End-Users' Concerns Regarding Automotive Parts Distribution

12 September 2000

Frost & Sullivan Research Reveals End-Users' Concerns Regarding Automotive Parts Distribution

    SAN JOSE, Calif.--Sept. 12, 2000--Price and quality were once the major factors affecting automotive parts installers' purchasing decisions.
    However, installers' needs have changed, focusing more on customer service and the supply and distribution capabilities of part suppliers.
    New strategic market research from Frost & Sullivan (www.frost.com), "U.S. Automotive Parts Distributor Selection: Survey," reveals the expectations and perceptions independent parts installers have about customer service. This report also analyzes the supply and distribution capabilities of parts distributors.
    Nearly 700 independent shop owners and managers were asked to rate competitive factors. They assigned letter grades to their current suppliers, including parts departments of new-car dealerships, program distribution groups and auto parts retail chains.
    The key to success for auto parts distributors and suppliers is knowing their customers. Parts suppliers need to have their finger on the pulse of independent installers, but without direct feedback it is hard for these suppliers to know exactly how installers perceive the parts supply industry.
    This report is one of the first to offer insight into 20 competitive variables that suppliers face in the following segments: maintenance service, under-car repair, general repair, engine or transmission overhaul, and engine and transmission replacement.
    "Market participants need to know what their customers think," says Frost & Sullivan analyst Joerg Dittmer. "This report provides that information. By grading market participants on specific factors, they can see where they fall short and need to improve."
    Suppliers and distributors that can live up to installers' expectations are likely to increase their market shares. Although parts quality remains a critical factor for installers, order accuracy was rated number one. Credit terms for returned parts and on-time delivery also played a role in their purchasing decisions.
    Brand variety, total parts on hand and labor warranties were less important, but were nonetheless determinants in the decision-making process.
    "The primary objective of this study is to identify, on both a national and regional basis, those criteria found to be the most important to independent installers when deciding which parts distributors to use," says Dittmer. "It also enables parts manufacturers to evaluate the capabilities of current and potential distributors and distribution channels in meeting installers' needs."
    Companies that participate in this industry include automaker parts centers: American Honda Motor Co. Inc.; BMW of North America Inc.; Chrysler Group (DaimlerChrysler Corp.); Ford Motor Company Customer Service Division; General Motors Service Parts Operations; Mercedes-Benz USA; Nissan North America Inc.; Toyota Motor Sales U.S.A. Inc.; Volkswagen of America Inc. and Volvo Cars of North America.
    Program distribution groups include: All-Pro/Bumper-to-Bumper (Aftermarket Auto Parts Alliance Inc.); Auto Parts Express (Big A); Auto Value Associates (Aftermarket Auto Parts Alliance Inc.); CARQUEST/General Parts Inc.; Federated Auto Parts Distributors; IWDI/Auto Pride (Independent Warehouse Distributors LLC); NAPA/Genuine Parts (National Automotive Parts Association); National PRONTO Association; The Parts Plus Group; RPM Group and Strauss Discount Auto.
    Auto parts retail chains include: Advance Auto Parts/Western Auto; AutoZone Inc.; Bomgaars; Crow-Burlingame Co.; CSK Auto Inc.; Discount Auto Parts; Double Discount Auto Parts; Fisher Auto Parts; General Parts Inc.; Genuine Parts; Hahn Automotive Warehouse Inc.; Hal Art LLD (Trak Auto); MAWDI (Middle Atlantic Warehouse Distributor); Midwest Auto Parts Distributors; O'Reilly Automotive Inc.; Paccar Automotive; The Pep Boys -- Manny, Moe & Jack; Southern Auto Supply; Strafco Inc.; Sun Devil Auto Inc.; U.S. 1 Parts; WorldPac Inc. (Worldwide Parts and Accessories Corporation); and WSR Corp.
    Frost & Sullivan, which is headquartered in San Jose, Calif., is a global leader in international strategic market consulting and training. Frost & Sullivan's industry experts monitor the automotive industry for market trends, market measurements and strategies. This ongoing research is used to complement the Automotive Aftermarket Custom Subscription, which includes studies on the U.S. Automotive Gauge Aftermarket and the North American Shock Absorber and Strut Aftermarket. Executive summaries and interviews are available to the press.