WHIPPANY, NJ —
As managing director, Bosal U.S., Jeff Berman is responsible for all of Bosal’s aftermarket customers in the NAFTA region. He was recently appointed to this position and is now responsible for managing operations, sales and marketing for Bosal’s U.S. aftermarket and performance divisions at Bosal USA, Inc., based in Whippany, NJ, as well as the sales and marketing for Bosal Canada in Kingston, Ontario.
Berman has more than 28 years of experience in the automotive aftermarket and has been with the Bosal organization for more than two decades. Prior to his appointment as managing director, Berman was vice president, Bosal North America, a position he held since 1998. Before that he was vice president of sales and marketing of Bosal U.S.A., Inc. where he helped promote Bosal’s OE replacement program and helped launch the company’s high-performance exhaust program. Berman joined the Bosal organization in 1985 as an outside sales representative and has served the company in various sales and marketing capacities. Prior the Bosal, Jeff Berman owned and operated a retail automotive parts store. He is a member of the Automotive Sales Council, SEMA, AAIA, and was just elected the board of AIA.
Founded in 1923, Bosal employs more than 4,500 people worldwide on five continents. In addition to its 25 manufacturing plants, Bosal also has 45 distribution centers in Europe, Africa, North America, South America and Australia. In North America, Bosal has four factories, eight distribution centers and a research and development center that supply exhaust systems to OE and aftermarket customers.
Recently, Berman took time to talk with aftermarketNews.com about the company’s OEM heritage and its role in the aftermarket. Berman shared his insights on the future of the import segment and the keys to tapping this segment.
Bosal has been around since 1923 and supplies exhaust systems for both the OEMs and the aftermarket. How does Bosal’s long-standing history and OEM background help the company’s aftermarket business?
One of the key reasons for acceptance of import brands is OEM heritage. Most import brands are made by manufacturers that are also OE suppliers to the vehicle maker. The import specialist knows this and is confident that the parts will meet required specifications and are the right parts.
We have been able to carry many of our OE processes over to our aftermarket manufacturing. The keys to being successful in this market are the ability to deliver product at a competitive price while also being first to market with new applications. Our OE heritage has enabled us to deliver this while also offering the broadest coverage in the industry. Many of the manufacturers importing from the Far East and many of the short-line manufacturers don’t produce with the same consistency and standards as OE manufacturers.
As an import specialist, what’s different in the buying preferences of import car repair specialists vs. someone who works on domestic vehicles? What are the needs and priorities of import specialists?
For starters, the import repair specialist segment of the aftermarket is one of the few areas that is growing. These technicians are very brand conscious and prefer parts that have the same form, fit and function as the OE parts that are being replaced. They typically don’t feel that the domestic brands can deliver this and that the import brands have a better reputation for quality and reliability.
In the case of exhaust systems for import vehicles, the market has shown a clear preference for one-piece, direct-fit systems. We feel that the one-piece, direct-fit system offers a higher value to the repair shop, because it comes with a competitive price, is easy to install and is readily available. One-piece systems tend to be an easier sale for the technicians because of their similarity to the parts coming off of the vehicles. In addition, the OE design offers ease of installation time and allows technicians to turn cars in and out of bays quickly.
We’ve been reading and hearing a lot about recent studies showing that price is not the most important factor to repair shop owners buying parts. Do you find this to be the case with import specialists and if so, why?
We do. Lang [Marketing] has done several studies that show service outlets rank price substantially lower in importance when purchasing parts for imports or import nameplates than they do working on domestic cars and trucks. Most believe that an import-branded part is best suited for their needs and that it’s made for the cars they are working on. They are willing to pay a higher price because they feel they will get the fit, form and function, as well as the availability and support they need. They do not feel confident that domestic makers can deliver this and are often suspicious of the quality and reliability of the parts.
Last year the company launched a new online catalog. How’s business online? Are you finding more customers utilizing e-catalogs and online parts ordering?
One thing we are finding is that more and more customers are looking for online cataloging with the ability to check pricing and availability. The trend toward placing orders online has been a bit slower. Our site gives the customer the ability to check price and availability at all of our locations, as well as place orders. The customer also has the option, if they choose, of getting their account information, and that would include purchase histories, past invoices and account balances.
We are looking to upgrade our site in the next 12 months and we’ll also be concentrating our efforts to encourage more customers to use the site to place orders.
What’s ahead for the import exhaust system market?
Quite a bit. While the exhaust industry as a whole has been declining due to the impact of stainless steel OE systems, we haven’t felt the same impact due to the import vehicle nameplates’ continued growth. This represents further growth opportunities for us, especially on the traditional side of the business. A common theme we hear from the traditional side is, “We know imports are growing. We know we’re not getting our share, and what can you do to help us get it?”
The domestic parts distributors want to get a share of the import parts market and this works in our favor. We’re interested in doing business with them and we can do a good job in supplying them. Traditional distributors that have made the decision to sell domestic brands for domestic vehicles and import brands for import vehicles tend to see an overall growth in these product lines as these lines tend to compliment each other and present growth opportunities.
The other area where we see opportunity is in OEM performance programs. These programs have had very good results for us. We’ve been able to parlay our OE manufacturing capabilities and partnerships with major carmakers for their performance programs. Right now we are working with Subaru, Toyota and Mazda. As an OE supplier we know how to work with them, we have the capabilities and infrastructure to meet their business requirements and performance criteria as vendors. It’s really a natural fit for us.
The tuner market is as strong as ever and is an important part of our performance business.
We are also seeking growth opportunities in direct-fit catalytic converters. These converters are a key focus for us this year and work well with our overall positioning as a manufacturer and supplier of OE replacement parts. We’re expanding in range this year with about 100 new SKUs. There’s a big difference to the customer in selling direct-fit versus universal catalytic converters, in terms of added value and profitability. Selling a converter with all the specific pipes and flanges included brings an average of about $85, while a universal converter is more of a commodity, averaging about $25. For the technician, this again, represents an easier installation and higher profit margin.
What’s the biggest issue you face in this market segment?
Obviously, we continue to be concerned about the rising costs of steel prices. Offshore exhaust products are coming in at a price that is significantly lower, but we also feel those systems are cheaply made and not very reliable.
I think our biggest concern is part number re-labeling. To us, it’s no different than brand counterfeiting, or at the very least, misrepresentation. What happens is some suppliers, especially the short-liners, are selling their products with a Bosal part number, and the technicians think they are getting a Bosal product. Legally, there is very little you can do about it.
Because we have the broadest coverage and catalog we are an easier target for this. We know we can’t be all things to all people. For the distributors whose sole buying criteria is price, Bosal is probably not the best choice. However, these distributors should not represent the product they sell as Bosal if it’s really not. We’re not the cheapest because of the range, quality, cataloging and extended services that we offer.
What happens quite often is our customer service department will get a complaint about fit or performance of a product, or a warranty claim, and we go through the motions of getting the VIN number and looking it up in the crash guides and OE microfiche and a few minutes into the conversation we find out that the part has yellow label and it’s not a Bosal part at all. In some cases the damage has already been done and these are just the ones we know about. These are the guys that are calling, that we can respond to. The question is, how many installers don’t call and lose confidence in the Bosal name when it wasn’t our product to begin with?
One thing the technician can do is look for our label, which is red and white. Many of our parts also feature certain stampings that identify the parts as manufactured by Bosal.
Any last thoughts for our readers?
Yes. We’re always looking for opportunities to take on some new product lines if they fit within our targeted market. Companies interested in working with us can contact me at 800-770-2224 x. 226 or via email at [email protected].
_______________________________________
Click here to view the rest of today’s headlines.
