Ferrari shops and the recession, will they hold up ?

Repair shops, Dealers, Parts suppliers, etc.


Do you think they will survive in this economy ?

 

but the quality will rise to the top and gain market share.

 

I would think the independent repair shops will actually do better in the recession. people will be looking for bargains on service (not going to the factory authorized dealer) and holding on to/driving their Fcars, instead of trading up every time their current car needs a major.

 

Surely survival of the fittest....Agreed those who already offer superior customer service will continue to do so and will gain market share from those that are mediocre. Time for all to ratchet up a notch.

 

No the best businessmen will rise and some quality shops will rise. Some poorly managed quality will go away too.

 

Agree, a lot of VERY talented techs just don't know how to run a shop. It's unfortunate that they will suffer and so will owners as a result.

 

I owned my shop in LA for 10 years in from about 1986 to 1997. During the year after the LA riots it was MUCH worse than this turndown. Not only was the local economy horrible, many owners stopped driving their cars very much because of fear or appearances.

It was really tough to keep things going but if you have loyal customers, they always come back. But, you have to find other additional income, be resourceful, cut your take home pay, make your cash last, borrow if you're able, and sometimes swallow a bit of pride.

As a business owner, there are two things that you have to maintain at all costs:

1) good employees. It's particularly true with exotics but in any repair shop, good mechanics are often hard to find. You have to do anything to hold on to the best of them because they are so hard to replace. Poor or mediocre employees can be replaced but the best may be next to impossible. Without good employees, you might as well just shut the door. You can't do everything yourself.

2) the expectations of your customers. You can't scrimp on the service they've come to expect. If anything, you have to do more, not less. A still upper lip helps too. Keep people thinking business is just fine. Success brings success. People love a winner.

Some shops will not make it for sure. Those that will survive will be stronger but it will be painful in between.

 

I think in this economy the last thing on peoples minds is Ferrari shops and dealers. If you are lucky enough to own one or two..be grateful that you were smart and lucky enough to enjoy it and love the car enough to keep it while it's percieved value plummets. These are toys for most of us..the country and world are out of jobs and our economy is literally in the ****ter with no sign of recovery anytime soon. Right now it's survival of the fittest not only Ferrari repair shops and dealers. Hyundai shops can't survive...etc....

 

ppl still need to maintain their fcars; but dealers need to adjust their pricing down to reality. 2000$ oil changes are a thing of the past

 

Good shops are overflowing.

Bad ones are not.

My people are on all the overtime they want and we are not keeping up.

Our apointment schedule is full and we have been turning away some work for new people. The good shops I know of are in the same situation. We worked a full schedule during the holidays and that is one time it usually gets a little quiet. Not this time.

 

I thought you said the good shops were overflowing?

 

I have been around a lot of shops...from regular mechanic shops to horsepower shops to exotic shops....and it always amazed me how an exotic shop would float the cash for a major repair. If there was a $5k-10k-20k+ repair and parts order...I was always shocked that some places wouldn't take a deposit. Now, fast-foward to today....the economy is in the tank...people are getting laid off...quite frankly, if I was getting my car worked on and it was a big tab, I would offer 1/2 the cash up front. Not only is it the right thing to do, but I bet you will have the best relationship with your tech. Ask yourself this....what would $5k-10k-$30k cost you in hard money terms for 30-60 days...or if you had to borrow it on the street. Why should the indy front that type of cash? I wouldn't take offense if my mechanic asked me, I would think he is smarter than the rest and a better businessman....and I bet he would get paid 100% of the time.

Just a thought.....

oh, in Village Coffee Roaster terms, a hot middle aged blonde, dressed well, comes in and wants a small coffee ($1.30), she has NO cash...so I say, just come back tomorrow or the next day.....she responds "I live right up the street", think she ever came back? and that was for ONE DOLLAR AND THRITY CENTS.

Cash up front and nobody gets hurt.

 

That’s not the latest question at hand in this thread, and you know that.

