Remarkable Rebound

June 29, 2020

Coronavirus shutdowns came quickly. This is how quick lubes responded.

Business got a little slower for Rick Murphy. 

The owner of two quick lubes and a tire shop saw that car counts were down, which wasn’t a good sign for a business that thrives on volume. He wasn’t sure what to make of it—maybe people’s tax returns were low this year, he thought.

Of course, this was before the impacts of COVID-19 took hold. It was December 2019 and into the first two months of 2020, and Murphy’s shops saw lower-than-usual business. Once COVID-19 hit, the resulting shutdowns took that challenging period and drove it into the ground. By March, business took a sharp turn.

“The volume sank below 50 percent of last year,” Murphy says. “I mean, just almost overnight.”

Hundreds of miles away, Jiffy Lube of Indiana was having a stellar start to 2020. Shops were cruising along with good returns through January and February. There was little reason to believe March would be any different.

“We had the best week in the history of our company in the second week of March,” says Lonnie Hinkle, chief operating officer for Jiffy Lube of Indiana. “And then all of a sudden, the bottom fell out.”

It didn’t matter how well or how poorly shops performed in early 2020. The coronavirus made sure that every business felt the same impact. As alarms raised about the deadliness of the virus, stay-at-home and business closure orders began coming down by early April. Everyone, essential or not, felt the resulting drop in foot traffic.

Suddenly, operators dealing with the same virus outbreak had to make different decisions to make it through. Federal aid packages came swiftly but created a new set of challenges and tough decisions.

“It’s been a shot in the dark with so many of these things. And frustrating,” says Claudia St. John, president of Affinity HR Group. “The calculus has been something you have to make quickly. You have to just go for it, and it’s going to be different from what your peers do.”

As the human resources partner for the Automotive Oil Change Association, St. John’s research and work to bring technical resources to shops served a critical role, especially early in the shutdown phase.

But it’s ultimately the decisions of individual operators that will set the course for the post-coronavirus future of the quick lube industry. For this special feature story in National Oil and Lube News, hear three operators from around the country tell their stories of getting hit by the shutdown, reacting and forging ahead.

Standardized on the Fly

Jiffy Lube of Indiana

The World Health Organization declared the coronavirus a global pandemic on March 11. At that time, Jiffy Lube of Indiana was enjoying a strong start to 2020.

Indiana Gov. Eric Holcomb issued a stay-at-home order on March 23 as part of an international effort to slow the virus’ spread. Hinkle says the effect was short and intense.

“All of a sudden—wham—when that lockdown came,” he says.

While it was clear that the stay-at-home and business closure orders resulted in sharp drops in business, it wasn’t entirely clear early on how shops could proceed—or whether they could do so at all. State leaders issued orders. Some counties issued their own orders. Cities and other local governments also took action, but nothing was unilateral.

“I think it was very hard for the industry because those stay at home orders were not consistent,” St. John says. “And in some cases, they were county-by-county and in some cases they were state-by-state.”

Being an “essential business” became the necessary designation. Auto repair shops were included in most precedent-setting jurisdictions. It wasn’t until federal guidance emerged, which included automotive repair “and maintenance,” that quick lubes got the go-ahead to safely operate.

That is, if each local jurisdiction accepted the federal interpretation of essential.

“We also had local police coming in to some quick lubes and trying to get them to shut down, which was their own interpretation of an essential business,” St. John says.

Hinkle says that it wasn’t long before they determined their essential status. But while being essential was a positive step, it didn’t solve the biggest issue: how to carry on during an unprecedented drop in business.

New Normal

The larger challenge was figuring out how to keep as many shops open as possible without getting into financial trouble. That was no small task for Jiffy Lube of Indiana, which operates a network of 48 stores.

Like so many businesses, the company made some tough calls.

“We shortened some service center hours,” Hinkle says. “We temporarily closed some service centers. And unfortunately we had to furlough some people off work.”

Because the company expects to bring those workers back, Hinkle says it was incredibly helpful to have a staff member in place to help furloughed employees manage the transitions. The director of retention and recruiting was able to use her skills to help workers get assistance.

“Shelly was right there on the phone with people and emailing them documents and making sure people knew where to go for unemployment,” Hinkle says.

To remain both essential and effective, shops needed to make some operational changes. The alterations that Jiffy Lube of Indiana made were common across the industry, as operators sought to minimize customer contact.

