What your employees and customers aren’t telling you about your technology

July 31, 2015
With the old system, they had a limited ability to capture important information on customer buying patterns. They couldn’t easily spot a sudden decline in friction purchases, for example – a decline that likely meant another jobber had gained that business. They were spending hours each day on price maintenance rather than focusing on building sales.

Is this you?

You’ve been running your parts business on the same software for more than a decade. It paid for itself years ago and still performs the same basic functions it did when you logged in that very first time. You have every reason to feel proud of making a sound technology investment way back when.

What others – including your employees and customers – might not tell you, however, is that this same software could be slowly, inexorably strangling the life out of your business.

I recently spoke with a parts wholesaler who was a “power user” of one of our legacy platforms dating back to the mid-1980s. He admitted that his software had outlived its purpose as long ago as 2002. He finally upgraded to a powerful, modern solution in 2014.  So, what happened during the intervening nine years? “We coasted, and it hurt us,” he said. “I knew I needed to make a change but kept coming up with reasons to wait ‘til next year.”

What this business owner would tell you today is that had he replaced his old software even four years earlier, it already would have paid for itself multiple times through increased efficiency, reduced labor and inventory expenses, and improved customer satisfaction.

“It’s always easy to put off an important decision until next month or next year – especially when it involves a financial investment,” he said. “But the worst thing you can do is convince yourself that indecision doesn’t carry a price of its own. And that price can be very high.”

This business owner saw firsthand what he had been missing simply by observing his employees, who were now “willing to explore new ways to service our customers.”  With the old system, they had a limited ability to capture important information on customer buying patterns. They couldn’t easily spot a sudden decline in friction purchases, for example – a decline that likely meant another jobber had gained that business. They were spending hours each day on price maintenance rather than focusing on building sales. They couldn’t analyze their business performance beyond a few canned reports.

With the new software, however, all of this changed. “I suddenly saw longtime employees who were re-energized and who had confidence that they could attack problems in new, more efficient ways. It was like they had been waiting for me to give them these tools for several years. How do you assign a value to that?”

Bob Dylan wrote, “If you’re not busy being born, you’re busy dying.”  The same seems to be true in the context of operating a parts business. The wholesalers who are most energized and, often, most successful, are the ones who understand that technology is a sales and profit enabler, not a cost center. They are continually looking for ways to harvest additional competitive value from their systems, and when those systems have been maxed out, they carefully select a new system with proven potential to drive their growth for the next several years.  Conversely, there are businesses that continue to rely on an outdated solution simply for the reason that it still turns on every morning.  It’s no wonder that many of these business owners are working harder than ever just to maintain some semblance of the sales and profitability they enjoyed 10 years ago.

Which are you? A business owner committed to aggressive growth and to attracting and retaining high-energy employees who look forward to coming to work each day? The supplier of choice to leading service shops, many of whom appreciate the modern technologies you utilize in supporting their success? Or are you experiencing a steady erosion of your business as shops and other customers move to better-equipped competitors?

If you’re the former, I congratulate you on your willingness to seek continuous improvement through leading edge technologies. If you’re the latter, I urge you to make the investment you’ve been postponing for so long. Haven’t you already paid too high a price?

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