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Measuring Growth - An Interview with Randy Moore, Vice-President of Mister Transmission International
a 30-year commitment to BI

by Giorgio Grosso, Business Author, Dashboard InsightMonday, June 25, 2007

I recently had the opportunity to catch up with Randy Moore, Vice President of Franchise Operations for Mister Transmission International, Canada’s largest chain of automotive transmission repair shops with 85 locations nationwide and growing. We met at their corporate headquarters in Richmond Hill, Ontario.

Randy is a cerebral 53 and has an innate ability to relate to people, which has served him well over his 30 years at Mister Transmission. The company started as a specialty repair shop in Richmond Hill, Ontario in 1963 when owners Jerry Etkin and Bruce Brillinger decided to build an automotive transmission repair service second to none and give consumers a choice of where to get their transmissions repaired (other than the car dealerships). They called their business Mister Transmission, and it wasn’t long before they had succeeded in establishing themselves as experts in their field.

Randy Moore started with the company as a store manager in 1977 and has had the opportunity to witness the company’s growth one location at a time. In fact, he considers himself fortunate to have had the chance to grow with the company and, as such, Randy and his team can say they have personally opened most of the company’s 85 locations. He is proud of the work he and his team have done and is passionate about his company. In fact, his pride in the organization and its people is only exceeded by his enthusiasm for their collective future.

Metrics and KPIs

I was eager to ask Randy what key performance indicators (KPIs) he uses to measure the success of Mister Transmission. He told me that retention ratio was at the top of the list and went on to explain what that KPI meant. Marketing and advertising activities drive consumers to his stores, or cause them to make telephone inquiries there. The retention ratio is a measure of how many of those inquiries actually turn into work orders. He noted that it really isn’t as simple as it sounds, and that retention ratio is closely related to how many customer calls can be turned into visits to the location. As an organization, Mister Transmission aims to “retain” 80 percent of the telephone inquiries that it receives, and turn those inquiries into visits to their locations. Randy knows that all customer inquiries come in as qualified leads. Once the consumer makes the decision to visit one of his locations, he knows that they’ll be impressed by the level of professionalism, the quality of service and products offered, and that they will be satisfied that all of their concerns will be answered by an expert who knows automotive transmissions better than anyone else. It’s a fact, proven over 45 years of business experience, that visits to one of his locations can be split into what he calls the 65/35 rule of thumb. That is to say that roughly 25 to 35 percent of customers who come into a Mister Transmission location will not need any kind of major work done. Most of these people have vehicles that experience some sort of irregular behavior and only require a minor service or adjustment. Randy calls these “relationship building adventures” and understands that these types of visits are important for building customer loyalty as well as trust in the brand name. Here these types of repairs are simply referred to as Minor Repairs.

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On the other hand, 65 to 75 percent of the vehicles that come into one of his locations are going to have some kind of critical problem that will require some extensive work on that vehicle’s transmission. These types of repairs are charted as Major Repairs. When it comes to major repairs, Randy is confident that once the consumer has had the opportunity to see the facility, and understand what they have to offer, they will feel more comfortable about having their vehicle repaired at that Mister Transmission location. He knows the business numbers quite well and uses defined parameters to gauge the correct number of repairs vs. services. These vital statistics allow him to focus and refine his training programs with laser precision, so that every one of the franchise owners on his team can achieve the base numbers required for their individual stores to succeed. He is ever mindful that “without the base numbers to work from any training is void because it’s like fishing in the dark.”

I wondered how he knew that retention ratio was in fact a KPI. How did he develop it, and how did it become obvious that retention ratio was a “top of the list” statistic to monitor? He explained that years ago the organization started measuring a range of metrics at the store level in an effort to see why certain locations were more successful than others. He looked at more than just sales performance; he saw a significant correlation between the number of inquiries that turned into visits to the store and the sales that were done at that location. In other words, if the consumer was willing to bring in their vehicle for an inspection at the location, then it was likely that they would remain there to have it repaired. He knew that marketing dollars were able to generate a satisfactory number of phone calls to his locations. However, he found that many potential customers would only call the store but not actually come in. This was resulting in unrealized revenue to the store because many of these customers were finding their way to competing repair shops.

This indicated some sort of communications problem at the store level. To solve the issue Randy began using training tools to teach his people how to answer the phones correctly and address customer concerns dynamically. He told me that “this training allowed us to increase the amount of visitors to the store, which resulted in an increase in end business to the location, and also raised the overall level of customer satisfaction.” Everything centers on the retention ratio; when the location hits the level of retention needed, that location succeeds as it should.

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