Auto Services Profile: Redemption and a Growing Business
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Matt Curry started working in the automotive services industry at age 15. After fifteen years in the business, he opened his first repair shop in 1998. Despite his industry knowledge and experience, getting Virginia-based Curry’s Auto Service up and running was more difficult than Curry imagined.
He ran into financial roadblocks in starting his business, and at one point was more than $135,000 in debt. However, it’s how he successfully got out from under a heavy debt burden to grow his company that can provide lessons learned for your business.
As soon as he could work, Curry started a job at a parts house and later moved on to sales and store management for a number of big-name companies. As he approached his 30th birthday, he decided to open his own shop.
Through a 50/50 partnership with a friend, he was able to start his company. However, responsibilities of running a business became more difficult when the partnership dissolved, leaving Curry to go it alone. An early challenge was his inability to secure a business loan due to a lack of cash on hand. That led Curry to seek out other financing methods—including those small business owners should avoid in starting a business to help ensure financial well-being.
“The biggest challenge was capital,” he says. “No one would lend me money. But back in the mid-90s, you'd get five credit card offers a day. So I filled them all out.”
That resulted in more than $100,000 in credit card debt, in addition to a $35,000 personal loan from his father-in-law. Looking back, he says the better approach would have been to delay starting his business and spend more time saving money and building collateral to obtain one business loan, rather than having to pursue multiple financing options—some of which were very high risk and costly.
Overcoming debt burden
Due to his financial situation, Curry ran the business as lean as possible, and any money he made went almost entirely to paying off his debts. He even took a 70 percent pay cut. Despite these early challenges, he was able to build a successful business, due in large part to leasing equipment that gave his shop a competitive advantage.
A five-year lease and the equipment served as collateral, so Curry was only required to pay the first and last payment upfront. This freed up more capital in the beginning than buying would have. Leasing also allowed him to buy higher tech, better quality equipment than he could have afforded otherwise.
“I had the forethought to buy the top-of-the-line stuff because we needed it to do good work on the type of cars we wanted to work on," Curry says.
Based on his knowledge of the trends in the automotive industry, Curry knew manufacturers were starting to create bigger wheels and lower-profile tires. He leased the new equipment he needed to service and balance high-end vehicles with these features; his shop was one of the only in the country at the time with this technology. After providing quality services to the president of a local auto club, business accelerated.
Two years after opening his shop, Curry paid off the credit card debt and reimbursed his father-in-law. He also worked hard to develop a relationship with the commercial lender at his bank, who eventually helped him get future loans approved at more optimal terms. That relationship was a key factor in Curry’s success going forward.
Over the next several years, Curry used commercial real estate loans to expand his footprint. He consistently secured financing at more attractive rates for new locations.
Today, Curry continues to focus on prioritizing customer service and technology, keeping up with competitors and maintaining a loyal customer base. He also ensures that his garages offer customers the latest technology and equipment to stay ahead of manufacturing changes to high-end makes and models.
“We have the best technicians [and technology], the best managers and we warranty all our parts and work,” he says. “Price doesn't reflect quality. You have to sell your value.”
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U.S. Small Business Administration (SBA) loan programs provide longer terms and lower down payments than conventional financing, allowing you to optimize cash flow and focus on operating and growing your business.