Volume 12, Issue 4 - July/August 2010

feature

Belron Gets Bigger
Lubner Discusses Entry into China Market, Economy and More

It’s not surprising that Belron chief executive officer Gary Lubner is confident his company will continue to grow worldwide. To prove it, he recently purchased one percent of the company’s equity from parent company D’Ieteren, for a purchase price of approximately $20.5 million (16.6 million Euros).

AGRR
magazine recently had the chance to conduct a one-on-one exclusive interview with Lubner, along with his right-hand man in the United States, Belron US president and chief executive officer Tom Feeney (*see sidebar Below). The interviews took place during the company’s international Best of Belron competition in Paris.

AGRR:
What similarities do you see among all the competitors throughout the world?

Lubner:
There are a number of similarities with these guys. First thing is, these 27 technicians have all won their national competitions, so the one similarity is they’re all national champions and they’re all the best in their countries. Much more than that, these are dedicated guys, they’re professional, they’re customer-focused and they are passionate about what they do. They are highly, highly technically competent as well as being very customer-focused. And I think from our point of view [the reason] why we’re so proud of them is what they’ve been through to get here today. This is a tough, tough competition and I think it’s an amazing thing. There are a lot of similarities. They are world-class. They are all our champions.

AGRR:
How has Belron fared in the Chinese market since its recent entry there? Are there any plans to expand this presence?

Lubner:
We’re very happy with our progress in China. We [recently] announced two further acquisitions, one in Hangzhou and one in Shenzhen. Yes, we are looking to grow our footprint. We now have 200 people employed in China, we have a full Chinese management team, all of whom [were] at Best of Belron. We’re very excited about the Chinese market. It obviously has challenges, but we think that’s going to be one of our exciting ones for the future.

“There are a number of new geographies that we are looking at, particularly places
like Asia and other parts of the world.”
—Gary Lubner


AGRR: We’ve spoken before with you about franchisees in various markets. Are there any markets Belron has pinpointed for future franchisees? Are there any major acquisitions planned that you can comment on?

Lubner:
We’re always, yes, we have got and are planning acquisitions, but I’m not going to tell you which ones they are. You know that Belron does many acquisitions. This year, I think in the first five months we’ve done nine acquisitions already in various countries around the world, including the one that we announced [recently], two acquisitions in China. We are continuing to look for opportunities in all of our markets both in acquisitions, as well as looking for new market entry—whether we’re going to do that by franchising, we may do, but we equally are happy to go into a market with 100 percent owned [locations].

AGRR: Is the control of franchisees any more difficult than with corporate-owned stores?

Lubner:
The control is not more difficult at all because they aren’t our businesses. We just receive a license fee and so it’s more the support model. We support franchisees. All of our franchisees are doing extremely well and, in fact, many of them are represented here at Best of Belron. But, in the uld prefer to own those businesses, and, if you look at our track record, Greece and Turkey were our first two franchisees. Both have been acquired in the last three years. Over time, perhaps franchisees become successful and we can acquire them.

AGRR: We understand you recently purchased one percent of the Belron’s holdings for 16.6 million Euros. What made you decide to do this, and do you have plans to purchase further shares?

Lubner: I had an opportunity and investing in this business, frankly, is a fantastic opportunity. I’m extremely excited about the future and a large part of that future, by the way, is the United States, because our U.S. business is performing beyond expectations. There are significant growth opportunities and so I had the opportunity to invest, which is what I’ve done. If I get further opportunities, I’m sure I’ll be investing more.

AGRR: Glass quality seems to have become a major issue for technicians in the United States. Are you seeing the same throughout the world, and do you think there’s a remedy for this?

Lubner:
I suppose I’m a bit surprised by the question because I don’t think that’s strictly true, that that’s become more of an issue in the United States—technical quality. Technical quality or glass quality has been an issue for as long as I can remember in the United States and in fact from a Safelite point of view we’ve seen a dramatic improvement. We’ve invested significantly in our factory in Enfield and in fact the quality of glass generally over the last few years has improved, so if that’s the case in the rest of the industry I can’t really comment.

In terms of the rest of the world, glass quality’s always an issue for us, but frankly we have processes in place which make sure we try and avoid having low-quality glass get to a technician. [We have] quality controls in our whole supply chain, and our distribution centers, and the whole point is to try and catch quality issues before they actually get into the field. It’s something we’ve got to keep looking at, [and] we’ve got to keep on it at the manufacturers. You know, it’s part of our business processes. I don’t particularly see this as an increasing trend—it’s just something we’ve got to deal with.


*Feeney Discusses Television Campaign, Economy
AGRR magazine also spoke with Tom Feeney, president and chief executive officer of Belron US, during the Best of Belron competition in Paris.

AGRR: What do you think sets apart the U.S. competitor from those throughout the world?

