Shop of the Month

A & J Collision
Jody Gatchell, Owner
Conway, AR

After I graduated from high school I went into the military and was stationed in Germany. I got out in the early 90's and didn't know what I wanted to do. There wasn't a lot of need for what I learned in the Army stateside! I always liked messing with cars so I decided to go to vo-tech school on the government. I went for collision repair.

When I was done with school I moved to Conway and got a job working at a small shop. After about a year the owner had enough and turned the business over to me and the other tech in the shop. I started a partnership and bought his equipment for $500.

The first seven years I worked on cars and did most of the painting and doing estimates and handling the books. My partner didn't want to deal with the business side of things so he stayed in the back doing the metal and body work. We did it alone for the first 2 years. As we grew we started to add on employees the confusions started to mount.

By 2001 I had bought out my partner and had 3 employees and yet I was still doing everything—spending 12-16 hours a day in the shop. As the business grew the profits shrunk—we were doing a lot more volume but there was no bottom line. I was lucky to pull $300 a week out of the place and the employees were getting a third of the sales. I had a retirement home for techs!

I was so discouraged I considered taking a job as a manager at a dealership; they offered me a good deal and wanted me to come. But I didn't want to work for anyone else after being in the military, had enough of that, but I knew I had to do something. At the time I belonged to a 20 group and they were telling me I would be lucky to get 6 points on the bottom line. I didn't like that or agree with that. Debt was compounding. My vendors were driving me crazy with calls and visits. I took my AMEX and paid them all off. That allowed me to breathe for a month and now I only had one call a month and I could hide from it. But that was just a band-aid, not a fix. My debt finally was over 6 figures and I knew I couldn't pay it. Our gross sales at this point were $821,000 but it didn't matter what volume I had it just kept getting worse.

I went to a PPG training class in Pittsburgh and met a guy at the training. He pointed to another guy there and told me he was the most profitable shop in the room. He told me he had hooked up with a management company and they really helped him. I didn't want to talk to him at the time; you know how it is when you're suffering sometimes you don't want to hear how good someone else is doing. I guess it was a pride point. When I got home I had received a flyer from Management Success! to go to one of their training seminars in Osage Beach.

I was at my wits end so decided to go. The seminar was very good but it seemed geared toward general repair guys and I couldn't see how it could really help me outside of a couple of things I heard. My consultant at the seminar gave me a phone number and told me to call this guy out of Pittsburgh. I didn't make the connection at first but he turned out to be the same guy I saw at the PPG training.

We talked for a while and he showed me how the Management Success! program works for a body shop—“just follow the steps and do what your consultant tells you to do.” That turned out to be the best business advice I had ever gotten. I found out my shop is not that different—business is business. So I signed up.

While on the program my consultant was so important. I had an employee that I thought I couldn't live without, and he turned out to be the one causing so many of the employee issues I was struggling with. I wouldn't have seen them without my consultant. Once that was handled the production lines of the shop started to smooth out and I started to make money! I was grossing $820,000 a year with seven techs and now I'm doing over 1.2 million a year with six techs. That's pretty easy math.

Learning to manage by stats was the most valuable thing I've learned in business. I can talk to other body shops now, ask a couple of questions and know whether or not they're making any money. I've help some other collision shops get on the program and when we get together we talk about business, or percentages, marketing and ways of keeping the techs motivated and the shop moving. We don't talk about the latest techniques of painting, it's not our job. I'm working on the business, not in it, and I don't react any more I'm proactive. Statistic management allows you to operate this way.

I bought a piece of property for $280,000 and was able to pay the down payment in cash. I can pay my taxes on time now without any worries, my debt is paid off and I've got money in reserves. I am now making plans for a new building. Now when we need equipment we can pay for it, no more debt! My stress level is down which makes me very happy. I'm achieving my goals. I work hard but I love it. Life is good!

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