Every other week, aftermarketNews.com offers an interview with high-profile individuals in the automotive aftermarket. We give executives free rein to express their views on anything from the state of their corporations to recent legislative news to future trends in their niche markets. Here you see what matters to the newsmakers themselves.
Patricia Law, VP and general manager of ANSA Automotive, recently sat down with aftermarketNews.com and shared her 25-plus years of market experience and some insight on the aftermarket. In addition to managing ANSA’s Macon, GA, distribution facility, she also actively supports industry initiatives and associations. She is currently serving her second term on the board of directors for AIA (Auto International) a segment of AAIA. She also recently completed the University of the Aftermarket/Northwood University Leadership 2010 Program.
ANSA Automotive Parts Distributors, Inc. established itself back in 1977 as the exclusive North America supplier for ANSA brand exhaust products. Can you give our readers a glimpse into the origin of the company and how it has evolved over the years?
We opened our doors as the North American factory warehouse for a performance exhaust line (ANSA SPORT) specializing in European sport car coverage, including exotics like Ferrari and Lamborghini. Our best sellers in those days were for BMW, MGB, Porsche and Alfa Romeo, and later included other popular enthusiast models like the Datsun Z’s, Triumph TR/6 and early VW Rabbit and Scirocco.
In the early 1980’s, we quickly began expanding our ANSA brand OE replacement line to meet the increasing demand for a quality, bolt-on exhaust solution for the growing number of high-end, European car registrations. At that time, our product lines were being sold into the performance distribution channel, as well as the import specialty and the emerging exhaust specialty channels.
By the early 1990’s, we had added popular Asian applications. This was prompted by our penetration into the undercar channel, as well as the opportunity to sell product to import specialty distributors that were expanding their import coverage beyond European makes. This coverage expansion has continued. In fact, our latest OE replacement catalog includes more than 300 new part numbers covering 80 new vehicle applications.
While these original lines continue to be a mainstay within our offering, the resurgence of performance in the last decade has prompted us to expand our manufacturer relationships to develop additional exhaust products to satisfy today’s enthusiast. In 2002, we introduced Silverline – a line developed to bring high-quality, stainless steel exhaust products to the performance-minded consumer and performance parts reseller.
Given the longevity of your company in this industry, what are the main challenges that the supply chain for exhaust products has experienced over the years?
For distributors and installers, the initial challenge was in finding the coverage, which was quickly replaced by managing the coverage. As imports evolved from a niche opportunity into a more “mainstream” need, the SKU’s have grown, as have the number of suppliers. This means variances in the approach to quality and design have also increased, compounding the number of options available. This is further challenged by the incompatibility between various exhaust brands. Ironically, this has all been happening at a time when original exhausts for the most part are lasting much longer.
How has ANSA Automotive managed to prevail over those challenges?
Rather than try to be all things to all people, we have continued to identify and pursue niche opportunities within our expertise of import replacement and performance exhaust. For instance, we don’t offer direct-fit muffler assemblies for import light trucks. There are suitable, lower cost alternatives available through most “full-line” manufacturers. Instead, in the replacement line we focus on applications where OE fit, form and function are an installer and consumer preference – the E/36 BMW exhaust, for example. On the performance side, we stay focused on offering the right product for the right vehicle – again with consumer preference in mind. For instance, the look, performance and sound desired by the typical owner of a Z3 is entirely different than what a Dodge Neon or Honda Civic enthusiast is looking for.
Let’s explore the “niche market strategy” further. How has this approach provided ANSA Automotive with a competitive advantage?
Our product development decisions are based on where we can deliver value. For the service technician, this means offering a quality direct-fit, bolt-on product that is compatible with, and looks and performs, like the OE – when that is the best solution for their customer. For the distributor, it can mean offering specialty items that may not be available through “volume” suppliers – again with an eye toward the need for quality, compatibility with the vehicle and ease of installation. And for the performance-oriented consumer, it can mean having the right look, sound and performance gains appropriate to that vehicle owner. Because we’ve chosen the path to specialize in specific channels and products we can understand the needs of the end-consumer, giving us the ability to deliver to the supply chain what we feel is the best exhaust option in terms of quality and value.
Provide us with an example of a strategic product launch that was derived from your niche business model.
An example of a channel niche for us has been the undercar distribution channel. Our anticipation of this channel’s need for a universal, all-stainless performance exhaust led us to develop an extensive line of universal mufflers and tips branded Silverline. Further capitalizing on this exhaust trend, we next developed a bolt-on, cat-back solution for the key import and sport compact applications. And most recently, with an eye on performance and consumer trends, we launched a complete line of performance exhaust for diesel light trucks. While we saw this as a growing opportunity within our existing customer channels, it also perfectly fit within our niche channel strategy.
We back this strategy by committing significant marketing dollars to support the growth of these niche lines, at the trade, consumer and co-op level. This year, we are sponsoring some competitive motorsports teams and using these events to build exposure for the Silverline and ANSA brands. We also continue to build awareness for our brands within the niche channels we focus on.
Is this a business strategy that can be successfully implemented down the supply chain?
Absolutely. In fact, it is becoming increasingly difficult to differentiate yourself at the distributor or installer level. The lines are blurring between vehicle specialization, and/or repair specialization. Paths are beginning to cross more and more. We believe it’s important to have a message that is unique or special to your business – be it promoting a brand that is not on every corner, or pursuing a consumer demographic that is not the mainstream. When all other things are equal, it of course comes down to price – a tough long-term strategy. We encourage customers to get involved in the local “car scene” – see what’s happening at the consumer level, look for emerging trends or opportunities you can incorporate into your business – find ways to differentiate. We also encourage partnering with suppliers or manufacturers who are doing this – and who support push through with the right mix of market knowledge, experience and sales and marketing tools.
Where do you feel the direction of the exhaust market is going?
Short term, we will continue to feel the pinch of longer replacement cycles, although there is a general sense that drop in demand has “bottomed out.” Certainly, the huge growth in import vehicle count supports some eventual offset to these longer replacement cycles. However, this growth, when combined with the average age of vehicles increasing, points towards even more “active” SKU’s being needed. It will become increasingly difficult not only for one exhaust manufacturer to have it all, but to know what to have in terms of design, quality level and when to have it. Consider, as an example, the variables likely to exist between the owners of a 10-year old Audi and a 10-year Hyundai – in terms of the owner demographic, the “relationship” with their vehicles, their expectations for product quality and price and where they are likely to have repair and service work performed. This all points to closer cooperation and communication within the supply chain – especially between the manufacturer/supplier and their distributors.
_______________________________________
Click here to view the rest of today’s headlines.
