Shop Strategies: SCRS Chairman Opens 34,000-Square-Foot, State-of-the-Art Facility in CA
Growing up in Southern California, Kye Yeung always had a passion for cars.
He recalls that his first vehicle---a 1969 Oldsmobile 442---was intended to be shared with his mother, but Yeung had plans of his own and wanted to hot rod it. He soon found that he could only do so much with the Oldsmobile in his garage without some heavy-duty equipment and knowledge.
He enrolled in a four-semester body and fender course at Golden West College in Orange County where his instructor, Bud Yeargain, taught him how to be a body man and helped him land his first job in the auto body industry.
Meanwhile, Yeung had aspirations of being a racecar driver and traveled throughout the United States racing while running European Motor Car Works, which he opened in 1975.
Eventually, his father-in-law, whom he considered a mentor, told him, “If you put the same tenacity into your business as you do in racing, you’ll be successful.”
That’s exactly what he did, and has not looked back since. That was more than 34 years ago.
“What I was able to learn from racing, I applied to the mechanical end of my business,” said Yeung. “I found I had an edge over my competitors due to the knowledge I could draw from.”
Since then, he has put all of his time and effort into running his business in Costa Mesa, CA. This past summer, Yeung opened a new 34,000-square-foot location after 25 months of planning and construction.
Autobody News recently toured Yeung’s shop and talked to the industry veteran about his journey to become a successful businessman and operate a state-of-the-art collision repair facility
Q: What prompted the decision to open a new location?
A: Over the past five years, I had been looking to expand. We were inundated with work at our other location and had a three- to four-month backlog. At the time, we were focused on repairing the four brands we are OEM-certified with: Aston Martin, Jaguar, Land Rover and Tesla.
Making the decision to only focus on the certified brands created a challenge. Unfortunately, we were turning away our loyal customers with whom we had built relationships over the past 40 years because of all the work/pressure to repair these four brands.
We are the only body shop in Orange County that is certified to repair Aston Martin, Jaguar and Land Rover. There are some Tesla competitors, but not in the immediate area.
I began working with a realtor to find a new location. We found an old run-down building that was constructed in 1975 and didn’t even have power. However, there was an upside---it was located next to Tesla, our biggest vendor. When I saw the building, it was hard to say that I didn’t like it. It was a leap of faith, but I went ahead and secured the deal. After making the purchase, Edison took seven months to get the power we needed. Meanwhile, the building was completely renovated.
We soon found that there were a lot of unexpected up-front costs. For any potential shop owner looking to expand, whatever you think you have put away, you better have triple that because of all the unknown things that come up.
For example, I didn’t realize [there were] new ADA (Americans with Disabilities Act) compliance codes in CA. We spent a lot of money to become compliant and demolished quite a bit to ensure we were up to code. For example, we added handicapped parking and the restrooms had to be upgraded. It was almost like starting from scratch. Eventually, we got past the hurdles and opened five months ago.
Q: What are some of the unique features at your new location?
A: Everyone has dreams and aspirations of what they would like to do with their business. When the building was going through the restoration process, I was able to implement most of the desires I wanted.
We run about 100--120 vehicles at a time and are using a different type of processing. Everything is in a mobile state and a lot of the smaller repairs have no dedicated bay. Also, all of our paint booths are drive-through.
Our previous facility didn’t have the luxury of space the way it was constructed. We would have to back out five cars to move one. It took us an hour in the morning to move everything outside and then another hour at the end of the day to put everything back. The shop procedure was that every person driving a car had to have a spotter to guide you out. You lose two people by doing this. Now, with the flow going one way, our goal is to eliminate any need to back up a vehicle.
When we used to close up at night, we had to leave 40 cars outside in the parking lot. Luckily, we didn’t have a theft issue, but you always worry about leaving vehicles outside, especially high-end ones. Because our new location has so much space, we are able to have more cars come in and we can stage them. Another advantage with our set-up now is that we don’t have a lot of internal damage with parts lost and cars damaged from having to relocate them.
Part of what makes our facility unique is that we focus 100 percent on these four brands of vehicles. Obviously, competition is fierce in our industry and to be able to just focus on these unique brands, we have been able to be successful.
All of our employees are trained on how to repair these vehicles. What I have found is that to be good at doing a repair process, it helps to be repetitious. Like anything in life, once you do things enough, you become a perfectionist.
We have eight dedicated aluminum bays, which demonstrates the volume of work we do. The curtains are primarily for dust control. We don’t have a cross contamination problem since 95 percent of the vehicles we repair are aluminum.
We’re also able to stock all of the parts that are relevant to the four brands such as quarter panels, headlamps and grills. As a result, there isn’t a lot of downtime waiting for a clip or fastener. This allows for more efficiency and helps accelerate getting the vehicle back to the customer.
Q: How did you get involved repairing British vehicles?
A: I was born in Hong Kong and had British citizenship. My parents migrated to Hawaii and after obtaining U.S. citizenship, we came to CA in 1960. I was always fascinated with British cars. When I was growing up, they had a bad reputation of not working and leaking oil. However, I felt they were the nicest cars out on the road. When I opened my business, I decided to focus on those brands. At the time, they weren’t popular, but now I’m thankful that I did.
