Defending the “Yellow Pages Scheme”

© 2006 Door & Access Systems
Publish Date: Summer 2006
Author: Tom Wadsworth
Pages 34-42

Defending the “Yellow Pages Scheme”
Anonymous Owner Reveals the Other Side of the Story
By Tom Wadsworth

Editor’s Note: If I had to select the most popular article we’ve ever published, it would be “Bad Bob’s Yellow Pages Scheme” (Spring 2003, pp. 44-45). The article outlined several negative elements of a new approach to the garage door business, flourishing in larger cities and led by huge Yellow Pages ads.

Up until now, we have been unable to get any of these “Bad Bobs” to talk to us. But here, for the first time, we publish the other side of the story.

In order to present as much information as possible, we will protect this dealer’s identity. In this case, this business owner just recently decided to jump into the garage door business, opening up two operations in two major cities in the last year.

One of your competitors complained to us that one of your two full-page Yellow Pages ads portrayed your company as having the same name as his company. Why did you do that?

It was not intentional. The phone company simply made a mistake. Their sales rep should have done better research. I relied on him because I was out of state.

The phone company credited me and the other door company for the ads. Unfortunately, they cannot correct it for 12 months.

This is our first year in that market, and I have hundreds of thousands invested in this company. I would not want to have the misunderstanding that I am another company.

Have you read any of our stories about the “Yellow Pages Scheme”?

Yes, and I think you’re giving some good people a bad reputation.

How so?

There’s nothing wrong with large ads in the phone book. When you’re trying to break into the market, you need to get your name out there. So you turn to people like (the Yellow Pages publisher). They advise you on what size ad you need to make your phone ring.

In the service industry, it is vital to be in the Yellow Pages, and all business owners agree on that. When your door is broken, you go to the phone book.

You have to be financially secure and have good credit to be approved for these size ads. They are very expensive, and I virtually had to sign my life away. It is a good thing that I’ve run a successful business in another industry for 10 years.

It generally takes about three years to have a repeat business. After that, you should be able to put that ad money somewhere else.

Your ads don’t identify a specific address. Some might argue that having no address is a way to constantly hide from unhappy customers.

We’re not trying to hide from anybody. We’re primarily a service business, and a storefront is simply not necessary at this point.

My invoices have a contact address and phone number displayed on them. We have someone who answers the phone 24 hours a day. If someone wants to reach us, they can.

I choose to put my money in advertising. Our primary costs are in the Yellow Pages and other forms of advertising; that’s not usually the case in the typical door company. I do not need a fancy showroom when I am not open to the public.

When I called your business number, I got the impression that the person who answers your phone is actually located in another city. Is that right?

There’s nothing wrong with having a phone room in another city or state. Dell and major credit card companies have call centers in India. Our business is just a different business model than the typical door company.

It’s not always good to have the techs in the same area with the phone people, especially when you plan on expanding. You need to maintain control over the phone room to be sure that you optimize all calls. When the dispatchers are in the same area as the techs, they may show favoritism to a particular tech.

A common complaint about certain large Yellow Pages ads focuses on false claims in the ads.

The art department at (the phone directory company) put our ads together. I’m trusting (the phone directory) to design those ads correctly. I’m not the expert; they’re the ones who deal with this on a daily basis. If they’re putting illegal things in my ads, I’d like to know about it.

Do your ads claim that you are “#1 in customer service”?

I don’t have the ad in front of me, but I think we do.

How can you be #1 in customer service when this is your first year in business? It could be argued that this constitutes “false advertising” and/or “deceptive practices.”

It may be my first year in business, but other members of my family have invested in my company and they’ve been in the door business for years.

We call every customer back and, to my knowledge, they are satisfied. They would do business again. They are satisfied with our customer service. So we are rated by our own customers.

If putting this in the ad is found to be unethical, then I would take it out of my ad. I do not want to represent my business in a way that is illegal or unethical.

Some companies have attracted lawsuits because they use certain manufacturer logos without permission.

To my knowledge, it is legal to display these logos when you repair or sell a certain brand of product. Again, this advice is from the phone book sales rep.

The (phone directory company) maintains a big file with all these logos. I just assumed that they knew what they were doing when they designed my ad. If a company does not want me to display their logo, then I will take it out.

It sounds to me like maybe you should be going after the telephone directory companies.

Some door companies with large Yellow Pages ads are known to grossly overcharge for service work. How do you respond to that?

We’re not responsible for what other companies do. We think our prices are reasonable. When I went into this business, I researched the prices from all my competitors and set my prices accordingly or even less.

We only use top-quality, name-brand products. We only use galvanized springs, and we sell a lifetime warranty.

We encourage customers to call around, and we will price match. I would guess that our prices are probably within $50 of the other door companies in town.

It all goes back to overhead costs and to what (the phone directory company) charges for ads. In order to compete in a service industry like this, you’ve got to be first, second, or third in the Yellow Pages. All that expense goes into your overhead, and that determines what you charge. You have to charge enough money to make it work.

Has your company had any complaints about overcharging?

I’m aware of two customers who felt they were overcharged. When one person complained, I gave them some money back even though I did not personally agree with them. I was trying to make them happy so that they would return to us if there was ever a need. To my knowledge, my customers are happy.

Do you train your techs to reach a quota amount for service tickets?

No, absolutely not. I know there are other companies out there that work on a quota system. But that’s not how we train our people. We train them to do the work that needs to be done.

My guys are never told to go after the high-dollar ticket; however, I do expect them to sell the job. That is salesmanship. There is nothing wrong with that.

When technicians are paid a commission for every service call, they are more motivated to run up high service bills. Do you pay a commission to your techs?

I won’t go into how we pay our people. I consider that a private matter.

In your business model, it seems that the owner/manager is often in a different city than where your technicians work. How can you manage your techs if you’re not there?

Our techs are flown to our corporate office to train with a trusted, experienced tech for a minimum of two to three weeks. In training, we talk about the proper way to deal with service issues. If they have proven that they can do the job, then we put them in the field.

We only hire experienced techs with a minimum of three to four years’ experience. They must be honest techs who do good work. If they cause callbacks, that costs us money.

How do you know that your techs are doing a good job for your customers?

Business owners in the service industry are often at the mercy of our technicians in the field. We’re trusting that they’re doing a good job with customers and charging appropriately. One bad tech can hurt our reputation before we know anything about it.

I can’t follow my techs everywhere they go. In one of my markets, I had to fire a couple of my technicians because of complaints.

When we receive a call from a customer, our trained technicians go out and thoroughly inspect the door. Then they will give the consumer the price. It is up to the consumer to authorize the work. There are no scare tactics or high pressure.

We try to do quality work and only do the work that needs to be done. Our techs’ confidence and experience is what will come across and get them the job. In one location, my lead tech has 24 years of experience.

We call every customer back to make sure they were satisfied with our work. If there’s a problem, we should know about it immediately.

Are your businesses doing well?

To be honest, I have not made one penny yet. (One city) is a nightmare. I think I should have done more market research. That market seems to be oversaturated with door companies, and if it does not turn around in the next couple of years, I may have to pull out.

In the end, the strongest companies will survive.

To respond to this story, send an E-mail to daseditor@dasma.com.