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October 8, 2010 Opportunities come and go. That’s the nature of business. When things go your way, enjoy it while you can because it is typically short lived. A month ago I said prices were on a decline and to enjoy the added margins since it wouldn’t last forever. Well, this opportunity has come and gone, and now that extra profit is about to evaporate. Anyone paying attention to the gasoline market (and I DO HOPE you have been paying attention) will see that rack prices have crept up more than 20¢ in the last week. The reason is that crude oil prices have consistently been around $75 a barrel for the last few months, but have jumped to over $85 a barrel in the last week. That hike is now filtering down to your price at the pump. This spike in wholesale prices will undoubtedly hit your bottom line. It is very difficult to maintain prices as they are rising. However, I must encourage you to NOT sit on your price and make things worse. Without a doubt, your competitors’ prices are rising as well, so don’t wait for him to move. It is crucial that you maintain your margins or you will suddenly find you are squeezing any profitability out of your operation. That puts you and your employees at risk. I believe that prices are likely to come back down again. However, I have yet to see the most recent supply/demand reports to confirm this. Keep in mind that if the price is rising without the typical supply/demand ratio indicators in the market, then prices will come down again. If however, demand has increased (and people have taken to the roads for some reason), then this abnormal spike could become a new “norm” for a time. The bottom line: The marketplace will always play out and we just have to watch it. BUT that doesn’t mean that you don’t have to be aware of your margins and staying profitable. Sometimes a bad reputation takes years to shake off. No matter how quickly you move to make a change and repair what was wrong, it typically takes considerably longer for the perception to catch up to reality. For well over a decade now, New Jersey has built a reputation of having an anti-business environment. With high taxes, unlimited bureaucracy, and endless regulations this reputation has been well deserved. Many of you are very well acquainted with this problem and know what it is like to deal with bureaucrats in state government. They visit your shops, they hand out violations, and you often must pay ridiculous fines in order to continue doing business. In fact, a running joke in the State House among business advocates was that the previous Administration was going to plug the hole in the budget by handing out more and more violations to business owners like you. While NJGCA has assisted many, many members in getting fines reduced, license-suspensions eliminated or violations dropped altogether, other types of businesses continue to suffer. Well, it appears that the powers that be in Trenton wish to start repairing our well-deserved reputation. The Department of Environmental Protection recently launched the Office of Dispute Resolution (ODR), a one-stop-shop that seeks to resolve issues between the enforcement agency and businesses, local governments, and average citizens. The goal of the office is to come to common ground between parties when a conflict arises and prevent them from erupting into expensive legal battles. What does this mean for you? Currently when a problem arises, you must get lawyers involved, pay high hourly fees, and go before an Administrative Judge. It’s costly and it takes forever to get problems resolved. However this change means that if you suddenly find yourself locked in a battle with NJ DEP over a remediation issue, a spill, or other environmental related problem, ODR may be able to help you get it resolved quickly and much more affordably than the traditional route. To learn more about ODR, click HERE to read the Press Release announcing the new office and click HERE to visit their website. A battle is raging on in Trenton over funding current and future transportation projects. The focal point of this battle is reauthorizing the Transportation Trust Fund (TTF), which will soon run out of money. Remember that Legislatures and Governors over the last 20 years have continued to rob funds from the TTF in order to pay for other programs. Many in Trenton are criticizing the Governor for keeping his word and refusing to increase the Gas Tax. Pundits and the political opposition continue to hammer at the Administration for putting important infrastructure repair projects at risk by not entertaining a Gas Tax hike. However, ideas are swirling on how to alleviate this issue (as well as other funding problems) in the Governor’s Office. I was fortunate enough to be invited to another meeting this past Tuesday with the Governor’s Chief of Staff Rich Bagger and State Treasurer Andrew Sidamon-Eristoff to discuss possible tax changes. The goal is to alter the tax structure to stimulate growth for NJGCA members and all small business owners. Several examples were presented as possibilities, and while I can’t share details as of now, I was firmly against some proposals as I believe they would be harmful to the folks in the industry. I openly expressed my concern and was assured that they are only exploring different ideas and not ready to make any decisions. It was for this reason that small business advocates were asked to participate to gauge feedback and garner opinions. While it’s too soon to predict what these discussions will produce, the general point is that the state’s lack of revenue has created a funding problem that must be addressed. No matter if it’s for the TTF, school budgets, or the Unemployment Insurance program, Administration officials will need OUR OPINION to make the right choices. Why? Because the Governor wants to pursue policies that won’t impede your ability to create jobs and maintain your establishment. That means you must be part of that discussion – and I hope you will participate. The New Jersey Green Automotive Repair Program (NJGARP), of which NJGCA is a proud partner, is currently seeking to expand the number of certified shops in Morris, Somerset & Union Counties with a fall initiative. NJGAR is asking interested shops to conduct their assessment, decide if you’d like to pursue certification, and submit the Application. Please visit http://www.njgreenautorepair.org for more information and to download an application. Lastly this week, I want to wish all of you a very Happy Columbus Day. It is my hope that you will have the opportunity to spend some quality time with your family as we head into the fall holiday season. Enjoy! Thanks for reading and see you next week!