 

What is it that I know? I know the economy sucks, I know that everybody is hurting, I know that prices of Ferraris and every other car make have tanked.....and why would anyone expect someone to front them $10k, $15k...etc. With so much uncertainty, I would be afraid of getting stuck with a tab from a customer that just got fired, laid off, lost a business.

And, please dont tell me what i do or dont know.

 

A true entrepreneur would have offered to -barter- something of substantial value for the coffee...gee,
just -what- did she have on her(or off ) to offer that day??

 

Yes, you are correct. I fell a little short there. And she was very nice looking.

 

O_M_G!

 

WHAT!

better ship off the Mondial real soon then I guess....

 

We have several cars in storage and the bill is being taken care of on the payment plan now. What you say is 100% true. It is not so much the shops having trouble as it is the clients paying the bill on judgement day. There is also some pressure from suppliers. Many are far less interested or able to supply parts net 30. For some businesses that is just a sudden shift in how they have done business. Many good shops are getting money up front for a variety of reasons. I can say for myself with a new client, right now, there is no way I am taking in a big job without money up front and it has nothing to do with MY ability to cover the costs of the job. We are getting a little tired of doing everything on the easy payment plan, especially when that is not brought up until the car is finished.

Sorry but when I go to the grocery store I plan on paying before I go home. Wish everyone with a Ferrari felt the same.

 

I know with the few home improvement projects I've done, some builders ask as much as half up front. Depending on the contractor I may push for 40% or even 20% (depending on if there are a lot of materials or just a lot of labor), if I'm not 100% confident the contractor will still be in business to finish the job. Then do payments along the way as work is performed. I don't see any reason why a Ferrari service shop couldn't so the same. I know it hasn't been customary in the past but seems like a prudent thing these days. Having a warehouse full of cars doesn't pay the bills, and you can't sell the car to pay off the bill unless you sue the owner first, another costly thing. So a warehouse full of cars is not good, they're just taking up valuable space.

 

I've done that on HI projects myself. However, it's been "I'll pay the supplier for the concrete or lumber or roofing materials, when delivered to my house". Then it's clear that the money went to my materials, not to pay off the laborers from the last job, so they'll work on my job. This helps protect both the contractor and the customer and is probably a bit more negotiable since a lot of small contractors don't even have a place of business (they can close up shop and reopen somewhere else too easily). Progress payments are also easier at your home since you see the laborers at work and see that progress has been made. It may be less clear where the money goes when parts and disassembled cars are all mixed up at the shop and the customer may be a bit more reluctant to write even part of a big check before work even starts. Remember PeterS' experience with the repair shop that supposedly was fixing up his 308? But people like Rifledriver certainly are right to expect that customers can write $K checks when they drop the car off. The problem may be when they do so thinking it's $5K and then it turns out to be $15K. I don't know if or how often that happens, but that probably surprises everyone and is likely to cause a cash flow problem for somebody or everybody.

 

Great points; I'll bet the latter part of your statement happens quite a bit, didn't think of that. Personally I've had that happen many times, not with Brian but several times at FoSF. I'll admit in most cases its not their fault, especially when you come in with something like 'my car isn't running right', that could take a lot of diagnosis time. But something like an oil change/new clutch should be easy enough to estimate.

 

If that were the case I would agree but now it is happening on jobs on time and in estimate. I have a car done on time and in estimate with over 5 figures into it sitting on ice and I am getting monthly payments for it. The recession will be over long before I get paid at the current rate.

One of the best known early Ferrari restorerers in the US does 2 cars at a time. Has appointments out for a few years. He has had both current clients tell him to stop NOW. Just stopped his business cold. A real risk with his setup. Point is things are not normal and methods are being adjusted. Can't always read too much into it.

 

Did the work start before Sept or did he lose his job? Otherwise, seems like the guy was too optimistic and should have just let the car sit in his garage rather than put you out.

Just curious, how long does a resto like that take and is it usually done on weekly/monthly payments, progress milestones or final delivery?

 

Work started before but he is the CEO of a decent size Co.

A year +. I have been out of that business for a long time but I think it is still done on monthly billings.