Tue, 09/01/2015 - 18:25

SEMA News—September 2015

BUSINESS
By Chad Simon

Retail Spotlight

Southern Off-Road Specialists Provides Superior Customer Experience
 Southern Off-Road Specialists
Southern Off-Road Specialists is closing in on $1 million in monthly sales by supplying enthusiasts with lift kits, tires, wheels, tonneau covers, aftermarket bumpers, lighting and other popular truck accessories.
  

A longtime passion for off-roading helped motivate the Richmond family to launch Southern Off-Road Specialists (SORS) in 2000. Having an enthusiast mindset with the ability to relate to customers and foresee trends is the formula that has enabled owners Don Richmond and his son Adam—who started working at the shop when he was just 15—to succeed in this competitive market.

SORS got its humble start in a two-bay gas station, grossing $50,000 to $60,000 in monthly sales. Today, the four-wheel-drive shop is housed in a 40,000-sq.-ft. facility in Alpharetta, Georgia, and employs 18 people. The family-owned company is closing in on $1 million in monthly sales by supplying enthusiasts with lift kits, tires, wheels, tonneau covers, aftermarket bumpers, lighting and other popular truck accessories. In 2012, SORS added an entire arms-and-ammo showroom inside of the truck shop. Adam Richmond instantly saw the benefits of the natural crossover, as 80% of the company’s gun business came from existing truck and accessory clients.

SEMA News recently caught up with the younger Richmond to find out how the family has managed to propel the company forward despite competition from larger, corporate-owned companies.

SEMA News: What is the single most important factor in your success? Who are your customers, and why do they come to you?

Adam Richmond: In a market where almost everything we sell is discretionary, the customer experience is truly one of the most important factors contributing to our success. Most customers have a general idea of what they’re looking for but welcome the expertise of our sales team. At the end of the day, we always want our customers to leave happy. We understand that we’re in a word-of-mouth business, and making them happy is of utmost importance to us. People make mistakes, and the true success of a business is how it overcomes those mistakes and responds to them.

Our clients are mostly males between the ages of 16 and 45. They come to us because we are established in the community, we have a solid reputation and we’re in a great location.

SN: What is your customer-service philosophy, and what do you do specifically to meet that philosophy? How do you train your staff to best serve the company?

AR: We strive to provide a superior customer experience, starting with the interaction with our sales team, followed by top-quality installation service and continuing with friendly after-sales support. We found that hiring off-road enthusiasts is key because it’s easier to train them on the products and services we offer, and the personal interest transfers strongly when working with customers on their special projects.

SN: What differentiates you from the competition?

AR: We are an operationally involved, family-owned company, and our clients like knowing that the owners are directly involved in the day-to-day operations. Problem resolution is typically streamlined much faster and more efficiently compared to our corporately owned competitors.

SN: What has been your company’s most rewarding success?

AR: We have created very close relationships with the leaders in our industry. We test prototype products, have direct contact with their design teams and can help influence products that we know our customers will love. This keeps us on the leading edge and helps propel us into the future.

SN: What has been the biggest challenge you have faced?

Southern Off-Road Specialties
SORS continues the customer experience beyond the actual sale by providing installation service and support.
 
  

AR: The industry is constantly changing over time. It’s a challenge to keep up with current trends and foresee what will be popular. Being an enthusiast helps us to understand what’s going on in the industry.

Before the recession, back in 2007 and 2008, a large majority of our customer base was small-business owners. We catered to a clientele who purchased a new truck every year. Literally, it felt like overnight that business went away. If we had not been watching what was happening in the market and been able to anticipate that customer base disappearing, we would have been in real trouble.

We actually started targeting dealerships prior to that. We were able to supplement the individual small-business owner customer base that was our cornerstone for several years and transition it to dealer-focused for the next couple years. Throughout the recession, our company continued to grow.

About 40% of our business was diesel performance when stricter diesel emissions-controls were put in place, and that went real soft overnight as well. Seeing that happening, we were able to transition almost 40% of our business to nothing but Jeep products. We’re constantly finding what’s new and what else we can be doing, which has helped us.

Executive Summary

Southern Off-Road Specialists
770-346-7777
www.southernoffroad.net
843 McFarland Parkway
Alpharetta, GA 30004

• Owners: Don and Adam Richmond.

• 18 employees

• Operates out of a 40,000-sq.-ft. facility in Alpharetta, Georgia.

• Sales and installation of off-road truck parts and accessories.

• Grosses nearly $1 million per month in sales.

• The family-owned business hires knowledgeable employees, offers exceptional customer service and is experiencing growth in custom builds and restoration.

• Biggest challenge is evolving with the market and foreseeing trends.

SN: What are your strategies for marketing the company?

AR: We do very little marketing outside of sponsoring local high-school football and softball teams. We get return customers based on the quality of our work and our ability to give great advice about what else can be done to customers’ vehicles the next time they come in. It’s been a recipe for success. We don’t advertise, but we are active on social media. We also give out T-shirts and windshield banners.

We have a lot of young customers who we get to see off to college. We’ll lift their trucks and they’ll come back for a bumper, a winch or some side steps, and the next time we see them, it’s to switch out the mud-terrains for all-terrains. We’ve been around long enough that we’re starting to see these guys come home from college and start their careers.

SN: Do you have plans for future growth? Where do you see the company headed?

AR: We’ve just expanded our showroom for the third time. We’re moving into more custom builds. We’ve started doing restoration again after six years, so we see growth in that regard. The dealer side of our business has grown every single year since 2007. Ten years from now, if everything continues to go the way it’s going, we should double in size.

SN: What advice would you offer retailers to hone their businesses?

AR: What’s helped us the most is the fact that we’re enthusiasts. Read the magazines and watch the trends. You can understand what’s going to happen in the market and do something about it before you’re left in the dust. Go to the SEMA Show every year and look at the new products that are coming out. It’s such an advantage in this business; if you’re not doing it, I think you’re going to have a hard time.

 

Tue, 09/01/2015 - 18:25

SEMA News—September 2015

BUSINESS
By Chad Simon

Retail Spotlight

Southern Off-Road Specialists Provides Superior Customer Experience
 Southern Off-Road Specialists
Southern Off-Road Specialists is closing in on $1 million in monthly sales by supplying enthusiasts with lift kits, tires, wheels, tonneau covers, aftermarket bumpers, lighting and other popular truck accessories.
  

A longtime passion for off-roading helped motivate the Richmond family to launch Southern Off-Road Specialists (SORS) in 2000. Having an enthusiast mindset with the ability to relate to customers and foresee trends is the formula that has enabled owners Don Richmond and his son Adam—who started working at the shop when he was just 15—to succeed in this competitive market.

SORS got its humble start in a two-bay gas station, grossing $50,000 to $60,000 in monthly sales. Today, the four-wheel-drive shop is housed in a 40,000-sq.-ft. facility in Alpharetta, Georgia, and employs 18 people. The family-owned company is closing in on $1 million in monthly sales by supplying enthusiasts with lift kits, tires, wheels, tonneau covers, aftermarket bumpers, lighting and other popular truck accessories. In 2012, SORS added an entire arms-and-ammo showroom inside of the truck shop. Adam Richmond instantly saw the benefits of the natural crossover, as 80% of the company’s gun business came from existing truck and accessory clients.

