Built to Last
ALONG THE STRETCH OF MINNESOTA HIGHWAY where Buerkle Honda has its multi-building dealership, there are so many cars for sale that the strip looks like an airport long-term parking lot. Offering everything from Range Rovers to Kias, every dealership has fluttering signs about good deals and glittering autos lined up perfectly. But none has what Buerkle Honda does: a collision center.
With multiple bays and a paint booth that runs into the wee hours, the Buerkle Collision Center in St. Paul, Minn., keeps all the components running thanks largely to the shop’s manager, Dwayne Peterson, who has spent nearly four decades at the dealership. In an office not much bigger than the interior of an old Buick, Peterson and his second-in-command, Bob Ulrich, field phone calls, rush requests for signatures, answer parts questions, and attwnd to other frantic everyday issues.
“This is actually kind of slow for us,” says Peterson with a laugh. “I can talk for longer than a few minutes without getting interrupted. Usually, it’s not like that at all.” From his expression of amusement over the flurry, it’s clear that no matter how busy it might get, Peterson wouldn’t have it any other way.
GROWING A BUSINESS
After serving in the military just out of high school, Peterson enrolled at Dunwoody College of Technology, a Minneapolis school with extensive automotive programs.
—Dwayne Peterson, Manager, Buerkle Collision Center
He started at Buerkle in 1971, when it was a Buick dealership, and watched the company change through automotive trends that brought in Opal, Isuzu, and finally, Honda. When his manager retired in the mid 1980s, Peterson was offered the job and then climbed the ladder to the shop’s top spot.
The process was fascinating, he recalls, because when the Japanese first entered the market, they didn’t know how to build cars for U.S. customers. The seats were much smaller, for instance, and the cars didn’t seem very reliable. But as the Japanese worked through their growing pains, Peterson began to see that it wasn’t just kids looking for cheap first cars that were snapping up the imports, but also their parents.
“It’s been a challenge to keep up with the changes, because our guys work on all models, and when you’re dealing with new cars, training has to be a constant,” he says, noting that some people wreck their cars on the first day of ownership, before there’s much of a repair database in place, and the parts department isn’t fully stocked yet. But seeing the wide range of cars since the early Buick days has also been fun, he notes: “It definitely keeps it interesting.”
BUCKING A TREND
Although there are numerous body shops in Minneapolis and St. Paul, there are very few collision centers associated with dealerships. In fact, Peterson only knows of one other Honda dealership in the Twin Cities area that has a similar shop. He believes the relationship is mutually beneficial, but he doesn’t think many dealerships know how to manage both sales and collision repair.
“The numbers don’t work for them because they’re just looking at the bottom line in one area,” he says. For example, one job might include $3,000 worth of parts, but only a few hours of labor. So, the revenue generated by the shop might seem minor, even though the parts department reports strong numbers.
It seems logical to connect both labor and parts together to get an idea of revenue generation, but Peterson says many dealerships didn’t do that in the past, and instead saw their shops as faltering when they weren’t.
Working with Honda, as opposed to being an independent shop, has a number of advantages, he believes. The shop can call technicians that staff a 24/7 phone bank. There’s also a level of accountability that’s useful. At an independent shop, an unsatisfied customer might complain to the owner, but at Buerkle, they can grouse to Honda, and if that ever happens, the shop gets a phone call very quickly. This is beneficial, Peterson notes, because it makes the technicians and managers accountable not just to the dealership, but also to Honda itself. “It keeps us on our toes,” he says.
Over the decades, Peterson has seen many local collision repair shops come and go, particularly at dealerships, and he feels that Buerkle is unique in a number of ways.
One top example is that for a few years during the dealership’s Buick era, Buerkle Collision decided to diversify by working on motorcycles as well as cars and trucks, and although the extra income was a nice boost, the shop had to discontinue the work because the owner didn’t like the image, Peterson says.
“It drove him nuts to have motorcycles flying in and out of here,” he recalls. “Also, Buick customers tend to be older, and they weren’t exactly thrilled about the motorcycles.”
