24 minute read
AOCA CORNER
from NOLN - October 2021
by EndeavorBusinessMedia-VehicleRepairGroup
KRISTY
BABB
Is the executive director of the Automotive Oil Change Association (AOCA).
INFO
@AOCA.COM OR 800.230.0702
Government Aff airs in Fall 2021
Get updated on the AOCA’s work supporting the industry
STAY PROACTIVE AND HELP COMBAT OIL POLLUTION. AOCA encourages service station members to make sure they are qualified for the Service Station Dealer Exemption. In 1986, Congress added the Service Station Dealer Exemption to the Comprehensive Environmental Response Compensation and Liability Act (CERCLA or Superfund). Without the Exemption, automotive service facilities that changed engine oil for customers could be held liable for any used oil pollution that occurred offsite due to transporter or recycler accidents/negligence. The trade-off has largely been a win-win.
Since 2016, the Federal EPA Region IV and the Mississippi Department of Environmental Quality have been working together to remove an abandoned JCC Environmental Site in Picayune, Miss., a former used oil and waste recycling facility that filed bankruptcy in 2013. As of August 2021, the EPA has settled with 84 “generators,” and 30 automotive service facilities that changed engine oil for consumers. The highest cost allocation to any generator so far is $24,100.
When “service station dealers” (e.g., fast lubes, auto repair, automobile dealers, tire dealers, etc.) meet the following Exemption conditions, they are relieved from responsibility for costly cleanups and liabilities associated with off site handling of used oil.
Comply with all applicable used oil management standards, which includes complying with the federal Spill Prevention Control and Countermeasure regulation. Do not mix used oil with any hazardous substance, and accept used oil from DIYers and send it for recycling.
Remember that there is no minimum amount of DIYer used oil that must be accepted. However, EPA’s Exemption Application requires applicants to describe any methods used to notify the public that the facility accepts(ed) or was willing to take DIY used oil (e.g., sign at premises, newspaper, pamphlets) and, if available, to provide a copy or picture. AOCA has a DIYer used oil acceptance notice poster, and DIYer used oil collection log available for members at www.aoca.org.
On August 13th, 2021, OSHA updated its COVID guide on Mitigating and Preventing the Spread in the Workplace to refl ect the CDC’s July 2021 mask mandate and testing recommendations to protect vaccinated and unvaccinated workers.
Save the Date iFLEX will be here in November! At this year’s convention, a endees will be able to learn from top industry professionals while networking with other operators and vendors. You’ll be exposed to training and education that will advance your business as well as your confi dence, but it doesn’t stop there. Come join AOCA at the Rockhouse in Las Vegas, Nev., on November 14 to kick off iFLEX! From 6 p.m. to 9 p.m., you can connect with our industry professionals and enjoy the ambiance of the Hard Rock Café. Register today at wcwa.org/events.
STAY PROTECTED WITH API
API standards and programs provide benefits and protections to shop owners and operators
BY JEFFREY HARMENING, AMERICAN PETROLEUM INSTITUTE, MANAGER – EOLCS/DEF/MOM
The American Petroleum Institute (API) works across the auto industry to develop motor oil standards that meet changing lubrication demands as engine technology advances. We have been licensing engine oils for almost four decades through the Engine Oil Licensing and Certification System (EOLCS). However, there is more to EOLCS than developing and licensing engine oils. There are a number of other programs that benefit oil change and quick automotive maintenance shop owners and operators by providing protection and monitoring programs.
ENGINE OIL LICENSING AND CERTIFICATION SYSTEM
The most recognizable program from EOLCS is the voluntary licensing and certification program that authorizes engine oil marketers that meet specified requirements to use the API Engine Oil Quality Marks. There is a robust global network of 870 licensed engine oil marketers in more than 60 countries who are currently licensed to display the API Quality Marks on over 23,000 products in the marketplace. API 1509 - Engine Oil Licensing and Certification System has recently been updated and contains the latest standards and marketing guidelines for API Engine Oil Quality Marks. It governs how engine oil marketers certify that gasoline and diesel engine oils meet API’s stringent performance standards.
