Current Issue
Published on July 5, 1999

ETHICAL PRACTICES BUILD CUSTOMER TRUST

Editor's note: TB asked Joan Koebernick of Dakota-K Auto Repair Center & Tires in Arlington Heights, Ill., to share the views and policies of her family's dealership after it won the Better Business Bureau's Torch Award for Marketplace Ethics in Northern Illinois and went on to become one of only eight small-business finalists in the BBB's national competition. This is the first of three thought-provoking articles she authored in response.

Dear Tire Business:

You wrote asking about Dakota-K's approach to the tire and auto repair business following our selection as a national finalist in the Better Business Bureau's Torch Award for Marketplace Ethics. You inquired about our policies and how following them has affected the business and our lives, and asked for some background on the company.

Receiving national recognition in the Torch Award competition has been an honor and an opportunity beyond our wildest imaginings. My husband, Neil, and I are convinced that most individuals in the tire and auto repair business are fundamentally ethical. The BBB award has given us a new goal: to help others in our industry do a better job of demonstrating to the public that they are ethical.

Simply by avoiding some common pitfalls and misconceptions and doing a more effective job of communicating with customers and the public at large, we can do much to rid our industry of its negative image.

Please allow me to begin by explaining the criteria on which the BBB's Torch Award is based. Then I will tell how we attempted to apply those criteria to our business in preparing our demonstration to the BBB. In the process, I believe your questions will be answered.

To qualify for the BBB Torch Award for Market Place Ethics. a business must first demonstrate:

High ethical standards of behavior toward customers, suppliers, shareholders, employees and the community;

Ethical practices surrounding buyer-seller relationships;

A long-standing reputation for ethical practices in the marketplace;

Marketing, advertising and sales practices that give a true representation of the business' products and services:

Acknowledgment of ethical marketplace practices by industry peers and the community;

Ethics policies designed to give long-term value to customers, employees etc.;

Policies effectively communicated to employees; and,

Training programs to help employees carry out those policies.

As you may have guessed, applying for the BBB award made us take a very deep look into our business and how it operates.

It caused us to re-evaluate everything we do and have done. We wondered, for example, whether the policy brochure we developed several years ago was still up to date. Could we show that those policies were being practiced? And how could we prove ethical behavior toward our suppliers, customers and employees to the BBB's satisfaction?

The idea for starting our business took shape when Neil came home from his job in a local service station saying, ``If I had my own station, I would....'' Although we had no experience running a retail business, we applied for a franchise to operate a Union 76 service station. With $11,000 in borrowed money, in 1974 we re-opened a station that had been closed for three months.

We named our company after Neil's home state of North Dakota, which proved to be helpful in building the business. Many customers asked where the name came from, and learning that Neil was a North Dakota farm boy seemed to offer reassurance that we wouldn't take advantage of them.

We founded the business as Dakota 76 and the name later evolved into Dakota 76 Auto Repair & Tire Center. Tires have always been a part of our business, and we now carry the Cooper brand and offer a complete range of automotive services.

We bought the facility from Unocal in 1983 and two years later doubled its size, adding three more service bays, a parts department and an upstairs office. In '91, we removed the gasoline tanks, cleaned the soil and renamed our shop Dakota-K Auto Repair and Tire Center. We opened a second facility in 1998 and currently are celebrating our 25th year.

This is a family business and both of our sons are involved. Steve, our older son, is our technical specialist and has an uncanny ability to comprehend and retain automotive information technology. Rick specializes in marketing and human resources and is a real ``people'' person. He was responsible for the idea and the opening of our second location last June.

Neil oversees the operation and has an unbelievable memory. He surprises customers who haven't been in for years by remembering not only their name, but the color, make and model of their car.

Our ethics and business policies evolved through trial and error—by avoiding practices we didn't agree with and building on those we did. Simply put, they call for:

Never selling something that isn't needed;

Offering customers additional time to undertake repairs that can wait and concentrating on what's needed now;

Willingly admitting when we've made an error and working to correct it;

Working to solve problems and resisting the tendency to blame others;

Doing unto others as you would want done unto you.

These policies now are an important part of our strategic planning, advertising and hiring process, and are shared with vendors.

We display a copy of these policies, signed by everyone on the staff, in our reception areas. Most importantly, they are evident in the way we behave toward customers, suppliers and employees.

In an effort to demonstrate to the BBB how customers have responded to these policies, we started by explaining that we never forget that customers make us successful. People are sensitive about their cars and suspicious of auto repair facilities in general. Therefore, having to overcome the negative image of our industry has been a challenge.

Although most customers come to us by word-of-mouth, we realized we still are responsible for earning their trust. We know if we treat customers right they'll return.

Our industry is notorious for ``throwing parts at a problem.'' Instead of taking the time to find the cause, some outlets simply replace every part that possibly might result in a given symptom.

We work with customers to solve their cars' particular problems. Intermittent ones are particularly difficult, and we ask customers to help us in solving them. We explain that we may need their car for a couple of days or suggest they drop it by when the symptom is apparent. Sometimes our techs, with permission, drive a customer's car to and from work with test equipment attached to cut the time spent and reduce diagnostic cost to the customer.

At Dakota-K, we stand behind our work and will refund, fix or replace any defective part without question. We don't mind customer complaints and would rather have them let us make things right than go elsewhere.

We discourage customers from making repairs when we don't feel the car is worth the investment. It's always fun to let them know they don't need an expensive repair job they had anticipated. It also is the best word-of-mouth advertising.

In our submission to the BBB, we included many customer letters and some excerpts from our favorites. Here is one:

``I would like to compliment you, your mechanics and staff on consistently excellent work on our vehicles. Over the years, no matter what the problem, you have always given us the best service possible. You have always been fair; informing and advising us on the proper repair work prior to executing it.

``Your mechanics and staff are both friendly and well informed and most important, easily accessible to any questions we have on the repair work being done at the time. It is very seldom you can find an honest mechanic with reasonable prices''

One of the most valuable lessons we've learned (and sometimes had to relearn) is to take the necessary time to explain to the customer that his or her vehicle may still have other adverse symptoms once the primary problem is remedied. Otherwise, we wind up with comebacks that technically aren't our fault, but ones we asked for by not being sufficiently explicit with the customer.

Even if we choose not to give away this additional work, we risk paying for it in the form of the negative word-of mouth-advertising that could result from saying ``no.''

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