton Rouge, LA
Posted: Mon Jul 16, 2007 8:33 pm Post subject:
Hi Bud,
Bud wrote:
Also, tell us what happened to your former shops after you sold them. It was amayzing to see first-hand how people can take a pristine, thriving location and turn it into junk, probably with junk earnings.
So you remember that little tour of Baton Rouge last time you guys were down? I hope both of you can make it again, once it cools off a bit. We have really made some changes to the house.
Joined: 19 May 2007 Posts: 206 Location: Camp Verde, AZ
Posted: Mon Jul 16, 2007 10:29 pm Post subject:
louis wrote:
All in all each move was better than the last and after each I was far better off for the move. Also in each move there were clients that were loss, but far more that were gained. Continually changing locations could be bad for a business. I think occasional moves, to better facilities, may give clients the impression the business is successful and growing. I have noticed over the years, people tend to like doing business with successful businesses. It’s exciting to be part of something that is growing?
Wow, sounds like you had things planned out very well. You had things on your list that I would not have even thought of.
I strongly agree that people like to do business with successful businesses. Along with that, I think that clients want a business to be successful.
Joined: 15 May 2007 Posts: 774 Location: Baton Rouge, LA
Posted: Sat Oct 13, 2007 8:04 am Post subject:
Dave wrote:
I strongly agree that people like to do business with successful businesses. Along with that, I think that clients want a business to be successful.
Dave
Hi Dave,
Sorry, I missed your reply earlier. That is a great point! I think people like dealing with others who are outwardly successful or are at least trying to be.
There is also the "under dog" effect. A lot of folks naturally pull for the "under dog." For instance a guy who's struggling but still trying. Sort of like the little guy competing with the big-box stores. Many do quite well.
I think a key is to keep positive and show it outwardly. Constantly talking about how bad things are drives folks off, quicker than anything I know. Revising the business plan, sweeping out the cobwebs, painting the place and putting a smile on their face might be more effective?
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