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Service Executive Issue #11-18 (Full)

Monro Expands Senior Leadership Team For ‘Monro.Forward’ Project

Monro Inc. has named Jerry Alessia as senior vice president of tire merchandising and Avi Dasgupta as vice president of information technology (IT) infrastructure and data architecture. Both will support the Monro.Forward initiative, which focuses on tire strategy, technology and brand standards.

Alessia will oversee all elements of Monro’s tire merchandising operation as the company works to optimize its tire assortment. Alessia joins Monro with 27 years of industry experience at large, national retailers. This includes 12 years with Goodyear, where he served in a number of roles focusing on retail store management, best practices, category management and strategic pricing administration. Alessia reports to Monro president and CEO Brett Ponton.

Dasgupta will oversee the expansion of Monro’s IT infrastructure and data capabilities, supporting a number of Monro.Forward initiatives that will be rolled out in the coming months. He joins Monro with over 25 years of IT experience at companies including Constellation Brands, where he was vice president of application delivery, and Xerox Corp., where he was a director of project management. Dasgupta reports to Brian D’Ambrosia, Monro’s senior vice president of finance and CFO.

Monro kicked off its Monro.Forward initiative this year with an objective to update tire offerings aligned to local store demographics, improve customer communication, and develop a more robust omni-channel presence. Monro, for example, recently announced a “ship to store” collaboration with Amazon to provide tire installation services at its retail tire and automotive service centers.

The initiative also includes plans to drive consistency in store appearance and store layout across markets and store formats. The move is important for a company like Monro, which has grown through decades of acquisition, resulting in a store base with a wide range of sizes and configurations, according to management.

 

 

Mighty Lands 9th Jiffy Lube Group

Griffin Enterprises LC is now a Mighty Auto Parts franchisee and the exclusive distributor of Mighty automotive products throughout the Colorado Front Range. Griffin Enterprises operates 55 Jiffy Lube locations in Colorado, Nevada and Utah, as well as Golden Glow (an auto body collision center) and Cherry (a web-based vehicle inspection app developer).

The new Mighty franchise — which does business as Mighty of the Rockies — allows Griffin Enterprises to centrally distribute Mighty’s preventive maintenance products to its Jiffy Lube shops, as well as have access to Mighty’s inventory management programs, support and training. In addition, the Mighty division allows Griffin Enterprises to pursue business-to-business product sales to non-affiliated customers in its exclusive territory.

Griffin Enterprises is the ninth prominent Jiffy Lube group to add a Mighty franchise, according to Norcross, GA-based Mighty Distributing System of America.

 

Quick Lubes Continue To Be Key Growth Driver For Valvoline

For the fiscal third quarter ended June 30, 2018, Lexington, KY-based Valvoline Inc. came through with $577 million in sales — an increase of $43 million, or 8.1 percent, compared to a year ago. Key drivers of the improvement in sales were increased product pricing, favorable mix, acquisitions of quick-lube shops and overall increased volumes. Lubricant gallons sold were flatas volume increases in the Quick Lubes segment were offset by decreases in the Core North America and International segments.

Gross profit was up 2 percent; however, gross margin declined from 36.9 percent to 34.8 percent on a year-over-year basis. According to management, the decrease came primarily from higher raw material costs — some of which were passed through via pricing yet had a dilutive effect to Valvoline’s margin rate.

The company’s net income increased 14.3 percent to $64 million.

QUICK LUBES … Sales from Valvoline’s Quick Lubes segment increased by $28 million, or 20.1 percent, to $167 million in the fiscal third quarter. According to management, volume growth increased segment sales by $12 million, as lubricant gallons and transactions were up. Price and mix improvements increased average ticket and improved sales by $7 million, and acquisitions increased sales by $9 million.

Valvoline Instant Oil Change (VIOC) came through with 7.9-percent system-wide same-store sales growth, topping 7.9-percent growth from a year ago. Same-store sales growth for company-owned VIOC locations was 8.7 percent (on top of +6.9 percent a year ago), while same-store sales growth for franchisee shops was 7.4 percent (on top of +8.3 percent a year ago).

The increase in same-store sales was the result of both increased transactions and average ticket. According to Valvoline, investments made in customer acquisition and retention programs drove higher transactions, and previously implemented pricing actions and premium mix led to higher average ticket.

Quick Lubes operating income increased 11.8 percent to $38 million for the quarter.

EXPECTATIONS … “For the fiscal fourth quarter, we anticipate continued strong same-store sales growth from VIOC,” CEO Sam Mitchell said. “We’re also excited to bring the Great Canadian Oil Change stores into our system and, at the same time, expect to add nearly 30 new stores across the VIOC network.”

