An interesting thing happened a decade ago when a number of online parts procurement systems hit the market. Even though these products were designed to make ordering more efficient and parts less costly, a large portion of repairers pushed back.
With shops, insurers, MSOs, vendors and OEMS all jockeying for market share, little wonder that anything new involving all these parties would leave many shops wary. When State Farm began requiring its Select Service shops to use the procurement service Parts Trader, a number of repairers spoke out, declaring that more repair decisions were being forced from them and the service performed poorly.
Change doesn’t come easy in this industry. Still, online parts procurement providers have weathered this storm, rolling out upgraded services they believe can help create the best mix of OEM, aftermarket and salvage parts that can be delivered efficiently to shops with notable cost savings.
Could these services be right for your shop?
They certainly have their fans, including some of the most successful shops and MSOs working today. If you haven’t explored the entire procurement market, now is probably a good time to start. With potential advantages like shorter cycle times, better products and lower costs, you might want to get into the game. Here’s what you need to know about these services, along with the steps you should take when deciding which provider(s) to add to your business today.
Know the players
Online parts procurement systems all function essentially the same way. After a shop creates the estimate, it exports a copy to the system (or multiple systems), which then provides a list of available parts, prices and vendors. The shop then either selects the parts it wants (based on price, location and reputation of the vendor, etc.) or signs off on the parts mix created by the system.
The goal of these systems is to streamline the ordering process, eliminating the need to make calls and reduce returns. Many systems allow shops to view parts to ensure accuracy. Others are available around the clock, allowing orders to be made after hours, and some provide other benefits such as tracking.
There are a number of available systems to choose from. Your local shop association and vendors are good places to start to build a full list. The best-known, largest systems include:
CollisionLink – (www.collisionlinkshop.com) Built by OEConnection, CollisionLink is designed to bring more OE parts into shops by matching parts on a repair estimates to discounted or competitively-priced OE parts (thereby making OE parts a more attractive option). CollisionLink matches estimates to “exclusive” parts programs from 13 different manufactures (including GM, Ford, Chrysler, Honda, Toyota, Nissan and Mercedes-Benz). The company also matches parts from every available brand and model.
After an estimate is imported into its system, CollisionLink provides a shop a list of available OE options from preferred vendors the shop selects, along with their prices. The system also displays the price an insurer will pay for a non-OE version. CollisionLink is supported by dealers and is free to shops, along with any training or support.
PartsTrader – (www.partstrader.us.com) Billing itself as the only auto parts market bringing together OEM, aftermarket, remanufactured, specialist and recycled part suppliers, PartsTrader provides options from all these sources “minutes after” it receives the estimate. PartsTrader and OEConnection's CollisionLink have had an integration since 2016 that enables quote requests and orders originating from PartsTrader to be processed in CollisionLink.
OPS (www.OPSTRAX.com) – OPS is designed to allow shops to source, order and track parts with just “one click,” reducing re-keying and data entry. The company promises quick turn-around times and states that it is the only end-to-end solution provider. OPS does business with some of the largest MSOs and parts provider networks in the country.
uParts (www.uParts.com) - One of the newest providers (launched nationally in 2015), uParts creates what it calls the uParts Bundle, the "best mix" of OEM, aftermarket and LKQ parts that are sourced for a particular repair order/estimate.
OE leverage
Twenty years ago, a war raged across the repair industry over the use of aftermarket parts. An influx of cheap aftermarket products, many from Southeast Asia, had shops fuming over quality and the fact that the insurer was pressing them to use these products. Much of this antipathy has dissipated over the years. Part of the reason for that has been efforts by OEs to make their offerings more competitive.
Online parts providers are leveraging this movement. Tapping into special discounts and other promotions is the bread and butter of CollisionLink. GM, in particular, has made a big push for more sales by pairing programs like MyPriceLink, which offers up-to-the-minute pricing (Ford is now part of MyPriceLink) and Bump 2.0, a conquest program aimed at offering steep discounts to “bump” aftermarket parts off a repair order. MyPriceLink and Bump 2.0 both are incorporated in CollisionLink.