SEMA News recently caught up with the younger Richmond to find out how the family has managed to propel the company forward despite competition from larger, corporate-owned companies.

SEMA News: What is the single most important factor in your success? Who are your customers, and why do they come to you?

Adam Richmond: In a market where almost everything we sell is discretionary, the customer experience is truly one of the most important factors contributing to our success. Most customers have a general idea of what they’re looking for but welcome the expertise of our sales team. At the end of the day, we always want our customers to leave happy. We understand that we’re in a word-of-mouth business, and making them happy is of utmost importance to us. People make mistakes, and the true success of a business is how it overcomes those mistakes and responds to them.

Our clients are mostly males between the ages of 16 and 45. They come to us because we are established in the community, we have a solid reputation and we’re in a great location.

SN: What is your customer-service philosophy, and what do you do specifically to meet that philosophy? How do you train your staff to best serve the company?

AR: We strive to provide a superior customer experience, starting with the interaction with our sales team, followed by top-quality installation service and continuing with friendly after-sales support. We found that hiring off-road enthusiasts is key because it’s easier to train them on the products and services we offer, and the personal interest transfers strongly when working with customers on their special projects.

SN: What differentiates you from the competition?

AR: We are an operationally involved, family-owned company, and our clients like knowing that the owners are directly involved in the day-to-day operations. Problem resolution is typically streamlined much faster and more efficiently compared to our corporately owned competitors.

SN: What has been your company’s most rewarding success?

AR: We have created very close relationships with the leaders in our industry. We test prototype products, have direct contact with their design teams and can help influence products that we know our customers will love. This keeps us on the leading edge and helps propel us into the future.

SN: What has been the biggest challenge you have faced?

Southern Off-Road Specialties
SORS continues the customer experience beyond the actual sale by providing installation service and support.
 
  

AR: The industry is constantly changing over time. It’s a challenge to keep up with current trends and foresee what will be popular. Being an enthusiast helps us to understand what’s going on in the industry.

Before the recession, back in 2007 and 2008, a large majority of our customer base was small-business owners. We catered to a clientele who purchased a new truck every year. Literally, it felt like overnight that business went away. If we had not been watching what was happening in the market and been able to anticipate that customer base disappearing, we would have been in real trouble.

We actually started targeting dealerships prior to that. We were able to supplement the individual small-business owner customer base that was our cornerstone for several years and transition it to dealer-focused for the next couple years. Throughout the recession, our company continued to grow.

About 40% of our business was diesel performance when stricter diesel emissions-controls were put in place, and that went real soft overnight as well. Seeing that happening, we were able to transition almost 40% of our business to nothing but Jeep products. We’re constantly finding what’s new and what else we can be doing, which has helped us.

Executive Summary

Southern Off-Road Specialists
770-346-7777
www.southernoffroad.net
843 McFarland Parkway
Alpharetta, GA 30004

• Owners: Don and Adam Richmond.

• 18 employees

• Operates out of a 40,000-sq.-ft. facility in Alpharetta, Georgia.

• Sales and installation of off-road truck parts and accessories.

• Grosses nearly $1 million per month in sales.

• The family-owned business hires knowledgeable employees, offers exceptional customer service and is experiencing growth in custom builds and restoration.

• Biggest challenge is evolving with the market and foreseeing trends.

SN: What are your strategies for marketing the company?

AR: We do very little marketing outside of sponsoring local high-school football and softball teams. We get return customers based on the quality of our work and our ability to give great advice about what else can be done to customers’ vehicles the next time they come in. It’s been a recipe for success. We don’t advertise, but we are active on social media. We also give out T-shirts and windshield banners.

We have a lot of young customers who we get to see off to college. We’ll lift their trucks and they’ll come back for a bumper, a winch or some side steps, and the next time we see them, it’s to switch out the mud-terrains for all-terrains. We’ve been around long enough that we’re starting to see these guys come home from college and start their careers.

SN: Do you have plans for future growth? Where do you see the company headed?

AR: We’ve just expanded our showroom for the third time. We’re moving into more custom builds. We’ve started doing restoration again after six years, so we see growth in that regard. The dealer side of our business has grown every single year since 2007. Ten years from now, if everything continues to go the way it’s going, we should double in size.

SN: What advice would you offer retailers to hone their businesses?

AR: What’s helped us the most is the fact that we’re enthusiasts. Read the magazines and watch the trends. You can understand what’s going to happen in the market and do something about it before you’re left in the dust. Go to the SEMA Show every year and look at the new products that are coming out. It’s such an advantage in this business; if you’re not doing it, I think you’re going to have a hard time.

 

Tue, 09/01/2015 - 18:25

SEMA News—September 2015

BUSINESS
By Chad Simon

Retail Spotlight

Southern Off-Road Specialists Provides Superior Customer Experience
 Southern Off-Road Specialists
Southern Off-Road Specialists is closing in on $1 million in monthly sales by supplying enthusiasts with lift kits, tires, wheels, tonneau covers, aftermarket bumpers, lighting and other popular truck accessories.
  

A longtime passion for off-roading helped motivate the Richmond family to launch Southern Off-Road Specialists (SORS) in 2000. Having an enthusiast mindset with the ability to relate to customers and foresee trends is the formula that has enabled owners Don Richmond and his son Adam—who started working at the shop when he was just 15—to succeed in this competitive market.

SORS got its humble start in a two-bay gas station, grossing $50,000 to $60,000 in monthly sales. Today, the four-wheel-drive shop is housed in a 40,000-sq.-ft. facility in Alpharetta, Georgia, and employs 18 people. The family-owned company is closing in on $1 million in monthly sales by supplying enthusiasts with lift kits, tires, wheels, tonneau covers, aftermarket bumpers, lighting and other popular truck accessories. In 2012, SORS added an entire arms-and-ammo showroom inside of the truck shop. Adam Richmond instantly saw the benefits of the natural crossover, as 80% of the company’s gun business came from existing truck and accessory clients.

SEMA News recently caught up with the younger Richmond to find out how the family has managed to propel the company forward despite competition from larger, corporate-owned companies.

SEMA News: What is the single most important factor in your success? Who are your customers, and why do they come to you?

Adam Richmond: In a market where almost everything we sell is discretionary, the customer experience is truly one of the most important factors contributing to our success. Most customers have a general idea of what they’re looking for but welcome the expertise of our sales team. At the end of the day, we always want our customers to leave happy. We understand that we’re in a word-of-mouth business, and making them happy is of utmost importance to us. People make mistakes, and the true success of a business is how it overcomes those mistakes and responds to them.

Our clients are mostly males between the ages of 16 and 45. They come to us because we are established in the community, we have a solid reputation and we’re in a great location.

SN: What is your customer-service philosophy, and what do you do specifically to meet that philosophy? How do you train your staff to best serve the company?

AR: We strive to provide a superior customer experience, starting with the interaction with our sales team, followed by top-quality installation service and continuing with friendly after-sales support. We found that hiring off-road enthusiasts is key because it’s easier to train them on the products and services we offer, and the personal interest transfers strongly when working with customers on their special projects.

