Technology is changing the automotive industry at an astonishing pace, and it’s not just making its mark with new whiz-bang features for consumer pleasure. Technology also is having a massive impact on how automotive businesses operate, helping everyone from auto manufacturers to aftermarket parts suppliers and distributors stand out from the crowd.
Among the technologies an increasing number of aftermarket companies are beginning to use is business intelligence software, which allows them to efficiently capture and analyze data that matters most to their businesses. Below are four ways that data and analytics are helping aftermarket parts suppliers and distributors:
1. Take advantage of customer behavior
Without accessible data, would you be able to tell which customers have stopped buying, given the hundreds of sales and orders that your business processes daily?
While you could rely on sales reps for the intelligence, each of them is likely supporting dozens or more customers. Reps are human, so they may oversee a customer or not make timely contact with all of them.
With the right business intelligence tool, you can find out which of your customers have stopped buying from you over time. Armed with this information, you can decide what is the best course of action.
For example, if a customer’s orders decrease or stop altogether, you can send an account manager or sales rep to meet with the customer, learn more about the current state of their business and their needs, and potentially save the account.
You also can take advantage of customer-behavior data to look for opportunities to cross-sell. For example, you can see which of your customers are buying brake pads, but not brake discs. You can then offer disc brakes to these customers, increasing your sales and strengthening a business relationship.
While you and your sales team may be aware of a few cross-selling opportunities, you’re less likely to miss any when you understand what your customers are buying.
2. Optimize your stock levels
Would you agree that same-day delivery wins customers? Without enough stock in the warehouse, you could potentially disappoint and lose customers, especially if they need the parts quickly to protect their own businesses.
Too much inventory can also be a challenge. If you stock too many parts in the warehouse, you’re at risk of losing capital with write-offs and missed sales opportunities.
So, how do you make sure you stock the right number of oil filters or brake parts or spark plugs? While it’s a complex balancing act, it can be easier when you have access to historical and current business data. Business intelligence software allows you to see how many oil filters you have on hand, and based on past sales volumes, show you when you will run out. Actionable intelligence will make it easier for you to accurately forecast and estimate to optimize your stock levels.
3. Make smart decisions with business visibility
The secret to operating an efficient business is being able to see what’s going on behind the scenes and across your business, so you can make smarter, more profitable decisions.
To gain business visibility, and increase your revenue, you need access to key, up-to-date data. In today’s hypercompetitive marketplace, the only way to do that is aggregating and analyzing data from across your business through a central location such as BI software. The right solution can help you visualize your data in graphs and charts on dashboards to provide a view of key metrics at a glance.
The metrics you choose to focus on can give you visibility across several dimensions, including customers, products, locations, stock, etc. This means you can easily look for opportunities to increase focus on top customers, run promotions with underselling products, and identify deadstock to tighten up inventory. With accessible data you can make more intelligent business moves that will help grow revenues.
For example, if one of your distribution centers received an order for 10,000 shock absorbers, but doesn’t have enough, you can quickly see which of your other locations has the inventory to satisfy your customer’s demand.
4. Increase your sales
Imagine you are selling a lot of fuel valves in New York, but not in Los Angeles. With business intelligence, you can analyze the sales data to identify gaps and gain certain insights such as the reasons why sales are down in Los Angeles. Perhaps your promotions for fuel valves aren’t working or your customers have stopped buying fuel valves from you. Does your L.A.-based sales team even know you sell fuel valves? Or has a key distributor been overlooked? Can you bundle fuel valves with fuel filters to increase the sales in this region? When you are able to answer these questions with your data, then you can generate real business value from business intelligence.
Because of the intense competition in the aftermarket parts world, understanding your business metrics has never been more important for differentiating your company, building strong customer relationships, and protecting and growing your sales.
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