Our History – Burson Auto Parts – Garry Johnson

In September 2011, industry rumours were circulating that Burson Auto Parts was about to be sold. On September 7, Garry Johnson, chief executive of Burson, sent out a memorandum to all staff.

It was a reassuring, and revealing note sent “out of honesty and respect” for the more than 1000 employees Garry called Team Burson.

Garry told staff he was seeking a buyer for his shares but that nothing had been signed or agreed. He wrote that the selected buyer “must retain the brand, retain all employees and grow the business, not only into a bigger organisation, but a better organisation and the buyer must have the approval of myself and fellow directors.”

Garry, co-founder of Burson Auto Parts and owner from 1986 until the business was sold, is a rare breed in modern society: “I believe if you are advantaged in life, you have an obligation to give something back to society.”

It’s a credo that is left of centre in a society dominated by greed and self-interest, but one Garry follows through various charitable and sporting donations. He is strong on family values, and said he drew his inspiration from his father who both elevated and broadened his and his family’s lives.

The Burson journey is one of a single generation ownership, growing from humble beginnings and all the challenges of starting a new business to one of a substantial, privately-owned success story.

Garry described the rise and rise of Burson as “a journey of excitement, worry and achievement against lots of head winds. Most of all it was a shared journey, initially with Ron Burgoine and then for the greater part with Andrew Schram, Terry Penney and all at Team Burson.”

Persistence is the best way to describe a major part of Garry’s work ethic. Vision is a necessary quality of good leaders, and his vision has always provided leadership for tomorrow’s challenge. Under his ownership and leadership, Burson has undergone an amazing transformation since its conception in 1971. What began as a kernel of an idea grew into an automotive tree with branches reaching out across every State and Territory of Australia.

Born in 1941, Garry grew up in Ascot Vale, attending a local primary school before moving on to Essendon Grammar. Leaving school at 15, he joined the now defunct State Savings Bank of Victoria while continuing his education at night school where he studied accountancy. Garry left the bank and joined multi-national accounting firm, Coopers & Lybrand and during this time he qualified as an Associate of the Australian Society of Accountants.

The Burson business started as an idea between Garry and friend, Ron Burgoine. The two men thought they should be able to acquire a business at a reasonable price, and with Garry’s accounting skills and Ron’s selling ability, be assured of success.

“After a sustained search, we acquired the rights to the distribution of a range of automotive additives and chemicals for one third of Melbourne,” Garry said. “Product education, marketing plans and cash flow projections all seemed positive, so contracts were signed and away we went.

“Ron had cash for his 50 per cent share, and I took out a second mortgage on my home. It was big risk for both of us.”

Garry said sites were established and sales began to happen at service stations and other auto outlets, however, with a limited range and regular weekly/bi-weekly call cycles, progress was slow. The range was expanded by the introduction of a line of car carpet mats as well as other selected lines including car parts.

After a short period Burson grew to seven cash vans selling on-site to auto outlets on a regular call cycle.

“Warehousing grew from a store underneath my Doncaster home to a 2000sq.ft, warehouse in West Heidelberg, on the corner of Mologa Road and Orthla Avenue. And then to a 5000sq.ft. warehouse,” Garry said.

Meanwhile, the car mat business expanded into front and rear mats with customer-appealing packaging and display stands. This development allowed sales of the mat range to be introduced to the Targets, K-marts and other Australian retail outlets.

The fledgling Burson business was away on two fronts:

- Auto accessories and parts distribution to service stations and workshops in Victoria.

- Car mat range and auto spare parts, distribution to discount stores and auto retail outlets.

Garry said the seven cash vans called on a regular weekly/fortnightly cycle, but we soon discovered that workshop customers required parts on call so in 1977 Burson leased a building in Ballarat Rd, Braybrook, and so began the chain of Burson Auto Parts stores. The next stage was to take the cash vans off the road and replace them with auto parts stores where customer requirements could be met within the hour by delivery vans.

“The Burson range grew in both accessories and parts, and the auto parts store numbers grew both by acquisition of single store operators and greenfielding,” Garry explained. “Our car mat range continued to grow with mats manufactured locally as well as imported.  In 1985, Burson was judged wholesaler of the year by the industry association.”

In 1986, with 13 Burson company-owned auto parts stores, Garry acquired Ron Burgoine’s 50 per cent of the business.

