What would you do?

It's a free market don't get emotional about it you will loose every single time. Let them run their course and always be professional in your communication with them, if they need help charge them. They have a fairly good chance of failing from many aspects then once machines run out of warranty, print heads fail. Laminators don't track right and ruin many sqm/sqft of prints their accountant will let them know hey your print business was a bad deal. Let the market do what it needs to naturally. You might find yourself down the road doing business with them again after they realize that margin they saw on paper wasn't what they thought. You could end up with them coming back as a customer and they did you a solid by dissolving your competition. Consider hooking up with wholesale companies who can offer products you can't in house and you know they can't make in house. Be professional and be patient.

 

Only time will tell if they hold themselves to just in house stuff and how much work it takes to convince vehicle purchasers that they have the skills and talent on board to do as professional of a job as people expect or you would do. When Staples and UPS stores first starting offering copy services, they probably never envisioned offering a full range of signage, banner, print services, but they persist and while still relatively small players, they do cut into market share. In a small town, any reduction in market share is felt more than in a big city where one can just delve into other product and service offerings.

As perfectpdf stated, this is a labor and talent intensive line of work and I just can't imagine a auto dealership gaining the requisite skillsets, space dedication and investments it takes to make it viable over the long haul. I'm looking at our media rack and there is no less than a couple dozen different materials stocked. Our colored vinyl racks have literally dozens and dozens of rolls of different materials. I look at how much internally we need to know to keep our equipment running without calling in techs. The skills needed to run the software and how to design work that looks like professionals created it are even more daunting.

We have two local dealerships who we finally gave up on pursuing after offering commissions for referrals, constant check ins about offering our services, seeing service and parts vehicles wrapped by others, etc. They are beset with get rich quick mentalities, salespeople are always conjuring up ways to make an easy buck and as illustrated so aptly in the film, Fargo, the "add ons" and gimmicks like clear coats, etc. are usually perceived negatively by consumers.

We're located in one of the hottest wine producing regions in the country and vineyards make up a large portion of our business. One winery bought its own equipment thinking that it could be a cheaper way to make their bottle labels. They thought all the other wineries would line up to use them, FAIL. Then an out of town label maker leased a big shop and set up targeting the wineries. FAILED in less than a year.

Try not to let it bother you and do what you can to remind all of your customers who the real professional in town is.

 

Eliminating your competition is a big plus. And if they are a dealership, their prices will typically be on the high side, which will only benefit you.
I would view this new business as a potential ally rather than an enemy. You never know when they will be able to help you.
The list is long of ways they can benefit you if your relationship is not acrimonious.
Use of their shop (or a tool, or even an employee) in an emergency, for example.
Sending you work they can't handle when they're slammed or if they lose employees or if they have equipment go down.
And when you are ready to slow down, retire, or semi-retire? The steamroller of your business may make you feel trapped. They might be the prime candidate to buy you out for an acceptable sum, maybe even offering you a decent position in your later years, in a more relaxed situation. Maybe not. But who knows?

Why burn bridges unnecessarily?

I am reminded of an old girlfriend. After six years it was not working. The split was not angry, but quite sad. Yet she reached out to me later. She said, "I can't give you up as a friend." Such a request is often a veiled desire to continue a romance. In her case, the request was genuine. She has been a best friend for ten years now. She is like my sister. Close, but with obvious boundaries. My partner loves her.
This situation is so unusual, and I recognize its rareness. I don't take it for granted.
And whenever I am faced with a situation where I have a choice to permanently end a relationship of any kind, business or otherwise, with or without holding a grudge, I think twice.

Another interesting footnote:
I used to do a lot of work in a town in Illinois that had a number of dual car dealerships; two Chevys, two Chryslers, two Fords, etc. I asked one of the dealers once if lots of people play the dealers against each other. He laughed out loud. He said, "They think they are playing us against each other! And that's what we want." He continued, and I think this was a moment of unusual candor on his part, "You have no idea how dual dealerships can help each other. It's almost...criminal."
"So," I replied, "the only one that really gets screwed is the car buyer?"
He said, "I didn't say that." Then he just smiled.

Brad

 

They will figure out whatever they need to easily enough and will throw money at it if need be. You're better off giving them a hand, charging them for it if need be and maintaining a professional cordial relationship.
My question would be how a 20 yr relationship with a customer would end up like this without you knowing or them coming to you about selling out to them. Not trying to be rude but this subject comes up quite a bit and each instance people are mad at being blindsided, to me its more about the vendor not keeping a good finger on their clients and much less about the clients decision. If a customer is a big enough part of your business that it would bother you if they left, you really should see the writing on the wall well before it ever happens.

 

I agree, don't burn your bridges, just treat them like any other customer.
I had a similar situation with a bus company, but they did operate as a commercial sign shop.
They didn't last.

 

How much of your business income was the car dealership. With them buying your competition it seems everything is the same except your car dealership account is gone. Like others said about being friendly to your new competition would be a good idea and they probably will see what a pain it is to run a sign shop with their wacky employees and the profit is not from servicing something you bought from them. They might fold up in a year or two.
In the meantime go and get some legal weed and slowly enjoy their eventual demise.

 

They grabbed a huge bull by the horns. I always say you gotta pick one way to make money and get good at that. Hoping for the best for you.

 

Would not be the first time that I've seen a dealership purchase a sign company. Chances are their in-house work will do the majority of their projects, but they are still going to call you or someone in that area. Depending upon their equipment from the buyout... it could be a few calls a year or many calls a year. It's a small town as you mentioned, so no need to burn any bridges.

We purchased our first Vutek QS printer from a dealership out West that wanted to do more in-house. They lost their operator and decided the Vutek was too much to train guys on going forward, so they purchased Roland flatbed and roll to roll printers. I'm sure the sign companies in that city/town are very happy they sold the Vutek. So, what they have today may not be there in a year or two down the road.

I would be more concerned about the possibility of another company opening up now that one has been removed from the market.

Did they offer to buy you out? Does the workers and/or owner from the other company now work for them?

Good luck man...

 

There's really no such thing as loyalty any more in this business..... or anywhere else, except maybe personal friendships.

If you spread your customer base far and wide, you'll never miss when someone goes elsewhere or buys up a competitor.

Back in the early 90s and throughout, so many customers left us, when they were able to buy computers and then pay employees to come and run them. From hospitals, to beer distributors, schools, automobile dealerships and just about any other large customer, they began their own ventures. It was frustrating, but ya just need to march on and not look back.

Like they said, don't burn your bridges, just be careful what information you leak out.