LET'S SAY you are a very successful trailer dealer. Your parts department generates $20 million per year, despite its low-profile location far from most of your customers.
Let's then say that a fire destroys your shop, and your insurance company says you can rebuild anywhere you want.
What would you do?
Northeast Great Dane faced that scenario a few years ago. The company chose to move closer to the heart of the market, but in another low-profile facility.
President Tom Leuner decided his company did not need to be easily seen from an Interstate. But he did jump at the chance to relocate to the middle of his market.
So he moved his flagship location from Florida, New York, a town 70 miles northwest of New York City near the edge of the Catskill mountains. He chose to relocate in Hillsborough, New Jersey, in a facility that almost anyone can find if they have good directions and above-average determination. But making it easy for the customer to visit Northeast Great Dane is not a high priority.
“We aren't here to have the customer come to us,” he says. “It's our job to go out and serve the customer.”
Serving the customer is something Northeast Great Dane does well, as evidenced by the awards that fill the walls of this company. In addition to winning awards from Great Dane, Tom Leuner was named a finalist in last year's National Trailer Dealer of the Year award sponsored by CitiCapital and the National Trailer Dealers Association.
As its name communicates, Northeast Great Dane serves a major portion of the northeast. Along with its locations in Hillsborough and Florida, the company has branches in Hudson, Massachusetts, and Lancaster, New York, near Buffalo.
The relocation of its headquarters may be the most significant, but it is not the most recent. In 2000, the company bought and equipped a larger facility in Hudson and opened a small repair facility in Syracuse — all in a down market. The company also is shopping for a larger shop for the repair operation it opened in Syracuse.
“We are in a hotel there, and we are looking for a home,” jokes John Gendelman, vice-president.
In Search of Service
Northeast Great Dane headquarters is very much at home in Hillsborough after moving from Florida, New York, several years ago.
Florida is substantially north of the center of Northeast Great Dane's market. The move to Hillsborough placed headquarters 45 miles southwest of New York City and 55 miles northeast of Philadelphia, or roughly halfway between two of the largest cities in the country. Florida is 73 miles north of New York City and 136 miles north of Philadelphia.
Management had been thinking about opening a branch somewhere in metropolitan New York City. With the loss of the shop in Florida, the search for a site began in earnest.
“Each building we looked at was a little better than the previous one,” Leuner says.
The best of the batch — which Northeast Great Dane selected — is outside the town of Hillsborough in an agricultural area.
“We are near all these people, yet we are surrounded by cornfields,” Leuner says. “That means our customers are easy for us to reach, and we have people with a strong work ethic close to us that we can attract as employees.”
Making the Move
After an extensive search, Northeast Great Dane chose as its headquarters a building that formerly served as a government-owned battery testing facility. The structure had a series of 80-ft × 60-ft cells used for testing batteries, dimensions management considered well suited for use as trailer repair bays. Each holds five trailers.
While the building was well suited for Northeast Great Dane, the city fathers were not sure they wanted a business occupying the building that would attract truck traffic. They were unfamiliar with management's philosophy of reaching out to the customer instead of having trailer fleets come to them.
“We approached the Hillsborough city government with the attitude of ‘what can we do,’ instead of ‘here is what the law says we have the right to do.’ We approached them as partners, rather than adversaries, and we worked together to address their concerns.”
Northeast Great Dane attracted some local residents to come to work for the company, and a number of loyal employees moved to the Hillsborough area from Florida. They included members of the purchasing department, sales, and company truck drivers.
Even though many of its employees followed the company to Hillsborough, Leuner says that the company decided to retain a presence in Florida in order to continue serving customers in that part of the state. To do so, Northeast Great Dane built a smaller, six-bay shop to replace the one that burned. The shop serves as a service facility and a parts depot. Plus, the spacious yard provides ample storage for used trailers.
While the ultimate solution to the fire was the result of lengthy planning, it did not take Northeast Great Dane long to get back to work — albeit in temporary quarters.
“We were at 80% of capacity within a week,” Leuner says of the 1995 fire.
The fire started in the middle of the shop and spread both directions. When the smoke cleared, the shop was a total loss. But mechanics simply worked on trailers in the yard — at least those trailers that survived the fire.
The parts warehouse also was affected. Fortunately, Northeast Great Dane operates a fleet of parts delivery trucks that contained some inventory. Storage facilities were located to handle the rest.
Whole Lot of Parts
Northeast Great Dane is a full-service trailer dealer. The company provides new and used trailer sales, trailer leasing and rental, financial services, graphics production and installation, and trailer repair.
The parts department is a major source of revenue — $20 million per year.
