The leaders of some of the top program groups in the automotive aftermarket are optimistic about 2014 and beyond. However, all of them see some challenges ahead, chiefly the efforts of automakers to keep the reins of critical data, the impact of parts proliferation and downward margin pressure. Tools such as data warehousing help ensure program distribution will be here, serving professional repair shops, for years to come. Featured in a special section of the June issue of Counterman magazine, Editor Mark Phillips speaks to Federated’s Rusty Bishop; Automotive Distribution Network’s Mike Lambert; Pronto’s Bill Maggs; Automotive Parts Associates’ Dan Freeman; and the Alliance’s John Washbish to get their views on what the future has in store. Today, we bring you just a glimpse of what they see ahead. Look for the complete interview in the June issue of Counterman.
Read on to see how each one responded to the following questions:
What issues keep you up at night?
Rusty Bishop, CEO, Federated Auto Parts:
“We worry about the amount of inventory that exists in the distribution network today and the effect that terms factoring has on our industry. Certainly new technology and how it will impact our business is always a concern. We know that vehicle manufacturers want a bigger share of the service market and are trying to ‘lock out’ the aftermarket. That’s why we are so appreciative of all those fighting for the Right to Repair legislation that is critical to not only our industry, but the motoring public. Also, because we are concerned about a thriving future for the motor vehicle aftermarket, we support a variety of education initiatives to help attract and train talented individuals that make an industry strong. Personally, I serve as the chairman of the University of the Aftermarket Foundation and work with a dedicated board of trustees who see education as essential to a vibrant, growing aftermarket industry.”
Dan Freeman, President, APA — Automotive Parts Associates:
“Consolidating marketplace and margin compression.”
Mike Lambert, President, Automotive Distribution Network:
“Succession planning for all independent warehouse distributors. If every entrepreneur needs an exit strategy, then where do they turn as they approach that time in their career when they want to transition out of the business?”
Bill Maggs, President, National Pronto Association:
“Telematics and the dealers’ goal of keeping the car owner connected with technology.”
John Washbish, President and CEO, Aftermarket Auto Parts Alliance
“Course adjustments on my next day’s plan keep me up just about every night. Staying ahead of the increasingly fast aftermarket business pace is so difficult that I bet it keeps a lot of people up. The pace would be impossible if not for robust, well-targeted technology. Having that in spades at the Alliance lets me sleep a little easier most of the time. Still, you have to be decisive in a more timely manner. The Alliance data warehouse is 12 years old. Think about that. The fact that we have that much history in our databank and it’s growing every day; and we are making decisions every day that could impact us down the road. When you’re dealing with a lot of money, a rapidly changing technology base and more than one way to go, you’re bound to lose a little sleep. I can proudly say that our IT team could play at the pro level with their batting average.”
What’s your gut feeling about the outlook for the remainder of 2013 and 2014?
“At Federated, we will continue to sell parts and consumers will continue to get tremendous value from the aftermarket. I believe that there is an opportunity for continued growth in the market with an older vehicle population, slow new car sales recovery, an improving economy and a growing vehicle population. Taking advantage of the opportunities ahead requires a renewed focus on customers and collaboration between members and with supplier partners.
“Federated members are some of the most progressive in the aftermarket and can compete well with any competitor on a level playing field. They have valuable tools available to them, including the best marketing and support programs in the industry. Our Co-Man warehouse allows us to provide value to suppliers through high volume shipments to one location and gives us the ability to purchase efficiently and offer fast replenishment. While things may not get easier in the coming years, this is a business that rewards hard work and honesty. When I look at our membership, our supplier partners and our Car Care Center members, I feel very optimistic about the future.”
“It’s a bright outlook. We’re starting to recover from the recession years. Cars on the road are getting older. The main concern is miles driven. If that increases, we’ll see a real run up on parts sales.”
“I am always the optimist, so I look for growth in the coming years. I believe that pent up demand resulting from the recent recession will bode well for us in the next 18 months.”
“If things stay on the track they are, I think we’re going to be ok. We’ve got really good distributors who are very good in their markets. And we’ve got this aging vehicle population.
“People are pretty positive now. I’ve got a few members looking at opening new locations and expanding.”
“On this one my intuitive side agrees with our own research and the ‘experts.’ I think we’ll have an ‘okay’ year as far as growth goes, but we’ll have a great year relating to positioning for
what’s ahead. My answers to all of the questions you’ve asked lead me to those two conclusions. All I can say is, ‘Please hold onto the handles until the ride comes to a complete stop.'”