Safelite’s CEO on steering the company through crisis—and getting sales back to pre-pandemic levels


In early February, Tom Feeney was basking in the reception of a lifetime as he spoke onstage at Orlando’s luxurious Rosen Shingle Creek hotel to a jubilant audience of his 600 top managers. “2020 will be a year to remember, by far the greatest in our history,” declared the CEO of Safelite AutoGlass. Feeney reminded his troops that he had addressed them at another resort in Orlando in 2009 during the depths of the financial crisis, and on that occasion he had pledged that his radically new “Take care of your employees” mindset would power the enterprise to heights they had never dreamed of.

Now, Feeney intoned, that had happened, lauding that the numbers for 2019 smashed all records. In the decade since his team last met in Orlando, Safelite had multiplied sales fivefold, to $2.4 billion, making the 71-year-old enterprise 15 times bigger than its nearest rival. Safelite was notching double-digit margins—no need to mention that his managers were reaping all that bounty in the plodding, no-growth world of replacing windshields.

“I told the folks that we’d get to $3 billion in 2020,” Feeney, 68, told Fortune. “I came offstage with great confidence. I believed, and they believed too.” Feeney gave all assembled a $1,000 wristwatch, like the ones they’d received in 2009. Then, it was to express faith in what they could do. This time it was a thank-you for getting it done.

Within weeks of that celebration, says Feeney, business dropped “like someone turned off a light switch.” By the first week in April, Safelite’s revenues had cratered 45%, as its business of replacing windshields generally hinges on how much Americans drive. But what stands out about the company’s story is its highly original, keeping-your-base-intact response to the crisis. Feeney focused on sharply lowering costs to balance the drop in sales. But at the same time, he used furloughs, not layoffs, to ensure that almost all of his 17,000 employees remained on staff and ready to go when the rebound came.

When Feeney saw the coronavirus spreading in China in the days after the Orlando confab, he fretted that production would soon shut down in the nation where he sources half of his windshields. So he secured big advance deliveries from his Chinese suppliers in February and early March, and bought distribution centers that he stocked to the brim. “When I first heard the noise from China about COVID-19,” says Feeney, “I set about to get everybody else’s inventory for the recovery.” Starting in the second week in April, more families got back on the road, and volumes rebounded much faster than Feeney expected.

Feeney was able to quickly meet the surge by ramping up hours for service reps and technicians who’d been working part-time. Keeping people employed and on-call, and windshields set for delivery, enabled Safelite to steal sales from competitors that deployed sweeping layoffs and ran out of stocks. Those rivals can’t hire people back fast enough to recapture lost business, so those customers are going …read more

Source:: Fortune


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