He added that management expects a “solid” quarter from its International segment and modest improvement from the Core North America segment.

For the full fiscal year, VIOC same-store sales are expected to come in between +7 percent and +7.5 percent — an increase from management’s previous guidance of +6.5 percent to +7.5 percent.

EXPANSION … Over the nine months ended June 30, 2018, the company acquired 63 service centers for a total of $71 million. This includes 60 previous franchisee shops, of which 56 were acquired from Henley Bluewater LLC for $60 million back in October.

Over the first three quarters of its fiscal year, Valvoline also sold two service centers to a franchisee for roughly $5 million.

As of June 30, 2018, Valvoline had more than 1,200 company-owned and franchisee shops across North America.

 

ATD Eliminates 100 Positions; To Add 40 Others

American Tire Distributors (ATD) is in the midst of a restructuring, having eliminated nearly 100 field support center positions, with plans to add 40 new employees. The great majority of the eliminated positions were at the company’s Huntersville, NC headquarters and cover various support roles, including human resources, finance and information technology (IT).

As for the 40 positions coming on, ATD hasn’t specified the exact roles or timing, but they likely will align with the company’s strategy to focus on new technology, data analytics and supply chain.

The news is the latest in a tough year for ATD, as Bridgestone Americas and the Goodyear Tire & Rubber Co. ended their distribution relationships with the company in favor of TireHub LLC, a tire distribution joint venture the tire companies started in early July.

ATD has vowed to evolve by bringing game-changing innovation — including digital tools, programs and technical support — to the industry. The job eliminations, and additions, are part of CEO Stuart Schuette‘s transformation plans, which began about two years ago. The goal is to adjust ATD’s approximately 5,000 employees to meet the company’s current goals.

In a July 25 letter to employees, Schuette wrote:

“The decision to reorganize our field support center was not made lightly, but it was critical for us to align our capabilities with our strategy.

“More than 18 months ago, we began our transformation to become the most connected and insightful automotive solutions provider, and every decision that we have made — and will make — is grounded in realizing this vision,” the letter continued. “The digital tools and advanced technologies that we’ve introduced are key differentiators for ATD, and are being recognized by both aligned customers and manufacturers.”

ATD’s goal is to improve its partnership with customers and convince them to stay with ATD, even if that means changing brand allegiances, he wrote.

The letter concluded: “Today, you should remember that ATD has been an enduring brand for more than 80 years because we aren’t afraid of change. We make the change. We are the innovators, the disrupters and the leaders.

“We have a plan that we are working through with our sponsors, and, over the course of the next few months — through all of our efforts — we will pave the road ahead of us. We look forward to sharing this with you as it becomes finalized.”

 

 

Growth Expected For 2018 U.S. Passenger Replacement Tire Shipments

The U.S. Tire Manufacturers Association (USTMA) projects that U.S. tire shipments will increase 1 percent to 319.80 million units this year.

According to the national trade association for tire manufacturers, passenger replacement tire shipments are expected to grow 0.7 percent to 211.20 million units. Shipments of light-truck replacement tires are forecast to decrease 0.3 percent to 31.20 million units, while truck replacement tire shipments are expected to increase 2.7 percent to 20.20 million units.

The balance of projected unit shipments covers original equipment passenger, light-truck and truck tires.

 

Continental Buying Aus­tralian Tire, Service Chain

Continental AG is acquiring Kmart Tyre & Auto Service (KTAS), one of Australia’s largest tire and auto service chains with 258 locations and more than 1,200 employees, mainly in the eastern and southeastern coastal regions. The seller is Wesfarmers Limited of Australia. The deal is worth about $255 million.

The move expands Continental’s presence in the Australian market, which already includes the BestDrive and Continental branded retail network.

 

Myers’ Distribution Sales Fell 4.5%

The distribution segment of Myers Industries (Akron, OH) saw its total income from operations before income taxes fall 7.9 percent to $2.79 million in the second quarter of 2018. Net sales for the business — which is mainly composed of Myers Tire Supply — declined 4.5 percent to $37.48 million. However, gross margin expanded, and adjusted EBITDA margin was flat year-over-year.

Over 50 percent of the segment sales decrease came from equipment sales and the MTS International business. Management cited a number of factors for distribution’s sales shortfall, including salesforce turnover in certain territories, which resulted in coverage gaps and lower sales volumes.

