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Two Sides of the Same Coin


10/25/2006
By Brian Cruickshank

They say that numbers never lie, but data can be viewed in very different ways, depending upon where you’re standing.
 

In this space, I’ve written about a lot of topics, some that stem from my own experiences in the aftermarket, while others spring from what I read or hear others opine about the industry. Not surprisingly, industry-specific research is something I read a great deal of and it can often influence my writing. And while they say numbers never lie, I find that very often the same data can net two very different viewpoints.

For example, a few years ago I wrote a column about some research that tracks changes in the number of service bays in the country. The study showed that the number of service bays is shrinking, as the number of vehicles on the road expands. Current research shows the trend remains; the car and light truck population in the U.S. has grown by more than 39 million vehicles between 1996 and 2006, while at the same time, there are 44,000 fewer service bays to maintain and repair them. It doesn’t take a mathematician to see there might be a problem, both for stores who seek customers and motorists who seek repair services. After all, fewer bays mean fewer revenue opportunities for everyone. That’s pretty obvious, right?

That may seem obvious to me, but others may see the very same data and come to very different conclusions.

One might, for example, view this not as a problem, but rather an opportunity. As we all know, shops make their money by turning bays. The more cars they can push through their bays, the higher their efficiency, the better the profit. One could view the increased ratio of vehicles per bay as an indicator of increased car count at service outlets, of better efficiency, and therefore, better profit. And so, rather than seeing decreased bay counts as an indicator of fewer sales opportunities for stores or repair shops, a friend of mine sees it this way: More vehicles per bay translates into increased sales and decreased cost for service outlets. From the feedback he receives from the field, shops have additional bay capacity, though some are constrained by a lack of qualified technicians. Under this scenario, wouldn’t stores welcome fewer service outlet customers, each doing more volume? Sure. To my friend, it’s economic Darwinism: If the weak depart, leaving only the good and strong service outlets, the current ugly realities of returns and alleged defectives should decrease.

It’s the same data, but it produces two very different points of view. This just goes to show that not everything is as black and white as it may seem in the ever-changing, always fascinating automotive aftermarket. 















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