The ARI feature in the July issue (The Collapse of American Remanufacturers Inc: An Indepth Look at ARI’s Fall into Bankruptcy) was simply the best post-mortem of ARI I’ve read. But perhaps more importantly, Mr. Cruickshank’s use of this tale was an inspired case study of the challenges to the American automotive aftermarket. Brilliant!
East Lansing, MI
After reading your article about the downfall of ARI, I found myself wondering how an issue as important as component pricing was not part of the subject matter.
In your article, you state that remanufactured CV axles accounted for 72 percent of the company’s sales. Yet, it was never mentioned that the installer’s acquisition cost for a CV axle assembly had been spiraling downward for the last 10 years. A typical Honda shaft purchased in 1995 for $139, has gone down to less than $39 in 2005.
Now, it’s reasonable to believe that market conditions, technology and supply and demand will cause the prices to show downward trends. But to this extreme? I believe that this loss of component profitability played a huge role in ARI's demise.
A.L.O. Sales & Marketing, Inc.
Thanks for your note, Clark.
Yes, I agree that pricing was one of many factors the lead to ARI’s downfall. However, ARI’s problems were well beyond pricing, and I instead chose to focus on ARI’s internal issues. Those I interviewed for the article blamed lots of things, but pricing was not high on their list.
In retrospect, I should have made specific reference to the downward spiral of halfshaft prices because that would have gotten to the heart of ARI’s cash-strapped situation.
I hope you enjoyed the article nevertheless and I appreciate your input.
STICKIN’ IT TO THE MAN
To Counterman Publisher Jon Owens: I’ll give you two thumbs up for your May column (Who Ya Stickin’ It To?). I hope other companies will heed your suggestions.
The agents who call on us have so many lines and are so busy being “the taxi” for every sales manager who wants to visit our area. They simply have no time to learn even a single line.
The factory reps are not trained in anything other than how to shuffle paper work. The good reps the ones who see increased sales and lower returns are those with single lines and are experienced or have been properly trained.
Keep stickin’ it to ‘em!