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Shops need good relations with parts providers despite influx of automated ordering systems

Tuesday, January 26, 2016 - 09:00
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Early on in my career as a collision center manager I remember working with my local dealers to get discounts on parts, have them delivered when I needed them and use their expertise to ensure I received the correct part for the model vehicle I was repairing.

I have to tell you things have changed; now there are many options available to shops, some by choice and some not so much. OEConnection® can get shops parts through CollisionLink® using their connections with new car dealers. As advertised, they automate the process with a seamless integration with most estimating systems. This system is very effective in procuring parts and has proven to be virtually error free.

More recently PartsTrader® arrived on the parts scene with their, “your suppliers-your parts-your choice” theme. Some might question the “your choice” statement because State Farm specified that PartsTrader was their system of choice for parts procurement. This system is designed to provide shops a “real-time” competitive marketplace allowing purchasers to select from a variety of parts suppliers.

As reconditioning parts vendors' percentage of parts sales grew, OEMs took notice and began imposing core charges on headlamps and plastic bumpers as well as a variety of other highly competitive parts. Their hopes were that it would keep the parts out of remanufacturers' hands and would reduce their supply. Some enterprising remanufacturers began paying a small amount over the core charge to get the parts. This tactic also saved parts departments the hassle of processing the core for return, OEMs countered by making the core return policy easier.

Then along comes MyPriceLink, General Motors’ foray into a unique part-pricing system aimed at reducing the benefit of purchasing aftermarket parts. This “Bump The Competition” program provides conquest pricing against actual aftermarket pricing. The good thing about this program is a shop will not notice much operational change. GM’s claim is they will be offering real time pricing on collision parts via updates to the estimating platforms.

I am all for automated parts ordering, while parts people have some unique personalities and the phone calls are sometimes enlightening, often the interaction has little to do with ordering parts. So some of these changes are moving in the right direction, by guiding shops to use parts-ordering systems to simplify parts procurement. With MyPriceLink working through CollisionLink, it has augmented that system and not created a new parts-ordering platform. I have seen more and more shops use PartsTrader to order all of their parts. This is a positive change because the program's introduction was met with some negativity.

As all of these different parts-procurement platforms take hold I still believe it is important to maintain relationships with parts providers. Regardless of what platform you use, parts are coming from someone and I encourage that person to be someone in your market. Using a familiar source helps when you have concerns.

When I ran a shop I kept track of all my parts suppliers, and I feel assured they kept track of me. I shared the purchase amounts with them; we shared concerns with deliveries and incorrect parts as well as their ability to meet my needs. Having these sit-down meetings kept us on track and resolved the issues before they could disrupt either business.

All the parts-ordering platforms I have seen require you to create a profile and within that profile, you are able to select vendors. I suggest meeting with the vendors you choose to add to your profile and explain the program to them. Most of the programs require the vendor to enroll in them and some carry a fee. Talking with them beforehand will get their buy-in, so you can continue to be business partners.

Editor’s note: John Shoemaker is a business development manager for BASF North America Automotive Refinish Division with more than 30 years of  experience in the collision repair industry.

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