A&D Repair has a complex business with a very simple philosophy – relationships matter, and people come before profits. The crazy thing is, says co-owner and CEO Roy Niemi, by putting the needs of your customers, your suppliers and your employees first, profits follow right behind.
“People over profit is what I believe,” Niemi says. “When we let people know, ‘I care about you – I want you to succeed,’ we see some really, really big changes within our company, and we have seen people really buy into the philosophy and the process, and really get engaged. We just try to do things right, you know? We take care of our customers, with extended warranties [and going] above and beyond. Our process is just a little different, it’s about getting to know you and your vehicle needs and wants. It’s hard to explain in a quick conversation, but it’s not a simple transactional relationship.”
A&D Repair was formed in 1992 by original owner Dan Goodnoe as a heavy truck service and frame straightening operation. A family organization, Goodnoe and his sons expanded over the years to offer a wide range of services, including engine, undercar and collision and paint services for the heavy-duty and automotive sectors.
“They grew the business to about a $700,000 business,” Niemi says. “About seven years ago, I came aboard as a simple service writer. I was looking to reinvigorate my life after a long and draining career as a finance director and manager in the automotive industry. I had been working those proverbial 60-to-80-hour weeks and, frankly, I was kind of burnt out. I was looking for a little slower pace.”
What he found, Niemi says, was an operation with the same desire for excellence as he had.
“I was able to use my knowledge of sales, to help project them to the next level, so to speak. We went from $700,000 to a million dollars in sales the first year. By restructuring the organization a bit, it gave me the opportunity to step in as manager, work on growing the business, growing the customer base, increasing ARO, implementing tools to help with CRM and use them appropriately,” he explains.
“The owner at the time said, ‘I think I’ve got the right guy in the place, I can kind of move on to retirement.’ I moved some people around, hired some more people, bought equipment and changed some of our processes and procedures into being more customer and employee oriented,” Niemi says.
Today, A&D Repair, a Parts Plus Car Care Center, has a total combined square footage of around 24,000 square feet in multiple buildings on a campus of five and a half acres. The buildings include 14 service bays on the repair side, and another 12 service bays on the collision side, offering complete paint and body repair for automotive and heavy-duty vehicles.
With 31 employees and plenty of space to work, it may seem natural that business has boomed. Niemi explains that it’s actually because of the business success that the shop is so large.
“We had eight employees, including myself, when I started seven years ago. That was everyone, including technicians, service writers and office staff, doing repair shop and bodyshop work. To go from $700,000 to a million the first year – and we’ll do around six million dollars in sales this year – the trajectory was kind of insane. We had a lot of growth in a very short time. We had to adapt very, very quickly, and we did,” Niemi admits.
“We all worked out of one five-bay building,” Niemi says. “And, as we grew, we always kept saying we were capped out, but every year we ended up growing in double-digit percentages. However, it finally got to a breaking point. Our employees were super engaged, but they all had a common complaint: not enough space, they felt like they didn’t have adequate tools or space to be as effective, as efficient for long-term viability.”
The solution, he says, was the design and construction of a new facility.
“I expected a one-year build time, so it was my responsibility to try to get ready for that staffing issue, and I hired a lot of people I didn’t necessarily need at the time but knew we would need as soon as we opened. Unfortunately, ultimately due to COVID and to some logistical difficulties and materials for building, we ran an extra year.
As we’ve heard in hindsight from many shops, business during the pandemic certainly didn’t decline, but Niemi didn’t want to take any chances. Rather than reduce his staffing levels, he increased his marketing efforts.
“There’s a lot of ways to do it, of course,” he says. “For me, it was all about customer retention, and capturing a very specific market. We have a very, very high customer retention rate; once you become part of our A&D family, you typically stick with us. We have about a 93.7% customer retention rate. We’ve built our business on repeat and referral business. We had not done any advertising, whether digitally, socially, TV or radio, up until about two years ago. Everything we did was all about taking care of the customer.”
That specific market Niemi mentioned is a very mobile one – specifically, recreational vehicles. “We do a lot of fiberglass and metal work on RV chassis, and we have customers who drive as far as an hour for that type of work,” he says. “In addition, we do heavy-duty collision repair on trucks and school buses. One of our largest fleets is Dean Transportation, with roughly 4,000 vehicles, most of which are school buses.”
Automotive still makes up the largest sector in that part of his business, Niemi says, for both the collision and repair shops.
“We have some very small towns around us, so we push our message out about 14 miles, though the majority of our customer base falls within about eight miles of our facility.”
Niemi says A&D’s target demographic has always been 25- to 45-year-old women, and to reach them, the business networks with a variety of local civic organizations. “Through them, we were led to several child and family charities, area Moms’ events, Trunk or Treats, Touch a Truck and things like that, where people get together. They’re not necessarily automotive related, but we can interact with masses of people in our target demographic.”
Just as he puts great effort into engaging his customers, Niemi works hard to engage his team. He says regular meetings with every staffer is vital.
“Not every employee wants to come to me and say, ‘Hey look, I’m struggling here.’ So, I do my best to meet with everybody each week for a 10-minute one-to-one. These meetings are not designed to fix problems, it’s just an attempt to keep my finger on the pulse of the business, the lifeblood of how people are doing, how they’re feeling, and to keep that open line of communication going with them, to be comfortable to talk,” Niemi says.
