|
Cover Story: Marvin Rush is the 2008 Truck Dealer of the
Year
By Denise Rondini
|
Those words on the back of a coin that is given to each and every
employee is one of the driving forces behind the success of Rush Enterprises, according to Marvin
Rush, chairman and the 2008 American Truck Dealers’ Dealer of the Year.
Successful Dealer recently spoke to Rush about a wide range of subjects. Here are excerpts from our
exclusive interview with him.
SD: What has business been like for Rush Enterprises in the past few years and how does the
short-term future look to you?
Rush: We were prepared for 2007 to be a slow year compared to 2006. Everyone thought business would
pick up in the third or fourth quarter of last year. We knew sooner than some people that that was
not going to happen and we started to make adjustments to get us in line with what was coming.
The huge pre-buy in 2006 meant people had lots of trucks and when the trucking industry went into
recession in September 2006, those trucks sat. Today, there are still a number of trucks sitting.
They all have to flow through the market before we are going to see new orders.
We should start to see some of the pre-buy for 2010 open up. What has made us very successful is
that we are diversified and we have a strong back-end business.
SD: Talk a little about your business.
Rush: We have 48 truck stores and 70 locations and we are in the leasing business. We are in the
finance business, the tire business and the equipment business. We are in parts and service, and of
course we have body shops. We have specialized in things like the crane rental and leasing
business. We are in the roll-off business for garbage trucks. We are very big in the concrete mixer
business.
SD: What do you think it will take for you to continue to be successful in the future?
Rush: One of the things that makes us successful and will continue to make us successful is that we
believe that service sells trucks. Trucks don’t sell service; service is what sells trucks. We run
a one-stop shop. If a guy from Orlando, Fla. breaks down in Phoenix or Los Angeles, if he is in our
system, which is one seamless system, we will put his vehicle’s serial number in the computer and
if we did the work on it in the first place, we are going to fix it.
Using one system also gives us the opportunity to give our customers the same parts pricing and the
same labor discount across the whole United States. We guarantee that we will look at a truck that
is in for service within two hours. That does not mean we are going to fix it in two hours, but we
are going to tell him what is wrong with it and how long it will take to fix it.
SD: What areas of your dealership do you feel need improvement?
Rush: We always need to improve and we always are spending money to do that. One of the things we
are engaged in is finding a new business system.
In 2006, we started trying to find a solution so we would have the best accounting and functional
system that would allow us to see everything about our interactions with our customers. We wanted
to be able to see the entire life of a truck from date of birth until death.
We have settled on a system and we are spending probably more than $15 million to build a system
that will be second to none. It is still a year and a half to two years from being in place.
In the long run, if you don’t invest in the business you are going to die. You have got to keep
moving forward and improving your facilities, your people, their skills, etc. or you are not going
to get to the front of the pack. We are at the front of the pack and we are going to stay
there.
SD: If you had the opportunity to speak to a group of young people, what would you tell them about
working at a truck dealership?
Rush: This business has so many different kinds of jobs available for young people. You would be
amazed at what all we are in. We finance. We lease. We insure. We are one of the biggest oil field
truck rigging companies in the U.S. We are just so diversified that if someone wants to learn and
wants to get into one of those fields, he can.
There is a long future in this industry because you can rest assured that there isn’t a railroad
that is going to bring goods to your house. There always are going to be trucks in the foreseeable
future.
SD: Aside from the quality and competency of your people, what sets your dealership apart from the
competition?
Rush: Oh gosh. I have to talk about my people first because they are the ones that keep us
together.
We do not run our corporate office as God. Nobody up here can hire or fire anybody. We have senior
vice presidents of parts and service, body shops, heavy- and medium-duty sales, used truck sales
and finance and insurance. They are here to support the people at the dealerships.
We let all of our general managers have the freedom of thought and action within guidelines to make
their own decisions everyday. You can’t wait for somebody to give you approval on something. If you
do, the horses already are out of the gate and the deal is over.
The way we run our stores is one of the things that really sets us apart. Whether it is new trucks
or used trucks, it does not make a difference, our people have the right or the ability to make
their own decisions within boundaries.
Let me give you an example. Let’s say a parts manager is supposed to make 25 percent or 27 percent
a month gross profit and he gets a deal to sell 10 transmissions at 14 percent profit. If he had to
pick up the phone and call me or call the head of parts and then the national parts guy, then the
vice president of parts, by time they got back to him somebody on the street has already sold his
customer those transmissions. Our parts manager has got to have 25 percent to 27 percent gross
profit, but he can set up whatever he wants to on an individual deal as long as he winds up with
that percentage at the end of the year.
