TEDA Meeting, June, 2009

The TEDA meeting got off to a great start with the annual Golf Outing. Returning to Turf Valley Resort this year, we were off to a 9 a.m. shotgun start with approximately 74 golfers. TechShop provided the golf towels and tees again this year. One of the golfers, sporting a snappy swing and a beautiful TechShop golf towel.

Here's one of the foursomes. Is Steve trying to improve his lie?

After a long morning/afternoon of golf in the warm, 80+ degree weather, TEDA held a cocktail reception in the evening. It was a nice way to end the day, very relaxed, and lots of good conversation.

Wednesday morning, Glen Pratt kicked off the business meeting by introducing Rob Halbritter (Mid-States Tool). Rob addressed the group on overall business conditions and challenges we are all facing. He commented on the life cycle of the small business, ending with, "we need to beat the 40-year death rate of small business. We need to continue to be successful distributors and weather this economic storm and dance in this economic rain."

Glen returned to the podium for his annual State of TEDA address. TEDA is a group of 9 shareholder warehouse distributor members, with 12 locations.

This year was the 15th annual vendor's meeting, the 9th annual trade show. Even though we've all faced tough sales conditions this year and late last year, Glen announced that they had nearly the same number of attendees as last year. There were 138 registrations, and 73 exhibits. He was also pleased to announce they added 6 new vendors this year. He commented on TEDA's commitment to creative marketing through the use of their website and the TEDA Toolbox.

On to the sales story..... Glen reported that though driving mileage is down, he felt it was offset by the age of vehicles. He commented on the slowdown in consumer spending and the crazy fear-mongering as reported by mainstream media as contributing factors in the sales decrease they saw last year. (He specifically excluded the trade press from these comments. Thanks Glen!) In 2007, the TEDA members had a 9% increase overall. They suffered minor sales decreases through the third quarter of 2008, but 4th quarter really hit hard, with a 20% decline in sales. And historically the 4th quarter has been their best sales period. Overall, they ended 2008 down 8%. Not bad compared to what I've heard from others.

Good news, through the end of May, the TEDA group is flat v. same period last year. (However, last year was a down year through May, 2008)

Miscellaneous Numbers:

Specialty Tools and Hand Tools make up 38.8% of the members' total volume.

Shop lights was a bright spot in 2008 (get it, bright spot..). Their sales were up 14%. Unfortunately, it's a small category for the group and didn't carry much weight. Their next best performing category was Electric/pneumatic tools which were flat. All other categories were down.

Shop Equipment (3.5%)

Specialty Tools (5%)

Electrical Test Equipment (5%)

All other categories had sales decreases in the double-digits.

90% of all new products sales were generated by promotion in the TEDA Toolbox.

By report's end, Glen expressed an optimistic outlook for the remainder of the year. He is seeing more supplier's look to "green" initiatives and Hybrid tools for new products.

Glen then took a few moments to recognize the 2008 President's Award winners. This award is made based on a supplier's volume, growth and member participation. 2008 Award winners are: Ajax Tool Works, Bayco Products, Cal-Van, John Dow Industries, Legacy Manufacturing, Lisle Corp., Mayhew Tools, Midtronics, Schumacher Electric, and Sunex Tools.

Then the Golf Awards were announced. I'm happy to report that for the first time in 7 years, I actually was on a team that played well (not much thanks to me though. We were carried by our scratch golfer and a woman who had only excelled at putt putt before now.)

Trade Show Stuff

Craig Rae, President of SMC had some new products on display.

Cliff Resnak from SK Tools was happpy to report that SK is alive and well. They're focusing on their core lines. (I apologize for the glare on the photos)

Shop-Vac is beginning to take a hard look at the automotive aftermarket. Ron Geczi, VP of National Accounts brought a stainless steel version of the Shop-Vac. It was designed specifically for the automotive aftermarket, and can't be found at Home Depot, Lowe's or any other big-box retailer. (Unfortunately this photo does not do justice to the product.)

Paul Neu, Neu Tool Supply, talks with Sandy Allen and Rachel Purcell of Porta-Sol.

These guys don't need no stinkin badges! But it's Bob McInturff of Neu Tool Supply and Scot Holloway of Bartec.

Bob Hendry, of John Dow Industries, shows off his recently awarded President's Award.

Michael Gering, M. Eagles Tools Warehouse, chats with the Irwin people.

GearWrench featured some new tools and new sets. This is a 17 pc. metric combo set.

Clore/Solar had a full table.

Sunex featured new sets as well.

Spent some time talking with Scott Ironside, as is evidenced by the abundance of photos of SUNEX new products.

It was good to see these companies are investing in new products, new sets, new packaging. They're not afraid to invest in their future in times like these. Once the economy picks up, these are the companies that will be successful and able to pick up market share quickly.

Who will be there in 2009?

