Dealers on the Move is brought to you by the 2017 AMC Engineering Conference for off-highway equipment engineers, April 25th to the 27th in Waterloo, Iowa.
Dealers on the Move
Editor’s Note: In August 2016, Birkey’s Farm Store acquired Farm Pride’s stores in Arthur, Shelbyville, Casey, Newton and Mattoon, Ill. Farm Equipment will be providing updates on how the integration processes is going throughout the year.
Last fall’s harvest was just around the corner when Birkey’s Farm Store acquired Farm Prides 4 stores in Arthur, Shelbyville, Casey and Newton, Ill.. At that time the management team and employees focused their energy on taking care of the customers and getting everyone through harvest as smooth as possible. But, with the stress of harvest season behind them, Mike Carley, Birkey’s regional manager, says they are now focusing on training the new group of employees on Birkey’s processes.
“It’s a learning curve for the employees. They’re getting there, but they’re not used to everything we’re showing them,” Carley says. “They weren’t used to looking at the numbers and tracking recoveries and efficiencies. That weren’t involved in the budgeting process. We’re teaching them how to actually manage the business, not just work here.”
Carley stresses how important it is for the new employees — along with all of Birkey’s employees — to understand how the business works and what our goals are. “We want our employees to work with us, not just for us. We’ve got to do it together, and they can’t do their job if they don’t have the resources to do it well,” he says.
Part of being able to do that is knowing where the store stands from a financial standpoint. Department managers at the acquired stores weren’t involved in any of the budgeting and reporting previously. For example, the parts manager didn’t know the stores parts sales volume or parts turnover and the service manager didn’t know their recovery for the service technicians.
In December, Carley and Jeff Hedge, also an owner and the other regional manager for Birkey’s, were working with the newly acquired stores on the budget process. “We’re going through the process with them and how we look at expenses vs. what the store is going to do in total volume” Carley says. “It’s a crapshoot for us because they didn’t have good numbers for us to go off of for history. When we look at the budgeting process for our existing stores, we’ve got 10-20 years worth of data to look at. We can easily see when we went up, when we went down and when things stabilized. We have a better idea where the numbers will fall during the year.”
While the new stores had some data to work from, Carley says it’s not clear how good the data actually is. To combat that, they looked at an existing store that does the same type of total volume as the new stores did in the past and tried to match up their expenses for each department. In cases like this, Birkey’s errs on the conservative side. “We want to make the budget number achievable for the new managers,” Carley says.
Filling the Holes
Birkey’s has hired a new store manager, Craig Hanlin, for the Arthur store. Hanlin comes from the trucking industry, where he managed a Kenworth dealership. “I knew him from buying over-the-road semis from him over the years,” Carley says. “He made me loyal to him as a customer, so I thought what better guy would I want to hire for this position? I used to buy International, Kenworth, any make of trucks. Craig sold Kenworth and made me a loyal customer to his company.
“He understands the retail business with special focus on the parts and service departments. There’s very little difference in operating a car dealership or a truck dealership than our dealerships. It’s just a different product.”
Hanlin started working in the Arthur store in January, but before that he went through a training program in Gibson City. He worked with Todd Bohlmann, longtime employee of Birkey’s and the store manager of the Gibson City, Ill. For a two month store manager training before we put him in his new role.
During the first quarter of 2017, the focus is on getting Hanlin in the store and getting things organized. “The first quarter will basically be getting Craig in the store and comfortable working with the employees, figuring out his needs in the dealership and his capital needs,” Carley says.
In addition to getting the new store manager up to speed and comfortable, Birkey’s will be focusing on getting their arms around the new customers and employees at the Arthur location. The other locations had store managers in place, so it’s been an easier process with those employees and customers. “They have so many good people who are trying to understand our processes and get involved and make sure they do it correctly. So that’s really the main focus at the other stores, making sure our processes are followed,” Carley says.
Scot Campbell, the store manager at the Shelbyville store, is off and running. This is his first experience as a store manager, and Carley says he’s doing very well. “He’s acquired some combine deals which that store normally didn’t get. They sold a Quadtrack and he’s selling some equipment out the front door that’s generating some service work through the back door,” Carley says. “We’re getting the service work and we’re trying to acquire the parts customer that we need to have on our side that may have left because the store previously didn’t carry the right parts. Now we’re carrying the right parts, so they don’t have to go anywhere else but our store.”
The showroom area of the Shelbyville store previously was dedicated to NAPA auto parts. But with that contract gone, Campbell has been able to turn it into an indoor display area with lawn and garden equipment and utility vehicles. “We also created a guidance display for precision farming that allows customers to have a virtual reality precision farming demonstration right there in the showroom,” Carley says.
Acquisitions aren’t new territory for Birkey's, but Carley says this is the first time the dealership has taken on 4 stores at one time. “We’re trying to focus on the new stores and get them up and rolling,” he says. “We’ve never acquired this many stores at one time. This has been a challenge for us but we could not be happier with the transition these stores have made coming to Birkey’s.