The last time the Dunns threw a party at their Oregon dealership a monster truck almost went out of control. While the driver corrected in time to avert disaster in front of a crowd of 500, neither Jim nor Tom Dunn wanted to press their luck last year by throwing a party to celebrate a remarkable milestone--the dealership’s 100th anniversary.
Besides, Jim Dunn said in an interview last week, the brothers sell GM cars and without the government bailout the 100th anniversary may have been their last. The GM bailout and contraction of its dealer network was just the latest crisis for the family business, which has survived World War I, The Great Depression, World War II, the 1974 oil embargo, and 20 percent interest rates in the early 1980s.
Today, as the Dunns prepare to hand over one of Northwest Ohio’s largest dealerships to a fourth generation, the brothers are optimistic about the future. GM, they believe, has righted its sinking ship. Its cars rank high on quality surveys, which wasn’t always the case. At one time, the dealership averaged $10,000 a month in warranty work to fix factory problems, Tom Dunn said. Today, $300 a month is a busy month. Consequently, three of the top 10 vehicles sold in America today, according to cars.com, are Chevys—the Silverado, Malibu and Cobalt.
While GM’s quality has improved at a higher rate than the industry average according to J D Power & Associates, cars are still not selling at the rate they did before The Big Recession. Nationally, new car sales are down from an estimated 17 million in 2007 to 10 million.
While the Dunns have fared much better than national statistics—holding steady at about 2,000 new and used vehicles a year for 2008 and 2009--it was a local construction project that most affected sales. The building of the Veterans Glass City Skyway with its convoluted detours discouraged west Toledo customers from crossing the Maumee River. Sales plummeted from 3,000 a year to 2,000 and the Dunns cut the workforce from 84 to about 45. But, now with unimpeded access from Toledo and better quality vehicles, the future for the fourth generation of Dunns looks bright.
So, what’s the secret?
How does one of the nation’s oldest family-owned dealerships consistently overcome dire economic conditions?
The secret is as old as the dealership founded by Charles F. Dunn in 1909. It’s on the wall, in its brochure and both brothers have it memorized. It simply states: “Be honest and as good as your word. When you make a promise, keep it.”
These are not just words to the Dunns. They come with a price. For example when an extended service underwriter went belly up a few years ago, the Dunns picked up the obligation and have spent nearly $1 million to honor extended warranty claims. While this was not their obligation, they felt it would be hard to sell another service contract from another vendor if they didn’t assume the burden.
“We try to make long-term decisions, not short-term,” said Jim Dunn as he went on to emphasized the importance of repeat business and investing in the latest technology, just like his ancestors did.
The long view
The long view was exactly what Charles Dunn saw when he sold his first Buick in 1909. Charles ran a livery stable in Curtice and transported people to and from Toledo. He saw the future in motorized vehicles, not horse-drawn wagons. He built his first building in 1917 and brought his sons Clifford and Donald into the business. Donald soon left to open a dealership in Port Clinton and when fire destroyed Cliff’s building in 1959, he reopened within 24 hours operating out of wooden buildings on skids.
Cliff Dunn could have taken the insurance money and retired, but that was not in his nature, Jim said. He recalls his father asking him when he was 13 and Tom was 16 whether they would consider going into the family business. Neither brother recalls his answer, but Cliff had an inkling his sons would follow him, so he built a modern facility and began teaching them. Neither knew they were in training, they just thought they were getting summer jobs. But, each summer Cliff put his sons to work in a different area of the business—parts, service, body shop and the car wash.
Jim recalls one of those first jobs washing cars. “We got incentives. If the car had whitewalls, we got 25 cents more for washing them.”
Although they grew up in the business, neither saw the dealership as a career. Tom went to Bowling Green State University to study math and business and Jim went to Wittenberg to become a teacher and coach.
Tom joined the business after college and in 1970 at age 27, after his father passed away suddenly, he found himself managing 40 to 45 employees who were selling 140 new cars a month from the small town of Curtice, population 4,462. Suddenly, Tom saw the wisdom his father displayed in having him work in all aspects of the business.
Jim joined his brother in 1974, after teaching and coaching at Clay High School, where he is a member of the athletic hall of fame. An innocuous event triggered the career change. “I couldn’t take my kids to McDonalds one day, so I decided I had to do something different because I didn’t have any money. That was like the crowning thing that said, “You’re stupid.”’
The brothers share management responsibility. Their roles dovetail with their education. Tom concentrates on the business end and Jim the employees.
The brothers moved the dealership in 1988 to Oregon and closer to the larger Toledo market. By 2003, Dunn Chevy Buick was selling 3,000 cars a year while employing 84. Then, construction for the new Veterans Glass City Skyway started and the detours over the following four years deterred car buyers from crossing the Maumee River. Once again, the Dunns had a new challenge to overcome.
Today, the business is one of the highest volume dealerships in Northwest Ohio. The complex features a state-of-the-art body shop and service department and carries over $500,000 in GM parts. Between 200 to 300 used cars are on display at two lots in addition to new Chevys and Buicks.
The Dunns are in the process of training a fourth generation to succeed them. They include Tom’s sons Greg, general sales manager, and Curt, wholesale buyer, and daughter Kari, who currently works part-time. In addition, Jim’s daughter, Andrea Musselman is the Internet manager and son Jay the assistant used car manager.
The brothers will make sure this new generation hears the echoes of their grandfather’s advice about being honest and keeping their word as well as their father’s advice. Cliff Dunn was fond of telling his children, “Don’t just stand there. Let’s get the job done.”
The brothers took this advice to heart. Ron Porter, shop foreman, recalls the day 15 years ago when he interviewed for the job. When Jim didn’t show for the interview the staff tracked him down in the shop. Porter recalls the scene: “He’s down there in his normal work attire—tie and white shirt—with his sleeves rolled up working on the wash machine. That left an impression on me. These are the kind of people I want to work for. They’re hands on. You just don’t see stuff like that in large corporations. It’s a family dealership and everybody’s family.”
These small–town values have served the Dunns well for 101 years. They’re still in evidence today. When, I went to the dealership last week to interview the Dunns, Greg Dunn was plowing snow, and Jim Dunn had just shoveled the walk.