Regards,
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NEW TRAINING CLASSES ADDED!!
CALL FOR FUTURE CLASS SCHEDULE INFORMATION Special ASE Level 1 Preparation Course for the November 2010 Testing: Class Instruction will be given as follows: Seven (7) hours of instruction on: Understanding the ASE composite Vehicle, General Power Train Diagnosis, Computerized Power Train Controls Diagnosis – Including: OBDII, Ignition System Diagnosis, Fuel Systems and Air Induction Systems Diagnosis, Emission Control Systems Diagnosis, and Inspection Maintenance Failure Diagnosis. NJGCA will provide a Course Manual – Power Point Presentation – Sample Testing.
Class Date: Monday – October 25th and Wednesday – October 27th TAKE ADVANTAGE OF OUR TRAINING CLASSES!
**To Register call Debbie Hill 973-376-0066 x 203 or debbie@njgca.org**
POLITICAL PARTICIPATON: THE NJGCA PAC
Ensuring our friends in the legislature are re-elected and advocating for our agenda in Trenton are of utmost importance to the agenda of NJGCA. It is for this reason that your Association has established the NJGCA PAC. For too long, the weight of funding our Political Action Committee, the arm of the Association responsible for political donations, has rested upon the shoulders of a few. This is not fair to them, and it is not fair to many of you who are relying on the benefits of good legislation being passed in Trenton. To truly understand the importance of fundraising for our allies, let’s look back upon the overwhelming successes of the last year: NJGCA successfully lobbied against BELOW COST SELLING. If approved, BELOW COST SELLING would have cost each of you thousands of dollars and put many of you out of businesses. NJGCA leaned on some of our friends in the Assembly and literally had the bill pulled off the floor on the day it was scheduled to be voted on. Our friends in the Legislature helped us get this accomplished. NJGCA made history and led the charge to pass the most comprehensive protection of franchisees in decades with FIRST RIGHT OF REFUSAL legislation. FIRST RIGHT OF REFUSAL passed only because NJGCA and dealers throughout the state were able to lean on several friends in the Assembly and the Senate. NJGCA has been rallying support for RIGHT TO REPAIR over the last two years among key legislators. This would end the practice of car manufacturers denying you the codes necessary to complete the repairs you make on your customers cars. Every state has tried to pass RIGHT TO REPAIR and no state has even been able to get the legislation out of committee. Because of our friends in the Legislature, NJGCA has been successful in getting this bill passed by the Assembly and now awaits a vote in the Senate. I am asking some of you as individuals to make a contribution and attend a fundraising event sponsored by one of our friends in the Assembly. However, we will not be able to host events for all of our friends, so the NJGCA PAC will have to make contributions. You will be receiving letters soon from the NJGCA PAC asking you to make contributions. If every member contributes just $100.00 we will be able to provide the help necessary to ensure victory for our allies.
PLEASE SEND YOUR CONTRIBUTIONS TO: I understand that times are tough for all NJGCA members, but this is just as important as any battle we have fought in the past. We have made great progress in Trenton. I hope that you will answer the call.
NEWS AROUND THE STATE
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