News: CIF Announces Support for Repairers Impacted by Hurricane Ian
Part four of a five-part series.
sell their businesses? Where do they go? What are they doing now? Perhaps more importantly, what leads these folks to put their shops on the market and are they happy now? Hello. I’m Barney Slifer, your host. Welcome to the fourth part in our five-part series of “Bondo Tales.” We’re now entering the last leg of our journey. Our search takes us to Champaign, Ill. – a pleasant Midwestern city of approximately 63,000 citizens. Let’s sit down and have a talk with two of Champaign’s residents, both of whom shared a prominent place within the local collision-repair community. Tom Sellers (coming in part five of our series) certainly fit my story criteria, for after a long tenure as a body shop owner, he sold and moved on to other business ventures. Paul Tatman also handily fits what I was looking for, despite the fact that today, he’s found himself back in the body shop business! Not only were Sellers and Tatman local competitors, they also happen to be very good friends. Given today’s increasing levels of negative polarization between body shop owners, I find this aspect to be most productive from my own charmed point of view.Slifer: You’ve cut yourself a very wide and very successful business niche for yourself, two niches for that matter! But such successes aren’t instantaneous, nor in most cases are they very easy. Please tell us of your early beginnings.
Tatman: “I got into the business while in high school. As I started my senior year, I had ample credits to graduate. But at that time, the law said you must have completed four years of high school. Faced with a history class, a P.E. class and five study halls, soon I was suffering attention disorder symptoms and was spending too much time in the dean’s office. He suggested I look at a ‘Diversified Occupation Class.’ This was for kids who had ample credits to graduate, weren’t going to college and were willing to learn a trade. You couldn’t just sack groceries or scoop poop; you had to learn a meaningful trade. The only job they had open was in a body shop, so I took it out of boredom to find an way to get out of those five study halls.”
Slifer: Yeah, I found myself getting bored with high school academics, which is why I found myself in Auto Shop and liking it. What was working at that first body shop like?
Tatman: “It was a typical body shop and the typical shop owner at that time. I was primarily used as a flunky – washing cars, running parts, sanding cars, sweeping the shop, sanding more cars and all the things that no one else wanted to do. The shop owner was into cars, boats, booze and chasing skirts, so a good part of the time, there was no one to watch the office or answer the phone. This soon became another of my duties, and within six months, I was writing estimates, booking jobs, ordering parts and sanding more cars.
“One of the bodymen took a liking to me and guided me through the proper repair process. He was a very patient man who gave up a lot of his time to teach me the business. After graduation, I continued working at the shop with the promise that I’d be soon making more money. At that time, my pay was $1 per hour, and it was a 47-hour week.
“Like a lot of youngsters at that time (1958), I, against all advice, got married and soon had a little one on the way. This was stretching my $47 dollar a week income. I approached my boss on one of the days he happened to be in the office about a raise. He stated that he felt that I was just starting to earn my keep and that in a few months, he’d consider a raise. I left that day and went into construction.”
Slifer: I think a lot of us started out that way. Heck, I got married when I was in the middle of a long spell between steady jobs! Then what happened?
Tatman: “Entering construction in the middle of November 1959 in Illinois was not smart. I worked two months and was laid off for the winter. I found when applying for unemployment benefits that my ‘body shop’ employer never felt the need to pay any government benefits. Therefore, I wasn’t eligible for anything.
“Somewhat frantic with a child on the way and no money coming in, I decided I could open a body shop. I took every penny I had saved plus a few dollars from my in-laws and rented a building. I soon realized that I knew enough to be dangerous, but my customers were willing to pay me to learn as I went. I made a living and eventually made most of my customers happy. In the spring, I went back to construction since it was really my first love. I kept the shop and worked nights and weekends, doing very few wrecks and mostly the rod and custom stuff that was fun but not profitable.”
Slifer: So that’s when you took the plunge and began your own body shop business career. Anything else you had going on during this period of your life?
Tatman: “Another dream I had was to be a police officer, so five years later I became one. This allowed me to work the shop in the daytime and do my cop thing during the night. Business had been growing, so I added two to three employees. My work day started at 6 a.m. and finished at 2 a.m., establishing a sleep habit of four hours that still carries through today.”Slifer: Four hours of sleep? Man, it’s tough for me to get anything done on less than eight hours a night.
Tatman: “But all those hours weren’t good for a marriage, so after 13 years and two children, I was divorced and starting back with nothing. I continued the hours and slept in the garage in the back seats of cars for several months until I was financially able to rent a sleeping room. It was especially nice when we had an ambulance or hearse to work on because the beds were more comfortable.
“After remarrying in 1972 and soon adopting three kids, I decided I had to do something different. The hours were taking a toll on the old bod and I wasn’t being fair to the family. I had an offer to sell the shop and some surrounding real estate for a real nice profit – and a profit properly invested would allow me to live off my police salary. So I approached the city about a leave of absence to sell the business and assist my employees in gaining other employment. Even though I’d been constantly encouraged to start moving up the ranks in the police department and become a command officer, I was refused the leave of absence I’d requested. The day they refused, I immediately gave my resignation and decided I had to make it in the body shop. August 1, 1972, I quit my job. With five kids, a wife, a mortgage and scared of failure, I went at it full time.”
Slifer: Sometimes the best of later successes were borne on early desperations.
Tatman: “The first full year we grossed $95,000 and managed to pay all the employees, bills and build a little reserve in the bank. I’d lived that first year on the $5,000 the city had given me from my retirement account. After the first year, I was able to start taking a small paycheck.
“The second year was better and business was growing. We added a couple more employees and made plans to build an addition. In 1974, the addition was done and our space doubled. In 1976 through 1987, we saw more business growth, more physical additions to our building, more employees. Business was going great, and we topped the $2 million a year mark. We added a 24-hour wrecker service and more employees to work that division. And business was still growing.