President and CEO Dave Banyard told analysts on the company’s July 30 conference call that the distribution segment continues to make progress, albeit at a slower rate than management is happy with. “We are making some progress, and we see that in our daily sales run rate of consumables in our domestic business, which increased year-over-year in the second quarter,” he explained. “And, the gross profit margin expanded year-over-year in the second quarter as well.”

“There are two key areas that we’re focused on in this business to help continue to improve it,” Banyard said on the call. “One of them is putting the right tools in the hands of our sales force, and we’re doing that with a number of different initiatives. One in particular is a sales contest, where we are incenting the sales force to focus on certain product lines as well as certain customers in certain segments. We did a bit of that in the first quarter through the second quarter with some success, and we’re continuing that here in the third quarter.

“Secondly, we are very focused on recruiting and training — that’s both retaining the people we have and training them better, as well as recruiting the best people we can and training them well.”

For the full year, management expects Myers’ distribution segment sales to decrease in the low-single digits. “We expected it to be flat in the second quarter, and we were not. So, we’re muting our expectations here,” Banyard explained. “We do expect to grow in the second half of the year, but we don’t expect that sales growth will be enough to overcome the declines that we had in the first half.”

 

Motor Expands Coverage With TireTech+

Following up on the debut earlier this year of Motor TireTech, Troy, MI-based Motor Information Systems has launched the premium database service Motor TireTech+. According to the company, TireTech+ includes over 230 brands and 58,000 SKUs, supporting tire images, product descriptions, and features and benefits. The service provides access to manufacturer product codes, as well as warranty, tire weight, tread depth, ply rating and other attributes. Updates are performed monthly.

 

Tire Registration Plus Now Integrated Into TireShop By Freedomsoft

Tiremetrix (Brighton, MI) has announced the integration of Tire Registration Plus into Freedomsoft’s TireShop platform. Tire Registration Plus is billed as a complete tire registration and tire recall management package. The partnership gives Tireshop dealers the ability to complete the registration process at the point-of-sale and get real-time feedback to check for accuracy and safety issues before the tire leaves the shop.

Dealers can register every tire they sell at the point-of-sale directly with the responsible tire manufacturer. Registrations are stored in a secure cloud platform, allowing dealers to retrieve records and know when customers are affected by a recall.

Freedomsoft is a software development company located in Asheboro, NC. Its product, TireShop, is designed to manage tire, automotive repair and quick-lube shops.

 

 

MAM Software Integrates VAST With Top Dog

MAM Software says its VAST point-of-sale and business management software for tire and auto service dealers is now fully integrated with Top Dog Solutions’ business intelligence reporting. The integration will give VAST users a more robust set of reporting and analysis tools, according to the companies.

“VAST customers will greatly benefit from the additional data analysis available through Top Dog Solutions, and our hope is to have more customers integrated in the future,” Lance Brierley, general manager of North America at MAM Software, said in a statement.

Top Dog Solutions is a Boston-based developer of business intelligence technology for small- and medium-size distribution and logistics organizations. The company offers reporting modules to support key analysis in tire distribution.

 

Christian Brothers Shops Are Now Using Identifix’s Direct-Hit

Christian Brothers Automotive has chosen Direct-Hit from Identifix Inc. (Roseville, MN) as its preferred repair software. The Houston-based service and repair franchise group will offer the technology in all 182 of its locations in 26 states.

Direct-Hit gives technicians and shop owners access to a fix database of over 1.50 million confirmed fixes, along with OEM information, color wiring diagrams and more. Identifix is a Solera Holdings company.

 

Kukui Joins Season Two Of ‘Garage Rehab’

Kukui is joining Richard Rawlings and his crew for the second season of the Discovery Channel program Garage Rehab. In the series, Rawlings and his team travel the United States helping struggling shops. Kukui’s role is to support the shops featured in the episodes with new websites designed to help them revitalize their marketing efforts and achieve success. Season two of Garage Rehab premiers in September.

 

AVI Acquires Ohio Automotive Technology Assets

Automotive Video Innovations (AVI) has acquired Ohio Automotive Technology’s catalog of advanced automotive training material. Financial details were not disclosed.

“AVI and Ohio Automotive Technology have a very long and successful relationship,” AVI CEO Paul Louwers said. “And, by acquiring the extensive training assets of Ohio Automotive Technology, we are now able to offer even more high-level training videos and manuals to Master Technicians everywhere.”

Bill Fulton — owner and director of Ohio Automotive Technology and a longtime AVI instructor — has been developing training content for the automotive repair aftermarket for over 30 years. His company will remain in business, with Fulton continuing to build and teach auto technology.

