Multiple Shops, Multiplied Profits - BodyShop Business

Multiple Shops, Multiplied Profits

Name: Alamo
Body & Paint, Inc.

Location:
San Antonio, Texas

Owners:
Wayne Baker

Established:
1973

Square Footage:
80,500 (total of three locations)

Number of Employees:
152 (total of three locations)

Repair Volume:
1,150 cars per month (total of three locations)

Average Repair Ticket:
$1,300

They say everything’s bigger in Texas. Take
Alamo, for instance. (No, not the historic battle.)

Alamo Body & Paint, Inc. in San Antonio,
Texas, according to operations manager Mark Fuller, lives up to
the Texan adage: It’s big – three locations big.

Established in 1973, the business has grown
to a total of 80,500 square feet, 152 employees and moves about
1,150 cars per month (with average repair tickets of $1,300) through
its three locations.

Built specifically for housing corporate offices,
the third and newest location, which opened in April, is the smallest
of the three shops – measuring in at 22,500 square feet – and
is the only location with a second floor (which houses the offices).

Fuller says each facility’s work flows efficiently
and that the shops do "a pretty good job on dollars for the
production space." Although the new facility has the smallest
physical paint area probably of any shop in town comparable to
its size, a recent visitor was amazed at the amount of production
that goes through that shop’s paint department (which currently
has five preppers and room for 10 cars).

What happened to the Texas adage, "Everything’s
bigger in Texas"? Why not have a larger paint department?
"Years of experience tell me I don’t need that much physical
space," Fuller says, "because, traditionally, … if
we prime a car, we park it back outside. … One person can’t
work on more than one car at a time, so why should I spend the
money for building space?"

The Texas climate really helps with space
conservation, too. "Ten months out of the year, technicians
work outside and/or with the doors open," says Fuller. "They
can wash, dry, mask and do body work in the parking lot."
Reassembling cars outside of stalls means not tying up productive
stall space, and this regional advantage allows the shops to produce
without needing the actual building space in which to do it.

This wise use of space, however, doesn’t mean
Alamo is done expanding. Fuller says he’s looking to grow the
business again with another location in San Antonio and one in
Corpus Christi, Texas. The goal is to have five shops in the next
two years.

Benefits of Multiple Locations

What are the benefits of having three locations?
According to Fuller, benefits include:

  • Corporate offices. Having all the information at one
    location makes it easier for him to know what’s going on – without
    having to physically be at another location or having to modem
    into all of the facilities.

  • The ability to shuffle. Alamo can shuffle work when
    one location is busy and another is not, which makes it possible
    for Alamo to handle a lot of business and keep the shops running
    the numbers they should.
  • Employee retention and steadier workload. The business’
    size and the amount of work Alamo has year round helps to draw
    employees and eliminate seasonal slowdowns. "We don’t have
    the normal little seasonal humps and bumps that most businesses
    have," says Fuller, adding that publicity (in part from DRPs)
    is another reason business isn’t affected by the season.

  • Employee benefits. Since growing to its current size,
    Alamo has a big enough group that good health and dental care
    can be offered at a reasonable price to employees – which, again,
    helps Alamo to keep employees.

  • Hindsight. "If you make a mistake at one location,
    you don’t make that mistake at the next one," says Fuller.
    One manager, with about a year’s experience working for Alamo,
    gets the benefit of Fuller’s 11 years of experience – and mistakes.

"When I opened the other location, it probably did $1 million.
This store did $4 million the first year," he says. "Experience
can help you grow twice as fast, if not more. That’s a major plus
with multiple locations."

  • The ability to cater more to customers. If a customer
    lives on one side of town but works on another, the car can be
    worked on at whichever location would be more convenient for the
    customer – a real plus for customer service.

"Size has so many more benefits than it does problems,"
Fuller says. "One of the benefits you get with our size is
you can do the impossible in the shortest amount of time with
the manpower and the equipment." For example, Alamo has the
ability to stop production to fix a car with $5,000 worth of damage
for someone who lives out of town and needs his car in three days.

Problems with Multiples

The following are challenges that Fuller says go with managing
multiple locations:

  • Workload overload. Being able to handle the work, even
    with Alamo’s size, is the biggest problem. "[Work] is out
    there," he says, "and we can only handle so much."

  • Consolidation, assimilation and communication. Consolidating
    the businesses – trying to funnel them into one – and communication
    between the three locations (such as relating problems back and
    forth from store to store) pose multiple challenges.

  • Employees. Fuller explains that employees may get disgruntled
    at one location and think they can just relocate to another location.
    "They feel like they have somewhere to go [while staying]
    within the organization," he says. "This does become
    a problem at times."

Alamo’s Soldiers

To beat the rush of battered vehicles entering Alamo’s front lines
on a daily basis, 34 body technicians and eight painters have
been enlisted. "They’re the best there is," says Fuller
about his outnumbered painters.

At the new store, there are two painters to nine body men, but
the painters manage to keep up. They have at their disposal two
paint booths and some helpers. "They pull the trigger all
day long," he says. "All they do is make paint and put
it on cars."

