Heavy-duty aftermarket chain builds on automotive parts model
When it comes to delivering the right part, as soon as it’s needed, aftermarket suppliers serving the heavy-duty equipment industry have lagged behind those serving the automotive and light-duty sectors—but the gap is narrowing thanks to better distribution networks and inventory management technology.
“In the truck parts business, the supply chains are just not as efficient as they are in the auto space. The auto retailers and the auto chains are much further along in their ability to deliver a broad range of products more rapidly,” says FleetPride Chief Merchandising Officer Robert Sammons.
That difference in that capability is a function of scale as well as experience with the distribution model, he explains. And Sammons should know what he’s talking about: His career includes roles at auto-parts giants Pep Boys and AutoZone, where he focused on building the distribution network.
For instance, a typical, neighborhood auto parts store might stock 25,000 products, or SKUs, while the area hub store will carry twice that many, and deliver to other stores three or four times a day.
“You don’t see that much at all in truck parts. The market’s just not quite as developed—but we are working to get there,” says Sammons, whose company is the largest distributor of heavy-duty truck and trailer parts in the United States, with more than 260 locations in 45 states. “That’s been one of FleetPride’s primary focuses, working on the supply chain.”
To close that gap, FleetPride this year has expanded distribution centers in North Haven, CT, Atlanta and Dallas by 95,000 total square feet of capacity.
“We’ve made enormous improvements in our supply chain, and the biggest piece of that is our dedicated fleet. We are now trucking to over half of our branches every single day from our distribution centers,” Sammons says. “This has moved us significantly forward. In many branches, if we don’t have a part available that day, if you order it by 5:00 it’s going to be in that branch the next day from our DC. That is a big, big step in our industry.”
At the customer-facing end of the network, the company continues to add new locations.
Among the most recent is a store in Mount Crawford, VA. Branch Manager Bruce Crantz has lived in the area all his life. He was involved with the branch from the time the site was acquired, and worked with the FleetPride “implementation” specialist each step of the way.
“I’ve been able to see it from day one, from the ground up, the way FleetPride runs these brand new ‘greenfield’ stores,” he says. “There is a method to the madness on who, what, when, where, and why. I questioned a handful for things, but now that I’ve been through the process, it makes sense to me.”
Crantz had nearly 25 years in parts and service with specialty vehicle manufacturer Crane Carrier Co before coming to FleetPride. “I like the parts business—and I’m kind of a weekend gearhead, anyway.”
Mount Crawford, VA is a small town just south of Harrisonburg on I-81, and about 100 miles north Roanoke. FleetPride’s Roanoke branch had serviced the area.
“Obviously, the business is here,” Crantz says. “I think it just got to bigger than what FleetPride had anticipated, especially the national accounts.”
But even locally, there’s demand: The area is home to “a good variety” of trucking companies and private fleets, large and small, according to Crantz. The phone on his desk rings frequently during an interview.
“It’s owner-operators, Walmart, farmers—anybody, really,” he says. “That’s the one big challenge we’ve had here: We’re new, and a lot of people still don’t know we’re here and what’s available through us. There’s nothing that we can’t get our hands on.”
Crantz hopes to add additional help at the parts counter so that he can spend more time calling on people he knows in the community: “from the independent guy that has two, three, four dump trucks and does all of his own service work, to the company that 30-plus trucks and trailers and hauls mail for the government.”
“The majority of the local business, we have not really begun to service. I only have one outside sales guy, so that presents a challenge,” he says. Already, though, his two parts-delivery employees “run constantly,” covering a territory than stretched three hours east into West Virginia.
Indeed, after opening in May, Crantz called the volume of business in June “unbelievable” and July was even better.
“We had an open house at the end of June, and that opened a lot of people’s eyes,” he says. “But to get them to call me instead of the other guy, we have to be out there right off the bat to get them in the habit, to change to call Bruce over at FleetPride.”
Location, location, location
The process for selecting branch locations is based on “the value and the opportunity in the marketplace,” FleetPride’s Sammons explains.
“We look at each market, at where the customers are, where the competitors are, our current branch penetration, and then we stack-rank those based on our criteria and we’ll pick our locations based on that,” he says. “We look for acquisitions in those markets, but if there are no suitable acquisitions, then we’ll look for a greenfield opportunity.
“Every market it is a little bit different, the way the traffic flows and the highways run—these kinds of things are all part of the thinking about where we’ll place a greenfield.”
FleetPride also has very structured method for opening a store.
“Every location has a roadmap, a timeline for each individual task, including post-opening,” Sammons says. “We track every greenfield through its development, from the point that it opens, and then after it opens in terms of customer acquisition and so forth. So we’re absolutely following a plan.”
