Setting Goals for Profitability

May 1, 2013
"I knew in my gut that I could run this shop. This is my home. If I want to go to work for 10 hours a day, I want to give it 110 percent."

At 21, Danny Szarka took over as collision center manager at Thompson Collision Center, a dealership shop in Edgewood, Md. In just six years, Szarka has helped grow the shop’s annual revenue to $5.75 million, drawing on a series of innovative ventures to keep work coming into and flowing smoothly through the shop, proving that youthful determination can keep up with the demands of an ever-evolving industry.

When I turned 21, I made a list of 10 personal and professional goals. One was to reach $5 million in sales. We did that when I was 24. Another was to get my guys at least a 10 percent increase in pay without raising their pay rate. That happened when I was 22.

I keep the list in my desk, and I cross stuff off as I go through. I’ve already had to redo that goal list probably about five times.

I started working at the dealership when I was 17, sweeping floors for $7.50 an hour. I pretty much had no training. From there, I cleaned and detailed cars, learned how to paint and prep a vehicle, and then I was brought into the office.  I started writing tickets and handling all the parts orders.

I applied to be shop manager when I was 20. I got the job at 21.

I knew in my gut that I could run this shop. This is my home. If I want to go to work for 10 hours a day, I want to give it 110 percent.

When I come in each morning, it’s meet and greet. I have regular meetings with each service writer and customer service rep, and we kind of plan out the day. The writer then carries out our goals and agenda for the day with his technicians.

A year before I took over the shop, we had hit rock bottom. We saw two DRPs pull out due to previous management reasons. We lost about four employees. It got real tough.

Once I took control, the roles changed. Before, when I got to work, I usually thought about my paycheck and how I was going to pay my bills. Now I had to think about my employees. I had to worry about feeding nine families. I grew up real fast.

I knew above all else that I had to get work through the door. To do that, I had to put my face in front of the right people. I got all the information about the right DRP coordinators—the address of their front desk or their P.O. box. But I knew I had to give them something that would make them open up their mail.

I decided to make a DVD of the shop. I figured they weren’t going to get up and drive all the way over here, but I want to bring the shop to them. We filmed it ourselves on a shoestring budget. I took the camera, put it on a tripod, and then rotated it 360 degrees.

It was pretty much a shop tour—the office, the parking lot, the handicap spaces, all the amenities the insurers want for their customers.
We also made a brochure of our warranties, certifications and the location of our shop.

There’s a lot of great shops around us. I could throw a stone and hit a body shop. I think what stood out about us is the fact that we had the willingness to do this. We got three DRPs within that year, and we saw revenue increase more than 65 percent.

The afternoons are pretty much just a recap on everything—go over the numbers and check the KPIs. We opened a second facility in July of 2012. The building was an existing aquatic center about 30 yards away from our original shop.

We put about a year and half of planning, if not more, into the building itself.

I was involved in a pilot for the Toyota production system. As part of the pilot, we traveled to the Tacoma/Tundra truck plant in San Antonio. It really opened my eyes to see how much production can be done in a stress-free environment.

You don’t have everybody going crazy, looking for parts or this and that. I became determined to create a similar environment at our new facility.

We started taking booth measurements, figuring out how to maximize the new building—not maximizing how many cars we’re going to get into it, but how may cars we’re going to get out of it.

Essentially, it’s a fast-lane facility. Anything under $2,500 is usually fixed up there. We just wanted to set up an atmosphere without the big frame machines—keep it simple. We made an assembly line that lets us crank cars out fast.

Our relationship with GEICO played a huge role in developing the fast-lane facility. We’re a large DRP for them, meaning we have to get all of their repairs done in three days or less, including the weekend.

I knew the GEICO guys weren’t going to make me work harder; I would work smarter to keep up with demand. We streamlined all of our GEICO repairs by running them through the fast-lane facility. We complete eight drivable GEICO repairs a day in that facility, as well as two small jobs or internal repairs.

Right away, we saw $200,000 a month going through the fast lane. Between 2011 and 2012, when we opened the new shop, total revenue increased about 17 percent.

I try to leave around 6 p.m. Unfortunately, the needle doesn’t always stop at 6—reading and researching are always done after hours.

I’m always looking at better ideas. It could be with materials or finding a better way to get extension cords run in the shop—anything to better our shop. I became the manager here when I was 21. I’m only 27 years old, but it seems like that was 20 years ago already. It’s crazy.

I knew I could turn it around. I knew what I had to do. I couldn’t just sit behind a desk and wait for the work to come in. And I’ve felt a lot of satisfaction along the way.

I think it’s just the gratitude of the guys coming up and saying they are making more with me now than they ever have before. I love that kind of stuff.