In tough economic times, the consumer’s state of mind is understandable. Everything around them is going up in price, from food to clothing.
At the grocery store, prices were up 8.9 per cent year over year in March. While that’s down from the 10-plus per cent that was seen from September to January, wallets across the country continue to take a beating.
So when a consumer hears a squeak when they press the brake pedal, a knocking under the hood or any other uncomfortable sound, they clutch their wallet just a little bit tighter.
As other industry reports have shown, along with any given shop’s appointment calendar, people are willing to get their vehicles fixed. Whether it’s to ensure they can get to work, take the family on a weekend jaunt or the price of a new vehicle is just too expensive, consumers are looking for maintenance and service for their vehicle.
But there may be a catch. In the same way prices have gone up at the grocery store, the same has been seen in the automotive aftermarket. The DesRosiers Automotive Consultants Aftermarket Scorecard showed passenger vehicle parts, accessories and supplies prices were up 8.6 per cent in 2022 compared to 2021. Maintenance and repair service costs rose 5.6 per cent in that same time.
So just as they may look for the lower cost option in the cereal aisle, consumers may look to find ways to save money when getting their vehicle fixed and lean on their shop to get them the cheapest brake pad, belt or alternator they can find.
But the way jobbers see it, agreeing to sell cheaper parts is the biggest mistake shops are making with 41 per cent saying so, according to the CARSAnnual Jobber Survey. And it’s a growing problem. Last year, that number was at 31 per cent. So it remains the top issue — but it’s an even bigger one today, according to the jobbers we heard from.
“Think they are doing their customer a favour” but really are not, pointed out one respondent when given the opportunity to comment in the survey.
Another called for better education of the consumer. Shops “feel that price is everything to the customer when, in most cases, if you properly ‘sell’ the better quality part, they will understand the value and why it is more money,” they wrote.
It’s not just the fact that a lower-quality part is being sold and will fail quicker, the shop’s bottom line won’t be healthy, said another. “In a competitive trade, including DIY, they want to offer a lower price. However, they are cutting down their profit margin and quality.”
The CARSAnnual Jobber Survey went out to jobbers to gauge their views on how shops are running their businesses, the relationship between the two sides, industry trends and how to better work together. The survey was sent out via newsletter, e-blast and social media.
The second pick for the most common mistake shops make was the lack of proper business management procedures (24 per cent).
Jobbers are concerned that their automotive service professional customers aren’t preparing themselves adequately for the rigours of running a business or getting the training needed to work on more technologically advanced vehicles.
One respondent simply stressed that they “Should take management courses.” Another complained that ignorance is getting in the way: “They just need to educate themselves.”
That segues to the second question of the survey: Do ASP shops take the need for management and technical training seriously enough? The answer, overwhelmingly, is no.
Nearly half of respondents (47 per cent) say they’re told by their ASP customers that they’re too busy to go to classes. Another 35 per cent said they’re told by shops that they’ll attend but never do. That’s 82 per cent of jobbers saying their industry partners are not getting the training they need.
“They need to understand they need training,” lamented one comment.
That said, many respondents understand the reality of the situation. ASPs are working all day; they don’t want to give up their evenings or weekends for more work, even if it’s training. Shop owners don’t want to close their doors and lose a day’s business either.
“There is a variety of challenges here from being paid for training to locations and time of day,” a respondent noted.
“Finding time away from their daily work schedule to get to training — too tired at the end of the day to attend training,” pointed out another.
One looked inward. “Our sales reps must keep trying to advertise these programs,” they said, noting that banners are offering quality learning opportunities.
However, “the better the meal, the better attendance,” one person mentioned about training sessions.
There are still challenges around getting proper training out there, a couple of respondents observed.
“We must commit to more training, especially in this rapidly changing environment with EVs and such,” one said.
“We, western Canada, need more hands-on training. A lot of shops say there doing online training. But nothing beats hands-on,” said another.
Shops have bemoaned the lack of quality parts available to them. Some are turning to the dealer more often than before to get what they need. Based on the responses by jobbers, they believe they have the quality shops want but price is an issue.
One jobber who said they continually remind suppliers to keep quality standards high noted that profit margins need to be maintained on their end. “We are keeping decent margins and using the profits to ensure we have better service and inventory levels than the dealers.”
Another noted that many brand-name parts meet or exceed the original equipment manufacturer’s quality. “We spend a lot of time educating shops about the benefits of our parts. A lot of cost comparisons to understand what is best for their business. We do stock a few white box parts but try to upsell to a better part,” they said.
Click to expand
Many shops have moved the bulk of their ordering online for reasons including ensuring they’re getting the exact part they want and not needing to speak with anyone. This, they say, quickens the process.
Jobbers are responding to make it easier for shops to do so.
At this time, upwards of 60 per cent of a jobber’s products are sold online — about 24 per cent said they were doing that much business in this area. Some see this as a growing area. While there are kinks to be worked out, the offering is part of a system to offer a fully-rounded service experience.
“Online levels have steadily increased over the last five years or so, and we are never completely satisfied with the process, but it is working well,” one jobber wrote. “We have our outside sales team doing weekly visits to ensure all is going well, pick up returns, warranties and show new products or programs.”
Another has also seen a steady increase in online ordering. “Our customers rely on it. However, the shops call if they have an issue or can’t find their parts. The counterperson must be well trained to deal with an issue and be able to source their parts. I believe the counterperson has to be better trained than ever,” they observed.
“Online ordering creates more returns,” said another. “An outside sales rep visiting once a week for best shops to once a month for all is a requirement. Returns, ask the right questions, show off new products, explain changes, present rewards and opportunities. Be more than RockAuto with a local store.”
However, jobbers are noticing that just because shops want to order online, that doesn’t mean shops are instantly turning to their first- or even second-call jobber.
“For shops, it is becoming increasingly convenient and allows a simpler solution for parts that are not available from first- and second-call suppliers. I see Parts King and RockAuto boxes more and more on sales calls,” one respondent reported.
“One issue is the wrong [part] ordered and some shops ordering cheaper parts. We lose control of the personal connection. Also losing a bit to online [stores] like RockAuto and Amazon,” said another.
Jobbers were asked to outline their challenges so that their shop partners would have a better understanding of what’s getting in their way.
One, seemingly feeling beat down by constant requests for discounts or cheaper offerings simply said, “We need to make a profit, too.”
Others, for the most part, want to get the message across that they’re trying the best they can to help their customers to help their customers.
“How hard we try to get their orders out the door and to them as quickly and efficiently as possible. Yes, we make mistakes, but we try our best not to and are always looking to improve our delivery system,” one respondent wrote.
“That we are just human and can’t just wave a wand and have their odd part in their hand now. If they work with us, we will help them in every way we can,” said another, adding that an unpleasant customer will still be helped but maybe not to the fullest extent.
Staffing, like everywhere, remains a top concern for many jobbers — they placed it second (35 per cent) behind only parts availability (53 per cent).
“What we go [through] each day with the day-to-day issues of staffing, returns, drivers [availability],” a respondent said.”