SD: Have you seen a change in your customer base or in customers’ expectations of your
dealership?
Rush: I think we made them expect more because they know they are going to get the same thing from
us no matter which location they go to.
I’d have to say that the mix of fleet operators and owner-operators has changed. There are less
owner-operators. Years ago, the owner-operator was his own businessman, now he leases to a fleet.
And they furnish everything.
Approximately 35 percent to 40 percent of our business is now vocational. Fifteen years ago, 90
percent of our business was fleets and road tractors.
Our size really has helped us diversify the business to get out of this real high and low cyclical
business. We still have a cyclical business, I don’t want you to misunderstand me, but it is
nothing like it used to be.
And we concentrate on our parts and service business. Our absorption this last year was 105
percent. That 105 percent is for all stores. The ones that are three years and older are in the 115
percent to 120 percent range and the new ones—we always have five, six or seven new start ups every
year—those are the ones that are running 80 percent.
SD: How has technology impacted your operation?
Rush: If you don’t keep up with technology you are going to be left at the gate. We spend $2500 to
$3000 annually per technician in training, which equates to about $2.5 million.
We spent $40,000 to $50,000 for special tooling required for new vehicle technology, which does not
include the laptops and other things they have.
SD: Do you have any plans to grow Rush Enterprises?
Rush: We always are growing. We keep looking for opportunites. This last acquisition in Charlotte
gives us not only a Peterbilt store but it will be our first Navistar store.
We did a little less than $2 billion last year. We did $2.4 billion in 2006, but our goal by 2011
is $5 billion so you see we have a lot of work to grow. We are going to continue to grow.
SD: Any other comments you would like to make?
Rush: I think this industry is a changing industry. I will be 70 years old this year and I don’t
know how much longer I will be doing this, but I think there is a great future in this business. It
is going to change rapidly. The amount of change we saw in the last 10 or 15 years we will see
again in the next five years.
There is just so much happening to technology and trucks. There is no telling what trucks are going
to look like in 15 years. But I don’t see how anybody can get a product around this country, or
anywhere else for that matter, without a truck finally delivering it.
The Rush Coin
The Rush Coin is a symbol of the company’s values of productivity, fairness, excellence and
positive attitude. Each Rush employee is given a coin to carry.
The coin serves as the guiding principles for the company.
The front side of the coin reads: Rush Enterprises The customer is the Boss. And the words
productivity, fairness, positive attitude and excellence, run around the edges of the coin.
The company explains how each of these principles is played out in its every day operation.
Productivity is demonstrated by:
- Thinking beyond the customers’ requests and meeting their
immediate and unforeseen needs across all products and services.
- Managing multiple tasks to achieve performance goals and exceed customer
expectations.
- Developing new customer relationships and improving current relationships, thus expanding
opportunities for future success.
Fairness is demonstrated by:
- Doing what you say you will do, when you say you will do it.
- Seeking first to understand problems before seeking solutions without any preconceived
assumptions.
- Emphasizing and demonstrating effective communication on all levels of
interaction.
- Communicating with employees by establishing clear expectations, goals and providing
meaningful feedback, with continued education and training as necessary.
Excellence is demonstrated by:
- Ensuring high customer satisfaction.
- Maintaining consistent financial performance for the
shareholders.
- Developing long-lasting relationships that foster trust and influence buying
decisions.
- Continuing to set stretch goals for performance and developing a culture of
achievement.
- Taking pride in the maintenance of facilities and continuing to improve amenities and
convenience.
- Choosing to be a premier supplier of the best quality products and services that meet
customer expectations and needs.
Positive attitude is demonstrated by:
- Being willing to accept challenges and seeing them
through.
- Fostering and enjoying communication among all levels of the organization.
- Believing that Rush has the best facilities, people, products and services in the
industry.
- Setting the right tone, knowing that you can make a difference each day for everyone in the
Rush organization and in turn, enhance the customer’s experience.
- Finding the common ground situation or solution for everyone.
The words on the back of the coin are: “Our future is dependent upon loyal, dedicated,
results-oriented people, whose hard work integrity and pride ensure the success of our
organization, and each and every employee.”
|
|