For an industry so focused on process, this was a true disruption. Hinkle says that they had to leave out some of the fundamental parts of their service model, like vacuum cleaning and checking cabin air filters. Like all else, the changes had to be made on the fly. 

They adopted a drive-thru model, which wasn’t as common in the Jiffy Lube system as with other brands. It was all about keeping people in their own personal bubbles.

“We decided people should stay in the car,” he says. “They’re touching their own controls in the car. And the other thing is it keeps people out of the lobby.”

The shops added some items, too. Extra sanitizer had to be ordered. Same with extra gloves for techs, who were disposing of them more often. Techs also wore masks, which Hinkle said have been hard to get at times.

Though the company had to make some tough changes, Hinkle says that the bottom line was that the shops were able to reinforce their essential business designation with customers.

“This is going to go down as one of those times that we’re proud to say that we stepped up and took care of folks when they needed it,” he says.

Maintaining Poise

Taking care of the shop process is one thing. Managing the needs of a workforce during a pandemic is another challenge.

St. John says that’s one of the most important responsibilities for operators,, especially in tough times.

“Your commitment to your employees and to your customers and to their health makes such an impact,” she says. “Your commitment to saying, ‘We’re gonna get through this. None of us have ever been through this before but together we’re gonna get through this.’”

Hinkle says that education was their strategy. In addition to providing the masks and other equipment needed to stay sanitary, he says they made a point to stay in touch with people throughout the ranks and on a regular basis.

“Talking to them about social distancing,” he says. “It’s a given that we need to keep our distance from guests, but not everyone thinks about that from the perspective of the coworkers.”

It’s unavoidable that Hinkle worries about an employee getting sick and potentially spreading the virus, which hasn’t happened so far. But he hopes the education component mitigates the risk.

Being a visible presence is also important for company leaders. For Hinkle and CEO Steve Sanner, that means spot visits to shops. There aren’t the usual handshakes, but Hinkle says they want to bring good news for their essential workers.

“Just delivering a positive message.”

Community Over COVID

Valvoline Express Care of Ennis, Texas

What does the phrase “we’re all in this together” mean to you? Maybe you live in a big town, or a city, where it’s hard to find meaningful connections, and it really doesn’t mean that much. But perhaps you live in a small town, a place where everybody knows each other. A place where there’s a real community. 

If so, you may know what it’s like to be Brenda Rider.

Rider’s Valvoline Express Care in Ennis, Texas, has been hit by the COVID-19 quarantine as hard as anyone. It’s a three-bay shop with a staff of six. Small businesses like hers are being devastated by stay-at-home orders and government aid that is tough for some to access. But for her community, “we’re all in this together” means personal connections. It means helping out the people you know.

Instead, Rider has made a commitment to her town and shop. To her, keeping her employees’ and her clients’ best interests in mind are the priority. Although the outbreak has hindered some of her plans, she’s still going strong.

Stopped Short

Business dropped quickly after the pandemic hit. The shop's car count dropped from normal levels by about five cars. Recently, though, they’ve gained back some ground.

“Our car count has been slightly increasing, toward the end of April. It’s looking up,” Rider says. 

To counteract the drop in car count, Rider has made some changes to her business plan. Some of them have been fairly standard, like emphasizing to her employees the importance of selling recommended repairs, but some are more radical. 

One strategy of hers actually involves a sort of car delivery service.

“We have someone go out and pick up the car, then bring it here,” Rider says. “Then they’ll drive it back and the customer doesn’t have to leave their house. It’s about convenience for them.”

The strategy adds a level of convenience that might not have been available in other circumstances.

Time for a Change

As business slowed, Rider made some hard-and-fast changes to her processes. She knew that things couldn’t keep going the same way as before— life was different, and the store’s operations had to reflect that.

Like Hinkle’s Jiffy Lubes, Rider cut hours. By the third week of March, normal operating hours had to be reduced by an hour and a half on weekdays. They went down to one day open on weekends.

Rider also made certain to keep up proper levels of cleanliness and distancing. Luckily, none of her workers have been diagnosed with either COVID-19 or any other illnesses to date.

“There aren’t signs of sickness among staff,” Rider says. “They’re always washing their hands in the shop. And we’re keeping chairs in the waiting room six feet away.”

While Rider was able to keep the majority of her staff, she had to let go a new hire in March. Though she doesn’t expect to lose any more employees, she cautions that it’s a different situation for everyone.

Overall, Rider says, she has had to become much more cautious. That community spirit hasn’t been derailed by COVID-19.

