Sometimes we get so caught up in our own world we lose sight of what others in similar, but still different industries have to cope with.
Choices, choices, choices??
I can’t recall how many times I’ve visited with a parts manager and heard complaints that the orders were delayed for a day or two, or referred from the normal PDC to another, or even in some cases referred to the factory for a critical order fill. Hey, at least there is a process to get that order done, and that’s not always the case.
Every year Ed Kovalchick and I visit the Amelia Island Concours and attend vintage car and motorcycle races; you think you have parts problems? The vehicles being loved and campaigned are largely out of production, in some cases approaching 100 years old. Where do you think their owners and restorers go for parts? They seek out small suppliers, often in other countries, wait for months, and pray the damn things actually work! I volunteer at the Barber Motorsport Museum in Birmingham and they’ve gone so far as to acquire a CNC milling machine to make the parts they cannot find. How would you like to deal with that every day?
Expand supplier lines
Too many parts managers in franchised stores confine their lines of supply to their factory or factory wholesale distributor. Well, sometimes that???s just not good enough. A while back we talked about having multiple supplier lines for pricing purposes; remember good, better, and best? Well, that goes for supply as well as price. Even your franchise manufacturer has multiple suppliers just in case one goes down, as well as to control costs.
Brave new world
2009 is now behind us and stores left standing have to deal with the realities of a shrinking new vehicle market. Those who plan to structure their business on first owner vehicles are going to see a dramatic reduction in their business over the next few years. Those who aggressively pursue the subsequent owners with the high-mileage units are going to grow and prosper. To do that you have to become flexible on sourcing and pricing, as well as be able to acquire quality non-franchise parts quickly. There are some progressive companies that are gearing up for this business. They’ve traditionally served the aftermarket, but they’re available to you as well and I don???t mean just for the occasional “hot shot.” You need to cultivate good quality vendors who will stock and supply you with your needs as the market shifts, and now is the time to be selecting them, not when you’re stuck with a problem. Conversely, some of these vendors could use you as a supplier to them. They can’t have everything in stock any more than you can, so line some of them up as wholesale customers. Aren’t they just as valuable as the independent shops you only sell a few parts to right now? It’s plus business and you’re going to need every bit of it.
It could be a lot worse??
Looking back at the last two years we’ve all come through a lot, but hey, we’re still here and ready for more. 2010 will be a year of opportunity — no more retrenching. There’s an old saying, “You can expense your way to profits” and I firmly believe that to be true. You can’t grow if you’re shrinking. Now is the time to say, “I’m done with back pedaling” and prepare for the future. Be the winner! If you want to discuss this personally contact me at jrichter@DFO-magazine.com.
Author: Jim Richter
Jim Richter is a Fixed Operations Consultant and Performance Coach with M5 Management Services, Inc., an international company working with dealers, distributors, and manufacturers. He has spent over 45 years in the automotive, power sports and marine industries analyzing and assisting parts and service operations throughout North America and Europe. His work experience includes dealerships, field and management positions with major manufacturers, and his own consulting company.