SN: What differentiates you from the competition?

AR: We are an operationally involved, family-owned company, and our clients like knowing that the owners are directly involved in the day-to-day operations. Problem resolution is typically streamlined much faster and more efficiently compared to our corporately owned competitors.

SN: What has been your company’s most rewarding success?

AR: We have created very close relationships with the leaders in our industry. We test prototype products, have direct contact with their design teams and can help influence products that we know our customers will love. This keeps us on the leading edge and helps propel us into the future.

SN: What has been the biggest challenge you have faced?

Southern Off-Road Specialties
SORS continues the customer experience beyond the actual sale by providing installation service and support.
 
  

AR: The industry is constantly changing over time. It’s a challenge to keep up with current trends and foresee what will be popular. Being an enthusiast helps us to understand what’s going on in the industry.

Before the recession, back in 2007 and 2008, a large majority of our customer base was small-business owners. We catered to a clientele who purchased a new truck every year. Literally, it felt like overnight that business went away. If we had not been watching what was happening in the market and been able to anticipate that customer base disappearing, we would have been in real trouble.

We actually started targeting dealerships prior to that. We were able to supplement the individual small-business owner customer base that was our cornerstone for several years and transition it to dealer-focused for the next couple years. Throughout the recession, our company continued to grow.

About 40% of our business was diesel performance when stricter diesel emissions-controls were put in place, and that went real soft overnight as well. Seeing that happening, we were able to transition almost 40% of our business to nothing but Jeep products. We’re constantly finding what’s new and what else we can be doing, which has helped us.

Executive Summary

Southern Off-Road Specialists
770-346-7777
www.southernoffroad.net
843 McFarland Parkway
Alpharetta, GA 30004

• Owners: Don and Adam Richmond.

• 18 employees

• Operates out of a 40,000-sq.-ft. facility in Alpharetta, Georgia.

• Sales and installation of off-road truck parts and accessories.

• Grosses nearly $1 million per month in sales.

• The family-owned business hires knowledgeable employees, offers exceptional customer service and is experiencing growth in custom builds and restoration.

• Biggest challenge is evolving with the market and foreseeing trends.

SN: What are your strategies for marketing the company?

AR: We do very little marketing outside of sponsoring local high-school football and softball teams. We get return customers based on the quality of our work and our ability to give great advice about what else can be done to customers’ vehicles the next time they come in. It’s been a recipe for success. We don’t advertise, but we are active on social media. We also give out T-shirts and windshield banners.

We have a lot of young customers who we get to see off to college. We’ll lift their trucks and they’ll come back for a bumper, a winch or some side steps, and the next time we see them, it’s to switch out the mud-terrains for all-terrains. We’ve been around long enough that we’re starting to see these guys come home from college and start their careers.

SN: Do you have plans for future growth? Where do you see the company headed?

AR: We’ve just expanded our showroom for the third time. We’re moving into more custom builds. We’ve started doing restoration again after six years, so we see growth in that regard. The dealer side of our business has grown every single year since 2007. Ten years from now, if everything continues to go the way it’s going, we should double in size.

SN: What advice would you offer retailers to hone their businesses?

AR: What’s helped us the most is the fact that we’re enthusiasts. Read the magazines and watch the trends. You can understand what’s going to happen in the market and do something about it before you’re left in the dust. Go to the SEMA Show every year and look at the new products that are coming out. It’s such an advantage in this business; if you’re not doing it, I think you’re going to have a hard time.

 

Tue, 09/01/2015 - 18:25

SEMA News—September 2015

BUSINESS
By Chad Simon

Retail Spotlight

Southern Off-Road Specialists Provides Superior Customer Experience
 Southern Off-Road Specialists
Southern Off-Road Specialists is closing in on $1 million in monthly sales by supplying enthusiasts with lift kits, tires, wheels, tonneau covers, aftermarket bumpers, lighting and other popular truck accessories.
  

A longtime passion for off-roading helped motivate the Richmond family to launch Southern Off-Road Specialists (SORS) in 2000. Having an enthusiast mindset with the ability to relate to customers and foresee trends is the formula that has enabled owners Don Richmond and his son Adam—who started working at the shop when he was just 15—to succeed in this competitive market.

SORS got its humble start in a two-bay gas station, grossing $50,000 to $60,000 in monthly sales. Today, the four-wheel-drive shop is housed in a 40,000-sq.-ft. facility in Alpharetta, Georgia, and employs 18 people. The family-owned company is closing in on $1 million in monthly sales by supplying enthusiasts with lift kits, tires, wheels, tonneau covers, aftermarket bumpers, lighting and other popular truck accessories. In 2012, SORS added an entire arms-and-ammo showroom inside of the truck shop. Adam Richmond instantly saw the benefits of the natural crossover, as 80% of the company’s gun business came from existing truck and accessory clients.

SEMA News recently caught up with the younger Richmond to find out how the family has managed to propel the company forward despite competition from larger, corporate-owned companies.

SEMA News: What is the single most important factor in your success? Who are your customers, and why do they come to you?

Adam Richmond: In a market where almost everything we sell is discretionary, the customer experience is truly one of the most important factors contributing to our success. Most customers have a general idea of what they’re looking for but welcome the expertise of our sales team. At the end of the day, we always want our customers to leave happy. We understand that we’re in a word-of-mouth business, and making them happy is of utmost importance to us. People make mistakes, and the true success of a business is how it overcomes those mistakes and responds to them.

Our clients are mostly males between the ages of 16 and 45. They come to us because we are established in the community, we have a solid reputation and we’re in a great location.

SN: What is your customer-service philosophy, and what do you do specifically to meet that philosophy? How do you train your staff to best serve the company?

AR: We strive to provide a superior customer experience, starting with the interaction with our sales team, followed by top-quality installation service and continuing with friendly after-sales support. We found that hiring off-road enthusiasts is key because it’s easier to train them on the products and services we offer, and the personal interest transfers strongly when working with customers on their special projects.

SN: What differentiates you from the competition?

AR: We are an operationally involved, family-owned company, and our clients like knowing that the owners are directly involved in the day-to-day operations. Problem resolution is typically streamlined much faster and more efficiently compared to our corporately owned competitors.

SN: What has been your company’s most rewarding success?

AR: We have created very close relationships with the leaders in our industry. We test prototype products, have direct contact with their design teams and can help influence products that we know our customers will love. This keeps us on the leading edge and helps propel us into the future.

SN: What has been the biggest challenge you have faced?

Southern Off-Road Specialties
SORS continues the customer experience beyond the actual sale by providing installation service and support.
 
  

AR: The industry is constantly changing over time. It’s a challenge to keep up with current trends and foresee what will be popular. Being an enthusiast helps us to understand what’s going on in the industry.

Before the recession, back in 2007 and 2008, a large majority of our customer base was small-business owners. We catered to a clientele who purchased a new truck every year. Literally, it felt like overnight that business went away. If we had not been watching what was happening in the market and been able to anticipate that customer base disappearing, we would have been in real trouble.

