Maintaining Customer Service Under New Ownership
The maintenance light in my car came on about two weeks ago. As usual, it took me a while to find time to get to my mechanic to get my oil changed, so I ignored it for a bit. But I happened to be driving down Hillsborough Avenue in Tampa last Wednesday, and was very close to his shop, so I decided to drop in and see if he could squeeze me into his schedule.
I’ve been taking my cars to the same mechanic since 1985. At first, Jim worked for a small shop that had been highly recommended. So after a few years, when the two owners decided to close their shop, Jim chose to start his small business. Jim was the only one that worked on my car, so it was a no-brainer for me. About 15 years ago, he brought his two sons into the business. Jerry worked as a full-time mechanic, and Charlie, also a mechanic, ran the office. In the last three years, Charlie’s son PJ also started working on cars. Jim has since retired, leaving Charlie and Jerry in charge of the shop. These guys are not the least expensive mechanics in town, but they are the most trustworthy. About 8 years ago, the trunk latch on my car broke. I happened to be driving by the dealer and took it in for an estimate. They told me it was going to be $600 to fix the latch. I figured if I was going to spend $600, I’d take it to my mechanic and let him make the money. Jerry took a pair of pliers and climbed into the car’s trunk and in 10 minutes fixed the latch. He told me that if I treated it gingerly, it might last a while. I asked him how much I owed him and he laughed and said it only took him 10 minutes to fix. I argued that he saved me $600, so I should pay him something. He refused to charge me, knowing, I guess, that my loyalty to them would pay off. By the way, I sold that car a couple of months ago and the latch never did break again.
So imagine my surprise when I roll into the shop to get my oil changed and Jerry tells me that they sold the shop two months ago to a new owner! Both Jerry and PJ are still working there. Jerry introduced me to Bill, the new owner. While Jerry is telling me the story, all I can think of is “do I want to leave my car here today?” I have to admit, I was dismayed at the prospect. After almost 30 years, I was faced with a decision about one of the important relationships in my life: my mechanic!
As an SBDC business consultant, I think a huge opportunity was missed here, by both the outgoing owners and the incoming owner. The original owners must have had dozens of similar long-term relationships with other customers. Why didn’t they send out an email or a letter to their clients letting them know of the changes that were happening? Instead, they waited until we brought our cars into the shop to tell us. Had I called to make an appointment over the phone, which is my usual protocol, I would have heard the news from the new owner instead of my trusted mechanic. If down the line, they decide to open another shop, then their old customers may hesitate to return to them. Additionally, they didn’t tell me they were thinking of selling. Our consultants at the SBDC could have done a free valuation of the business and given them the necessary information to determine the right price for their business.
The new owner, Bill, is also missing an opportunity. When he bought the shop, not only did he buy the land and the infrastructure, but most importantly, he bought a book of business….all of Charlie and Jerry’s customers! He should have communicated with all of their customers immediately, introduced himself, and outlined his expertise and his commitment. Charlie and Jerry’s customers need reassurance that Bill is also trustworthy and will deliver similar services at similar prices. If they don’t receive those assurances, what’s to stop them from finding another mechanic or going to the dealership?
Unfortunately, this is not an anomaly. My dentist did the same thing three years ago as did my mom’s primary physician most recently. Customer service extends beyond the life cycle of the current business owner. As the seller, once your non-compete has expired, you may not have the loyal following you thought you had. If you are planning on buying an existing business, communication with the existing customer base is part of the purchase. If you fail to address this, you may find that your financial investment is not worth as much as it was the day you closed on the deal. I’m going to wait 3,000 miles and see if I need to find another mechanic or not. I hope he calls.