AFTERMARKET AUDIT PROGRAM
The API Aftermarket Audit Program (AMAP) supports the licensing and certification program by overseeing the sampling of API-licensed oils in the marketplace and tests them to verify compliance with engine oil specifications. This ensures that oil marketers, distributors, installers and consumers can have confidence in the quality of API-licensed motor oils in the marketplace.
API-licensed engine oils are purchased in packages and from bulk tanks in the marketplace and tested to determine their physical, chemical, and performance properties. The results are compared to the formulations submitted by the licensed oil marketer to API. Conforming oils will show test results that are consistent with the formulations on file with API and meet the API specifications claimed as well as all EOLCS program requirements.
To confirm the oil quality, all oil samples undergo elemental analysis and testing for required properties, which include viscosity at 100°C, hightemperature/high-shear testing, cold cranking, pumpability and volatility. At regular intervals, the oils may also be tested for foaming properties, shear stability and oxidation, among others. In addition, product packages are inspected to make sure they correctly display the API Marks, comply with licensing requirements, and carry product traceability codes.
If a licensed oil does not match the physical and chemical data on file, API will work with the licensee to evaluate the nonconformity and take appropriate corrective action. Unresolved nonconformance issues are subject to additional enforcement actions. Actions may include termination of the license to display the API Marks and removal of noncomplying product from the marketplace.
COUNTERFEIT OILS
We also investigate oils that are falsely claiming to be certified by API. Unscrupulous manufacturers producing low quality oils may add API marks to confuse distributors, shops, retailers and consumers. API hosts an Unauthorized Oil listing of oils which are not licensed by API and displays product labels. This listing is continuously updated as API works with infringing companies to remove their unauthorized products from the marketplace and alter their marketing materials accordingly. API may also investigate oils at change locations and notify the marketer identified on the oil change receipt of these test results if the test results indicate that the oil on the receipt does not match the formulation licensed by API.
MOTOR OIL MATTERS
Motor Oil Matters (MOM), API’s program for licensing oil change locations, provides benefits for installers and their customers. MOM-licensed oil-change locations and distributors certify that they meet the requirements set forth in API 1525A, which governs bulk oil chain-of-custody and quality documentation. Licensed locations commit to dispensing oils meeting API performance standards and permit API to sample their bulk oils as part of the aftermarket audit program, ensuring they are pouring the oil as stated to their customers. Licensed installers and distributors also meet the regulations for chain-of-custody enshrined in NIST Handbook 130 Uniform Laws and Regulations in the Areas of Legal Metrology and Fuel Quality, as adopted by the National Conference on Weights and Measures annually. MOM provides protection and assurance for you and strengthens your reputation with your customers. Information about all the benefits of MOM can be found at MotorOilMatters.org.
The standards and programs established by API are continuously evaluated and updated as needed with input from OEMs, oil marketers, distributors, shop owners and other stakeholders in the industry. This helps assure shop operators that they are getting high-quality oil that will meet the needs of their customers’ engines.
—Jeffrey Harmening, American Petroleum Institute, Manager – EOLCS/DEF/MOM If you have questions or need additional information, contact the API Engine Oil Licensing and Certification System at eolcs@api.org.
HOW DO YOU COMPETE WITH BRAND-NAME CHAINS?