We actually started targeting dealerships prior to that. We were able to supplement the individual small-business owner customer base that was our cornerstone for several years and transition it to dealer-focused for the next couple years. Throughout the recession, our company continued to grow.

About 40% of our business was diesel performance when stricter diesel emissions-controls were put in place, and that went real soft overnight as well. Seeing that happening, we were able to transition almost 40% of our business to nothing but Jeep products. We’re constantly finding what’s new and what else we can be doing, which has helped us.

Executive Summary

Southern Off-Road Specialists
770-346-7777
www.southernoffroad.net
843 McFarland Parkway
Alpharetta, GA 30004

• Owners: Don and Adam Richmond.

• 18 employees

• Operates out of a 40,000-sq.-ft. facility in Alpharetta, Georgia.

• Sales and installation of off-road truck parts and accessories.

• Grosses nearly $1 million per month in sales.

• The family-owned business hires knowledgeable employees, offers exceptional customer service and is experiencing growth in custom builds and restoration.

• Biggest challenge is evolving with the market and foreseeing trends.

SN: What are your strategies for marketing the company?

AR: We do very little marketing outside of sponsoring local high-school football and softball teams. We get return customers based on the quality of our work and our ability to give great advice about what else can be done to customers’ vehicles the next time they come in. It’s been a recipe for success. We don’t advertise, but we are active on social media. We also give out T-shirts and windshield banners.

We have a lot of young customers who we get to see off to college. We’ll lift their trucks and they’ll come back for a bumper, a winch or some side steps, and the next time we see them, it’s to switch out the mud-terrains for all-terrains. We’ve been around long enough that we’re starting to see these guys come home from college and start their careers.

SN: Do you have plans for future growth? Where do you see the company headed?

AR: We’ve just expanded our showroom for the third time. We’re moving into more custom builds. We’ve started doing restoration again after six years, so we see growth in that regard. The dealer side of our business has grown every single year since 2007. Ten years from now, if everything continues to go the way it’s going, we should double in size.

SN: What advice would you offer retailers to hone their businesses?

AR: What’s helped us the most is the fact that we’re enthusiasts. Read the magazines and watch the trends. You can understand what’s going to happen in the market and do something about it before you’re left in the dust. Go to the SEMA Show every year and look at the new products that are coming out. It’s such an advantage in this business; if you’re not doing it, I think you’re going to have a hard time.

 

Tue, 09/01/2015 - 18:25

SEMA News—September 2015

BUSINESS
By Chad Simon

Retail Spotlight

Southern Off-Road Specialists Provides Superior Customer Experience
 Southern Off-Road Specialists
Southern Off-Road Specialists is closing in on $1 million in monthly sales by supplying enthusiasts with lift kits, tires, wheels, tonneau covers, aftermarket bumpers, lighting and other popular truck accessories.
  

A longtime passion for off-roading helped motivate the Richmond family to launch Southern Off-Road Specialists (SORS) in 2000. Having an enthusiast mindset with the ability to relate to customers and foresee trends is the formula that has enabled owners Don Richmond and his son Adam—who started working at the shop when he was just 15—to succeed in this competitive market.

SORS got its humble start in a two-bay gas station, grossing $50,000 to $60,000 in monthly sales. Today, the four-wheel-drive shop is housed in a 40,000-sq.-ft. facility in Alpharetta, Georgia, and employs 18 people. The family-owned company is closing in on $1 million in monthly sales by supplying enthusiasts with lift kits, tires, wheels, tonneau covers, aftermarket bumpers, lighting and other popular truck accessories. In 2012, SORS added an entire arms-and-ammo showroom inside of the truck shop. Adam Richmond instantly saw the benefits of the natural crossover, as 80% of the company’s gun business came from existing truck and accessory clients.

SEMA News recently caught up with the younger Richmond to find out how the family has managed to propel the company forward despite competition from larger, corporate-owned companies.

SEMA News: What is the single most important factor in your success? Who are your customers, and why do they come to you?

Adam Richmond: In a market where almost everything we sell is discretionary, the customer experience is truly one of the most important factors contributing to our success. Most customers have a general idea of what they’re looking for but welcome the expertise of our sales team. At the end of the day, we always want our customers to leave happy. We understand that we’re in a word-of-mouth business, and making them happy is of utmost importance to us. People make mistakes, and the true success of a business is how it overcomes those mistakes and responds to them.

Our clients are mostly males between the ages of 16 and 45. They come to us because we are established in the community, we have a solid reputation and we’re in a great location.

SN: What is your customer-service philosophy, and what do you do specifically to meet that philosophy? How do you train your staff to best serve the company?

AR: We strive to provide a superior customer experience, starting with the interaction with our sales team, followed by top-quality installation service and continuing with friendly after-sales support. We found that hiring off-road enthusiasts is key because it’s easier to train them on the products and services we offer, and the personal interest transfers strongly when working with customers on their special projects.

SN: What differentiates you from the competition?

AR: We are an operationally involved, family-owned company, and our clients like knowing that the owners are directly involved in the day-to-day operations. Problem resolution is typically streamlined much faster and more efficiently compared to our corporately owned competitors.

SN: What has been your company’s most rewarding success?

AR: We have created very close relationships with the leaders in our industry. We test prototype products, have direct contact with their design teams and can help influence products that we know our customers will love. This keeps us on the leading edge and helps propel us into the future.

SN: What has been the biggest challenge you have faced?

Southern Off-Road Specialties
SORS continues the customer experience beyond the actual sale by providing installation service and support.
 
  

AR: The industry is constantly changing over time. It’s a challenge to keep up with current trends and foresee what will be popular. Being an enthusiast helps us to understand what’s going on in the industry.

Before the recession, back in 2007 and 2008, a large majority of our customer base was small-business owners. We catered to a clientele who purchased a new truck every year. Literally, it felt like overnight that business went away. If we had not been watching what was happening in the market and been able to anticipate that customer base disappearing, we would have been in real trouble.

We actually started targeting dealerships prior to that. We were able to supplement the individual small-business owner customer base that was our cornerstone for several years and transition it to dealer-focused for the next couple years. Throughout the recession, our company continued to grow.

About 40% of our business was diesel performance when stricter diesel emissions-controls were put in place, and that went real soft overnight as well. Seeing that happening, we were able to transition almost 40% of our business to nothing but Jeep products. We’re constantly finding what’s new and what else we can be doing, which has helped us.

Executive Summary

Southern Off-Road Specialists
770-346-7777
www.southernoffroad.net
843 McFarland Parkway
Alpharetta, GA 30004

• Owners: Don and Adam Richmond.

• 18 employees

• Operates out of a 40,000-sq.-ft. facility in Alpharetta, Georgia.

• Sales and installation of off-road truck parts and accessories.

• Grosses nearly $1 million per month in sales.

• The family-owned business hires knowledgeable employees, offers exceptional customer service and is experiencing growth in custom builds and restoration.

• Biggest challenge is evolving with the market and foreseeing trends.

SN: What are your strategies for marketing the company?

AR: We do very little marketing outside of sponsoring local high-school football and softball teams. We get return customers based on the quality of our work and our ability to give great advice about what else can be done to customers’ vehicles the next time they come in. It’s been a recipe for success. We don’t advertise, but we are active on social media. We also give out T-shirts and windshield banners.