Keeping the mindset of earning and retaining customers’ trust is one method that’s gotten her through so far. Although they may be guarded now about spending money, it won’t last forever— and when customers eventually do start to feel safe about coming back, having their trust will be essential. Customer retention— not replacement—is key.

“I’m in a small town, a small community,” she says. “I depend on my community. Normally we’d sponsor school programs, festivals, sports teams, things like that. Things just to give back, whatever I do.”

Derailed Renovations

Before the virus hit, Rider had intended to start refinishing her shop. She had started renovations before, in 2017, but planned on continuing this past January.

“We had a huge renovation for the waiting room and the outside of the store— we added more seats and customer comfort,” Rider says. “The business is the customers, after all.”

The renovations she had planned on for 2020 would have meant finishing a remodel of the bays, as well as updating the walls and floor paint in the pit to make it match the updated storefront. The renovation wasn’t just for customer comfort—it was also for the comfort of her workers.

For now, though, things remain in limbo. 

“It really depends on the shop’s numbers and what happens in the next couple months,” Rider says. “Right now it just isn’t feasible.”

Extra Support

While the federal government passed a number of aid and loan packages in response to the economic downturn in the wake of coronavirus, none received more attention than the Paycheck Protection Program. The measure received hundreds of billions of dollars in an initial bill but ran out of that money in less than two weeks.

“The CARES Act provided loans, grants and a variety of buckets of money to help businesses stay afloat,” St. John says. “And one of the big pieces of that is the Paycheck Protection loan.”

For the PPP, as many know it, 75 percent or more of the money must be used on payroll. The rest must be used on rent, utilities or mortgage payments. The loan could then be fully forgiven, after a six-month deferral on payments, or turned into a low-interest loan.

Rider found one of the biggest sources of support in her local bank. They’ve made it a priority to help struggling businesses like hers, she says.

“It was unbelievable,” Rider says. “My bank worked tirelessly to get it done. They got the money turned around in a week.”

While businesses across the country experienced wait times and delays with large banks, it was the community business tie that came through for Rider.

That isn’t the only source of support she’s been receiving, however. Valvoline has also done its part to keep her business going through financial assistance and other means.

“Valvoline has gone above and beyond to help,” Rider says. “It’s a huge impact when you’re in a small community.”

Overall, it’s become clear to Rider how much her community has needed to band together— and how they really are all in it together.

Quick Action at the Quick Lube

Magic Lube stores of Kansas and Arkansas

Murphy has been in the business since 1992, starting as a contract manager for a car wash and lube shop.

Today, his network includes Fort Scott Quik Lube in eastern Kansas, Mr. Lube in Bentonville, Ark., and Magic Lube Tire and Brake in the Little Rock area.

Though he was having a slight slump in the 2019-2020 transition, there was no cause for alarm at first. After all, the previous years had been phenomenal, he says.

As mentioned at the top of this story, Murphy’s volume dropped to less than half of what he saw the previous year. Most of his operation is in Arkansas, where Gov. Asa Hutchinson hadn’t issued a stay-at-home order. Murphy says that people stayed home nonetheless. Bars and restaurants closed down—the typical scene that played out across the world. 

His small region of the world was just starting to see cases of coronavirus when he got a call that sent a panic through one shop.

“I get a call from the Fort Scott store. And one of our employee’s wives is a nurse, and they think they’d been exposed,” he says. “And he was worried about his family, worried about her.”

Make the Call

One of the biggest challenges for St. John and her staff, as they fielded call after call from clients, was that there was no standard operating procedure for this situation. What works for one shop might not work for another. What is the best course of action for one employee might be different for another.

The circumstances become even more precise when there’s a potential virus exposure and an operator is faced with the excruciating decision to keep everyone safe while salvaging their business.

It comes down to the details.

“Do we know approximately when he got infected? Did he have a doctor’s note? What was the nature of his illness? What were his symptoms and when did he get tested?” St. John says. “All of those things affect the decision about how to go out. How to get covered. How to get paid. When he can come back. And then his colleagues who work next door to him—that could be a completely different conversation”

Complicating things is the fact that there isn’t really time to slowly weigh the options. Operators have to act fast.

That’s what Murphy did.

“We closed the store, first thing,” he says. “We said, ‘Look everyone: go home and figure this out.’”

He counseled his employee to have their family doctor lead the way. After three days, there were no symptoms among his staff. He then looked to resume business with the rest of his people. But it wasn’t mandatory.