FleetPride found an existing building for the Mount Crawford store, one used previously to make plastic from chicken feathers, of all things. But the 100’-by-120’ two-story steel facility seems ideal: The showroom and offices are in a front corner of the building, with ample warehousing space in the rear alongside a large shop with two overhead doors, one tall enough for an 18-wheeler.
In walking among the parts racks, Crantz explains the FleetPride “dock-to-stock” process.
“Everything has a bin location on it, and all of the FleetPride stores are organized in the same way. If I go to another location, everything is marked similarly. When you punch up the part number on the computer, you’ll know to go to Aisle C05, Shelf 09.”
At the new location, his inventory is based on the expected needs of FleetPride’s national accounts, and that stock will be adjusted “as time goes on,” Crantz explains. The store initially has a staff of five people, and Crantz expects that to grow.
Indeed, for a long-time parts and service pro, coming onboard with FleetPride has been a straightforward process.
“For the parts side of it, there’s really been no learning curve. It’s just a different way to look parts up in the FleetPride system,” Crantz says. “The biggest issue is trying to navigate the trail of who to talk to for certain things because the organization is so big. Luckily, I’ve been able to lean on the guys at the Roanoke location to help me through all that.”
The parts part
Mark Hartman had been in parts and service for almost 30 years before moving to the parts counter at the Mount Crawford store from a truck dealership.
“At the dealer level, everything’s done off the VIN number. You look everything up by the last six numbers on the VIN,” Hartman says. “Here, you really have to have an idea of what the parts are and figure out how to get to the right part—how to get the number off of a valve and how to cross it over.
“We can do things by measurement, like taking S-cams and measure the length, the splines, the rotation,” he continues. “It can be a little more of the old-school way we used to do it. When I first started in parts, there were no computers.”
Indeed, along with their extensive distribution networks, the other advantage the national auto parts chains have over heavy-duty aftermarket dealers is in their electronic catalog systems, according to FleetPride’s Sammons.
“For that reason, you’ve got to find people with truck parts experience. The learning curve is very, very steep over here,” Sammons says.
But creating a system to provide instant access to the right part across the complex range of truck and trailer brands and products is not a trivial problem.
Still, Sammons hints that FleetPride is developing its own solution.
“We’re focused on technology and what’s going to be required to be effective in the industry over the next 10 years, and that’s really I can say at this point.”
Aftermarket vs. OEM
But as much as they might envy and emulate the distribution model and technology, aftermarket suppliers aren’t really competing with the auto parts chains. They do compete, however, with truck and trailer OEs and their dealer networks that depend on new sales to lead to a long-term—and profitable—service relationship.
“For the auto parts companies, they really divide their business among the DIYers and the do-it-for-me customers,” Sammons explains. “In the truck parts business, you have some of both—but it’s far more weighted toward the folks that are working on fleets.”
In addition to 40 company-owned repair shops, FleetPride provides parts to the FleetCare Truck Service Centers network, 240 independent, heavy-duty maintenance and repair shops around the country.
So how can FleetPride, or any independent, capture some of that proprietary business? In order to compete, FleetPride must provide “an overall better value” to the fleet customer, Sammons suggests.
“We do that through our private branding efforts, through our merchandizing. We’re focused on expanding our assortment of products beyond typical categories like wheel-end, and into categories that have traditionally been OE, or proprietary parts,” he says.
He cites products such as radiators and charge air coolers, and credits FleetPride’s relationship with aftermarket parts supplier Dorman HD Solutions as “a big part” of the growth.
Looking ahead
As far as parts and service trends go, the move toward digitally controlled equipment will provide “tremendous growth opportunities” for aftermarket suppliers, Sammons suggests.
“The diagnostic tools, the information needed to do the diagnostics, and the parts necessary to repair the vehicles—all of these are opportunities,” he says. “You got a few vendors that are starting to make real progress with some of these sensors and aftertreatment components. These are areas we are focused on and will be big growth over the next decade.”
And trailers aren’t an afterthought.
“Certainly trailers are a focus for us, and we want to make more trailer parts available, and closer to customers than they have been in the past—that’s been a focus for FleetPride over the last year,” he adds.
Crantz in Mount Crawford confirms. “We have a very good selection of trailer parts. We’re getting calls every day for trailer stuff, but it’s from existing customers who know that we have it.”
And he also offers a few tips for anyone looking to move from OE parts and service to aftermarket.
“Be patient. Form relationships with other store managers, and lean on those guys until you can figure it out,” Crantz says. “There’s not been one person here that’s hesitated. FleetPride has done exactly what they told me they were going to do, and to let me do.”
