The Story Behind American Independent, Inc.
A.I.I. was started by Herman (Butch) Eckhoff and Rick DeAndero in May of ’88 but really the origins began at Industrial Parts Depot (IPD) years earlier.
IPD was formed in 1955 and evolved into a large manufacturer of aftermarket cutting edges, engine part’s and other high mortality part’s for caterpillar equipment. They also had a full service repair shop that performed rebuilding services for cat machines from bumper to bumper.
Butch joined IPD in 1978 after being hired from Shepherd Machinery which at the time, was the Cat dealer serving L.A. He was the “transmission guy” who had a reputation for meticulous attention to detail and was said to have never had a comeback.
Rick was hired from a nearby auto repair shop where he was the service manager and became acquainted with Clark Ashton (then vice president) when he brought his car in for repair in 1982.
In the early 80’s IPD was a beehive of activity headquartered in Torrance, CA and employing 300 people amongst their 12 branches across the United States. Butch and Rick worked together often trying to solve problems with aftermarket transmission parts and quickly became friends who would sometimes socialize together outside of work.
There were a couple of lovely sisters who also worked at IPD named Karin and Kristin Basinger who were part of a social group that often included Butch and Rick. In 1984 Rick married Kris and a couple years later Butch married Karin so now they were family. The couples spent a lot of time together and came up with the idea of starting an independent rebuild shop specializing in transmissions. IPD was phasing out of the repair business and they saw an opportunity in the void that would be left in the bustling dirt moving industry. They gave there notice to Robert (Bob) Rasmussen (founder of IPD) and to their pleasant surprise he was disappointed but supportive of the decision.
Rick and Kris sold their home in Long Beach providing a small amount of startup capital which funded the humble beginnings of A.I.I. The couples including Rick and Kris’s two small children moved to Riverside and rented a 900 square foot unit in a new multi-tenant business complex. In the beginning Butch assembled transmissions while Rick took care of the office and washed parts. The customer list could be counted on one hand and they were all local contractors who knew Butch from the reputation he had earned at IPD and Shepherd.
It was a struggle in those days as they had only a solvent tank, an air compressor, Butch’s tool box and an old used railroad truck with a knuckle boom that served as the assembly crane…work was spotty. In a few months they landed their first big account, C.W. Poss who had nearly 200 big scrapers and all the support equipment. Suddenly they had more work than they could handle and had to make some changes fast if they were going to be able to keep up.
They knocked down the wall separating the vacant unit next door doubling the size of the shop, bought an old used forklift and an electric jib crane (no more exhaust fumes from the old railroad truck) and hired a helper to wash parts.
Gradually they picked up more and more accounts, hired more helpers, built a test bench and things were progressing nicely until the recession hit in 1991. Suddenly the phone stopped ringing and transmission rebuilds were few and far between. They laid off all the help, wore out several brooms and took turns driving around looking for what few job sites there were. Meanwhile, the other one would stay at the shop hoping the phone would ring.
At the time people would say “survive till ninety five” which turned out to be true. Had A.I.I. started in ’89 rather than ’88 they would have never made it and would have been a flash in the pan like so many repair shops that came and went back in those days. Fortunately they had a couple of good years under their belts which enabled them to make it through four years of making little or no money.
Things turned around and gradually A.I.I. started growing again knocking down more walls taking over two more vacant units quadrupling the original size of the shop.
In ’96 Butch decided he wanted to try something different and the partners worked out a buyout plan which enabled Butch to purchase a neighboring automotive machine shop. Rick was now a sole proprietor who struggled to find a replacement for Butch (not an easy task) when luckily he learned of a wiry young field mechanic named Lee Schofield who was working at a nearby sand and gravel pit and was looking for a change. Lee had the desire and work ethic Rick needed to continue growing so that the company could serve its expanding customer base.