Ft. Myers, FL-based AVI has been providing advanced automotive repair training since 1994.

 

GMB Creates Page-A-Day Online Marketing Workbook For Shop Owners

Auto parts manufacturer GMB North America now offers an e-book for repair shops that provides once-a-day exercises to help shops get involved in online marketing. Market Your Shop Online In One Month aims to help shop owners better understand the “why” of each task and how the tasks complement each other, without diving too deep into marketing jargon and theory.

The concept is for shop owners to complete one page of the book each day, read the explanation of the tasks and the benefits associated with it, and decide if that day’s task makes sense for their business. If not, skip it.

The 30 daily exercises include creating a professional email address, setting up Google Analytics and establishing a business Facebook page.

“Our representatives often speak with shop owners who don’t know where to start with online marketing or think they just don’t have the time to do it,” said Sarah Porter, marketing manager at GMB. “We’re always interested in our customers’ success, so this easy, once-a-day workbook is a great way to help shop owners get into basic online marketing without overwhelming them.”

 

 

Safety-Kleen Profitability Up Double Digits For Third Consecutive Quarter

The Safety-Kleen segment of Clean Harbors Inc. generated $294.44 million in direct revenue during the second quarter of 2018 — an increase of $23.12 million, or 8.5 percent, primarily because of more favorable pricing on oil products and growth in the business’ core service offerings.

Increased base and blended oil pricing, volumes and direct sales of blended oil accounted for $18.50 million in incremental direct revenue, according to management. Revenue generated through direct sales of packaging and blending services and other core service offerings (such as handling of containerized waste, vac services and sales of allied products) accounted for $11.70 million in incremental revenue, which more than offset an $8.50-million decrease in used oil collection revenue. Safety-Kleen also experienced $1.40 million in positive foreign currency translation during the quarter.

“We grew waste oil collection volumes from those of a year ago, while maintaining an average charge-for-oil position for those collected gallons,” said Chairman, President and CEO Alan McKim. “We continued to steadily grow direct lubricant sales through our closed-loop initiative, which has now surpassed 20,000 customers. Direct lubricant sales accounted for 6 percent of our total volumes sold in the quarter — up from the prior year and from the first quarter of 2018.”

Segment adjusted EBITDA increased 21.2 percent to $73.07 million, and adjusted EBITDA margins grew 260 basis points to 24.8 percent.

“For Safety-Kleen, the focus in the second half of the year will be on further enhancing margins through pricing strategies, continuing to advance our blended oil sales programs and capitalizing on cross-selling opportunities,” McKim stated.

 

AAPEX Service Professionals Session To Address Career Paths For Techs

The general session “Automotive Career Pathways: The Road to Great Technicians” at AAPEX 2018 will focus on identifying career paths for current and future technicians, and how students, parents, instructors and shop owners can play a role in career development. The panelists will include Donny Seyfer of NASTF, Chris Chesney of the Carquest Technical Institute and Kyle Holt of S/P2. Carm Capriotto of the Remarkable Results Radio Podcast will moderate.

The Service Professionals General Session — part of the AAPEXedu program — will take place from 2:00 pm to 3:30 pm, Nov. 1 at the Venetian in Las Vegas. AAPEX runs Oct. 30 to Nov. 1 at the Sands Expo. Click here to register for the show.

 

Cooper Tire Launches National Tire Safety Campaign Aimed At Teens

The Cooper Tire & Rubber Co.’s “Tread Wisely” program has launched a national tire safety campaign for young drivers with DoSomething.org, a not-for-profit organization focused on young people and social change. The “Pump It Up” campaign — which will be active through Sept. 30 — encourages teens and young adults to learn how to check tire pressure, tread depth and overall tire condition to stay safer on the road.

“We know that young people don’t always prioritize tire safety, so we’ve designed this campaign to combine a significant topic in their world — saving money — with the important topic of tire safety,” said Anne Roman, Cooper’s vice president of communications and public affairs. “Proper tire maintenance can save money in fuel costs and help increase the lifespan of tires.”

Young drivers who sign up and complete the campaign requirements are entered into a drawing to win a $3,000 scholarship.

 

App Connects Truckers To Goodyear Roadside Service

Trucker Path, an app for over-the-road drivers, now offers its members direct access to roadside service from Goodyear Commercial Tire & Service Centers (CTSC). A “click-to-call” feature in the app connects users directly to Goodyear roadside service, which is provided by nearly 200 CTSC locations across the United States. Trucker Path says it has over 700,000 active monthly users. The app helps drivers plan trips, research fuel prices or search for parking.

