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No More Status Quo: How Race Engine Builders Are Updating Their Business Models

Whether using proven methods or adapting to the latest technology, engine builders investigate the most effective ways to improve their businesses’ bottom lines.

By Ilona French

Most race engine builders spend their workdays doing what they love. After all, a career around engines requires a deep passion—a drive to help competitors land prime real estate in the winner’s circle. These days, due to the economy, disposable income among some racers has dwindled. To cope with those deflated budgets, many shops have had to open their doors to other sources of revenue outside of their typical customer base. “In our earlier days, we basically did sprint car engines,” said Bob Kriner from family-owned Kriner’s Engines, Chambersburg, Pennsylvania, “and now we do dirt late models, street rods, midgets, boat engines, and we’re starting to do more import work because that’s where the younger generation is putting their time and money. They’re not building big block Chevys and small block Chevys anymore. They build Hondas and Mitsubishis, and we’re forced to buy new equipment to accommodate the newer cars for the newer generation. With fuel the way it is, the everyday-driver, high-performance engine now tends to be a four cylinder instead of a V8. So we have to adapt with the times and change and get ready for the smaller engine.”

Adapting with the times often requires a business model update in order to strategize income optimization. For many successful engine builders, that means service after the sale, which can be as simple as a follow-up phone call to ensure everything is performing properly and as expected. “A follow-up call once in a while helps put out any problems that the customer might have and not call you and be upset and not come back again,” said Kriner. “So if you follow up and make sure everything’s good, then they know the lines of communication are open so that if they do have a problem, they don’t hesitate to call you. They know that you’re concerned.”

After-the-sale service not only shows customers you care, but also helps ensure they come back. But earning a customer’s loyalty often means making yourself completely accessible. For example, Jim Beyer at Jamestown, North Dakota-based Dakota Engine Builders gives his home, business and cell phone numbers to every customer that purchases a new engine. “I tell him he’s free to call me day or night, anytime,” said Beyer. “That seems to work out quite well for us, just being there to answer questions for people when they call.”

It’s not uncommon for Beyer to work at the shop till the wee hours of the morning. “Here in WISSOTA, we have a teardown rule. If you want to protest someone before the future race, you would give the tech official a certain amount of money to protest a certain car; after the race, that motor would get torn down.”

Beyer has received calls between one and two o’clock in the morning from customers who say, “We’re being protested; they tore us down.” Beyer then tells them to wrap up the motor, ensuring that dirt doesn’t get inside, and take it to the shop. “We’ll put it back together for no charge as long as one of our engines is getting torn down,” he said. “There have been times when this has happened on a Friday night. I’ve had to come up here bright and early on a Saturday morning to get the motor back together so they could race Saturday night…. I’ve been here as late as three or four o’clock in the morning putting motors back together so they could race the next day with them.”

The hours may sound grueling to those not in the industry, but for engine builders like Beyer, who works with eight to 10 engines in the shop at all times, “service after the sale” is part of the job. “I believe all engine builders sell a pretty good engine,” he said. “You have to work with your customers and get more personal with them.”

Ink & Screen Promos

Many builders rely on word-of-mouth advertising to draw in new customers. But Jon Kaase from Winder, Georgia-based Jon Kaase Racing Engines has found additional ways to successfully capture the eyes of a wider audience of potential customers. While he doesn’t do a whole lot of traditional advertising, per se, like in the back of newspapers, he receives press coverage via new product releases and tech articles featured in magazines. Additionally, the company has won the prestigious Popular Hot Rodding Engine Masters Challenge. “We get what I guess you would call free advertising and use that as something to promote our business,” said Kaase. “You get a lot of magazine coverage in it. We’ve had a couple of front covers on a magazine called Engine Masters and the front cover shots were our engines that we won with. That’s huge for your business, but not everybody is going to get that.”

Kaase has dabbled in TV as well, on Speed Channel’s Gearz with Stacey David. “We helped him with a couple of engines on cars that they were building,” he said. “You get a TV show out of that where they might spend five or 10 minutes talking about your products. I mean, what could be better than that?” Kaase estimated that the TV show has rerun the episode 25 times or more in a couple of years, which has helped boost his brand visibility.

The Internet plays a vital role in sales at Jon Kaase Racing Engines, as one team member answers about 50 emails a day from people simply asking questions. “A lot of them are from out of the country—Australia and places like that. It seems like email is more popular than the telephone anymore. You can’t ignore the emails. You have to answer them.”

The company’s website has been active for about nine years, but only recently launched its Facebook page—about six months ago. “Actually, I think the Facebook page now gets more business than our website,” he said, adding that he does have an employee dedicated to help with web visibility.

Trackside Support

Many engine builders have molded their business model to include a presence at the race track, which can create great publicity. “We have multiple customers at a lot of different races, and we’ll have multiple employees there to support those customers,” said Kevin Kroyer from Las Vegas, Nevada-based Kroyer Racing Engines. “We specifically do a full-vehicle approach that starts at the shop. Besides having two engine dynos, like most engine shops, we also have a chassis dyno so we can check the customer’s race vehicle before it goes to the race track. Once at the race track, as most of our customers have electronic fuel injection and data acquisition, we’re heavily involved in actively pulling their data for them and helping them to discover problems, hopefully before they happen. So we’re actively involved in every facet of their pre-race ritual, let alone during the race.”

The company supports major off-road sanctioning bodies and series, including SCORE, HDRA, Best in the Desert, and Lucas Oil Off Road Racing Series, and sends anywhere from one to seven employees from the shop to a race, depending on the event location. “At the Baja 1000 last year, I think we had seven individuals that traveled all the way down the 1100-mile journey of the race,” said Kroyer. “Because our races are longer—they’re endurance-style races with our desert customers—typically we’re monitoring radios, communications between the teams and satellite phone and cell phones depending upon where we’re at, whether we’re in Mexico or the US, so we can be there at any given time. We’ll be at some of the particular pit areas that they have when they stop for fuel and tires to be there to answer any questions or, if need be, help fix a problem.”

On the company’s job board, there’s typically a rotating cycle of between 30 and 50 engines. And on the short-course series, like the Lucas Oil Off Road Series, employees are present at the track for the weekend through practice, qualifying and the main event, just to make sure everything runs properly. “Honestly, our laptops are probably something that we darn near can’t live without, because whether it’s pulling our data acquisition files out of the customer’s vehicle and analyzing that data to see if they’re going to have a problem or it’s being able to tie back into the database that we have at our shop, via a wireless connection, we can tie back into our mainframe back at the race shop even if we’re in Mexico and look up records, build folders, files, customer information, that kind of stuff,” he said.

Managing Dollars

To stay afloat in a tough economy, profit-minded builders pay close attention to the details of business expenses. “You have to manage your technology dollars, spending the best you can, because in today’s world you can spend a very large percentage of your budget in technology that changes every year,” said Kriner. “About every six months there’s a new cell phone, and that’s one thing that we’ve noticed with cell phones, smartphones and everything: Our expenses for communications and Internet is going up a lot; we didn’t even have that 15–20 years ago…. That’s something you don’t think about till you look at your balance sheet at the end of the year and see how much you really spend.”

 

 

 




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