In ’98 A.I.I. was paying rent now on four units and was looking for more space to expand so Rick contacted a local commercial real estate broker who located an abandoned truck terminal about ten miles away in a great location on three and a half acres of land. The building was a real fixer upper and being a dock high wasn’t really ideal for a transmission shop so Rick took his seven employees to look it over and get a consensus as to whether or not it could work for them. The decision was unanimous….BUY IT!
Remodeling and upgrading the building was costly and the move was even more disruptive to the busy shop at the time but they did it by working long hours seven days a week while still trying to keep up with their normal workload. Somehow it got done without alienating too many customers and now A.I.I. was like a bee bee in a box car with way more space than they needed.
Eventually A.I.I. consumed much of the space and leased out portions of the rest to other complimentary companies such as McClure’s Repair who did engine rebuilding and performed R & I work for A.I.I. Later they added on to the main building and leased space out to their long time friend and vendor Greg Thompson who was well known for his capabilities with cast iron welding, a service that transmission rebuilders frequently need. A couple years later another building was erected near the back of the property where they brought in a company specializing in undercarriage work and installed a track press.
Now A.I.I. was a full service repair facility that could offer all of the services of a dealer and became a relevant part of the local dirt moving industry. Just like a gold fish that will grow as big as its bowl the company grew to thirty employees and was rebuilding more transmissions than all three of the Southern California Cat dealers combined! If you added the rolls of all the companies on site nearly fifty people worked at the location.
And then…RECESSION TIME AGAIN!
After ten great years of sustained growth the local dirt moving industry died…completely! This time however it was different in many ways, some good…some bad.
The good:
-A.I.I. had accumulated a large cache of tools, equipment and inventory.
-The customer list was extensive and they had a good reputation.
-They had relatively low debt and where in a strong financial position to withstand a reasonably long downturn.
The bad:
-Thirty employees that needed a substantial volume of work to cover payroll cost.
-The company had been so busy for so many years they had forgotten how to sell.
-They had become overconfident!
So what to do now? The answer came to Rick through a simple graph shown to him by a consultant he hired by the name of Mike Clogg. Mike was introduced to Rick by Bob Rasmussen (IPD founder and Rick’s former employer). Mike had a distinguished career in the heavy equipment aftermarket including having been the CEO of IPD when Bob retired. The graph was simple, one horizontal line representing customers and one vertical line representing products/services.
A.I.I. had to either spread their geographical base or offer more products and services to the existing customers….and they did both.
This new business strategy meant that A.I.I. would have to become more proactive rather than what they had been doing for the last ten years reacting to its customers’ needs. In order to accomplish this they developed a three pronged attack.
Prong one, their office manager Maria Pancheri convinced Rick that the company needed to be more sophisticated with its processes via the use of computer’s. She got everyone networked, began training and took over the time consuming task of invoicing which freed up Rick’s time so that he could concentrate on sales.
Prong two, Rick’s oldest son Trevor (an adult now) developed their internet presence with the help of his fiancée Toni Luchessi who designed a website. Next he put their extensive inventory of rebuilt components and used parts on the internet so that people looking for their products and services could find them and the quoting became automated.
Prong three, A.I.I. became a service center for Al-Jon, a Midwestern manufacturer of trash compaction tractors and scrap metal crushing machines. The money wasn’t great, but it introduced them to other industries heavily populated by cat machines.
Today A.I.I. employs only twenty people. The engine rebuilder and undercarriage companies are gone but the yard is full of machines purchased at recession prices thanks to a partnership formed by Rick and three other investors including Bob Rasmussen. They have supplemented the depressed transmission rebuilding business with dismantling machines and selling of used parts and equipment to industries where they were previously unknown. It’s not uncommon to see Volvo, Komatsu, Terex and other alternate brands of components being rebuilt at A.I.I.
In summary, today A.I.I. is more diverse and now serves an international market with a wide variety of products and services. Their unique perspective having experience in both the aftermarket and OEM sides of the business gives them a healthy balance that reduces rebuild cost through understanding of parts reusability, remanufacturing, the importance of supporting the independent repair industry and the potential hazards that can be found in rebuilding with aftermarket parts.