Sharpening Skills

I had the privilege of being with over 1,400 managers, executives and owners, from over 400 distributor, service, association and supplier companies that recently met for a week at a conference called Heavy Duty Aftermarket Week.

During these tough economic times it is difficult for anyone to justify spending thousands of dollars on a trip, hotel, and lost time from your business, unless there is a big, quick payback.

This was the primary challenge that faced the 50+ staff and volunteer planners for the distributor education program for 2009, the 4th annual HDAW event. The leadership direction was simple: We are taking several hundred small business owners away from their companies for 4 or 5 days. None of them need a vacation; some will be willing to take a break to re-arm their businesses and we need to provide maximum take-away.

The program began with a strong nuts and bolts approach called the HD Aftermarket Forum, presented by MacKay and Co. This included a detailed, but market-specific presentation of the economic factors that directly affect the aftermarket. This was an expert view and explanation of a rough economy and the effect on a measurement called Truckable Economic Activity, or TEA. Current TEA is off last year's pace by 6.6 percent.

The good news was that the recovery in this measurement should begin in the second half of 2009. This translates in to a pick-up in replacement parts sales. MacKay and Co then began to lay out some important information on the increase in the average age of HD vehicles during the past 3 years. From an average age of 7 ½ years in 2000 to the current age of approximately 8 ½ years; low sales of new vehicles are going to drive significant sales and service increases in the aftermarket in the coming years.

As is always stated in this industry, trucks and trailer miles wear parts out, they are replaced individually, or as part of a new vehicle. This environment favors parts and service distributors and independent shops and the future is very optimistic.

This set of data focused on the fact that a sound business strategy for a parts distributor is to enter the service business, or have a close alignment with a service provider for fleet customer needs. Now is the time to start in the service business, particularly in powertrain and other areas that customers and competitors shy away from servicing.

There was an excellent segment on improving profits presented by Dr. Al Bates. Judging from the body language of the audience at the outset, many thought this would be a Ho-Hum session of :"BUY-LOW, SELL-HIGH" and as Bates got in to the meat of his talk, knees became uncrossed, pens and pencils were grabbed and the only conversation in the audience was something like "what did he just say? I missed it when I was writing the last one down". Bates covered a dry topic name with a style that inspired a room full of hardened veterans to take several pages of notes on new/old ideas and best practices. There was an outstanding presentation on managing your customer relations process by Harry Howard. Howard's approach to customer service can be summed up as "treat your customers like they are all new and like you did when you first started in business. Strangers and prospects are always treated better than long standing customers.

It appears to me that the people that attended this conference all felt they had made a very wise and fruitful investment with their time and resources. Comments from all we met and feedback on the evaluations filled out on-site indicate that very high value was provided. That is sometime an elusive result in today's environment.