JIM BURKE, PRESIDENT AND CEO
DRIVE TRAIN INDUSTRIES
Name of Company: Drive Train Industries
Headquarters Address: 5555 Joliet Street
Denver, Colo. 80239
Web site: www.dti-inc.com
Founded: 1945
Owner(s): 100% Employee Owned (ESOP Corporation)
Number of Locations: 10
Number of Employees: 137
WHY DID YOU START THE BUSINESS?
Drive Train Industries was founded in 1945 by my grandfather John Burke. Drive Train was the premier aftermarket brake supplier in the Rocky Mountain Region. John had a passion for that business that he passed on to his sons (Joe, Jim, Larry, Tom and John).
As the “boys” went to work, they began to push and expand the company in new directions. They added drivelines, axles, transmissions and PTOs. The company was located in downtown Denver on Market Street and had stores on both sides of the street. There were several names for the company: Brake and Clutch, Gear and Joint and Axle and Transmission.
In 1974 they moved from lower downtown to a location a few miles away in a newer, larger building located on Brighton Blvd. It was at this time they combined all of the operations into one and changed the name to Drive Train Industries.
WHAT’S BEEN YOUR TOUGHEST BUSINESS DECISION?
I would like to answer: What the toughest thing I’ve had to do in this business?
Last year we had the biggest challenge we have ever had to face. Most people would say that challenge was our poor economy, and while that was tough for us, the even bigger problem for us was that we had to relocate our headquarters. Our building had been sold two years earlier and our lease was due to expire.
After 35 years of doing business at our Brighton Blvd. location, we had to move. While this was certainly a daunting challenge it also gave us the opportunity to rationalize our business model. By starting with a clean sheet of paper we were able to tear down barriers between traditional departments, allowing us to streamline process flows. We examined the products and services offered by each of our profit centers and in some cases decided that particular pieces would not make the transition with us.
We made the decision to combine our two separate truck service operations and our main store, which contained a large warehouse and brake, machine, driveline, transmission, differential and hydraulic shops.
Our next challenge was to find a building. We calculated that we could take a combined 170,000 sq. ft. of current operations and fit them into a building with roughly 90,000 sq. ft. We looked at more than 40 buildings before we found the one that met our needs.
We then spent nearly five months securing a lease on that building. After taking possession of the building in May, we then started tenant improvement projects which included constructing demising walls, cutting service bay doors, creating an administrative office, designing a new showroom, and installing new phone, network, materials handling and compressed air systems, just to name some of the things we had to get done in a short four month window.
The next big hurdle was to formulate a logistics plan to move more than 45,000 part numbers, a computer system and all of the admin functions over the Labor Day weekend. When we negotiated with the moving company they calculated it would take at least 56 hours to complete the move of our warehouse, counter and admin areas.
Last year Drive Train Industries moved to a new state-of-the-art facility after having been at the same location for 35 years. Jim Burke, president and CEO, says it was one of the toughest things he’s had to do in this business.With some careful planning and some very talented and motivated employees and suppliers, we were able to move it in just over 18 hours (the movers did not get the double time they thought they would get for working on the Monday holiday). We were able to get set up to conduct business on Tuesday morning.
In the next phase of the process, we had a rigging company transfer and install 49 pieces of production machinery and machine tools into our component repair shop. During the following two weeks we moved our two service shops into their new home in the corner of our building. This operation was very successful and now allows us to better serve our customers.
This by far was the most difficult thing our company has had to overcome, and I hope I’m long retired before we ever have to move again.
WHAT WAS YOUR BEST BUSINESS DECISION?
Our move, while difficult, was the best business decision I think we have ever made. By combining all of our operations and streamlining our warehouse I believe we now have the ability to be very efficient and effective at helping our customers. The combination of our truck shop, with our component repair shop, and throwing in a comprehensive inventory, has allowed us to deliver a level of service to our customers that cannot be matched by our dealer competitors.
WHAT WAS YOUR WORST BUSINESS DECISION?
Moving might have been our toughest decision, but it wasn’t our worst.
Drive Train Industries’ new facility combined its other locations into one and brought under one roof the company’s truck service, store, warehouse and brake, machine, driveline, transmission, differential and hydraulic shops.The economy during the last 18 months has forced us to make very difficult decisions in order to keep the company viable. The worst thing I think we have had to do is to reduce our workforce to remain competitive. Letting go of some of our long-term employees was an emotionally difficult decision that we wish we didn’t have to make.
WHAT IS THE BEST WAY TO KEEP A COMPETITIVE EDGE?
The best way to keep a competitive edge is through information and communication. If you can collect, calculate and generate the right and accurate data, you can make the best decisions. We are constantly trying to search our databases in new ways to help us make accurate projections and decisions.
Even though Drive Train Industries cut their total space almost in half when it moved to its new roughly 90,000 sq. ft. location, President and CEO Jim Burke says they were able to optimize operations and storage.As accurate as data can be, nothing can be more helpful than constant communication with your customers, employees and industry peers. There are so many times that people tell a different story with a different conclusion than what the latest database can come up with.
WHAT IS YOUR FIVE-YEAR VISION?
The current economy has changed everything we thought we knew about our business. The term that everyone uses is “the new normal.” As we move forward, our immediate challenge is to weather the storm and bring back the strength of our organization.
The decisions we have made in the past year-and-a-half will cause us to look closely at growth decisions as we move into the future. We believe we need to stay lean and to carefully control our growth and expansion plans. We also have also learned that our service operations help with profitability, and truck service is an area where we plan to focus more of our resources.
WHAT IS YOUR BUSINESS PHILOSOPHY?
We still operate off of the same basic philosophy that John Burke started with. We create value for our customers by offering quality products and services – and then by combining outstanding technical support, training and service – we can help our customers be successful, efficient and profitable.
WHAT IS THE BIGGEST CHALLENGE FACING THE AFTERMARKET?
The dealer network. It seems like it has been that same challenge for several decades now.
HOW DO YOU SEE THAT CHALLENEGE BEING RESOLVED?
Distributors are doing several things to remain competitive with our dealer counterparts. We are lobbying heavily for access to vehicle information.
Distributors attend trade shows, training opportunities and events like Heavy Duty Aftermarket Week, NTEA’s The Work Truck Show and others on a regular basis. This allows us access to our industry peers and the ability to share best practices.
Most distributors are members of one of the marketing groups. These groups allow us to pool our purchases, and sometimes our resources, in order to remain competitive.
WHAT ADVICE WOULD YOU GIVE A YOUNG PERSON CONSIDERING A CAREER IN THE AFTERMARKET?
This is a business based on relationships. In order to be successful you have to build quality relationships with your customers, your suppliers and your peers in the industry. If you don’t possess the skills to build and cultivate those relationships, you will have a difficult time succeeding in this business.
HOW DOES YOUR BUSINESS CONTRIBUTE TO THE COMMUNITY?
John Burke was a devout Catholic and he strongly believed in helping his employees and his community. John was a big supporter of the United Way. For well over four decades Drive Train Industries has partnered with United Way and continues to encourage all of our employees to contribute to this charitable organization.
John also had a very soft spot in his heart for The Little Sisters of the Poor. The organization’s charter is to help indigent seniors with nursing home and hospice services. The Sisters always knew they could twist John’s arm whenever they needed help and he always would come through. When John passed away, my father, Jim, took up the torch and continued the support. Now the nuns are after me. n