Strong customer service will help keep your business competitive for the long term
BY KIM TULLY-SUTTON, LEAD MARKETING SPECIALIST AT CHEVRON LUBRICANTS, AND GRAHAM RUSSELL, AUTOMOTIVE INSTALLED BUSINESS CONSULTANT AT CHEVRON LUBRICANTS
You’ve spent several years building a successful, independent responding to reviews—either positive or negative—personally and fast lube business. You like being your own boss. You have steady, quickly as a larger chain operation is less likely to respond online hardworking employees and loyal customers. You’ve contemplated to a dissatisfied customer. Finally, there is the real possibility that expanding and acquiring or opening another fast lube facility. the negative performance of a local franchisee can affect other
You find out one of your competitors a few blocks away has sold to franchisees in the area that are under the same brand name—so just a chain operation. A big (franchise) player comes into your territory by brand association there could be unintended consequences. with name recognition, backed by radio ads. Suddenly the local As an independent owner/operator, you also have more flexibility competitive landscape has changed. in hiring and setting workplace policies. Many owners
This scenario has become more common as the tell us they think of their employees as family and automotive installed business continues to go through “When employees treat them accordingly. That means being free to give consolidation and investor pressure on private equity feel they are them time off when they need to attend to personal owned franchise chains requires them to increase site counts. How does the independent owner/operator treated well, business, knowing they will return the favor by being extra diligent on the job. Furthermore, you decide stay competitive and grow in this environment? that translates how much to pay your employees based on their value
Independent owner/operators have numerous into loyalty and to the business, not according to a corporate formula. advantages over the franchisee including flexibility better customer All of this makes a difference because employees compared to the constraints and restrictions imposed with some business models. Often the franchise offers service—a win, win represent your business to your customers. When employees feel they are treated well, that translates a brand and required operating model and advertising for everyone.” into loyalty and better customer service—a win, win control in exchange for a percent of gross revenue for everyone. and possibly a royalty. The franchisee also typically —Kim Tully-Sutton, Lead As Tom Thornton, who runs a Havoline xpress pays into a marketing pool of funds for advertising, Marketing Specialist at lube® in Vancouver, Wash., explains, “Customers love where the franchisor controls how the funds are Chevron Lubricants local, family-owned businesses. In this day and age, spent. The benefit of a franchise model is that if you that’s a leg up on the competition.” Thornton goes on don’t have direct, hands-on experience operating a fast lube, the to say, “The people who come in for an oil change know us and trust franchisor provides required processes and procedures for running us. That always helps, especially in these times with COVID.” the business. The importance of trust can never be overstated when it comes to
In contrast, independent owner/operators are constantly making vehicle maintenance, as trust is one of the most important reasons why decisions that they know are best for their business and their customers return to your shop again and again. customers, such as being involved and visible in the community As an independent owner/operator, pairing strong customer service, through various organizations. As an independent owner, if you want experience with personalized knowledge of your local community and to support a local charity, or advertise in the high school football off-site local advertising will help keep your business competitive for team’s program, you don’t need to seek permission or funding to do the long term. that because you have control over your local advertising and your social media presence. Kim Tully-Sutton has been with Chevron for more than 12 years and is
Rarely does a franchise chain store have its own website—more currently the lead marketing specialist. You can reach her at Kimberly. typically, it appears in a zip code search on the corporate site. Sutton@chevron.com. Whereas independent fast lubes have the opportunity to use their Graham Russell oversees the Northwest business area for automotive website and social media platforms to tailor their messages to installed as a business consultant. You can reach him at grahamrussell@ their local market and customers. Plus, there is an added benefit of chevron.com.
MARKETING TIPS TO GROW YOUR BRAND ONLINE
BY MORGAN TEPSIC, MARKETING AT DEVON
In our industry of all things “quick”, it can be frustrating when some of your digital marketing efforts take a bit more time than a speedy oil change. In this month’s article, I will walk you through some market trends and specific strategies we have been doing at DEVON. Hopefully, you’ll find a helpful nugget somewhere in here! “The more you understand your ideal customer, the easier it is to market to people with similar purchasing habits.” —Morgan Tepsic, marketing at DEVON
The more you understand your ideal customer, the easier it is to market to people with similar purchasing habits. Many advertising clients, such as Google and Facebook use artificial intelligence to create audiences that match your current customer list. “Lookalike Audiences” effectively widen the net that you cast every time you sponsor a post using these tools.
