Force of Nature
Saturday, April 16, 2011, provided North Carolina residents with clear, undeniable proof of the fury that Mother Nature can conjure.
Thirty confirmed tornadoes touched down around the state that day, marking the highest one-day total on record for North Carolina. Nine tornadoes occurred in what the National Weather Service calls the Raleigh County warning area, with six of those storms producing wind speeds of at least 111 mph. Eight fatalities occurred in that area.
All around Raleigh, power lines were left mangled. Large trees were ripped from their roots. And, unfortunately for business owners Jim and Tana Malerba, Coats Auto Body & Paint got thrown into the upheaval.
By the time the Malerbas reached their shop near downtown Raleigh late in the afternoon, their eyes grew wide.
“There were actual 2x6s that were stuck in the wall—in the cement wall—that were like projectiles from the strength of the tornado,” Jim recalls.
“One of the water lines was torn, and it looked like a geyser shooting up in the air. The roof was completely torn off,” Tana adds. “It was just very surreal.”
Alas, for the Malerbas, issues associated with that storm were all too real. The business they had owned for roughly eight years had seen most of its structure get flattened. The building, which they owned, was considered a total loss and was condemned.
Fortunately, Tana and Jim—a former firefighter in the New York City area—were equipped with ample determination. They felt compelled to rebuild. And, as they learned in the months ahead, by keeping a level head, shop owners can recover from even the most devastating of occurrences to be left with businesses that are more prosperous, and efficient, than ever before.
SHOP STATS: COATS AUTO BODY & PAINT Location: RALEIGH, N.C. Size: 11,600 SQUARE FEET Staff Size: 22 Average monthly car count: 200 Annual revenue: $5.2 million
On that spring afternoon back in 2011, as Jim Malerba looked at the devastation laid at his feet in Raleigh, he promptly came to a conclusion.
“We’ve got to keep going,” Jim recalls thinking. “There was a sense of urgency to find another place that we could work out of."
“We were afraid that we put all this money, blood, sweat and tears, into this business. … We didn’t want to see that all go away.”
Jim was determined to have a shop that was better than ever, with fewer inefficiencies than his old shop layout, which featured less-than-ideal elements like three bay doors on the front of the building, close to where employees parked. More importantly, Jim wanted to provide consistent paychecks to Coats Auto Body’s employees (all of whom were away from the shop on the Saturday that the tornadoes occurred, as the business was closed that day.
“It wasn’t about us; it was about the 28 people that worked for us,” Tana notes. “We didn’t want to lose the market share. … So, as a group, we all worked together.”
The Malerbas’ employees diligently helped clean up the rubble from their former workplace. Friends stayed overnight in the facility a few nights with Jim to ward off the threat of looters looking to prey upon a few unexposed shop valuables like the A/C unit. And, several peers offered to help Coats Auto Body, like those at the body shop of Raleigh’s Thompson Automotive Group, who offered the use of a spare spray booth.
Fortunately, the Malerbas had solid loss-of-use insurance coverage and a continuing business writer, which offered the possibility of paying for 75 percent of a rebuilt facility (a loan covered the rest). And, the couple received another stroke of luck when they found a temporary facility roughly 8 miles south of Raleigh, in Garner, N.C., where the previous tenants wanted out of their lease immediately.
“It was almost like a godsend,” Jim says of finding the Garner facility, which cost $10,000 per month in rent. “It was just perfect timing.”
Winds of Change
Once the Malerbas moved into their temporary location in Garner and got their business back on solid footing, Jim began focusing more and more time on rebuilding in Raleigh.
Jim decided to design the new facility largely by himself, with an eye toward solving some of the inefficiencies that had held Coats Auto Body back in the past. Namely, he sought to improve cycle time.
In the days prior to the tornado’s destruction, Coats Auto Body’s shop floor operated in fits and starts. Body technicians would often have to pull vehicles they were working on out of the shop, so that painters could move their projects onto the shop floor. The shop simply wasn’t designed with fluidity in mind.
“We would play musical cars,” Tana recalls.
All told, the Malerbas learned multiple lessons during the tribulations that followed their upheaval in April 2011. Those lessons—many of which can be applied to any business that encounters an unforeseen, devastating event—include the following:
Be proactive with insurance coverage. The Malerbas say it’s imperative to make sure you have quality, thorough insurance for your business.
“And make sure that you revisit your insurance coverage, and don’t say, ‘It’s not going to happen to me,’” Tana says. “Because you know what? It can happen.”
Back up key information. It’s of utmost importance to back up any of your business’s important information, like tax returns, insurance policies, business contacts, and payroll information.
“Everything now, I back it up,” Tana notes of business documents. “I have a little USB [flash drive] I back up everything on.”
Be honest with employees. In the wake of an event like a natural disaster, it’s important to promptly reassure your staff that insurance will provide them with a steady paycheck. Otherwise, rumors can fly, and concern among employees can grow, the Malerbas note.
“Employees, they’re just as afraid as you are,” Jim says. “They’re looking for their check every week, and, unfortunately, a lot of people live week to week.”
Communicate with customers. That tornadic afternoon in April 2011 resulted in six totaled customer vehicles at Coats Auto Body. The Malerbas responded to that issue by simply calling upon full transparency, even going as far as to provide those customers with Tana’s personal cell phone number for any questions that arose during off hours.
Jim also suggests ending tough conversations with customers on a positive note, perhaps adding reassurance that a shop’s insurance will take care of the lost asset.
Be wary of scam artists. In the wake of catastrophic events, scam artists can rear their ugly heads, the Malerbas note. Contractors who are eager to help you rebuild will come out of the woodwork, for example. As a result, the Malerbas suggest researching all businesses that offer assistance.
“We finally found a family owned, small business for a contractor that held our hand throughout the entire [rebuild] process,” Jim says.
The Malerbas ended up building an entirely new facility in Raleigh (a process that cost nearly $1.3 million) on the same property as their old, tornado-stricken shop. The redesigned shop opened on July 13, 2012, and the 11,600-square-foot facility’s new layout began paying dividends in short order.
The new shop’s improved amenities include an area dedicated strictly to detailing; heated prep decks; significantly larger bays; a slightly larger paint booth; and six bay doors to which body technicians have easy access.
Jim laid out his new shop floor so that, once vehicles are brought into the facility, they first enter the prep area, then proceed to the paint booth, are taken out of a second door in the shop, and are driven around to a tech bay.
The Malerbas have found the new shop floor layout to be decidedly more efficient than their former Raleigh setup; cycle time has been reduced from 6 days down to 3.7.
Yes, the Malerbas’ whirlwind stretch as business owners has settled in recent years. In fact, the forecast is as promising as ever.
“When this happened, we had blinders on, you know?” Jim says. “We just went, and just drove right through it, and never really looked back.”
The owners of Coats Auto Body have been left with a new Raleigh shop that’s appreciated by customers and sits in a metro area whose population is expected to grow by 72 percent by 2040, according to American City Business Journals.
The Malerbas’ Raleigh location did around $3 million in annual sales prior to the 2011 tornado. These days, annual revenue is $5.2 million at that location.
The shop operators also ended up keeping their “temporary” facility in Garner, N.C., due in large part to the area’s projected population growth. That location is holding strong; it has 11 employees and recently added a production manager.