“Tuesday of next week, we need to reopen,” he recalls. “And nobody has to come. If they’re scared or showing symptoms, they sure don’t need to come. Do whatever the health department wants you to do.”

Bright Spots

It took no time before the Fort Scott shop was able to demonstrate its essential nature. In the small town, the dealership was closed. Customers needed service. 

The first customer after reopening was a state trooper. That’s just one public safety agency that the shop services.

“Of course we do the Sheriff’s Department there,” Murphy says. “We do the ambulance service there. Small town, and we’re the only quick lube.”

With fewer customers showing up, it was good to see law enforcement come through the shop. The numbers were dire at times. Murphy had weeks that were 75 percent below the previous year.

But then, all of a sudden, Magic Lube Tire and Brake had a big day in late March, right as national shutdowns were taking hold. It was a clear day after nearly two weeks of rain. Commercial customers came out of the woodwork, needing service. It was a reminder that their business kept the community running.

“We actually had our busiest day ever at our tire store,” Murphy says. “Highest volume, highest tickets. And a week before, we did virtually nothing.”

Acting Fast

Like most operators, Murphy had to make quick decisions not just to keep his employees healthy, but also to keep his balance sheet as healthy as possible.

Like Rider, Murphy opted to pursue Paycheck Protection Program funds. Also similar to Rider, he went with a trusted local bank to get things done. Murphy applied for the assistance during the first round of funding, which was available through the middle of April. He didn’t know it, but he was getting into a program that quickly depleted.

“The application form was a simple two or three pages,” he says. “It was all fill-in-blanks online, and if the bank already had your information, it made it a lot simpler. If the banker knows you, I think that made a difference.”

It was a total of about 10 days before Murphy received the funds. He says he’s glad he acted quickly on the application.

As the economy sank amid coronavirus, the federal government passed multiple forms of assistance for businesses and workers—paycheck protection, expanded unemployment, disaster loans and more. If required business leaders to figure out the best course of action for their operations.

For PPP loans to be forgiven, for example, owners had to use the majority of that money to keep people on board. If businesses couldn’t do that, they had to assure their people that unemployment benefits would be available to them.

“There have been businesses who said, ‘I can't keep my payroll up. It doesn't make sense for me to pay this loan,’” St. John says. “Because it converts into a low-interest loan if you don't keep your employee population up. So I've seen businesses not take the money and furlough employees to wait it out.”

Others, St. John says, were happy to convert the funds into a low-interest loan to use on other expenses.

In Murphy’s case, the money went directly to payroll, and he kept his people on staff. He said it will go a long way toward it’s intended purpose: offsetting payroll costs during a drop in revenue. Of course, there’s a limited window.

“It won’t last very long. It will be gone in a hurry,” he says. “We’ve already used a lot of it.”

The Leadership Factor

Early in the shutdown phase, when officials were drawing lines to separate essential and nonessential businesses, Hinkle says the company received some pointed questions.

“Right at first, when this whole thing started to unfold, we had a couple folks come to us and ask why we were essential,” he says.

To him, it was obvious. People need reliable transportation to get to the doctor’s office. Families need to carry a household’s worth of groceries home every week or two. A flat tire throws a nasty wrench into an already stressful time.

That rings true for Murphy, whose shop saw that state trooper cruiser come in for service in the middle of a pandemic. Servicing vehicles for the public safety sounds pretty essential to Murphy.

There’s another side effect to that work, too. It’s the pride that takes hold within the shop. 

“Our guys feel better about being there, so that helps too,” Murphy says.

In an industry so customer-focused, it’s important to be attuned to the struggles within your ranks. In a time of unknowns, this is an area that leaders can lay a solid foundation for the near future.

“If they know you care about them and are taking their health and safety very seriously and you’re going to be there for them when this is all over, that will do a lot to alleviate some of the uncertainty,” St. John says.

From a business standpoint, the uncertainty aspect is the crushing long-term blow from the coronavirus outbreak. No one knows how long shutdowns will be necessary, let alone how customer behavior might change as a result.

While shops are all facing their own hardships, they have been true to the quick lube model and were quick to adapt. Individually, that means that another local business is able to stay open. Collectively, it means that they’re serving the infrastructure that helps the country through this time.

“We are really proud to say that we have stepped up,” Hinkle says, “and have done our part to help people take care of their cars during a trying time in our community.”

Correction: The original version of this article misstated the drop in car count for Valvoline Express Care in Ennis, Texas, as well as the regular average car count. It has been corrected.

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