We have a lot of young customers who we get to see off to college. We’ll lift their trucks and they’ll come back for a bumper, a winch or some side steps, and the next time we see them, it’s to switch out the mud-terrains for all-terrains. We’ve been around long enough that we’re starting to see these guys come home from college and start their careers.

SN: Do you have plans for future growth? Where do you see the company headed?

AR: We’ve just expanded our showroom for the third time. We’re moving into more custom builds. We’ve started doing restoration again after six years, so we see growth in that regard. The dealer side of our business has grown every single year since 2007. Ten years from now, if everything continues to go the way it’s going, we should double in size.

SN: What advice would you offer retailers to hone their businesses?

AR: What’s helped us the most is the fact that we’re enthusiasts. Read the magazines and watch the trends. You can understand what’s going to happen in the market and do something about it before you’re left in the dust. Go to the SEMA Show every year and look at the new products that are coming out. It’s such an advantage in this business; if you’re not doing it, I think you’re going to have a hard time.

 

Tue, 09/01/2015 - 18:25

SEMA News—September 2015

BUSINESS
By Chad Simon

Retail Spotlight

Southern Off-Road Specialists Provides Superior Customer Experience
 Southern Off-Road Specialists
Southern Off-Road Specialists is closing in on $1 million in monthly sales by supplying enthusiasts with lift kits, tires, wheels, tonneau covers, aftermarket bumpers, lighting and other popular truck accessories.
  

A longtime passion for off-roading helped motivate the Richmond family to launch Southern Off-Road Specialists (SORS) in 2000. Having an enthusiast mindset with the ability to relate to customers and foresee trends is the formula that has enabled owners Don Richmond and his son Adam—who started working at the shop when he was just 15—to succeed in this competitive market.

SORS got its humble start in a two-bay gas station, grossing $50,000 to $60,000 in monthly sales. Today, the four-wheel-drive shop is housed in a 40,000-sq.-ft. facility in Alpharetta, Georgia, and employs 18 people. The family-owned company is closing in on $1 million in monthly sales by supplying enthusiasts with lift kits, tires, wheels, tonneau covers, aftermarket bumpers, lighting and other popular truck accessories. In 2012, SORS added an entire arms-and-ammo showroom inside of the truck shop. Adam Richmond instantly saw the benefits of the natural crossover, as 80% of the company’s gun business came from existing truck and accessory clients.

SEMA News recently caught up with the younger Richmond to find out how the family has managed to propel the company forward despite competition from larger, corporate-owned companies.

SEMA News: What is the single most important factor in your success? Who are your customers, and why do they come to you?

Adam Richmond: In a market where almost everything we sell is discretionary, the customer experience is truly one of the most important factors contributing to our success. Most customers have a general idea of what they’re looking for but welcome the expertise of our sales team. At the end of the day, we always want our customers to leave happy. We understand that we’re in a word-of-mouth business, and making them happy is of utmost importance to us. People make mistakes, and the true success of a business is how it overcomes those mistakes and responds to them.

Our clients are mostly males between the ages of 16 and 45. They come to us because we are established in the community, we have a solid reputation and we’re in a great location.

SN: What is your customer-service philosophy, and what do you do specifically to meet that philosophy? How do you train your staff to best serve the company?

AR: We strive to provide a superior customer experience, starting with the interaction with our sales team, followed by top-quality installation service and continuing with friendly after-sales support. We found that hiring off-road enthusiasts is key because it’s easier to train them on the products and services we offer, and the personal interest transfers strongly when working with customers on their special projects.

SN: What differentiates you from the competition?

AR: We are an operationally involved, family-owned company, and our clients like knowing that the owners are directly involved in the day-to-day operations. Problem resolution is typically streamlined much faster and more efficiently compared to our corporately owned competitors.

SN: What has been your company’s most rewarding success?

AR: We have created very close relationships with the leaders in our industry. We test prototype products, have direct contact with their design teams and can help influence products that we know our customers will love. This keeps us on the leading edge and helps propel us into the future.

SN: What has been the biggest challenge you have faced?

Southern Off-Road Specialties
SORS continues the customer experience beyond the actual sale by providing installation service and support.
 
  

AR: The industry is constantly changing over time. It’s a challenge to keep up with current trends and foresee what will be popular. Being an enthusiast helps us to understand what’s going on in the industry.

Before the recession, back in 2007 and 2008, a large majority of our customer base was small-business owners. We catered to a clientele who purchased a new truck every year. Literally, it felt like overnight that business went away. If we had not been watching what was happening in the market and been able to anticipate that customer base disappearing, we would have been in real trouble.

We actually started targeting dealerships prior to that. We were able to supplement the individual small-business owner customer base that was our cornerstone for several years and transition it to dealer-focused for the next couple years. Throughout the recession, our company continued to grow.

About 40% of our business was diesel performance when stricter diesel emissions-controls were put in place, and that went real soft overnight as well. Seeing that happening, we were able to transition almost 40% of our business to nothing but Jeep products. We’re constantly finding what’s new and what else we can be doing, which has helped us.

Executive Summary

Southern Off-Road Specialists
770-346-7777
www.southernoffroad.net
843 McFarland Parkway
Alpharetta, GA 30004

• Owners: Don and Adam Richmond.

• 18 employees

• Operates out of a 40,000-sq.-ft. facility in Alpharetta, Georgia.

• Sales and installation of off-road truck parts and accessories.

• Grosses nearly $1 million per month in sales.

• The family-owned business hires knowledgeable employees, offers exceptional customer service and is experiencing growth in custom builds and restoration.

• Biggest challenge is evolving with the market and foreseeing trends.

SN: What are your strategies for marketing the company?

AR: We do very little marketing outside of sponsoring local high-school football and softball teams. We get return customers based on the quality of our work and our ability to give great advice about what else can be done to customers’ vehicles the next time they come in. It’s been a recipe for success. We don’t advertise, but we are active on social media. We also give out T-shirts and windshield banners.

We have a lot of young customers who we get to see off to college. We’ll lift their trucks and they’ll come back for a bumper, a winch or some side steps, and the next time we see them, it’s to switch out the mud-terrains for all-terrains. We’ve been around long enough that we’re starting to see these guys come home from college and start their careers.

SN: Do you have plans for future growth? Where do you see the company headed?

AR: We’ve just expanded our showroom for the third time. We’re moving into more custom builds. We’ve started doing restoration again after six years, so we see growth in that regard. The dealer side of our business has grown every single year since 2007. Ten years from now, if everything continues to go the way it’s going, we should double in size.

SN: What advice would you offer retailers to hone their businesses?

AR: What’s helped us the most is the fact that we’re enthusiasts. Read the magazines and watch the trends. You can understand what’s going to happen in the market and do something about it before you’re left in the dust. Go to the SEMA Show every year and look at the new products that are coming out. It’s such an advantage in this business; if you’re not doing it, I think you’re going to have a hard time.

 

Tue, 09/01/2015 - 18:09

SEMA News—September 2015

INTERNET
By Joe Dysart

Got Old Credit Card Terminals?