“There aren't many parts distribution centers that sell as many parts as we do,” Gendelman says.
Northeast Great Dane has approximately 20,000 square feet set aside for its parts operation in Hillsborough, including zero for supermarket parts shopping. The company uses a fleet of 22 parts delivery trucks to take the product to the customer instead of relying on the customer to come in to buy. The company is so committed to the idea of going to the customer that no one among its 58 parts employees is designated to work the retail parts counter. Instead, they handle the phones, stock the shelves, and deliver to the customer.
“We believe in selling,” Gendelman says. “We don't just take orders.”
Northeast Great Dane sells parts to approximately 1,000 customers. The company is an original equipment dealer for a variety of suppliers, including Accuride, Carlisle, Holland, Kinedyne, Maxon, Todco, Truck-Lite, and Whiting.
“We aren't big on changing suppliers,” Gendelman says. “A lot of the companies that we represent were our vendors when we started in 1973. That includes Great Dane trailers, the only major trailer manufacturer we have ever represented.”
Northeast Great Dane has 11 sales representatives in its parts operation, one more than it has in new trailer sales.
Just as it does not change vendors often, the company has a stable workforce.
“We don't want guys who have worked for a lot of other people,” Gendelman says. “If you steal someone from his employer, another employer can steal that person from you. We prefer to get someone from outside the industry and train him from the ground up.”
The background of those in trailer and part sales varies. One of the company's top sales representatives went to Cornell University to be a landscape architect. Another sold for a door manufacturer, and a third had served as a mechanic.
Management believes in training someone from the ground up. The company pays high school trainees full wages as they learn.
“Trailer dealers like us are schools for our employees and representatives for our vendors,” Gendelman says. “If we are serious about getting and keeping good employees, it's our job to give them the training they need. It's also important that we promote them through our system and to show our employees the career capabilities they have with the company.”
Gendelman speaks from experience. He joined Northeast Great Dane years ago as parts manager. Now he is vice-president and part owner of the company.
“You owe it to your employees to train them,” Gendelman says. “Once you train them, you owe it to them to promote them — even if it means having to hire someone to fill the vacancy. We are to the point now where our employees are bringing relatives to us to hire because they see this as a good place to work.”
“We take care of our employees and vendors exceptionally well,” Leuner adds. “They in turn take care of our customers exceptionally well.”
Northeast Great Dane periodically conducts think tanks in an effort to identify ways for the company to operate more effectively. The events bring managers together to identify what the company needs to do and what it should stop doing.
The company also holds monthly meetings with management to make sure everyone knows what the company is doing and to develop ways to do it better. On the second Tuesday of the month, all directors of departments, brand managers, MIS director, and controller gather to discuss key issues. The meetings typically run about four hours.
“Information is the key,” Leuner says. “If we don't want to manage by crisis, we have to identify what to fix and what we don't want to get broken. The meetings offer cross-pollination of ideas. Branch managers talk about the way they do things at their location, and we discover ideas that we can apply at all of our branches. We get a lot of ideas from these meetings, including most of our safety plans, our paint booth at the Hudson branch — anything from major financial decisions to deciding on floor cleaner products.”
Another idea from the Northeast Great Dane think tank: 12-point service exams.
“If a customer brings a trailer in for us to fix a problem with the lights, for example, we still will check everything on our 12-point list,” Gendelman says. “What if we simply fixed the lights like the customer asked, and that trailer hits a school bus after leaving our shop?”
“We strive for professionalism in everything we do, but the key to professionalism is in the shop,” Leuner says. “Anyone can look good selling new trailers. But not everyone looks good fixing a competitor's brand of trailer.”
Trucking for Three Generations
Tom Leuner is the third generation in his family to be involved in the trucking industry. His grandfather got the family in the business by providing contract hauling for A & P in 1916. Tom's father joined him in the business after completing his service in the U S Navy.
The operation grew to 75 tractors and 150 trailers by the 1970s.
“We knew we had to diversify,” Tom Leuner says. “We had been buying Great Dane trailers, so we decided to sell them.”
The family started Northeast Great Dane in Florida, New York, in 1973. The company added a location in Marathon, New York, in 1975 and bought out a company to set up its Massachusetts branch.
The diversification effort really paid dividends when A & P discontinued its warehouse operation. When Northeast Great Dane began selling trailers, Tom Leuner left his job in the aerospace industry to help the company grow.
“My early experience working on the trucking side of our business really helped me understand what our customers consider important,” Leuner says.
One of the things he concluded was that it is not nearly as important that customers find him as it is for him to be able to find the customers.