“With the support of two senior directors, Andrew Schram, warehouse/purchasing, and Terry Penney, sales, each having 5 per cent shares in Burson, the journey continued.

For an accountant, Garry has been a great spare parts salesman, however, good financial planning and a high level of profit retention are among the key factors in the growth and success of Burson.

One major hiccup occurred in 1987 when Garry attempted to float Burson on the Stock Exchange. This was about the time of the October 1987, share market crash. The float was unsuccessful. Garry’s idea was to move away from expansion by debt, to expansion by equity and to include employee shares. Land was sold in 1989, and a new distribution centre that was to be owned was built, but leased and the journey of range expansion and more auto stores continued.

“The focus of Burson was predominantly trade with retail making up about 16-20 per cent of the business,” Garry said.

With Garry’s vision and leadership, “Team Burson” was an exciting place to be. Terry Penney oversaw auto parts store operations and new store openings, and Andrew Schram oversaw warehousing and auto parts range expansion. Garry said customers preferred Burson over other competitors and staff loved the care, excitement, pace of expansion and opportunities available.

“Burson was growing; not yet as big as Repco, but the gap was closing and we were doing it better,” he said. “The car mat division was considered non-core to the main business and was sold.”

Burson modern warehousing commenced as did computerisation of operations. Invoicing, previously done by hand, was replaced with computer produced invoices, and extended to re-ordering and inventory management. The company pursued a policy of continuous improvement with a strong focus on spare parts range expansion.

Team Burson was on a roll, and in 2005, with a strong customer focus and a dedicated team, auto store numbers grew to 58 in four States, turnover at $150m and about 600 employees. The same year, Burson moved into a state-of-the-art, 11,000sq.m head office and distribution centre with hi-tech warehousing. This formed a solid base for the future.

Burson had a strong emphasis on Team Burson, incorporating staff training, performance reporting, incentives, regular meetings and conferences to keep staff aware of changes and encourage feedback and continuous improvement.

Garry said Team Burson culture was the envy of competitors. He regularly visited stores, was in constant contact for events or record sales, and rang every employee on their birthday.

Coventry Auto, a West Australian auto parts distributor, had an unsuccessful expansion into the east. In 2006, the company made the decision to exit the east and Burson acquired five of their stores in New South Wales. Two years later, 11 Coventry stores were acquired in Queensland, and in 2011, 11 more Coventry stores came under Burson ownership in South Australia.

As well these purchases, other independent auto stores were also being acquired, and Garry said: “It was a busy period managing and financing the rapid expansion.”

In 2011, with 92 company-owned auto parts stores, about 1000 employees and a turnover of just under $300m, Garry, at 70 years of age, made the decision to sell.

It was a decision he described as “sad and emotional” for himself and Team Burson. Although he is married to Margaret and has two beautiful daughters, Adele and Monique, and six grandchildren, there was no family succession line. Garry believed it was time for new ownership and leadership to allow Burson to become better and bigger.

“What happened was I went through a selection process with KPMG and there were five organisations selected as possible owners,” he said.

“I wanted to sell to an organisation I felt would grow the business to be bigger and better while retaining the Team Burson culture. I went through a lengthy sale process but an acceptable purchaser proved elusive.”

Garry was having conversations with Darryl Abotomey, an associate and ex industry executive, and told Darryl that he was struggling to find a buyer. Darryl indicated that he was interested in putting forward a proposition with him as managing director and a financial backer at Garry’s price.

Garry was comfortable with him and his proposition, as were Garry’s directors, and that was how Darryl became managing director and Quadrant Private Equity became owner of Burson.

An agreement to acquire Burson was signed on Friday, September 16, 2011 and announced on September 19 when, in keeping with his open management style, Garry sent out another memo to inform all Team Burson staff. The $148m sale was completed on October 17.

“Darryl has proven to be a hard-working and competent leader who has grown Burson to be both bigger and better,” Garry said.

Garry remains a major shareholder of Bapcor, in a non-executive capacity, and looks back with pride and a strong sense of satisfaction with what he and Team Burson achieved. He now has more time to pursue his passions, other than Burson, enjoying travel and other activities with his wife, Margaret, and being involved with, and proud of, daughters, Adele and Monique and his six grandchildren. These days Garry swims with various groups, is a regular “but average” golfer, loves the Western Bulldogs and manages his investments, including the Johnson Family Foundation, which gives to charities of choice of family members.

Interviewed June 2017