CONSISTENCY IS KEY
Whether that’s in the colors you use or the frequency IF IT AIN’T BROKE, DON’T FIX IT....UNLESS IT IS you post online, your customers will come to expect As a digital marketer, sometimes it may feel as though some familiarity within your content as your brand everything I post online is instantly gold. However, grows. In the digital age, it’s important to frequently numbers never lie, and it’s essential to rely on them remind your customers of your services, as they are to decide which tactics aren’t working for your most certainly being bombarded with advertisements brand. Many marketers will depend on “A/B Testing”, multiple times a day. essentially launching a campaign with a few slight
Staying consistent with your brand, message, and variations. Each variation is delivered to a select group frequency of content will all help play a role in how of people and compared against each other to see your company is perceived online. For instance, without looking at any which test was most successful in generating clicks. words on Chick-Fil-A’s Instagram, you can still recognize them with With the quick lube industry being so niche, it’s easy to get the help of their consistent colors and visual themes. These design comfortable with a specific terminology when referring to your elements have been communicated repeatedly for years, and it’s that products and services. These may not always be the exact words consistency that people have come to expect from them. Take a minute that your customers are using to try and find you. Communication is to think about your company’s strategy regarding consistency and how an excellent example of how A/B Testing can help you connect with you could improve on it. current and prospective customers.
YOU GOTTA KNOW YOUR AUDIENCE
Sometimes coming up with content to post online can seem complicated, especially when you don’t have a clear picture of who you want to see it! There are tons of creative ways to gather demographic information with your current customer base. Surveys, giveaways, and other calls to action are great avenues to collect information to make critical marketing decisions.
TO SUMMARIZE
Marketing in the digital age has never been easier, thanks to platforms like Facebook and Google. However, having a clear message and direction with your digital strategies makes it easier for your business to grow online. Search your company on every outlet on the Internet to see what impression you are giving new customers. Use that as a jumping-off point to better fine-tune your company’s overall message online.
CHOOSING THE RIGHT TRANSMISSION FLUID FOR THE JOB
Keep your vehicles’ gears shifting smoothly with the right fluid
Transmissions are one of the most important and complex vehicle systems.
They make a car move by receiving power from the engine, converting it into torque, and transmitting this rotational power to the wheels.
Transmission repairs are one of the most expensive, complicated repairs, so keeping transmissions in good shape and using the right fluid is critical to safe and efficient vehicle operation.
WHAT TRANSMISSION FLUIDS DO
For transmissions to work properly, it can’t have any metal parts grinding. Similar to motor oil, transmission fluid acts as a lubricant between the transmission’s parts for smooth operation and keeping the transmission lubricated, clean, cool, sealed, and transferring power. Typically, transmission fluid needs to be changed every 30k-100k miles, depending on manufacturer recommendations, or more often on cars HOW TRANSMISSIONS WORK driven in high-stress conditions (stop-and-go driving, heavy loads, or Transmissions use a series of gear ratios to keep a vehicle’s engine spinning driving up and down hills). optimally, while providing the wheels with the right amount of power they need to start, move, and stop the car. CHOOSING THE RIGHT TRANSMISSION FLUID
The transmission acts like a power switchboard for Since the Since the transmission is one of the most complex vehicle the car: it increases torque to accelerate, prevents the transmission is systems, choosing the correct fluid is critical to preventing engine from working too hard, and disconnects the engine power from the drivetrain to allow idling. one of the most damage and ensuring the best performance and fuel economy. Today’s transmission fluids are typically blended complex vehicle with synthetic base oils for better performance, with FOUR TRANSMISSION TYPES systems, choosing improved resistance to heat, cold, oxidation, friction, and -Manual the correct fluid shearing. Here are the most common transmission fluid types The simplest, oldest type of transmission is the manual. The driver controls the gearbox using a foot-controlled is critical to and what differentiates them: -GM DEXRON®/MERCON® V (Ford)/ATF+4® (Chrysler) clutch to engage and disengage the engine from the preventing damage These are the most common on the market, designed and wheels and a manual gear shifter to change gears. and ensuring the licensed exclusively by GM, Ford, and Chrysler. They are -Automatic best performance formulated for the newest transmission technologies in While manual transmissions are mechanically simpler, automatic transmissions are easier to use. Instead of and fuel economy. today’s cars. All three include friction modifiers, which reduce the friction in lubricated parts. the driver changing gears with a clutch and gear shifter, -Multi-Vehicle Synthetic Transmission Fluid automatic transmissions use a complex torque converter Multi-vehicle transmission fluids are becoming more popular. and computer-controlled gear sets, clutches, and brakes to automatically