Q: What are your plans for the original 16,000-square-foot facility?
A: We completely rebuilt our original location over the last five months and plan to re-open [during] the beginning of 2018. It will cater to all of our customers who don’t own the four brands we specialize in at the new location. The older location has 20 employees, and we are in the process of building a new team.
Q: Why did you decide to segregate your work by location?
A: One of the reasons we wanted to segregate is because we have been able to command a higher labor rate for our certified work. We can demonstrate why the compensation level has to be higher due to the equipment and training for the brands we work on. It gives us the luxury to stay in that little niche.
It’s very hard to negotiate a fair labor rate if you have a normal vehicle sitting next to one being repaired by a certified technician. I can see it from a third-party standpoint where they might wonder why they should pay more to repair one vehicle, when a technician will repair the other for so much less. It’s a fair statement. Sometimes the third party fails to realize that we are paying a technician based on their experience. By segregating the vehicles by location, we are trying to limit that argument.
Q: How do you run your business using a “team concept,” and what are the main benefits?
A: This is something I started 42 years ago. Every vehicle that comes through the shop is touched by every employee. If technicians have different skill levels and a repair is allocated to a certain individual, it’s the luck of the draw for the consumer because that person might not have received training for that car. All of our A Tech employees have been certified by the OEs to do a specific part of the repair. As cars come in, there are a group of guys that specialize in different aspects such as blueprinting, paint, mechanical components, wash and delivery, etc.
As product workflow goes through the shop, it only moves one way to the next station. What this does is help with quality control and polices the group of people beforehand. If a car is pushed through to the next station and there is a problem, it gets kicked back and doesn’t move to the next station until that particular job has been completed.
I’ve found that a team concept ensures you’ll have the right tech doing the right job and a consistent repair quality. I always tell everybody in life: Be ready for opportunity. In the past, when employees go on vacation or are ill, it gives others the opportunity to showcase their talents.
Q: How have you built a dedicated team over the years?
A: Our longest employee has been with us 36 years. Most have been here 15--20. I would say that 80 percent of our employees in the back shop started out sweeping floors and we [helped] these technicians [grow] to what they are now. We’re proud of them because they are top tier.
It’s great to see someone start out with a poor work ethic because they didn’t have the right guidance and then be able to nurture them. Some of them have quit and then come back with a new mindset.
I think the reason we have been able to hang on to our employees for so long is because we provide a nice work environment, we’re consistent and we always pay them on time.
Q: Congratulations on being named chairman of the Society of Collision Repair Specialists (SCRS). What have you learned from being part of SCRS over the years?
A: We’ve been members of SCRS for quite some time. About 15 years ago, my daughters, Nichole and Jennifer, came on board with the business. It freed up some of my time and I had an opportunity to attend the first Collision Industry Conference (CIC) SCRS meeting in Palm Springs. I was able to see shop owners and other people in the industry come together and share ideas and work out situations. It was something [that] I was totally unaware could happen.
When my dear friend March Taylor passed away in 2007, I was appointed to fill his seat on the SCRS board. I attended the first couple of meetings and was blown away with how much knowledge was flying around the room. It was so far above me at the time because I was in my own little world. As an owner/operator, like others in the industry, I was very hands-on. I could tell you everything that was happening at my shop, but I had no idea about all of the things that were happening across the nation. I always encourage new board members to be patient---don’t feel that you don’t have anything to contribute. It comes in time. I had no idea when I first joined that I would eventually chair SCRS.
As you start to get involved, you get SCRS blood in you and begin to understand the repair issues happening across the country. Now you have an opportunity to not only present those problems, but also resolve some of them and network with people who can help focus those issues.
Unfortunately, some shop owners have a tendency to complain [about] why they aren’t doing well. SCRS offers the opportunity to educate and inform repairers on the current industry climate and what direction it’s going.
Q: What do you attribute your success to?
A: I was ready for opportunity and I took advantage of it. A key component is that I’ve always reinvested in my business. When I had extra money, rather than purchasing a new car, I would buy a new frame machine! Our facility has always been properly equipped to repair vehicles properly.
Also, I feel that I couldn’t have success without my two daughters, Nichole and Jennifer, and son-in-law, Mike Hubbard, working in the business.
Q: What is your advice to others in the industry?
A: Life experience would be a good start. Personally, I wouldn’t change a thing. It has been an amazing journey and I believe the best is yet to come.
Many have a fallacy that body shops are dirty. This shop demonstrates that not only can you make a good living, but you can also have a great environment you are proud of and contribute back to the community.
You should have a game plan and realize what you have to offer. Look at your team of employees like a family. The most successful shop owners are the ones who have a passion for doing the repair properly and not looking at the bottom line of every vehicle. We ask ourselves: How many customers are happy this month? If you have that mindset going in, good will most likely come out of it.
When you have a third party dictating repair cost and procedures, how can you guarantee a safe and proper repair to your customer? Focus on best practices---that would include following OEM repair standards and continued training. By keeping your customers’ interests first and building on that relationship, you’ll realize that you won’t need to be dependent on a DRP or lose one that isn’t as profitable, and still be able to build your product brand.
I’m a perfect example of how you can be successful in this industry without any DRP relationships.