A Lifetime of Change for Distributors

THE TRUCK EQUIPMENT BUSINESS has been changing rapidly in recent years. Few truck equipment distributors have played a greater role in driving those changes than Walt Thomas.

Thomas, a former president of the National Truck Equipment Association and Scherer Truck Equipment, lost his bout with cancer March 3.

Since buying Scherer more than 30 years ago, he turned a small truck equipment business into a chain of distributor shops, ship-through operations, and truck modification centers. Many of these moves, including the new shop Central States Thermo King opened in Oklahoma City (see Page 58), were reported in Trailer/Body Builders as they developed. Here are a few of the principles we believe Thomas and other successful truck equipment distributors have used to grow and strengthen their businesses:

1. Involvement with local truck dealers. For most truck equipment distributors, the local dealer is still the primary means by which commercial truck bodies and equipment are sold. Thomas and his company worked hard to develop programs that would cement Scherer's relationship with truck dealers while at the same time promote the sale of commercial trucks. “We as distributors need to help dealers sell trucks so that we can sell truck equipment,” Thomas said in a 1989 interview with Trailer/Body Builders. These programs covered the gamut from golf outings and truck clubs to pre-spec'ed truck body and equipment packages. Going the extra mile to work with truck dealers helped establish partnerships that benefited the distributor, the truck dealer, and the end user.

2. A relationship with chassis manufacturers. Understanding the truck manufacturer as well as its dealer network led to arguably the most powerful marketing tool in truck equipment today — the chassis pool. In the early 1980s, Thomas and a few other truck equipment distributors brought the concept of chassis pools to the truck equipment business — a program chassis manufacturers had already implemented with recreational vehicle manufacturers and some specialized manufacturers of commercial truck bodies.

   Working closely with chassis manufacturers helped Scherer branch out in the right market at the right time. For example, the company opened a branch in Auburn Hills, Michigan, just as General Motors was switching production of its one-ton chassis cab from Janesville, Wisconsin. When Ford sold its heavy truck line to Freightliner, Scherer was ready with a facility near the Kentucky Truck Plant to work on the new Super-Duty F-Series that would be built there. And when Ford introduced the F-650 and F-750 chassis, STE Mexico was created to serve as a modification center offering low-volume options that Ford could not economically install on its assembly line near Mexico City.

3. New ways to market. “We have been reaching out to fleets, leasing companies, and railroads,” he said in 1989. “We have been working with OEMs on test marketing programs, all in an effort to develop new ways to deliver the product to the marketplace. It has been hard work, but I'm convinced that there is a direct relationship between the amount of energy, effort, and time you put into your truck equipment business and the amount of penetration you gain.”

4. A willingness to take risks. Each of the locations Scherer and Central States Thermo King built was a major capital investment with no guarantee of success. Sales promotion programs that Scherer conducts are also costly. Sometimes the company paid thousands of dollars on programs for truck dealers — programs that may or may not have produced tangible results right away.

   “You must convince the dealer that your company is worth the extra cost,” Thomas said. “If you can convince him of that, you should be provided with an opportunity to make the sale. Not a guaranty — just an opportunity.”

   Even so, Scherer did not shy away from spending money for potential reward, recognizing that distributors can't grow simply by cutting costs. “Sometimes you have to step up and pet the pony,” he said.

5. An aggressive approach to the market. Chassis pools were a different way to market truck equipment when Thomas and a few other distributors brought them into the truck equipment business in the early 1980s. “The marketing involved in pool programs is contrary to the way most of us in the industry operate,” Thomas said, during the early years of chassis pools. “We are used to having truck dealers call us with work for us to do.” He pointed out that having to pay floorplan costs for trucks that don't move is a powerful motivation for a truck equipment distributor. “You can't wait for the phone to ring,” he said. “You have to be aggressive.”

6. A desire to upgrade the industry. Some successful distributors choose to keep a low profile — and to keep their success stories to themselves. By contrast, Walt Thomas shared freely with Trailer/Body Builders readers his ideas about truck equipment sales, marketing, and management. He also shared his time, serving on advisory councils, the NTEA board of directors, and other organizations. He was willing to give back to the industry that rewarded him well.

   The truck equipment industry will continue to change. But distributors such as Walt Thomas certainly speed the process.