While not licensed by any specific auto manufacturer, they are designed for shift gears. The complexity, number of moving parts, and computer superior performance and protection. They are formulated with the latest system needed for automatic transmissions can lead to expensive repairs, additive technologies and typically use synthetic base oils. if not well-maintained. -Continuously Variable Transmission (CVT) Fluid -Automated Manual More manufacturers are using CVT transmissions in new cars due to their Like manual transmissions, automated manuals employ a mechanical exceptional fuel economy. CVT transmissions require specialized fluids clutch. However, the clutch is automated using electronic, formulated with the correct frictional requirements to ensure the belt or chain pneumatic, or hydraulic controls. Sometimes referred to as a “Direct remains in contact with the pulleys without slipping. Because of this, CVTs Shift Gearbox” (DSG) or a “Sequential Manual Gearbox” (SMG), this require specialized CVT fluids. transmission allows for either fully automatic forward gear shifts or manual shifts through the gear selector or through buttons or IN SUMMARY paddles on the steering wheel. Our engineers have been working to redefine the term smooth shifting. As a -Continuously Variable Transmission (CVT) result, our ATF products are all specifically formulated to ensure long service life CVTs are similar to automatic transmissions but operate using a different and provide consistently smooth shifting performance. Plus, every product is mechanism. CVTs don’t have gears at all. They use a system of belts and pulleys extremely shear stable, and holds excellent oxidation resistance. Use Phillips 66® for an infinite range of ratios. The car’s computer decides how to adjust the Lubricants or Kendall® Motor Oil ATFs for maximum anti-shudder performance, pulleys to create the optimal ratio for the driving situation. excellent low-temperature properties, and easier shifting in cold weather.
CHARACTER COUNTS
Grow your business by finding the right people with the right attitude
BY AMBER KOSSAK, CEO OF SOLID START
“Responsible people know what needs to be done and usually do not need supervision or guidance.” —Amber Kossak, CEO of Solid Start
One of the big surprises of the pandemic this past 18 months has been the workplace. Responsible people know what needs to be done and usually staffing issues we have all had to deal with. Filling vacancies at any level do not need supervision or guidance. You will find them to be trustworthy, can be time consuming. When filling a management role, it’s even more keeping their word and honoring their commitments. Equally important, important to get the right people in place. You certainly want people they don’t make excuses or blame others for their own failings. They learned who are capable, but equally as important is character, the subject of early on that even when the dog eats their homework, it was their own fault this month’s column. for leaving it where the dog could get it.
Some might say character is an intangible that you can’t really measure. If you break it down, however, you’ll see that character has many PUNCTUALITY observable telltale signs that reveal our inner qualities. This is another small but mighty facet of responsibility.
Here’s a non-exhaustive list of qualities that you will It is one of the ways we show respect for others’ time by frequently find notable in either employees or the ever- managing our own. valuable, vendor partners.
INTEGRITY
ALERTNESS The dictionary defines integrity as “the quality of being Alert people are tuned in to things going on around honest or having strong moral principles.” It’s one of the them, and not simply what is going on in their own most important qualities in the workplace or the home. heads. People who are alert are aware of dangers and It’s the opposite of hypocrisy. People trust those with opportunities. They have the ability to stay focused integrity and prefer to deal with them, as my father always on a task while not being oblivious to everything else says “even bad men want to do business with good men”. happening around them. Integrity is a quality we should all embrace.
EMPATHY CONFIDENCE
The opposite of empathy is indifference. Empathic people identify with Many of these concepts are interconnected. Confidence intersects with others’ emotions and know how to gauge what they are feeling. This is decisiveness and courage. Confidence is related to self-assurance regarding essentially an intuitive trait. You want employees who are empathic towards one’s abilities, though unwarranted overconfidence (pride) can be a flaw. It’s customers, and vendor partners who are empathic toward you and your more than useful to find a balance between confidence and the humility that team. They read people well, both their motivations and intentions. Empathy keeps us teachable. is where the idea of walking a mile in another’s shoes comes from.
FINAL THOUGHTS
DECISIVENESS I began this column discussing the staffing issues many companies are The opposite of decisiveness is wishy-washy. Decisive people are confident facing right now. No matter if you are trying to keep the right people, hire decision-makers. Once they have settled on a course of action they stick the right people, or find the best vendor partner, remember that character with it. They tend to be more comfortable with risk. They understand that counts. If you get the right people with the right attitudes, I’m confident your risk and uncertainty are part of the game, and when called upon to make a future will remain profitable. decision, leaders take action.
