One of my favorite life lessons is that of a teacher who walks into a classroom and sets a glass jar on his desk. He silently places large 2-inch rocks in the jar until no more can fit. He asks the class if the jar is full and they agree it is. He says, “Really?” and pulls out a bag of small pebbles, adding them to the jar, shaking it slightly until the pebbles fill the spaces between the larger rocks. He asks again, “Is the jar full?” They agree. So, next he adds a scoop of sand to the jar, filling the space between the pebbles, then asks the question again. This time, the class is divided. With the rocks, pebbles and sand, some are feeling that the jar is obviously full – but others are wary of another trick. With that, the teacher grabs the pitcher from his desk and begins to pour water into the jar, filling it to the brim, saying, “If this jar is your life, what does this experiment show you?” The discussion ensues.
The teacher went on to explain the lesson to his class. “The rocks represent the BIG things in your life – what you will value at the end of your life – your family, your health, fulfilling your hopes and dreams. The pebbles are the other things in your life that give it meaning, like your job, your house, your hobbies, your friendships. The sand and water represents the ‘small stuff’ that fills our time.”
The teacher was providing a life lesson that is also apropos to any small business.
In my first article last fall, I listed what I believed to be the top five things that I feel will help any retail dealer be more successful. Number five was to take a hard look at your business, to “break from your comfort zone and look for opportunity.” If we apply the logic from the story above to our business, it will shed some light on where I am headed with this fifth topic in the series.
As business owners, we often focus only on the large rocks in the jar. I compare these large rocks to our core business, tires and automotive service. We focus our attention on how we can be better and do more so our business grows. Maybe we stay open longer hours, work harder and become more efficient with our processes, raise prices or train our people – all to see if we can fit more large rocks into the jar.
The reality is that we are all limited to how much business we can do in our facility based on the available space and time. Many dealers will press the limits to squeeze every last dollar out of their business, yet we are still limited. Competition has become much tougher in recent years, vehicles are more complex and the talent pool has shrunk. Opportunity that we took for granted has disappeared – oil changes every 3,000 miles, exhaust rusting and needing replacement, tires wearing out at 30,000 miles and tune-ups every year, just to name a few. And car dealers continue to step up their game. Their core business is to still sell cars, but the profit from the service business has suffered, and they’ve been forced to get into selling tires and general maintenance that they’ve steered away from in the past.
We are much like the students who all agreed that the jar was full – that is until the teacher showed them differently. What if we took a step back and took a different look at our business and how we do things?
Using other industries, large retailers measure the profitability by the square foot, using every inch as effectively as possible. If we think outside the box, what could be done with our showroom, waiting area or extra storage space to generate additional sales and profitability? When you go into a grocery store and get into the checkout line, there are products on both sides of the aisle – from candy to magazines and cold drinks. We may not be looking for anything, but we often get an impulse to buy that one last thing. Other retailers have picked up on this idea. Home improvement stores have batteries, cold drinks, candy and small items at the register. Coffee shops have mints, music and logo items. Clothing retailers have candy, water and small merchandise to catch your attention and simulate an impulse to buy. So why haven’t we done the same in our stores? It’s like adding the small pebbles to a jar that we think is already full.
Many customers that come into your store also purchase image items to keep their vehicles clean – carwash soap, wax, tire shine, leather wipes, air fresheners to name a few. What about accessories like key chains, batteries, travel cups or a host of other items that may stimulate an impulse to buy? What if you sold small logo items for your business, or carried candy and other snacks like the grocery store does? (The dusty candy machine in the corner does not count.) For instance, during the Christmas season what if we added smaller items for stocking stuffers. Consider items that make sense as a convenience for your customers.
But you can do more than just point-of-purchase items. For the dealers that have larger showrooms, have you ever thought about subleasing space to another business? Some years back I had a store manager approach me with the idea of using our showroom space for a rental car company and a glass company. He knew local businesses that wanted to expand, and we provided them with space for a desk. They paid to add their phone lines, and they kept the same hours as the store so we didn’t even have to give them a key. We hung a small sign in the window and let them park a few vehicles in the lot. Each paid us a small monthly rent that helped offset expenses. We gave them a month-to-month lease and asked for a 60-day notice if they wanted to leave. That was adding small pebbles to the jar. It also attracted additional customers and helped build awareness. Take this in another direction and think about what a nail salon or what a coffee kiosk or espresso cart might do to generate traffic, revenue – and better serve your female clientele.
Of course, you might come up with reasons why it won’t work – like you don’t have enough space or your parking is limited. But even with those considerations, I’m sure you’re savvy enough to come up with other ideas once you focus on what’s possible.
The key to making any of these ideas work is how you market to the customers, and how well you execute your merchandising. Early in my career, the norm was to display tires throughout the showroom and walk the customer to the tire and present the features and benefits of what you were recommending. Of course, that is not the norm today and it seems that customers are not interested in looking or smelling tires while they wait for their vehicle. They also don’t want to see car parts, oil and additives displayed. But if we added attractive line-board on the wall with shelves or a gondola to display items nicely, it will stimulate an impulse to buy and add revenue to the business. There really is no limit as to what can be done.
So, is the jar full yet?
No. We still have space for sand.
The sand is taking things to the “granular” level (forgive the pun but it’s focusing on all the little things in your business.
• Are we performing a courtesy check on every vehicle?
• Do we recommend wiper blades, filters when needed?
• Are we checking vehicle lights?
• Do we offer a premium oil change?
• Have you considered packaging a tire rotation with an oil change to help counteract pricing pressures in the market?
• Do we control overtime by scheduling employees?
• Are we watching the pennies that are spent in the shop through inefficiencies?
The list goes on and on, and the continued focus on the small everyday things is the sand and water in the jar. We all want the jar to be full – and, as it applies to our business, we want to maximize the revenue potential.
As tire dealers, we all need to be better business people to be successful. There is no exact recipe for success in the retail tire and service business. There is no magic wand – it’s a combination of many smaller pieces that make us successful.
My top five things that I talked about in my first article are by no means all encompassing, but I have come to believe that they will work if they become part of your daily routine.
In Review: Top 5 Tips for Tire Dealer Success
1. Watch the sales and profit numbers.
2. Control payroll and effectively manage tech productivity.
3. Set yourself apart from the competition and develop an effective marketing plan.
4. Be great on the phone.
5. Break from your comfort zone and look for opportunity.
When trying to fill the jar, the core business that we’ve built are the large rocks, and we need to make sure we fit as many in the jar as possible. And it’s the small pebbles that help us break from our comfort zones, looking for opportunity. In many cases, this may come from breaking from traditional thinking. The sand and water are the small things that we may overlook every day, including holding our people accountable. It’s staying focused on all aspects of your operations.
The future is not going to be any easier. This business will continue to evolve and change, and we need to change with it to thrive. All of us have a jar – it’s how we chose to fill it that will dictate how successful our business (and our lives) will become.
An industry veteran of 40 years, Dave Crawford serves as a business consultant and trainer specializing in the evaluation of retail tire businesses for operational effectiveness. He can be reached at