“We should be able to catch any real problems, but, like I said, sometimes they just don’t say it, right? They just put their head down; they don’t want to be the one guy who’s complaining.”
As growth continues, Niemi recognizes the need to have his diverse team all pulling in the same direction.
“ADAS is definitely the next step for us and we’ve talked as a leadership team about potentially expanding into the towing business or possibly becoming a multi-shop operation. To do so, we’ll need to continue growing our team. For the past five years, we’ve had our own internal mechanics apprentice program,” Niemi explains. “I’ve been very fortunate enough to have an ASE L1 and two ASE Master Techs who work for me, and we were able to create a mentorship and apprentice program internally that has brought guys out of the high school tech programs, and turned them into state Master technicians, well on their way to becoming ASE Master technicians.”
While he lauds the value of mentorship, Niemi admits that it isn’t easy.
“Mentoring is a lot of extra work. You’re taken away from what you can produce for yourself to take care of your family. But, what I strive to build every single day is a team mentality,” he says. “Anybody in my facility, in any position, at any time, will put down what they’re doing to help anybody else. I truly believe that we all will do better together. That team mentality is a bond that we have. I cannot emphasize enough how important that is.
“Part of the reason I started building my own technicians was because I was finding that technicians we were hiring, often had a ‘me, me, me’ attitude, because they were not getting paid to help the guy beside them. I’m sorry, but that doesn’t make the guy next to you successful, and we have to do it together.”
Niemi says he uses personality tests and other resources to determine what motivates potential employees. “We look for a team mentality, a can-do attitude, and a guy who’s willing to sacrifice some of his own needs to help the guy next to him. That is hands down one of the biggest parts of our culture.”
He says his team participates in regular team-building activities, but one of the most effective programs he has implemented is what employees DON’T do together – work weekends.
“We work four-day work weeks, 6:00 am to 5:00 pm, with a one-hour lunch. So they’re 11-hour days with a one-hour lunch, or 10 hours of production,” he says. “Every one of my guys gets a three-day weekend, whether it’s a Friday through Sunday or it’s Saturday through Monday. Our core group, our heavy hitters, our Masters, they work Monday through Thursday. We get a lot of the weekend stuff, the heavy diagnostics or the drivability diagnostics, things that are more complicated. We do those on Monday, so we have less interference on the training portion of it or any of the assistance that the apprentice technicians will need when they are there.
“Then the other group, including B and C techs, comes in Tuesday and they work until Friday. Friday is usually reserved for a day where the main group of techs, if they need to catch up or they want to work more, can do so. We have an incentivized payment structure, so the more they produce, the more they make. I reward work ethic, I reward production. I reward the people who want to put in the most, so when they get close to a bonus, they can work a Friday to make it.”
In addition, Niemi says, Friday is a day for maintenance and light service. “We do a lot of lube/oil/filters, tire rotations and fluid maintenances on Fridays so we can kind of lighten up the workload a little bit for Fridays. But, we’ll never work a weekend as long as I own the shop. I believe weekends are for family and fun. It leads to a whole bunch of benefits, including less downtime, less sick time, more recovery, more production and more tech efficiency during those four days. I firmly believe that there needs to be a little bit of a balance there.”
Niemi credits his relationship with his local parts supplier, ACI Parts Plus out of the Grand Rapids area and especially his original sales rep, Sean Gaddy, for much of A&D’s growth.
“ACI Parts Plus has single-handedly been responsible for about 6% of our growth,” Niemi says, “and I’m so incredibly grateful to them for what they brought to us. It was a long journey to finally get to them, but as a two-step distribution partner, we noticed that there was a significant difference in parts pricing.
“They immediately made it very easy for us to join and start purchasing parts from them. We were able to increase our net profits, our gross profit margin on parts overnight, without affecting our customers at all. They’re involved, they very much care about us and our success, they constantly, constantly are bringing us new avenues and resources for training and towing and roadside reimbursement and things like that for our customers.”
Niemi adds he’s putting his mentoring skills to work, continuing to strengthen his relationship with ACI. “My current rep is Kaycee Sinke – she’s new to the industry but is very hungry, very motivated, extremely kind and understanding, and does a great job at trying to build that relationship. And, what she lacks in experience, she makes up for in effort. Can’t ask for much more than that.
“One of the things I try to help her with is, it’s one thing to build a relationship with me, the shop owner. Yeah, I may be the one who makes the decisions, ultimately. But, I remind all the sales reps who come in here, ‘you need to speak to the service providers.’ I look at parts reports and I look at profit margins, I look at shop flow and throughput, and I look at all the numbers and dollars and cents, and I have a finger on the pulse of day-to-day operations, but what’s happening with vehicles, they’ll know more than I ever will. I’ve given them the autonomy to purchase parts from you and other vendors based on availability and pricing and whatever they feel comfortable with,” Niemi says.
Niemi says he strives to be a valuable resource as Kaycee learns the business. And, yes, relationships are part of the lesson.
“We try to be helpful to her, to make her successful, to help her do the best she can for not only us, but the rest of our customer base. Ultimately, that relationship helps our entire organization be stronger.”