Heavy industry involvement helps Alamo’s soldiers be all that
they can be. All three shops are I-CAR Gold; employees include
an I-CAR glass instructor and an I-CAR detail instructor; one
of Alamo’s general managers is on the I-CAR advisory board; and
Alamo’s owner, Wayne Baker, is on the advisory board of Texas
State Technical College in Waco, Texas. Also, some employees are
ASE certified, and quite of few are MACS certified to perform
air-conditioning work, including A/C conversions and refrigerant
recycling/reclaiming.

Besides the more traditional employees – such as painters, preppers,
etc. – Alamo also employs an in-house health and safety person
who keeps up with all mandatory employee safety programs and hazardous-waste
communication programs (he monitors Alamo’s waste, too). Fuller
says he’s also signed Alamo up with the South Texas Safety Council
and that he’s heavily involved with an OSHA exemption program
and with the Texas Natural Resources Conservation Commission,
which helps shops find ways to reduce their waste.

An outside firm helps with OSHA and EPA guidelines. "We’re
real, real big from the top down on health and safety," says
Fuller. "That’s just an ever-increasing problem in our business."

Equipped for Winning

Alamo’s operations depend on its equipment. The larger facilities
each have two Spraybake downdraft paint booths, two Blowtherm
downdrafts, two Spraybake prep stations, and two Chief and two
Car-O-Liner frame machines. The new, smaller location also has
two Spraybake downdraft booths, one Spraybake cut-in station,
one Spraybake prep station and two frame machines – one Car-O-Liner
and one Chief. The shops also utilize three Benwil lifts and three
Rotary lifts, and have used ICI paint for about a year and a half.

Any future equipment purchases would be primarily for the new
location. "It will need another paint booth before it needs
anything, and it will be a Spraybake," says Fuller, who explains
that Spraybake was instrumental in getting Alamo to install IRT
rail systems underneath the new shop’s prep station. Fuller says
it was "a chore" to get Baker to try, but Fuller’s glad
it was done because the production time is phenomenal and the
cure time is exceptional. Spraybake also got Alamo hooked up with
a Eurovac vacuum system in two of the locations.

As for computerization, Fuller says it’s so important that they
couldn’t function without it. "There are not enough people
left here who know how to function without a computer," he
says. "We’re that dependent on it." So dependent, in
fact, that Alamo employees a full-time "computer nut,"
whose basic function is to maintain the shop’s software and hardware
and to do anything "new" Alamo needs done.

Baker, who remains very active in his business, is also extremely
involved with the computerization. Since opening the third location,
he’s helped with the consolidation of all Alamo’s payables/receivables.
(All day-to-day functions, as far as locations go, are now handled
through the central corporate office.) This has been a major undertaking,
according to Fuller, but has proven to be very cost beneficial.

Alamo’s computerized estimating systems include CCC, ADP with
EZFocus and PhotoLink. Although Alamo used ARMS for the past 15
to 20 years, it recently began using a new management system from
Combined Computer Technologies (CCT). According to Fuller, Baker
had CCT rewrite the program, which now does anything Alamo wants
or needs it to do, such as job costing, management reports (gross
profit and financial statements), and thank-you and follow-up
letters. According to Fuller, it covers every aspect of the business.

Big Populations, Bad Drivers, Big Accounts

Alamo is always hopping. And bad drivers, Fuller says – only half
kidding – are the reason. "It could rain for five minutes
and there are 300 wrecks in San Antonio, if not more," he
says.

With such a highly concentrated population in the Texas town,
the San Antonio freeways haven’t yet grown to handle the volume
of cars. For its size, Fuller says, San Antonio probably has three
times as many cars on the road at any given time than most major
cities. "It’s a zoo out there," he says.

Tourism, which, of course, adds to the population problem, is
the second largest industry in the city; military is the first.
As a matter of fact, between the Army and Air Force, there are
five bases in San Antonio.

The shop’s many military-personnel customers, however, don’t make
up the bulk of the business; DRPs – through many major insurance
companies – do. As a matter of fact, DRPs make up about 80 percent
of Alamo’s business.

To illustrate how busy Alamo is, Fuller tells a friendly story
about competition. One Alamo location, he explains, has been operating
for 11 years. Alamo’s largest independent competitor recently
built a 30,000-square-foot facility less than three miles from
that Alamo location. The competition, Fuller reports, currently
has more business than it can handle – something that hasn’t affected
Alamo’s traffic at all.

"I was beating on this guy’s door every week wanting to know
when he was going to get the doors open to give me some relief,"
says Fuller, not even half kidding.

Writer Eileen Benedict is associate editor of BodyShop Business.

Hey! Over here!

Alamo spent a lot of money on advertising when the new facility
opened. According to Fuller, about 2 percent of sales is budgeted
for advertising, and the way business is now, they’ll probably
spend $1,500 to $2,000 per month on radio advertising – "and
that’s strictly name awareness."

Alamo has an ad in the Yellow Pages, but Fuller hopes this is
the last year because he doesn’t think it’s cost effective. "We’re
spending a fortune," he says, adding that he’s convinced
Baker to downsize the ad.

Other forms of advertising include billboards and sponsor programs
with a local IHL hockey team and a local minor-league baseball
team. Alamo can also be seen on billboards in little-league parks
and in high school football programs.

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