FOR those of us who live near the Atlantic Ocean or the Gulf of Mexico, it's just a matter of time before we feel the wrath of a hurricane. Other parts of the country risk the devastation of tornadoes. Violent storms are part of the overall scheme of things. They occur naturally — and in certain areas, inevitably.
When these storms occur, we don't have a whole lot of options. The most common choice facing us: attempt to flee or ride it out. Some storms just can't be dodged, and we do what we can to seek shelter and hope for the best.
To a great degree, the same holds true in business. In a sense, that's where we as an industry are right now — we've been hit hard, but at least the storm has passed. We are slowly emerging from our shelters, assessing the damage and figuring out what we need to do to fully recover.
Based on what you have told us over the years and (most recently) in a survey that Trailer/Body Builders conducted during September, for many companies, parts sales provided shelter during this past storm. They seem to be more consistent in good times and bad. The aftermarket isn't enjoying the double-digit growth in new equipment sales that many in the industry appear to be experiencing. Yet they provided an anchor when new equipment sales were being battered in the downturn.
It's our hope that the parts department survey we conducted recently will provide a helpful tool as you evaluate the landscape. The survey was designed not only to help assess the damage that this economic storm inflicted, but also to generate an idea or two for moving forward. It asks a lot of questions about what has been going on the past two years — one a year of devastation for our industry, and the current one shaping up to be a year of recovery.
Surprisingly, however, 2010 may not be a strong year for industry parts departments. The storm may have passed, but many of us still hear the thunder in the distance and feel some headwinds still blowing. This is showing up in a number of areas — primarily in personnel. No one wants to bring additional employees into the company without being confident that the new hires will have a long-term future. Our survey indicates that there are slightly fewer people employed in industry parts departments today than there were a year ago. The earnings cuts that some companies were forced to implement last year have not yet been fully restored. Economists tell us that employment is a lagging economic indicator, and that seems to be the case in parts departments.
It's time once again for other segments of the industry to shine. New trailer sales are up by double digits in 2010. So are new truck sales. That's not the case with parts sales. Our survey results show parts sales will be relatively flat this year. But that's not necessarily a bad thing, because that same department also held steady at the height of the storm. When the recession hit, our companies were rocked. But parts departments continued to roll.
A trailer dealer reminded us recently how important it is for his dealership to have balance, to be strong in every facet of the business so that one can offset declines elsewhere. He credited his parts and service departments for providing a vital revenue stream when new trailer sales were slumping the past two years.
Speaking of giving credit, we would like to recognize the 240 people who took the time to respond to our survey. Because of how the survey was conducted (an online questionnaire that kept individual respondents anonymous) we don't know who you are, but we thank you nonetheless.
For Trailer/Body Builders to provide information that's of value to you, it's vital that we stay in close touch with our readers. We have tried several approaches for getting input from our readers, including direct mail and telephone surveys. This time we partnered with the market researchers in our corporate office to develop the online survey that provided the report that begins on Page 26. Professionals who work with a number of different industries, they told us to expect approximately 100 responses given the number of people we would ask to participate in the survey. They were pleasantly stunned by the rate at which you participated.
Meanwhile, please feel free to give us your thoughts on the results and the conclusions we reached. We were glad to hear from you last month as we conducted the survey. We will be glad to hear from you now.
Agree or disagree? Make your voice heard by visiting trailer-bodybuilders.com and clicking on “Contact Us.”