RESPONSIBILITY
Responsibility means being accountable for one’s actions. Responsible people know the rules and what is appropriate both in and out of the
Amber Kossak is the CEO of Solid Start, manufacturer of True Brand Products. She has been in the automotive industry for almost 30 years and is serving on the AOCA board of directors. She can be contacted at kossak@solidstart.com. For more information please visit solidstart.com.
THE FUTURE IS YOURS TO DRIVE
When you decide to sell your quick lube business, understanding the cash generated by your business is the fi rst step toward creating value to support your future
The quick lube industry has seen big changes in the past several the future when the timing is right. Whether selling or leasing, ensure years. Technicians and owners are meeting new expectations from you’re working with a fi nancial advisor to understand all the potential consumers while facing issues like employee shortages and supply tax impacts. chain disruptions. These pandemic-related concerns, along with new technologies and changing industry trends, have left many business WHAT IS MY BUSINESS WORTH? The next step is calculating EBITDA: owners with questions about the future of their operation. Earnings Before Interest, Taxes, Depreciation and Amortization, or
Owners with an eye toward selling their business should be mindful in other words cash fl ow. The buyer wants to know the cash you are of buyers who value the business based on pandemic-impacted generating today, and the cash they could generate if they owned your fi nancial statements and point of sale (POS) data. Many business tomorrow. businesses that remained open during the height of the pandemic likely experienced a signifi cant drop YOU’VE DONE THE LEGWORK, NOW WHAT? in business, and the impact of the pandemic should If you are ready Once the buyer works with you to calculate EBITDA, be excluded when valuing the business. Once these to sell, be sure to and both parties remain interested, you’ll move into adjustments are made, actual oil changes, ticket, discuss with your the next stage which includes a Letter of Intent (LOI). expenses, and resulting cash generated by your quick lube will remain the primary factors for valuation. The buyer the options After the LOI is signed, the next steps will include assessments in the form of surveys, environmental operation’s future potential will also infl uence the value for compensation testing, and market research. of your business to the buyer, which could include and benefits for factors such as nearby retail activity, demographic current employees. FAMILY AND EMPLOYEES data, and economic growth trends. Employees and family often go hand-in-hand. If you are ready to sell, be sure to discuss with your buyer the options IF YOU’VE DECIDED TO SELL: You’ll need some for compensation and benefi ts for current employees. documents to track past performance. These documents generally If your family has worked with you to make your store a success, include the last three years’ POS data and a breakdown of oil changes there may also be employment opportunities with the company who is versus other services, products or repairs sold on site. As previously purchasing your business or opportunities to fund di erent dreams. mentioned, past performance will be used as the starting point to value And how will you spend your time once the ink is dry and your people your business. Most investors simply want a clear picture of how your are taken care of? Take time to do what you have always wanted to do: overall business looks, performs, and trends under normal operating spend more time with loved ones, travel, or enjoy other hobbies! You’ve conditions, and a solid buyer can help you get there by partnering with earned it! you throughout the entire process. To learn more about transitioning into the next stage of your business, visit: ValvolineQuickLubes.com/frequently-asked-questions. IF YOU HAVE A LEASE: In this situation, make sure to partner with a buyer that is willing to work with your landlord to assume the lease, and prepare to provide the lease terms and other fi nancial responsibilities. IF YOU OWN THE PROPERTY: In this situation, the buyer may provide the option to buy or lease your property. A long-term lease may allow you to postpone some taxes, avoid the time and expense of managing the property, and still provide the fl exibility of selling the real estate in If you are not ready to sell, but you need to grow, there are ways to increase your oil changes by two cars per day over four years, guaranteed. This is a smart way to increase the value of your business in case you decide you want to sell down the road. Put more cash in your wallet now and in the future. To learn more, visit ValvolineQuickLubes.com/grow-your-quicklube, or give us a call: +1 859-357-7303. You’ve got questions, we can help!