You’re on the Hook for Fraud Starting October 2015
  Credit Card Terminals
According to a February 2015 poll by Newtek Business Services, 71% of business owners are unaware that they’ll be on the hook for magnetic stripe fraud after October 2015.
  
Auto-parts businesses will be on the hook for credit card fraud if they don’t migrate to new chip card terminals by October 1, 2015, according to the major credit card companies.

Essentially, Mastercard, Visa, American Express and the like have had it with old-technology magnetic-stripe cards, which are easy plunder for fraudsters, so they’ve decided to shift the fraud liability to businesses that insist on mag-stripe technology and don’t bring in new chip card terminals. Thus, if a fraudster comes into your non-chip-card-ready business after October 1 and charges a part—or more—on a credit card, your business eats the loss.

All of it. Problem is, thousands of U.S. businesses have no idea that they’re on a collision course with fraud liability this fall. And credit card companies are starting to get worried.

“While the credit card industry needs to churn out a lot more chip cards, retailers seem to be in worse shape,” said Matt Schulz, a senior industry analyst at
CreditCards.com. “Very few are ready to accept chip cards.”

Indeed. According to a February 2015 poll by Newtek Business Services, 71% of business owners are unaware that they’ll be on the hook for magnetic stripe fraud after October 2015.

“It is apparent that business owners still do not have a full understanding of the importance of chip card processing,” said Barry Sloane, CEO of Newtek. “It is extremely important for individuals taking credit card payments to be aware.”

Despite the backlash anticipated from businesses that begin getting stung for fraud this fall, the major credit card companies are hanging tough with their deadline. And it’s no wonder. All of those credit goliaths have been burned by the wholesale theft of credit card data that is often measured in millions of accounts. And all of those titans have been dealing with untold numbers of angry cardholders—many of whom know all too well that the security on a mag-stripe credit card is a joke.

Chip cards, by comparison, are much more secure, according to Megan Shamas, a spokesperson for EMV-Connection, a branch of the Smart Card Alliance. Specifically, chip cards produce a one-time-use code for every transaction, making it much more difficult for fraudsters to compromise. Plus, if a chip card is lost or stolen, the card is also much more difficult to counterfeit, Shamas said.

Chip cards—also known as EMV cards, an acronym for Europay, Mastercard and Visa, the three companies that helped develop the card technology—also have an extremely successful track record in Europe. Credit card fraud in the United Kingdom plummeted by 72% after chip cards were widely adopted, according to Patricia Moloney Figliola, a specialist in Internet and telecommunications policy with The Congressional Research Service, a research team employed by the U.S. Congress. And Canada saw a 48% reduction in fraud after chip cards were rolled out there, Figliola said.

In fact, according to Figliola, the United States is the last major market to make the switch to chip cards.

 Internet Card Chips
Chip cards produce a one-time-use code for every transaction, making it much more difficult for fraudsters to compromise.
  

Besides intense pressure from credit card companies on chip card migration, fed-up consumers are also beating the drum. A recent Mastercard study revealed that 63% of credit card holders want a chip card “immediately,” said Carolyn Balfany, group head of U.S. product delivery for Mastercard. And 87% of those surveyed said that they were completely comfortable with the idea of transitioning to chip cards.

Of course, the rub for auto-parts businesses is that getting from here to there will cost coin. Phil Wimberly, vice president of integrated solutions sales for OpenEdge, a payments software provider, said that companies can expect to pay $300 to $1,300 for a new chip card terminal, depending on the features they’re looking for. Plus, they’ll have to train staff to deal with the new technology.

One of the best resources for the new terminals will probably be the business that’s already handling the processing of your mag-stripe cards, Wimberly said. The silver lining is that customers will most likely find making the switch fairly intuitive, though there are a few differences.

Chip cards need to be inserted into a terminal rather than swiped. And a chip card needs to stay inserted in the terminal until the transaction is completed. For verification, chip cards will require either a customer signature or a customer PIN. And some will be “contactless,” requiring only a simple “wave” over a terminal to initiate a transaction.

During the first few years of the transition, chip cards will also come with magnetic stripes, which will enable consumers to make purchases at businesses still mired in mag-stripe technology. But the primary point to remember is that you won’t be on the hook for fraud created by any mag-stripe card you accept as payment as long as your business has chip card terminals, according to EMV-Connection’s Shamas. As long as your business has made the effort to accept chip cards, the credit card companies aren’t looking to penalize you for accepting a mag-strip card, she said.

As the October deadline looms, all of the major credit card companies are ramping up massive business educational campaigns, hoping to help businesses dodge the fraud-liability ax. But even with the massive PR push, industry watchers fret that there will still be hundreds of thousands of uniformed businesses seeing red over new fraud liability this fall.

“The Achilles heel for EMV merchant adoption will be small and micro merchants that are not only unprepared for EMV but are even unaware of the fraud-liability shift in the United States this year,” said Nick Holland, head of payments for Javelin Strategy & Research.

Don’t be one of those unaware businesses.

For more information about EMV® and its impact on your business, contact your First Data Business Consultant Ken Keifer @ 424-903-6877 or e-mail ken.keifer@firstdata.com.

Joe Dysart is an Internet speaker and business consultant
based in Manhattan.
joe@joedysart.com
www.joedysart.com

Tue, 09/01/2015 - 18:09

SEMA News—September 2015

INTERNET
By Joe Dysart

Got Old Credit Card Terminals?

You’re on the Hook for Fraud Starting October 2015
  Credit Card Terminals
According to a February 2015 poll by Newtek Business Services, 71% of business owners are unaware that they’ll be on the hook for magnetic stripe fraud after October 2015.
  
Auto-parts businesses will be on the hook for credit card fraud if they don’t migrate to new chip card terminals by October 1, 2015, according to the major credit card companies.

Essentially, Mastercard, Visa, American Express and the like have had it with old-technology magnetic-stripe cards, which are easy plunder for fraudsters, so they’ve decided to shift the fraud liability to businesses that insist on mag-stripe technology and don’t bring in new chip card terminals. Thus, if a fraudster comes into your non-chip-card-ready business after October 1 and charges a part—or more—on a credit card, your business eats the loss.

All of it. Problem is, thousands of U.S. businesses have no idea that they’re on a collision course with fraud liability this fall. And credit card companies are starting to get worried.

“While the credit card industry needs to churn out a lot more chip cards, retailers seem to be in worse shape,” said Matt Schulz, a senior industry analyst at
CreditCards.com. “Very few are ready to accept chip cards.”

Indeed. According to a February 2015 poll by Newtek Business Services, 71% of business owners are unaware that they’ll be on the hook for magnetic stripe fraud after October 2015.

“It is apparent that business owners still do not have a full understanding of the importance of chip card processing,” said Barry Sloane, CEO of Newtek. “It is extremely important for individuals taking credit card payments to be aware.”

Despite the backlash anticipated from businesses that begin getting stung for fraud this fall, the major credit card companies are hanging tough with their deadline. And it’s no wonder. All of those credit goliaths have been burned by the wholesale theft of credit card data that is often measured in millions of accounts. And all of those titans have been dealing with untold numbers of angry cardholders—many of whom know all too well that the security on a mag-stripe credit card is a joke.