Feeney:
These are 27 champions and in their own rights they are equals among equals in terms of their commitment to safety and quality and customer service. When I think about our U.S. technician, Mark Jackson, who happens to be from Columbus, Ohio, we hope he stands out in a couple of critical areas. One is quality, and the approach we take in the four exercises here, and the other is a little bit of a softer experience—and that’s around the customer service experience. We think his personality come[s] out in such a positive way. We see him not only in this competitive environment, but most importantly we see him everyday talking and dealing with our customers. And we get an awful lot of complimentary letters about him, and we track customer service satisfaction scores of all of our technicians. His [score] is very high, and we know that he distinguishes himself in the real world in dealing with customers. He sets the expectation and follows it up with quality work and backs it up by telling the customer what he just completed. So if I had to say what would distinguish our competitor from the others, it would be a real commitment to the quality followed up by a higher than average customer service experience.

“When the economy tanked in 2008, we chose to ignore it and invest in our business, and to take our business in a direction that the economy certainly wouldn’t support.”
—Tom Feeney

AGRR: How is the revived television ad campaign going? Did you get a good response and how long do you plan to continue that?

Feeney: I wouldn’t say it’s a revival. Advertising is a form of how we reach customers and it’s in our DNA today. It’s one element of our communications to customers and how we’re going to tell our story. We believe it’s the right approach, we like the messages we give, and we wouldn’t be doing it if we didn’t get a good return on that investment and you should expect to see us to continue to advertise but in different ways going forward.

AGRR: As for the U.S. economy, are you seeing signs of improvement, and the extreme winter conditions we had in the business in the United States—how did these impact you?

Feeney:
First, the weather—bad winter weather is always a friend to the auto glass industry and this year was no exception. It was interesting how it came in—it didn’t come in the normal geographical areas you normally see bad weather. It seemed to be very concentrated in the Mid-Atlantic areas, so we enjoyed the uplift like I’m sure the rest of the industry did, and it seemed to come later this year so we hope it carries us into the seasonal months of June, July and August as well. With respect to the economy, much like you’re reading in the financial papers and seeing on the news, there appears to be some uplift, growing signs of positive car sales, which is always a good sign for our business. It’s a good barometer for our business—it signals higher confidence, it signals that there will be more miles driven, gas prices have come down. There are a couple of key economic indicators that are actually favorable to our business and, of course, we plan to take advantage of those as I’m sure others in the industry will. That said, the economy is only one metric to how to run a business, and when the economy tanked in 2008, we chose to ignore it and invest in our business, and to take our business in a direction that the economy certainly wouldn’t support. And we’ve been rewarded for those investments, and we plan to continue to watch the economy but to drive the business in a way that supports the strategy and initiative that we have for our business.


Belgium Competitor Takes First in Best of Belron; Safelite’s Mark Jackson Takes Second
Benoit Deckers of Carglass Belux® in Belgium was named the winner of the 2010 Best of Belron competition in Paris in June. Safelite’s Mark Jackson took second place in the competition, and Steffen Taeterow of Carglass Germany took third. The second-place winner received a prize of 5,000 Euros (approximately $6,000 U.S. dollars) and third place takes home a prize of 3,000 Euros (approximately $3,600 U.S. dollars).

In addition, the three runners-up in the competition, in no particular order, were Canada’s Francisco Jarquin of Lebeau Vitres d’autos®; Davide Tropea of Carglass Italy; and United Kingdom-based Paul Howe of Autoglass®.

“This was a very, very—as ever—tough competition,” said company chief executive officer Gary Lubner during the awards ceremony. “The scores were very close. There were over 1,000 points that we had to give out.”

There were 27 competitors from around the world competing for the title of Best of Belron, and approximately 1,000 in attendance at the event.

Prior to naming the winners, Lubner applauded all the competitors for their efforts.

“You are all champions. You are all winners. You are national champions and you are among the best fitters and technicians in the world,” he said. “Secondly, you represent 12,000 technicians in Belron worldwide. You’re 27, but there are 12,000 people like you, and that’s a big number.”

The competition was based on a windshield installation, repair, sidelite replacement, backlite replacement and communication with the customer throughout each job. In addition, each competing technician must complete a test covering various aspects of the job, including health, safety, working methods and dealing with customers, according to the company.

To qualify for the event, each finalist has had to win his own country competition. Judging is based on a windshield installation, windshield repair, sidelite replacement, and communication with the customer throughout. Each technician also must complete a detailed questionnaire covering every aspect of his job, from health and safety, working methods to customer care.

“You always want to know how good you are and the honor of being named the best at anything is an amazing honor,” said U.S. competitor and second-place winner Jackson. “And one of the main things is that it gives you a chance to showcase the skills you use everyday on the job.”

Jackson said one of the most challenging parts of the competition was the backglass replacement.

“It’s the most rare piece that we do,” he said. “Trying to pull a backglass out in one piece—you may only do those once a month, and a windshield—you do 7 or 8 a day.”

The event was held at Grande Halle de la Villette in Paris.

 



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