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Big O Tires Franchise Review: Q&A with Karl Gabbard

Franchise owner achieves financial, professional and personal success with Big O Tires

Karl Gabbard has been in the tire and automotive industry since graduating from college 37 years ago. After years of working for corporate giants, he knew he wanted to be his own boss one day. Today, 20 years after buying his first Big O franchise in Arizona, he owns five locations and is building a sixth, which will open in March 2015. His original plan was to start downsizing as he readied for retirement, but when his daughter said she wanted to get into the business, he was all in! Now she manages the family locations, and Karl is able to spend four months of the year at his second home in Vermont.

What were you doing before Big O Tires?
I had been in the tire business since I got out of college, and I was a regional manager for a major, well-known company. But every time the stock would dip, they would bring in these kids from Harvard with no tire experience to tell us how to run the business. I saw them toss aside good people with a lot of experience. Then I would look at Big O and see how well the franchisees were doing. An opportunity opened for me and I decided to buy my first Big O store.

How long have you been a franchisee?
I bought my first store in 1994, 20 years ago.

What do you like about it?
Number one, the money is amazing. I enjoy more financial success than I ever thought I would in my life. Plus, with Big O, you’re not alone; there’s a huge support team behind you. The company is very professional, and they excel at promoting the franchise concept. I think the quality of people in Big O, from the top down to the area managers, is the best it’s ever been. And I know they have my back.

What sets Big O apart?
Because we are independently owned and operated, our customer service is top notch. I think independent owners bring to the table the understanding that this is their livelihood and everything is riding on this. We had an independent ad agency (Barkley) survey our customers, and our Net Promoter Score (a measurement of how much customers trust and respect a brand) came in at 70. That high of a score is unheard of for an automobile service franchise. So that shows our customer service is beyond what others are doing.

Also, because of Big O’s size, it has the buying power to compete with the big players by offering the top and popular name brands. Independent shops can’t buy the major brands at a decent price, but we have the power of group buying.

Big O is also about being honest, and that shows in all of our relationships. Every month we have an owners meeting for our region and that’s a chance to brainstorm ideas, to ask other owners how they are doing something, or if they have a better idea on how to do something. We’re not afraid to say, “I don’t know how to do this, what would you do?” That’s invaluable information that we’re able to share across the franchise.

Our group works together with our regional marketing agency to spend our marketing funds efficiently and effectively. We have to get our name out there, but I think our best advertising is word-of-mouth, and that comes from our reputation.

How large is the opportunity?
It’s huge. Big O is growing; they want to grow. And they look in-house first for successful owners who want to own more stores, so the possibilities are endless. Plus, we don’t just sell tires. Repair work is a big part of our work, and in Arizona air conditioning is an integral part of our business.

How important is previous automotive experience for a Big O owner?
It helps, but it’s not that important. It certainly helped me, knowing the industry. But Big O has so much training, it isn’t necessary. There’s a long history of folks coming into Big O with no auto experience, and they end up being very successful. We use Big O University all the time when we see someone who needs training. They also offer a business center for managers and owners that has resources that are just unbelievable. You get nothing like that if you are an independent owner. The support you get from Big O corporate is a great safety net.

What attracts customers to Big O rather than competitors?
One of the great things Big O does is hold focus groups around the country and ask customers that very question — what attracts them to Big O? Reputation is a big part of the draw. Customers are very loyal to us — once they come to our stores, they keep coming back because we are honest.

They also get really good customer service from us. We build relationships with our customers, and some of them have become our friends over the years. I value and appreciate the fact that customers trust us and look to us to take care of their automotive needs. That is something I’ll never take for granted.

Auto services are tough, because they can end up costing a lot of money. If you spend $1,000 on a new television, you have something to show the neighbors. But if you spend $1,000 on new brakes, you don’t call your neighbors and say, “Come see my new brakes!” At Big O we let the customers know what options are available, what services they definitely need now, and which services they can hold off on for awhile. We let the customer decide what works for them instead of pushing them into anything.

What does your typical day look like?
When I bought my first store, I would get there at 6 a.m. and leave at 8 p.m. I installed tires, waited on customers, cleaned bathrooms. I did everything I needed to do.

Now I’ve hired people I can trust to run the shops while I do the paperwork, pay the bills for all my stores and negotiate the leases. I talk to the managers every day and encourage them; they tell me if they need help with anything. When you’re running an auto shop you’re in a whirlwind all day long; there are a million things you’re juggling behind the counter. I enjoy the interaction with the customers. I like people. I try to be the calming force in the store. If we have a bad day in one of the stores, that’s not the time to take a manager to task. I say put it out of your mind and move forward.

How do you manage multiple locations, and do you plan to keep expanding?
My stores do very well, and that’s because of the people I have working for me. They are good individuals and high quality workers. I’ve put together a program to allow managers to become partners in each of my stores. That way they have a vested interest in the business and it becomes their business, too. I’m not paying a manager to watch my money — I have a partner to watch our money. A lot of the Big O owners have done that, so I decided to go that route. I don’t want to give these guys a reason to leave. Their shares are worth a lot of money. If I’m loyal to them, they’ll be loyal to me.

What is a secret to your success?
This is a people business. It’s the people I have in my stores. I have never seen a Big O in a good location not make it. I’ve seen good people go into mediocre locations, and even bad locations, and still succeed. I am successful because of the people running my stores.

What kind of person do you think would enjoy owning a Big O Tires franchise?
Somebody who is not afraid to work. Somebody who has the entrepreneurial spirit and wants to better their life, to control their own destiny. I’m so proud to be a part of Big O. I see the quality of people that work here and I like to surround myself with people who are smarter than me. I can learn so much from these people in Big O, and I feel like I know this business really well.

What does Big O bring to the table on behalf of its franchisees? How do they help you succeed?
They bring so much to the table: product, web presence, computer systems, special financing, they help with equipment and building of new stores. We have our own credit card through them. If it weren’t for them, I would have to do all that. That’s a lot of mental stress and pressure I don’t need.

What does franchise ownership allow you to do that you couldn’t before?
It has allowed me to work part time for a lot of years. I can come to my home in Vermont and live four months out of the year. They’ve allowed me to secure my financial future, to be independent of some guy sitting in an office 2,000 miles away trying to restructure the company. It’s also allowed me to pass my business on to my daughter.

Would you recommend a Big O Tires franchise to someone else?
This company has its act together. If you want to trust a franchise with your future, this is the place to hang your hat. It’s a true partnership. They work with you. Joining was one of the best decisions I’ve ever made. I have absolutely no regrets.

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