Chip cards, by comparison, are much more secure, according to Megan Shamas, a spokesperson for EMV-Connection, a branch of the Smart Card Alliance. Specifically, chip cards produce a one-time-use code for every transaction, making it much more difficult for fraudsters to compromise. Plus, if a chip card is lost or stolen, the card is also much more difficult to counterfeit, Shamas said.

Chip cards—also known as EMV cards, an acronym for Europay, Mastercard and Visa, the three companies that helped develop the card technology—also have an extremely successful track record in Europe. Credit card fraud in the United Kingdom plummeted by 72% after chip cards were widely adopted, according to Patricia Moloney Figliola, a specialist in Internet and telecommunications policy with The Congressional Research Service, a research team employed by the U.S. Congress. And Canada saw a 48% reduction in fraud after chip cards were rolled out there, Figliola said.

In fact, according to Figliola, the United States is the last major market to make the switch to chip cards.

 Internet Card Chips
Chip cards produce a one-time-use code for every transaction, making it much more difficult for fraudsters to compromise.
  

Besides intense pressure from credit card companies on chip card migration, fed-up consumers are also beating the drum. A recent Mastercard study revealed that 63% of credit card holders want a chip card “immediately,” said Carolyn Balfany, group head of U.S. product delivery for Mastercard. And 87% of those surveyed said that they were completely comfortable with the idea of transitioning to chip cards.

Of course, the rub for auto-parts businesses is that getting from here to there will cost coin. Phil Wimberly, vice president of integrated solutions sales for OpenEdge, a payments software provider, said that companies can expect to pay $300 to $1,300 for a new chip card terminal, depending on the features they’re looking for. Plus, they’ll have to train staff to deal with the new technology.

One of the best resources for the new terminals will probably be the business that’s already handling the processing of your mag-stripe cards, Wimberly said. The silver lining is that customers will most likely find making the switch fairly intuitive, though there are a few differences.

Chip cards need to be inserted into a terminal rather than swiped. And a chip card needs to stay inserted in the terminal until the transaction is completed. For verification, chip cards will require either a customer signature or a customer PIN. And some will be “contactless,” requiring only a simple “wave” over a terminal to initiate a transaction.

During the first few years of the transition, chip cards will also come with magnetic stripes, which will enable consumers to make purchases at businesses still mired in mag-stripe technology. But the primary point to remember is that you won’t be on the hook for fraud created by any mag-stripe card you accept as payment as long as your business has chip card terminals, according to EMV-Connection’s Shamas. As long as your business has made the effort to accept chip cards, the credit card companies aren’t looking to penalize you for accepting a mag-strip card, she said.

As the October deadline looms, all of the major credit card companies are ramping up massive business educational campaigns, hoping to help businesses dodge the fraud-liability ax. But even with the massive PR push, industry watchers fret that there will still be hundreds of thousands of uniformed businesses seeing red over new fraud liability this fall.

“The Achilles heel for EMV merchant adoption will be small and micro merchants that are not only unprepared for EMV but are even unaware of the fraud-liability shift in the United States this year,” said Nick Holland, head of payments for Javelin Strategy & Research.

Don’t be one of those unaware businesses.

For more information about EMV® and its impact on your business, contact your First Data Business Consultant Ken Keifer @ 424-903-6877 or e-mail ken.keifer@firstdata.com.

Joe Dysart is an Internet speaker and business consultant
based in Manhattan.
joe@joedysart.com
www.joedysart.com

Tue, 09/01/2015 - 18:09

SEMA News—September 2015

INTERNET
By Joe Dysart

Got Old Credit Card Terminals?

You’re on the Hook for Fraud Starting October 2015
  Credit Card Terminals
According to a February 2015 poll by Newtek Business Services, 71% of business owners are unaware that they’ll be on the hook for magnetic stripe fraud after October 2015.
  
Auto-parts businesses will be on the hook for credit card fraud if they don’t migrate to new chip card terminals by October 1, 2015, according to the major credit card companies.

Essentially, Mastercard, Visa, American Express and the like have had it with old-technology magnetic-stripe cards, which are easy plunder for fraudsters, so they’ve decided to shift the fraud liability to businesses that insist on mag-stripe technology and don’t bring in new chip card terminals. Thus, if a fraudster comes into your non-chip-card-ready business after October 1 and charges a part—or more—on a credit card, your business eats the loss.

All of it. Problem is, thousands of U.S. businesses have no idea that they’re on a collision course with fraud liability this fall. And credit card companies are starting to get worried.

“While the credit card industry needs to churn out a lot more chip cards, retailers seem to be in worse shape,” said Matt Schulz, a senior industry analyst at
CreditCards.com. “Very few are ready to accept chip cards.”

Indeed. According to a February 2015 poll by Newtek Business Services, 71% of business owners are unaware that they’ll be on the hook for magnetic stripe fraud after October 2015.

“It is apparent that business owners still do not have a full understanding of the importance of chip card processing,” said Barry Sloane, CEO of Newtek. “It is extremely important for individuals taking credit card payments to be aware.”

Despite the backlash anticipated from businesses that begin getting stung for fraud this fall, the major credit card companies are hanging tough with their deadline. And it’s no wonder. All of those credit goliaths have been burned by the wholesale theft of credit card data that is often measured in millions of accounts. And all of those titans have been dealing with untold numbers of angry cardholders—many of whom know all too well that the security on a mag-stripe credit card is a joke.

Chip cards, by comparison, are much more secure, according to Megan Shamas, a spokesperson for EMV-Connection, a branch of the Smart Card Alliance. Specifically, chip cards produce a one-time-use code for every transaction, making it much more difficult for fraudsters to compromise. Plus, if a chip card is lost or stolen, the card is also much more difficult to counterfeit, Shamas said.

Chip cards—also known as EMV cards, an acronym for Europay, Mastercard and Visa, the three companies that helped develop the card technology—also have an extremely successful track record in Europe. Credit card fraud in the United Kingdom plummeted by 72% after chip cards were widely adopted, according to Patricia Moloney Figliola, a specialist in Internet and telecommunications policy with The Congressional Research Service, a research team employed by the U.S. Congress. And Canada saw a 48% reduction in fraud after chip cards were rolled out there, Figliola said.

In fact, according to Figliola, the United States is the last major market to make the switch to chip cards.

 Internet Card Chips
Chip cards produce a one-time-use code for every transaction, making it much more difficult for fraudsters to compromise.
  

Besides intense pressure from credit card companies on chip card migration, fed-up consumers are also beating the drum. A recent Mastercard study revealed that 63% of credit card holders want a chip card “immediately,” said Carolyn Balfany, group head of U.S. product delivery for Mastercard. And 87% of those surveyed said that they were completely comfortable with the idea of transitioning to chip cards.

Of course, the rub for auto-parts businesses is that getting from here to there will cost coin. Phil Wimberly, vice president of integrated solutions sales for OpenEdge, a payments software provider, said that companies can expect to pay $300 to $1,300 for a new chip card terminal, depending on the features they’re looking for. Plus, they’ll have to train staff to deal with the new technology.

