Fixed Ops Journal - August 2020 - F21

FIXED OPS JOURNAL

ORIGINAL INTENT

A look at how dealers can step up sales of OE parts to independent shops

some theories on where those particular sales
here are great opportunities for auare coming from, but we'll have to dig more
tomakers and their dealers in the afdeeply on the next survey to test those theotermarket for automotive mechanical
ries. While IRFs indicate they offer OE parts to
parts. The total size of the market in
their customers about 50 percent of the time,
the U.S. is $26 billion, and it is expected to inthey also indicate that customers
crease 1.8 percent annually to $28
only ask directly for OE parts
billion in 2025. But original
about 20 percent of the time.
equipment parts have only a 36
Clearly, automotive OEMs and
percent market share. In Februdealers need to do a better job of
ary, Carlisle & Co., along with
creating demand for their parts by
automotive data supplier Motor,
selling the quality of genuine OE
surveyed independent repair facilparts.
ities, or IRFs, across the U.S. to better understand their decision-making when buying origiDo independent shops consider
nal equipment parts. (Read a
genuine
original equipment
white paper on the survey at
parts to be better than non-OE
autonews.com/genuineparts.)
parts?
Sales of genuine OE parts to these
It depends on the criteria. IRFs do inindependent shops through dealer
dicate that OE parts are better than
wholesaling generally represent
non-OE parts when it comes to qualiHARRY
about 20 to 25 percent of such parts
ty and fit and generating customer
sales. Collision parts represent about HOLLENBERG satisfaction. There are a few criteria
80 percent of that amount and mewhere IRFs see OE parts roughly the
chanical parts the other 20 percent. Harry Holsame as non-OE parts. These include part availlenberg, 55, managing director at Carlisle, disability, warranty coverage and technical supcussed some of the report's findings with Editor
port. Finally, IRFs report a preference for nonDan Shine. Here are edited excerpts.
OE parts when it comes to speed of delivery,
price and margin.
Q: How great is the demand for original
How can dealers sell more OE parts into the
equipment parts at independent repair faciliindependent channel?
ties?
Of course, price will always be an issue.
A: IRFs tell us that only 22 percent of their total parts sales are OE parts they purchased
There is a premium for OE parts, so anything
from OE dealers. Interestingly, another 21
to be more competitive on price would help.
percent of their sales are represented by "OE
But beyond price, there are additional steps
parts purchased from nondealers." We have
that OE dealers can take.
The first is delivery.
OE dealers dramatically overestimate
how long IRFs are
willing to wait for a
delivery.

&
QA

Among our IRF survey respondents, the median maximum order-to-delivery response
time for a mechanical maintenance part is
about one hour. However, when we asked
dealers how long their IRF customers were
willing to wait for a similar delivery, their median response time was 12 hours. Clearly,
there's a huge mismatch there.
What improvements are needed from dealers
regarding sales calls and online parts options?
IRFs told us that they receive an average of
19 sales calls annually from retailers they
purchase parts from. Conversely, nearby
dealers are only making about four sales calls
annually. It's hard to get the sale when you're
not even asking for it. Further, IRFs indicate
that when they search online to identify
which part to order for a particular vehicle,
they only receive an OE part option about 40
percent of the time. While this is more an
OEM than a dealer issue, there is obviously a
need for a comprehensive online OE catalog
to more easily help to get OE part options in
front of IRFs during the ordering process.
Particularly due to COVID, e-commerce is
more important than ever to sell to these
IRFs.
What surprised you from the survey?
While there were a number of findings that I
found interesting, I was surprised by the lack
of interest IRFs had in "one-stop shopping." I
know that a number of companies have been
trying to aggregate ordering and delivery of
parts to allow IRFs to more easily order required parts. Yet approximately two-thirds of
IRFs said they'd prefer to make a separate call/
order for each part if that was the only way to
maximize price, quality and availability. Of
course, one-stop shopping would be great if
you could do that and still get the lowest price,
the best quality and the fastest availability.
But in terms of sacrificing even a little bit on
price, quality and availability to support onestop shopping - there seemed to be very little
support for that. 

AUGUST 2020

PAGE 21

http://www.autonews.com/genuineparts

Fixed Ops Journal - August 2020

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