“By 1989, we’d maxed out the current facility, and it was no longer feasible to add more additions. We’d created a maze of buildings that somehow managed to be profitable and still looked better than the average shop.”
Slifer: You were definitely on a roll at this time, but there must have been something else that propelled you to even greater heights of success, a new form of enlightenment perhaps?
Tatman: “I attended a Dawn Enterprise seminar in Chicago that year and took in so much knowledge about management by the numbers that I was about to explode. I immediately put this knowledge to use and gathered all the facts I could find about this industry nationwide and about my local market.
“The numbers showed that to continue growing, I needed to locate another facility. So in the fall of ’89, we started construction on our first new shop that was designed and built to be a body shop. I attended another seminar on building design and learned the value of designing from the inside out. That is, to do the floor plan first to make sure everything flowed smoothly, along with ensuring adequate room. I adopted the policy that we don’t get paid to move cars around, only to repair them. Every time a vehicle was to be moved, it had to be heading for the back door.
“In the spring of 1990, we opened the first state-of-the-art facility in downstate Illinois – I think the second such facility in the state. It was an immediate success and within a year, we were planning our third facility 50 miles south. It, too, became a reality in 1992. And within a year, our fourth facility was open 15 miles north.
“During 1995, we opened our fifth facility, 23,000-square-feet, state-of-the-art with corporate offices upstairs and all the extras. By the end of 1996-’97 fiscal years, we’d come from a $2 million operation in 1990 to over $9 million. But the rapid growth needed a better foundation underneath if it was going to sustain itself and continue growing.”
Slifer: Nine million dollars sounds like something that would attract a well-funded consolidator. Is this when they began to flock around you and pitch purchase offers?
Tatman: “Coincidentally, we’d begun the process of building our management foundation about the time the consolidation thing started. I really didn’t think we’d be a target since we were in downstate Illinois, and the towns of any size were 50 miles apart. But I was wrong.
“Within a few months, I started receiving inquiries from consolidators. I turned down numerous offers the first part of the 1997 fiscal year and continued with plans to expand again. By early 1998, the offers got better, and CTA was coming on strong. I turned down the final offer in early spring.
“I spent a sleepless night thinking about what I had done. The next morning after talking to my wife, I decided I’d never have another opportunity to realize that much money from this business. I was 58 years old, not ready to retire, offered an amount of money that would make for a carefree retirement, along with the opportunity to stay on with the business as a consultant planning future growth and acquisitions. I could continue to do what I enjoyed without the headaches of holding it all together. So, after 37 years of being my own boss, I succumbed to the dollar and sold out. In just a few months, I realized that maybe I’d made a mistake.
“Rather than stay with the consolidator, I decided to leave and start another career. Little did I know that the consolidator was planning on eliminating me, too. Apparently the job position was a temporary enticement to convince me to sell. After some negotiating, I left with a two-year salary/benefit package.”
Slifer: What then?
Tatman: “I’d been a silent partner in a construction company for several years. This same company had constructed my shops and numerous other projects, so I moved my offices to this company and became more active. Over the past five years, we’ve become very successful in the construction business. This company grosses from $10 to $20 million in any given year. I’ve also had the opportunity to design and build several new body shops in that time frame. The construction business grows more every year. I’m not sure just where the cap is in this business.”
Slifer: It’s good to have an ace up your sleeve, another business endeavor to fall back upon. Any more to the story about CTA and of the well-publicized buyback deal?
Tatman: “In August of 2002, I was approached by CTA (Ford) with the opportunity to bid back the body shops I’d once owned. Ford had decided they needed to divest themselves of outside business ventures and were going back to doing what they do best: building cars.
“At first I wasn’t interested since I’d done that before and really had no desire to do it again. Yet after considerable soul searching and conferences with my attorney and accountant, I decided to make the offer to protect both my investments and employees. It appeared that if I didn’t buy back the shops I’d earlier sold, there was the potential of another buyer who was only interested in the larger shops. This would mean the loss of jobs for several long-time good employees, plus the closing of a couple of buildings that I held ownership of (for I did retain ownership of the real estate and had long-term leases on them).
“I think the deciding factor was the employees. These people had been with me for years, and I felt I owed it to them to make sure those shops stayed open. My employees have always been important to me since they’re what makes it happen.”
Slifer: How’d former shop owner Dan Hall get involved?
Tatman: “I contacted Dan Hall from Church Brothers. After that, the wheels were in motion to re-enter the business. The deal was made, and we’re back. Contrary to the body shop rumor mill, the shops were still profitable; CTA had done a fairly good job of maintaining customer satisfaction and profitability. They’d lost some of the market share in our area but were still a dominant force. They’d also installed some systems and procedures that are very good.
“During the past few months, my concentration has been on making the employees part of the business again, and getting them to take control of their actions and be accountable for what they do. We’re rapidly regaining the market share we lost, and for the most part, everyone is enjoying what we’re doing.”
Slifer: What’s next?
Tatman: “What is next? I don’t know. I really didn’t want to come back after doing it for 38 years. Sometimes I find myself really enjoying it and sometimes not. I’m rapidly approaching 63 years of age now, and I know nothing is forever.
“Running two entirely different operations of this size is taking its toll. Presently I feel that I no longer have a life of my own. At times I see a little light ahead, but it’s a far distance down the road. I try to look on the bright side – that if the weather is bad, the crash business is good and construction is down. If the weather is good, then the crash business is down and construction is up. I guess you could say that I can’t lose either way.”
Writer Barney M. Slifer is a practicing collision-repair technician of 30 years experience. He can be contacted at (219) 922-9886.