Another unique aspect of Buerkle has been the shop’s use of consultants, Peterson says. Within the past 10 years, consultants have come in three times to survey the dealership, from sales to collision to parts, and make recommendations for changes to management strategy and accounting practices. Each time, they returned about six months later to do another survey to see whether anything has changed in that time.
Their opinions are helpful, Peterson notes, because they’ve shared advice on how accounting procedures can be done better, and a recent report highlighted different ways parts requisition could be streamlined.
Since consultants have numerous other clients, Peterson also finds it useful to find out where his shop stands in relation to others—insight he wouldn’t be able to get on his own. “It’s interesting to hear about what other shops are doing, and how we stack up compared to that,” he says. “We’re always very concerned about having the right kind of people in place. That’s something you need to look at constantly—that people are doing what they should.”
Another differentiating factor is that Buerkle is a union shop, and always has been. It’s one of just a handful in an area that used to be dominated by the union, Peterson says. “They’ve kind of lost their clout, and some dealerships closed their shops because it was easier than dealing with the union,” he says. “But we find it important, and our technicians appreciate being part of the union. We’re not going to change that anytime soon.”
In terms of customer relationships, scoring high on satisfaction surveys is always crucial, but for shops that are attached to dealerships, it can be particularly important, Peterson notes. He’s seen people who’ve bought their first cars as teenagers now coming in with teenagers of their own to get new cars, and all of them come to the shop for repairs and maintenance.
“People want to go to the place that fixed their dad’s car for years, because there’s a sense of connection to the family, and of knowing a place is reliable,” he says. “But to be at that point, you have to be the kind of shop that’s built to last, and to think long-term.”
In other words, don’t just offer customer satisfaction to the person who’s currently sitting in the waiting room; create effective strategies that will keep his or her grandchildren coming to the shop, too. Effective tactics include mailing out regular offers for maintenance discounts, sending reminders about oil changes and service, and simply remembering customer names. Even keeping the waiting room stocked with fresh cookies goes a long way, Peterson says. “When we changed from chocolate chip to oatmeal, we heard about it for months,” he notes with a laugh.
That kind of reputation can also win over insurance companies, Peterson adds. “We have insurance firms approach us because customers have recommended us and have liked dealing with us in the past. I know there’s controversy with DRP, but I can’t fault insurance companies for wanting to align with shops that do a good job,” he says.
PASSING THE TORCH
Although Peterson has faced a number of challenges in building up the business—making sure customers are always happy, hiring the right people, and keeping on top of parts requirements—the next phase for him might be the toughest.
“I’m getting ready to retire in a couple years, and so I’ve been thinking about how I can do that without causing much disruption to the business,” he says. One important aspect is to give more responsibility to Ulrich, who already handles a major portion of the shop’s operations.
The pair mesh well, Ulrich says, because they tend to think the same way, which might have come as a result of sitting just a couple feet away for the past 13 years.
“You put two guys in a room this size, they’ll get on each other’s nerves from time to time,” Ulrich says with a laugh. “But in general, we work really well together, and with the guys in the shop, and the people in the dealership. Having that kind of backup for each other is important.”
Plans for the future include continuing focus on customer satisfaction, more consultant visits, and greater efforts to get more work from the community as well as the dealership. Although the ratio is about 50/50 for each now, the shop fixes more than Hondas, and is trying to keep getting the word out about its range of services.
Peterson has also emphasized to his managers a tactic that’s worked well for him over the decades: learning how to be a business person. He’s taken classes in body shop management, which includes learning about accounting and hiring. “You have to know how to handle the day-to-day,” he says. “And that means learning as you go, but also getting some more formal education.”
As for what Peterson will do once he’s retired, he plans to become a bit of a consultant himself, but much like many people who have lived through Minnesota winters all their lives, he sees his golden years of collision repair happening in a place with no snow shovels. He laughs, “Maybe someone in Florida could use my experience and skills!”