One of the best resources for the new terminals will probably be the business that’s already handling the processing of your mag-stripe cards, Wimberly said. The silver lining is that customers will most likely find making the switch fairly intuitive, though there are a few differences.

Chip cards need to be inserted into a terminal rather than swiped. And a chip card needs to stay inserted in the terminal until the transaction is completed. For verification, chip cards will require either a customer signature or a customer PIN. And some will be “contactless,” requiring only a simple “wave” over a terminal to initiate a transaction.

During the first few years of the transition, chip cards will also come with magnetic stripes, which will enable consumers to make purchases at businesses still mired in mag-stripe technology. But the primary point to remember is that you won’t be on the hook for fraud created by any mag-stripe card you accept as payment as long as your business has chip card terminals, according to EMV-Connection’s Shamas. As long as your business has made the effort to accept chip cards, the credit card companies aren’t looking to penalize you for accepting a mag-strip card, she said.

As the October deadline looms, all of the major credit card companies are ramping up massive business educational campaigns, hoping to help businesses dodge the fraud-liability ax. But even with the massive PR push, industry watchers fret that there will still be hundreds of thousands of uniformed businesses seeing red over new fraud liability this fall.

“The Achilles heel for EMV merchant adoption will be small and micro merchants that are not only unprepared for EMV but are even unaware of the fraud-liability shift in the United States this year,” said Nick Holland, head of payments for Javelin Strategy & Research.

Don’t be one of those unaware businesses.

For more information about EMV® and its impact on your business, contact your First Data Business Consultant Ken Keifer @ 424-903-6877 or e-mail ken.keifer@firstdata.com.

Joe Dysart is an Internet speaker and business consultant
based in Manhattan.
joe@joedysart.com
www.joedysart.com

Tue, 09/01/2015 - 18:09

SEMA News—September 2015

INTERNET
By Joe Dysart

Got Old Credit Card Terminals?

You’re on the Hook for Fraud Starting October 2015
  Credit Card Terminals
According to a February 2015 poll by Newtek Business Services, 71% of business owners are unaware that they’ll be on the hook for magnetic stripe fraud after October 2015.
  
Auto-parts businesses will be on the hook for credit card fraud if they don’t migrate to new chip card terminals by October 1, 2015, according to the major credit card companies.

Essentially, Mastercard, Visa, American Express and the like have had it with old-technology magnetic-stripe cards, which are easy plunder for fraudsters, so they’ve decided to shift the fraud liability to businesses that insist on mag-stripe technology and don’t bring in new chip card terminals. Thus, if a fraudster comes into your non-chip-card-ready business after October 1 and charges a part—or more—on a credit card, your business eats the loss.

All of it. Problem is, thousands of U.S. businesses have no idea that they’re on a collision course with fraud liability this fall. And credit card companies are starting to get worried.

“While the credit card industry needs to churn out a lot more chip cards, retailers seem to be in worse shape,” said Matt Schulz, a senior industry analyst at
CreditCards.com. “Very few are ready to accept chip cards.”

Indeed. According to a February 2015 poll by Newtek Business Services, 71% of business owners are unaware that they’ll be on the hook for magnetic stripe fraud after October 2015.

“It is apparent that business owners still do not have a full understanding of the importance of chip card processing,” said Barry Sloane, CEO of Newtek. “It is extremely important for individuals taking credit card payments to be aware.”

Despite the backlash anticipated from businesses that begin getting stung for fraud this fall, the major credit card companies are hanging tough with their deadline. And it’s no wonder. All of those credit goliaths have been burned by the wholesale theft of credit card data that is often measured in millions of accounts. And all of those titans have been dealing with untold numbers of angry cardholders—many of whom know all too well that the security on a mag-stripe credit card is a joke.

Chip cards, by comparison, are much more secure, according to Megan Shamas, a spokesperson for EMV-Connection, a branch of the Smart Card Alliance. Specifically, chip cards produce a one-time-use code for every transaction, making it much more difficult for fraudsters to compromise. Plus, if a chip card is lost or stolen, the card is also much more difficult to counterfeit, Shamas said.

Chip cards—also known as EMV cards, an acronym for Europay, Mastercard and Visa, the three companies that helped develop the card technology—also have an extremely successful track record in Europe. Credit card fraud in the United Kingdom plummeted by 72% after chip cards were widely adopted, according to Patricia Moloney Figliola, a specialist in Internet and telecommunications policy with The Congressional Research Service, a research team employed by the U.S. Congress. And Canada saw a 48% reduction in fraud after chip cards were rolled out there, Figliola said.

In fact, according to Figliola, the United States is the last major market to make the switch to chip cards.

 Internet Card Chips
Chip cards produce a one-time-use code for every transaction, making it much more difficult for fraudsters to compromise.
  

Besides intense pressure from credit card companies on chip card migration, fed-up consumers are also beating the drum. A recent Mastercard study revealed that 63% of credit card holders want a chip card “immediately,” said Carolyn Balfany, group head of U.S. product delivery for Mastercard. And 87% of those surveyed said that they were completely comfortable with the idea of transitioning to chip cards.

Of course, the rub for auto-parts businesses is that getting from here to there will cost coin. Phil Wimberly, vice president of integrated solutions sales for OpenEdge, a payments software provider, said that companies can expect to pay $300 to $1,300 for a new chip card terminal, depending on the features they’re looking for. Plus, they’ll have to train staff to deal with the new technology.

One of the best resources for the new terminals will probably be the business that’s already handling the processing of your mag-stripe cards, Wimberly said. The silver lining is that customers will most likely find making the switch fairly intuitive, though there are a few differences.

Chip cards need to be inserted into a terminal rather than swiped. And a chip card needs to stay inserted in the terminal until the transaction is completed. For verification, chip cards will require either a customer signature or a customer PIN. And some will be “contactless,” requiring only a simple “wave” over a terminal to initiate a transaction.

During the first few years of the transition, chip cards will also come with magnetic stripes, which will enable consumers to make purchases at businesses still mired in mag-stripe technology. But the primary point to remember is that you won’t be on the hook for fraud created by any mag-stripe card you accept as payment as long as your business has chip card terminals, according to EMV-Connection’s Shamas. As long as your business has made the effort to accept chip cards, the credit card companies aren’t looking to penalize you for accepting a mag-strip card, she said.

As the October deadline looms, all of the major credit card companies are ramping up massive business educational campaigns, hoping to help businesses dodge the fraud-liability ax. But even with the massive PR push, industry watchers fret that there will still be hundreds of thousands of uniformed businesses seeing red over new fraud liability this fall.

“The Achilles heel for EMV merchant adoption will be small and micro merchants that are not only unprepared for EMV but are even unaware of the fraud-liability shift in the United States this year,” said Nick Holland, head of payments for Javelin Strategy & Research.

Don’t be one of those unaware businesses.

For more information about EMV® and its impact on your business, contact your First Data Business Consultant Ken Keifer @ 424-903-6877 or e-mail ken.keifer@firstdata.com.

Joe Dysart is an Internet speaker and business consultant
based in Manhattan.
joe@joedysart.com
www.joedysart.com