Mobile Electronics 

 

Mobile Electronics (September 2006) - large

Southern California Shop Opens Under a New Name and Finds That Building the Business Relies on Successfully Navigating the Small Stuff

By Erin Powell
Photography By Ken Wong

When Becker Assad opened up Crazy Stereo in 2003, he was ready for the responsibility. After all, he had been store manager at a Stereo One shop for three years, and had many years of employment at other 12-volt shops under his belt.

"I was very ambitious and didn"t ever feel that I was going to fail, unlike most others," said Assad. But what he didn"t anticipate were all of the time-consuming, nitty-gritty details that go into running a business and can throw a wrench into even the best-laid plans.

What's Your Sign?

When it came to Assad's long laundry list of renovations he wanted to make to the location which had previously housed a car stereo shop. Assad started with a customer's first impression, the store sign. He felt that the building"s attached signs weren't visible to passers-by, so he obtained permission from the landlord to move them. Assad had re-named the store "Crazy Stereo" and wanted the new name on the signs to attract customers. Seems simple, doesn't it?

"The first month I lost a lot of business, because I had a problem with the signs. The city is very strict with signage, and the electrical has certain regulations," Assad said. The previous store, Advanced Car Audio, had taken the letters in "Advanced," and left "Car Audio," leaving large empty holes that were an eyesore to potential customers.

Eventually, the plans were completed and the city approved the signs, finally offering the retailer the exposure he wanted. Total cost to re-vamp two signs: $7,000, a huge expense that Assad did not anticipate.

Another modification that Assad made with a lot fewer headaches was the installation of a brand new phone system that allows for paging into the install bays. The system includes six phone stations with a five-line system, so no matter where an employee is in the store, someone is available to answer the call.

Stocking Up

Next item on the list? Inventory. Lucky for him, Assad was already well-connected in the industry before he opened his own shop. "Inventory wasn't a problem because most of the manufacturers and distributors already knew me, so I could get credit with them," said Assad.

But because he was in business for the first time, even the IRS took a deposit in advance of his first year's profits. "Managing the money in the beginning was a challenge. It wasn"t as easy as I thought it was going to be when I opened the store."

When it comes to keeping track of the inventory he has, Assad doesn't have a computer database. Not yet. But his system works just perfectly. Assad installed long, horizontal shelves in the showroom going up the walls and in doing so solved issues of tracking and protecting his stock, using space wisely, and showcasing a wide variety of product for customers.

 

"The store is a nicer presentation to the customer, and it preserves product better," explained the retailer. "And if I want to make an order, I just look and see what I have or don"t have." Eventually, he says, he"d actually like to make Crazy Stereo look more like a warehouse-type, bigbox looking store.

Fast Times on Harbor Boulevard Crazy Stereo has the built-in benefit of being located in an automotive center alongside a body shop, mechanic, a Phillips tire store and a car wash. The retailer has no complaints about getting enough traffic by his store, but there"s only one problem: The traffic moves too fast near the plaza on the downhill grade, which has resulted in a number of bad accidents at the intersection.

Assad stated that his store has become quite the hang-out for police armed with radar. "People ask me why I let cops park by my store with radar, but I know that people"s safety is much more important. I think from a business perspective, a lot of people are intimidated by police, so some customers may just drive by." The good news: Assad gets a lot of business from the police department.

By the Team, For the Team

So what's it like having Becker Assad as your boss" He believes in empowering his team and isn't big on having a hierarchy of employees at the store. "I teach them to take the initiative and I say, "This is your shop," he explained. "We work together, and we sit together. When there is work, we all work." Everyone pitches in with daily responsibilities, including unpacking stock, phones and clean-up, even bathroom duty. Crazy Stereo has 10 employees, some fulltime and some part-time. Prior to hiring, Assad tries out new employees for one week, tests them on check-out diagnostics, remote starter and a navigation or video install. Some of his installers are MECP-certified, but it isn"t a requirement. Assad recently spent several months assembling a database that eventually will go into a computerized system. The database includes OEM integration items for many makes and models of vehicles, Bluetooth and other current and new product data by manufacturer, kits and harnesses, plus contact information for everyone and anything under the sun.

Assad's goal in creating the database is to ensure that everyone in the shop can reference information and provide solutions for customers at any time, resulting in the kind of service that makes life-long customers.

The State of Business

The owner has found that posting the store's install policy on the wall on a large banner helps simplify doing business. "Sometime customers expect too much, so we wanted to be clear: 30 days over the counter, 90 days on installed product. We had to reduce the warranty on installs because increasingly, manufacturers are not so easy to work with. Still, there are others that are very lenient," said Assad. The retailer remembers a time when manufacturers would replace product that was old and beyond the warranty, no questions asked.

"Those were the glory days. Now, they charge us for the manual, the box, accessories, everything," said Assad. His frustration is such that occasionally Assad will help the customer get in touch directly with the manufacturer, with sometimes better results. Assad draws customers in with Yellow Pages ads in six different books, which are in print as well as online. He mentioned that he gets a lot of his customers who found him by "Googling" car audio retailers in the area. He also places ads in the local newspaper flyers in both English and Spanish, as he caters to a large Hispanic population.

Assad continues to feel optimistic about growth, despite the current slump. "Business is unpredictable. I try to project higher sales, but with the economy like it is, it fluctuates up and down. Over the last year, I was able to increase by between five to 10 percent. The game between balancing overhead and profit margin is never-ending," he said. Even after all that he's accomplished in the three years since opening shop, Assad still has lots of things on his wish list: a detailed Website with an industry forum, surveillance cameras, large vinyl window banners, store uniforms, a computerized customer and product database, TV advertising, and much more.

Protecting the Investment

So, Assad's got a store, a staff, customers, and product lines that his customers are happy with like Alpine, Boston Acoustics, Kenwood Excelon, Orion, Rockford Fosgate, Sony and Viper. Now, how does he keep it all safe" "We have a minimum of three employees at a time either opening or closing the store in the event of robbery. One person sets the alarm, one person stays at the exit and the third person is in the parking lot," he explained. "Dealers need to be careful. We have expensive inventory, and high-risk exposure to burglaries and hold-ups."

Sadly, Assad has first-hand experience on the risks of owning a retail business. In the Spring of 1994, his brother, Mike Assad, was killed during a robbery at the convenience market that he owned. And Assad is determined not to let anything like that happen at Crazy Stereo. By raising display cases one foot above the floor, Assad makes it virtually impossible for anyone to casually reach over the top of a case to slide out product while employees are busy or distracted. He also keeps touch-screen displays behind counters to prevent abuse or breakage, but within view so the staff can demonstrate product features.

He keeps expensive items such as in-dash video screens inside his open office. The office is raised 20 inches off the floor so Assad can oversee everything going on at the store at all times.

Tackling the Technical

Assad explained how the nature of the customer has evolved over the years. "[Some customers] don"t know anything technical, but they come in asking for iPod without even understanding the technology. I used to go to CES to see all the newest gadgets, the cool stuff, new technology. Now I go and visit PAC and others to see what integration solutions they have, so I can learn how to hook stuff up with kits, harnesses, adapters, the OEM solutions." The retailer has some tried-and-true advice about his own journey running a car audio and electronics store.

"Manage overhead well and just concentrate on certain lines instead of lowering prices"that will just hurt the business," he said. "Share information with other dealers. Work with each other and keep good relationships with each other. Take your time, don"t stress. And don"t worry when business comes too slow."