Nearly 1 in 5 car dealerships could fail: studyWed Oct 1, 12:25 PM ETDETROIT (Reuters) -

As many as 3,800 U.S. car dealerships could fail this fall and into 2009 -- nearly one in five -- because of weak sales, increased operational costs and the credit crunch, according to a forecast released on Wednesday." An increasing number of dealers are simply closing their doors because sales have plummeted, credit has dried up, the overall retail environment is increasingly challenging and potential investors are sitting on the sidelines," said Paul Melville, a partner with Grant Thornton LLP, which issued the forecast. "In addition, the domestic automakers who badly need retail consolidation are not spending much of their scarce capital on the problem because the economy is doing it for them," he said. Bill Heard Enterprises Inc, one of the biggest General Motors Corp Chevrolet dealerships, filed for bankruptcy on Sunday, citing operating losses, decreased demand for vehicles and lack of credit. At its peak, Alabama-based Heard's revenue was about $2.5 billion per year, according to the bankruptcy filing. With U.S. light vehicle sales predicted to drop to the 13.7-million-unit range in 2009, the study said that about 3,800 dealerships, about 18 percent of the total number of U.S. car dealerships at the end of 2007, will need to close. U.S. vehicle sales are expected to be flat next year with any recovery in demand expected only in 2010, as consumers struggle with tight credit, high gasoline prices and a housing market slump. The drop in demand has been particularly hard for Detroit-based automakers GM, Ford Motor Co and Chrysler LLC. GM's sales were down 18.5 percent in the first eight months of 2008 while Ford's sales declined 16 percent and sales at Chrysler, controlled by Cerberus Capital Management, dropped 24 percent. Thornton said apart from new car sales, other sources of revenue for dealers, such as used car sales and financing profits, are also falling.(Reporting by Poornima Gupta; Editing by Brian Moss )

Of course today it was announced that overall new car and light truck sales fell 26.% for the month of September, the first time sales have fallen below the 1-million-vehicle mark since February, 1993.

Good news for the independent repair service shop. But look out - the dealers still left standing will certainly improve their marketing efforts and get more aggressive to acquire and maintain repair business.

Opportunities Abound for the Independent Repair Shop

October is Car Care Aware month. You may have noticed information about Be Car Care Aware on your local network. The Care Care Council recently announced the results of last year's vehicle check-up events during Car Care Aware Fairs across the country in April and October 2006. What do you know? People just aren't taking care of their cars like they should. The CCC revealed that nearly nine out of 10 vehicles need service or parts, underscoring the huge untapped DIY and DIFM sales opportunities for the automotive aftermarket. The unsatisfactory condition of vehicles also reinforces the continued need for consumer education about the benefits of regular vehicle care, maintenance and repair.

An analysis of nearly 1,000 vehicle inspection forms, submitted from event coordinators in 16 states, show that 88 percent of the vehicles checked during National Car Care Month in April and Fall Car Care Month in October needed parts replacement, service or fluids. The top problem areas were motor oil, Windshield wipers, air filters, belts and hoses and lights. Any time a customer brings their car into your place for service, you should ALWAYS ASK, "May I check your oil, wipers, filters, belts, hoses and lights? Or at a minimum, have a place to check them on your work order, so you can discuss their condition with the vehicle owner.

“Vehicle check-up events are typically the focus of Car Care Aware Fairs sponsored by repair shops, parts stores, distributors in cooperation with local vocational schools, media, civic groups and others,” said Rich White, executive director, Car Care Council. “While these events are free to consumers and serve as community-relations builders, most aftermarket businesses who participate experience an increase in sales and customers as a result.”

When checking lubricants and fluids, the three top failure rates were: low, overfull or dirty motor oil at 30 percent, inadequate washer fluid levels at 28 percent, and low, leaky or dirty coolant at 28 percent. Transmission, brake, power steering and clutch fluids were also checked and had failure rates of 26 percent and below.

Approximately 15 percent of vehicles had front windshield wiper failures and 9 percent needed service to rear wipers.

At least one belt was reported as unsatisfactory in 22 percent of the vehicles inspected and 14 percent required at least one new hose. New air filters were needed in 25 percent of the vehicles, while 8 percent needed new PVC filters. The “check engine” light was on in 8 percent of the vehicles.

Battery cables, clamps and terminals needed maintenance in 17 percent of the vehicles inspected, while 9 percent of the batteries were not properly held down. Eleven percent had either a green, dark or clear/yellow charge indicator light.

Improperly inflated tires were found on 20 percent of the cars and 11 percent had worn tread and were in need of replacement.

The leading failure rates for vehicle lights/vision were: license plate lights at 18 percent, brake lights at 10 percent and side markers at 8 percent.

The Car Care Council is the source of information for the “Be Car Care Aware” consumer education campaign promoting the benefits of regular vehicle care, maintenance and repair to consumers. For more information, visit www.carcare.org.

Car Care Council 7101 Wisconsin Ave. Suite 1300 Bethesda, MD
Tel: 301-654-6664 Fax: 301-654-3299
www.carcare.org

What's Your Motto?

I recently wrote an article in TechShop magazine, describing my version of the Universal Independent Shop Owner and Professional Technician Motto: "I will do my best to be honest and fair, friendly and helpful, considerate and caring, responsible for what I say and do, and to respect myself and others, user resources wiesely, make the world a better place, and be a support to every technician I meet."

Here is a response from one of our readers:

Beth,
Just a quick note to say I enjoyed your point of view page in the
June's Techshop . I have been in the Automotive business for some 30
years and when I first started working at my friends fathers gas station
he use to have a sign posted on the door in the office of the "Mechanics
Creed". I was wondering if you could help me find the original. I have
found one but it is a edited version of the Aviation mechanics creed.
The one we had posted also spoke of keeping the Service station repair
shop, rest rooms, and uniforms neat and clean. First impressions matter
in every industry.
Best Regards,
Mike Natoli

If any of you have ever seen this Mechanics Creed, or have a copy of it, would you please post it to this blog? We'd like to forward it to Mike, and include it in the next issue of TechShop.

Thanks for your support!