In our 2020 Midyear Distribution Update in July issue of AMN/Counterman, aftermarket leaders reflect on how their organizations have adapted to the challenging business environment, and look ahead to the second half of 2020.
Here’s our Q&A with David Prater, president of the Automotive Distribution Network:
As the year began, a global pandemic probably wasn’t on your radar. As the pandemic escalated, how did you your organization adapt to the changing business environment?
There’s an old saying, “That which doesn’t kill you makes you stronger,” and I think that definitely applies to the situation we continue to face in 2020. The very first thing we looked at was the health and safety of our employees. We never really had a work-from-home policy in place and so we had to act quickly to implement a plan, create a communications network and establish a reporting structure. I am very proud of how our folks reacted and stepped up and frankly we didn’t miss a beat during that transition. The next thing we looked at were the financials and what we felt needed to take place to ensure survival in a worst-case scenario. We implemented those changes, some of which were honestly painful, but we felt and still feel we did the right things for our employees and the company. In addition to adjusting our budget, we either postponed or canceled all travel and in-person meetings and began using technology to a much higher degree in conducting remote meetings and sales calls.
Has the coronavirus pandemic inspired your organization to make any permanent changes to the way you do business?
Absolutely. Any organization that hasn’t made adjustments and embraced change as part of this is missing an opportunity to grow and increase efficiency, not to mention survive! Video conferencing is definitely part of the “new normal” and we are finding great ways to incorporate this into our meetings as both a time- and money-saving initiative while still maintaining a high degree of personal contact with everyone. We’ve really evaluated what we have done in the past and whether or not those things add value to the customer’s business. One thing I ask our folks every time we meet is, “How does this help us sell auto parts?” We have to be able to answer that very simple question before we invest time and/or money into any project.
As the economy re-opens, how quickly do you think we’ll bounce back to where we were prior to COVID-19?
Frankly, I think we all are pleasantly surprised at how the business has rebounded. It’s no secret the DIY side came back a little quicker than the DIFM side with people staying home and having time and stimulus money to help them perform repairs and maintenance. Now we’re seeing the commercial side gain traction as folks hit the roads again and get back to work. I wouldn’t be surprised to see us in positive territory year-over-year before the end of the third quarter. This business is resilient, and our industry tends to do better in tough economic times as folks hold on to their cars and are willing to spend money to keep them running. In addition, we are very fortunate as a group to have invested in a strong e-commerce platform early on. That’s allowed our members to capitalize on this revenue stream and be fulfillment partners with some of the largest e-commerce players in the game.
How have you worked with your program partners during COVID-19 to assist front-line workers or the communities in which you do business?
We’ve been very aggressive in procuring all the possible PPE we could get our hands on, from masks to gloves to hand sanitizer, and making those available to our members and their employees. We’ve also gotten much more into vehicle protection for our Car Care Centers and ASE customers with seat and steering-wheel covers and vehicle foggers. We feel some of these protections will most likely stay in place for the foreseeable future, and we plan on helping meet those criteria for protecting employees and customers going forward.
How do you feel the pandemic and its effect on the economy will influence the outcome of the presidential, congressional and senatorial races?
That’s a real moving target. It’s always easy to armchair quarterback things like this and unfortunately there are those already doing just that, and we aren’t even through it yet. I think the speed at which the economy rebounds will have the greatest impact on who wins and who loses.
What’s on your organization’s agenda for the second half of the year?
We plan on getting much more aggressive with our marketing strategy for the second half for sure. We purposely delayed spending as everyone navigated the past few months, and now we feel we’re ready to take advantage of the upswing. I am very proud of the IT solutions we provide to our members and customers, and we will build on those to become an even more integral part of their business strategies. Network Academy is our training initiative that has been in the works for about a year. We released this online training tool at the right time and we’ve been able to provide access to both our banner shop customers as well as the general public at no cost as a way to help provide information during the downturn. There are literally thousands of hours of technical training for all levels of expertise as well as product information and sales training for technicians, counter people and sales personnel, much of it in Spanish. The response has really been overwhelming and we will be even more aggressive with our offerings in the second half of this year.
Finally, we’re also getting back behind the Your Car Your Data program put forth by AASA and the Auto Care Association. This is still a monumental issue for our industry, and we want to be a force by participating at the forefront of this movement. We will once again feature the YCYD program as part of our Motorsports program with Clay Millican and NHRA as well as providing materials as part of our banner shop programs, so stay tuned!
Anything you’d like to add?
I want to thank the folks at both the Auto Care Association and AASA for their leadership during these times. They have been at the forefront of providing information and guidance to the industry, and I really feel they have been a lifeline for many of us during the first half of this year. Also, I want to publicly thank our employees, members and customers for their support through these times and into the future. We will come out of this stronger and better-positioned for the next round of changes, and The Network is proud to be helping to keep our members and our industry positioned for success.