The Automotive Aftermarket Industry Association recently rebranded itself the Auto Care Association, favoring the phrase “auto care” over “aftermarket.” Will you and your group adopt this new language? What are your thoughts on moving away from the term “aftermarket?”
We have always felt that the term “aftermarket” is an industry term that is not well understood by consumers. We use terms such as “Car Care Centers” for our shop partners and always try to communicate in a manner that will maximize understanding and effectiveness. We fully support the new association name and feel that it will definitely add to the understanding of what our industry is all about. Promoting “auto care” is a natural for our members and we will work to support not only the new name but also the concept of taking care of vehicles. There is no doubt that this is a solid upgrade and one the entire industry should be excited about supporting.
The aftermarket truly has become a globally reaching industry. How much of your group will be represented by stores or warehouses outside the United States?
While we do have members outside the U.S. and serve some global markets, it has not been a priority focus. Federated exists for the benefit of our membership and while we continue to look at global markets, we have not found sufficient advantages for our current members to pursue this in a major fashion. If our members or supplier partners see a benefit in increasing the focus outside North America, we will respond to their direction and increase the effort on their behalf.
How can eCommerce be used as a strategic benefit to program groups?
Wow, in so many ways! eCommerce provides our members with many benefits such as an efficient means of communicating with customers, suppliers and each other. It provides information that streamlines customer relationships in a variety of areas. It allows our customers to improve vehicle maintenance and repair procedures and helps simplify the communication of information, such as catalog data, interchanges and specifications. Also, eCommerce provides data to enhance inventory planning, analyze sales trends and identify additional sales and direct marketing opportunities to move excess inventory. In short, eCommerce allows groups like Federated to support all constituents, efficiently and effectively communicating and transacting business through collaboration.
What particular attributes about your group give you a leg up over the competition?
We believe the strength of our group is in the collaborative sharing of ideas, insights and innovations. Federated members are selfless in their approach to helping the sum of the total be as strong as possible. This may be in sharing processes, ideas or experiences in the market. This can be areas where cost and inventory efficiencies are leveraged. One example is our member-owned Co-Man warehouse that receives tremendous support from all members and a large number of suppliers. Another is eCommerce activities, including our in-house electronic catalog and enhanced supply chain program that allow sharing of the highest-quality information. Collaboration also occurs with the Federated Car Care program where members share ideas, approaches and improvement initiatives. Whatever the area, our members are willing to work together for the common good of all. Individual member success is contingent today on group collaboration and our members are dedicated to this process.
How does your group get the right mix of parts on the shelf?
We believe that inventory management is a combination of focus and execution. Members need as much information as possible on vehicle population, replacement rates, proper pricing, brands, quality levels, national and regional sales and a host of other input. This information is then applied to local markets where individual expertise on area demand and customer needs are added together with supplier input and other distilled data sets so that inventory can be tailored for each market. It is definitely not an exact science, but there is more information available today than ever before, providing insight and support for managing hundreds of thousands of items on a daily basis.
Do program groups look different today than they did, say 10 years ago? If so, how?
First of all, there are fewer groups and that is a significant change. Those that have survived have found new ways to add value for their membership. Certainly the past 10 years has provided an opportunity to address new challenges such as exploding inventory proliferation, new retail competitors, consolidation of customers, national accounts, eCommerce and data needs. Other issues include new efficiency methods such as bar coding, direct import and working capital challenges. Tools have been developed to help us address some of these challenges, and programs such as our Co-Man warehouse and data sharing initiatives have accelerated in importance. Program groups are much more involved today with associations like the Auto Care Association and AWDA. These organizations work on our members’ behalf to address such issues as evolving technology and the impact of government policies concerning our industry. The bottom line is that program groups like Federated exist today to help members leverage their collective strength in many areas that were not as significant 10 years ago. If we do our job correctly, there will be many new areas to explore 10 years from now.