There’s an old business axiom that goes something like this, “There are only two rules to follow in order to be successful in business. Rule # 1 is: The customer is always right. Rule # 2 is: When the customer is wrong, refer to Rule # 1.”
Certainly, there is an element of truth in that axiom, along with a smile and a wink. But, the psychology of “catering” to your customers requires some scrutiny and, in my opinion, must always be tempered with sound business practices. So, with this in mind, I listened attentively to two recent presentations at the inaugural Automotive Aftermarket Suppliers Association (AASA) Vision Conference last month in Orlando, FL. The first was delivered by new Pep Boys President & CEO Jeff Rachor. Jeff did an excellent job in outlining Pep’s new business strategy, which calls for strong initiatives to attain DIFM (i.e., automotive service) growth and recondition their merchandising format to focus on core automotive parts and products, among other things. I was impressed with the clarity of their strategy, and the resolve Jeff displayed in getting Pep Boys back to doing what they feel they do best sell automotive parts and provide automotive service. The other presentation, also quite impressive, was delivered by new Advance Auto Parts President and CEO Darren Jackson. While Pep’s Rachor is rather new in his position (closing in on one full year at the helm this month), Mr. Jackson had a full 51 and a half days under his belt as he stood before the crowd. But, it was clear that this is a man very capable of leading the second largest automotive retailer in the country. While Jackson didn’t reveal as much as Rachor in the way of new strategies or initiatives, he did emphasize that Advance too will seek to garner a much larger share of the DIFM market through parts sales and service to the traditional, independent repair market. Jackson and Rachor both realize the significant challenges their companies face as they continue to prepare their respective organizations for battle in the fight for wholesale market share. Significant increases in inventory investment/coverage, delivery service infrastructure, advertising, marketing and promotions, and so on. But, both leaders agreed, none of what is required is more important than parts knowledge and technical skills among their store personnel.
Both Rachor and Jackson emphasized that a critical need for each of their organizations is to have properly trained and technically competent store personnel. Obviously, I couldn’t agree more! So, what does all of this have to do with the business axiom I referred to at the beginning of this column? Simply, this: applying the “customer is always right” mantra requires a unique set of skills, especially as it pertains to independent automotive shops, the very same that Pep and Advance (among others) are trying to gain access to for sustainable growth over the next ten years. Caving in to a shop’s demands in every instance (especially those instances where unique and valuable knowledge can prevent a bad and unprofitable decision from occurring) sets a very bad precedent and drives the entire market down.
I wish Pep Boys and Advance nothing but success as they venture forward in the battle for wholesale growth. In fact, we will support them through the pages of this magazine as we are read at virtually every parts counter they have. But, I caution both of them to be judicious in how they implement their strategies and placate their wholesale customer base. No one is naÏve enough to think that the customer is always right, but that doesn’t necessarily stop some entities, eager for growth and desiring to please analysts and shareholders, from caving in to egregious customer demands just for the sake of a sale or two. To both Pep and Advance I say “go get ‘em!” But, don’t sell your soul and establish an unrecoverable precedent for the market in order to do so. Do as you claim, and put the emphasis on training your people. They will best at determining when the customer is right, and when NOT to refer to Rule # 1 when the customer is wrong!