Other providers also are concentrating on OE solutions. TraxPod, available through OPS, provides instant notifications on parts available for conquest or incentive pricing with a shop’s preferred suppliers. Manufacturers working with TraxPod include Ford, Hyundai, Infiniti, Lexus and Volkswagen. Auto Parts Bridge (www.autopartsbridge.com) offers price matching for parts from Toyota, Hyundai, Kia and Lexus. It also provides shops with access to all dealer information, including illustrations, VIN-based color-code filtering and exact part identification. Shops additionally can view all clips, fasteners and additional components not listed in many estimating systems to further ensure order accuracy.
Make a move: Five steps to take when selecting an online parts procurement system
While online parts system providers declare that their products offer many of the same features and benefits, there are some important differences. Many of these you won’t encounter until you become familiar with the system. Factors such as the area of the country where you work, size of your operation and the types of vehicles you typically see can have a big impact on what these systems ultimately can provide. Selecting the system(s) that will work best for you takes some time and due diligence. Use the following five steps when making your decision to buy in.
- Decide what outcome you want. Looking to use more OE parts? Cut part costs across the board? Get parts sooner? Build efficiencies with fewer steps? Reduce inaccuracies? You’ll want to know which of these benefits is most important since systems can focus more on certain order aspects. Also consider that you may not want to limit yourself to one system. Many shops, including some of the most successful ones in the country, opt for multiple systems since they want to look at multiple parts solutions.
Mark Newborough, owner of MN Collision in San Francisco, says his shop uses three systems after each proved its value during trial runs. “It can be a little tricky working with multiple part offers, but we like the setup because our estimators learned pretty quickly where they would see the best deals,” he says. “That’s probably not going to be the case with every shop.
Shane Thredgold, an estimator at Valet Auto Body in Draper, Utah, says his shop similarly utilizes three systems. Typically, it uses CollisionLink for most OE parts then turns to TraxPod for Nissan parts and Auto Parts Bridge for Toyotas.
- Take each system for a test drive. CollisionLink and other systems are available free. Regardless of which you opt to investigate, try each out for at least 90 days to get a better sense of what it will provide. Make sure your estimators and parts department are open to change. Being able to fax or phone familiar vendors (which some surveys show nearly half the industry still opts for), might provide comfortable familiarity, but could be cheating your shop out of a significant benefit. Note that some or many of these vendors could still be available through an online system. Also, seek referrals. Ask other shops what system(s) they utilize and why.
- Record results. Monitor results (costs, cycle times, accuracy, etc.) from each system to see how your shop is benefitting and where. Get estimators, parts personnel and management involved since this chore can be onerous and results will show up throughout the shop.
- Work with providers. Have questions or difficulties with a system? Don’t hesitate to contact customer support. As with any software product, these systems can take time to learn to use to their fullest, and sometimes need adjustments. Support personnel can help fix some of these issues. Also, companies that deliver these products usually are in search of customer feedback to guide them when designing upgrades. Your insights can help make a product benefitting your shop even better, which makes your business better.
“We’ve found that they’re glad to hear from us when we’ve had problems,” says Newborough. “I don’t believe we’ve had any issues that took longer than 15 minutes to resolve.”
- Don’t forget the human element. Having systems that can locate and order the parts you want quickly and easily with minimal steps can free your shop from some time-intensive tasks. Even better, they can take over management of this work, freeing up your time to concentrate on customer service and other business areas. This doesn’t mean you should entirely mechanize and depersonalize this work. Maintain the human element.
Regularly touch base with estimators and your parts department to see how a system is working and where improvement could be made. Keep in touch with vendors as well. You may strictly be dealing with each other online, but occasional phone calls and other contact steps may be necessary to complete an order.
Newborough notes, “Collision repair is always going to be a people business. It’s really great that we can automate a lot of our work, but we have to remember that these are our shops, and our customers and partners are our family and friends. We discovered when we started looking into these systems, they were much easier to adopt when we could put a face on them and experience some human interaction. It made a big difference.”