 

General Motors Launches Collision Repair Network, Includes OnStar Tie-In

General MotorsCustomer Care & Aftersales division has announced the launch of the GM Collision Repair Network. GM states that, for dealerships and independent collision repair facilities, this new network will build on GM’s current training and tools-focused programs, while adding standards for pre- and post-repair scanning, repair procedures, calibration and overall repair. The goal is for shops in the network to experience a more streamlined process, including reduced time spent on diagnosing and pulling repair procedures.

After a collision, according to the automaker, “GM’s Collision Repair Network — combined with OnStar — helps educate and empower GM vehicle owners by helping them locate repair facilities where qualified technicians follow proper repair procedures using original equipment replacement parts.”

For more information on the GM Collision Repair Network, visit GenuineGMParts.com and click on the “For Professionals” tab.

 

 

Mercedes-Benz USA Expands Training Programs

Mercedes-Benz USA (MBUSA) is expanding its technician training and development programs in an attempt to address the shortage of qualified automotive technicians in the United States.

The automaker has established a registered apprenticeship program for veterans through the Department of Veterans Affairs, as well as launched a partnership with Jefferson Community & Technical College (JCTC) in Louisville, KY. MBUSA is the first automaker to establish such a registered apprenticeship program for vets, and its partnership with JCTC is the first of its kind in Kentucky.

The JCTC educational program prepares students to become a Level One Mercedes-Benz Certified Systems Technician in three semesters. Students will train on Mercedes-Benz vehicles, intern at a Mercedes-Benz dealership and have the opportunity to gain full-time employment after completing the program.

MBUSA also offers an ongoing training program with Gwinnett Technical College, one of Georgia’s largest technical colleges, with plans to introduce more in the coming years.

Additionally, the company’s Mercedes-Benz DRIVE technician training initiative is coming to Robbinsville, NJ in 2019.

 

People Watching 8/21/18

• The U.S. Tire Manufacturers Association (USTMA) has hired Sean Moore as its director of government affairs. Moore comes to the organization with more than a decade of experience directing trade association government affairs programs, most recently as director of state and local government affairs for the Consumer Healthcare Products Association. His background also includes time overseeing the automotive affiliate of the Consumer Specialty Products Association (now known as the Household & Commercial Products Association).

Ron De Feo — retired executive chairman of Kennametal Inc. and a founding partner of Nonantum Capital Partners — has been elected to the board of directors at Myers Industries (the Akron, OH-based parent to Myers Tire Supply, among others). De Feo’s background includes marketing and leadership positions with Case Corp., Tenneco Inc. and Procter & Gamble.

• The Tire Industry Association (TIA) has announced that its 2018 “Hall of Fame” honors will go to Bob Majewski, president of Sumerel Tire Service, and Arvind Poddar, chairman and managing director of Balkrishna Industries. TIA’s 2018 “Ed Wagner Leadership Award” honors will go to Mike Baggett (retired) of Yokohama Tire Corp. and Freda Pratt-Boyer, senior auditor for the Purcell Tire Co.

• David Alspaugh is the Mitchell 1 “Educator of the Year” for 2018. Alspaugh is an automotive technology instructor at the Advanced Technology Institute in Virginia Beach, VA. He was the Virginia Career College Association’s “Teacher of the Year” in 2010.

 

News Briefs 8/21/18

• 37 percent of independent repair shops surveyed by IMR Inc. said specialty repair chains are their No.-1 competitor. This was followed by other independent repair shops (33 percent said), new car dealers (26 percent) and “other” (3 percent). It should be noted, however, that 51 percent of independent repair shops surveyed said they have no competitors.

Jiffy Lube International has opened 45 new U.S. service centers since January 2017, with recent openings in Glenpool, OK; Odessa, FL; Dallas, OR; Palmdale, CA; Holly Springs, NC; Alpharetta, GA and Tracy, CA. On average, Jiffy Lube has added between two and three franchisee-owned service centers per month since the beginning of 2017, with plans to increase year-on-year growth projections.

• The National Pronto Association has awarded eight Auto Service Center Scholarships for the 2018-‘19 academic year. The annual program is funded by Pronto and its WD members, and administered by the University of the Aftermarket Foundation. Sons, daughters and employees of active Pronto Auto Service Centers currently purchasing from Pronto members are eligible for consideration.

• The Car Care Council, in conjunction with AutoNetTV Media, has released a new video to help families get their vehicles “Back to School” ready.

John Bean has updated its website, JohnBean.com.

 

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