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Staying Competitive - Running in Front of the Bulls - Articles Surfing


At any given point you can find groups of economists, known as bears, predicting doom and gloom and herds of others, called bulls, pointing to stock market highs as an indication of brighter days ahead. With oil prices predicted to hit $110/barrel by the time you read this and lots of problems in the home equity arena, we thought we'd ask a few top jobbers their advice for staying competitive in times of well, let's just say, uncertainty.

As you might suspect, our jobber retailers also had differing economic forecasts. One of the jobbers that we talked to seemed surprised that despite signs of a possible shrinking economy, recent sales figures were higher than those of last year.

"In the past four years we've had 4 area tracks go under and Advance Auto Parts have come in hot and heavy, opening several stores" said Lonnie Lovell at Grand Prix Auto Sports Center in Tulsa. "We focus pretty heavily on performance and racing and you'd think we'd be hurting a bit, but our numbers are actually up. That doesn't mean that we're not paying attention and considering options."

Others admitted that they expected sales to tighten up a bit. Here's Sal Marsilla from Autosport in Upper Saddle River, NJ. "Look, I've been in this business for 27 years and it's like fighting a war when times get tough. You got to keep your overhead down and work the suppliers for better pricing. "

"These things come and go", he continued, "you can't get excited about it, but you have to work smarter. We're going to be doing more targeted direct mail with coupons to bring people into the store and to stay top of mind, for instance."

J.C. Colton runs Mild 2 Wild Custom Accessories in Lakeland, Florida. "We're not just in competition with each other in this business. We're increasingly aware that consumers have a lot of places to spend their 'fun' money. We need to quit cutting each other's throats and work together for the benefit of the car owner and the industry."

Mild2Wild has recently targeted upgrades for new car dealer inventory. "We're working with four dealers in the area now and that's working out really well." said Colton. "We're lifting trucks, installing high end wheels, audio and video for them. The rigs look great on the lot and attract a lot of attention. The buyer gets a custom vehicle ready to go and it's profitable for us as well."

ChuxTrux is a recognized local name in the Kansas City area with five stores. According to Chris Ripper, General Manager, jobbers need to create markets that no one is addressing and also do a better job of creating consumer awareness. "My boss was filling up his decked-out Mustang at a local gas station a few weeks ago when another Mustang owner approached him and wanted to know where Seth had gotten all of those great aftermarket parts! To make a long story short, he was in the store a week later happily writing a large check for all of the upgrades we installed on his Mustang. Now there's an issue we all need to be addressing"

Chux Trux has been a truck accessories chain for many years. Seth Gortenburg, the owner and Ripper realized that no one was doing a very good job of addressing the passenger car market and are determined to use that to their advantage. Chux Trux is now offering body kits, tinted windows and custom grilles for passenger cars. "Actually, the tuner market is pretty well covered so we're focused on all the cars that don't really fit that category. Whether it's the wife's Camry or a plain vanilla Neon, there isn't a car or truck on the road that we can't make look better or run better," said Ripper.

Roadrunner Body and Paint in Austin, Texas is a new SEMA member that started out as a traditional body shop, but is quickly adding lines. Collision work profits have been hammered by the big insurance companies according to owner Grady Foshee. "We were so busy with low-paid collision work that we couldn't look up long enough to realize that it was killing us," Grady said. "Diversification is where it's at. We're moving into audio/video, wheels and tires, custom body work, bed liners and other product lines that have a higher profit margin."

Jobbers find themselves in competition not only with other local brick and mortar aftermarket retailers, but also with online retailers.

Some owners and managers point to Minimum Advertised Pricing, internet and mail order sales tax issues and low dollar imports as factors that the industry should be addressing. Others weren't as concerned about the 'Net.

"Oh we see some 18 year olds buying knock off body kits and then paying the price with installation hassles, but online retailing hasn't really had an impact on our business," said Mild2Wild's Colton.

"Look," said Lovell, "Traditional jobbers are recognized as the local authority. Consumers appreciate well informed advice on these products and people like to touch and feel before making a buying decision. We need to capitalize on these advantages, but still become stronger in areas where we have been lacking and that includes our online presence."

Ripper agreed, "We're coming out with a full build on our website with online ordering and better content and features. We're confident that we can make some real inroads on the 'Net."

As we interviewed people across the country patterns began to emerge. These strategies might be labeled Best Practices for Staying Competitive. Here's the list.

* Maximize shelf space, shop space and time. Look for and enhance higher margin products and services so that every square inch and spare minute count toward better profits. * Make sure your Internet site is credible and that search engines can find it. This doesn't necessarily mean online commerce although that should be considered. You don't have to spend a lot of money and the results can be significant if planned and implemented properly. * Take care of your existing customers. They will always be a source of sales and there's nothing as powerful as word of mouth advertising. * Make sure you know what your customer base wants and needs and make sure you provide it. You may be missing out on sales by not fully understanding demographic groups in your area. * Don't get stuck in a box. Keep an open mind. Experiment. * Look for synergies with body shops, dealerships, repair shops and others who might augment your business or send you business. * Watch your overhead, especially payroll. Pay attention to the fact that you have some employees who consistently outperform others. Weed and feed. Weed out the ones who under perform and feed those who excel. * You've got to stay in front of consumers, but make your ads count. The only way to gauge this is by creating ways to measure all advertising results.

Chris Ripper offered this parting shot. "You've got to evolve and adapt. The stores that just sold truck caps and never expanded to other lines are gone. Fiberglass running boards used to be the rage, now no one asks about them. The only thing that never changes is the fact that everything changes."


Submitted by:

Dan Jondron

Dan Jondron began working in the automotive industry in 1985. In early 1993 he began building automotive enthusiast and commercial websites and took that company public on the NASDAQ (OTC:BB) in 1999.

Dan began teaching marketing and technology workshops for SEMA, other trade organizations and private companies in Japan, Australia and across the US and Canada. Dan's companies have won a number of awards for excellence over the years.

In 2000, Dan founded Advanced Digital Strategies, (http://www.digstrat.com) marketing and technology consulting company, focused on the automotive aftermarket. Since that time, clients have included SEMA, Lund, Autobacs, Fortune 100 companies and many smaller companies in the SEMA marketplace.

Dan is a founding member of SEMA's Business Technology Committee. Dan also serves on the Aftermarket eForum committee and has lead the eMarketing Panel there for the past two years. Other industry involvements include the Aftermarket Data Trust, a joint initiative of SEMA. MEMA and AAIA.


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