It’s probably not news to you that your real competition doesn’t come from other tool distributors in your territory. Your real competition comes from national retail chains and the Internet. The question is: What do you do about that?
The big home center stores sell the same cordless power tools you carry on your truck, maybe even the same brands. Most of them are for construction work, but they often sell mechanics’ tools too. Prices are usually lower, and sooner or later most of those tools will be on sale at a price that’s simply impossible to beat.
Retail parts stores are part of your competition too, mostly the big chains with national advertising campaigns. Along with parts, they also sell tires and batteries and lots of accessories like car stereos and steering wheel covers. And tools. The hand tools and diagnostic tools on the shelf are usually aimed at the DIY customer, and your customers wouldn’t have much interest in them.
However some also sell the good stuff, everything from hand tools to top-of-the-line scan tools and oscilloscopes. They may not stock them in the store, but often it can be ordered through a company salesperson at a price or package deal that’s usually better than what you can offer on the truck.
Internet shoppers can compare prices from a number of different sources in just a few minutes. This is an amazingly powerful tool, because even when shoppers decide against buying over the Internet, they come away with a firm price in mind for a particular item.
So how does a professional tool distributor compete against all this?
One obvious tactic is to make sure your customers understand that when they buy from you, they get free credit, a factory warranty and product support from an actual human being who comes to see them regularly. They also get your knowledge of other customers’ experiences with the tools.
I can think of other reasons too, but I’m not out there every day like you are. So you tell me: How do you compete against retail and Internet tool sellers? Send me an email at email@example.com and I’ll share your ideas on this page in a future column.
Customer service equips you to compete with the internet and big-box stores
The argument against discounting prices.
Search for more than automotive repair shops to sell tools.
The 2009 Aftermarket Factbook from the Automotive Aftermarket Industry Association is out, and there are some numbers related to tool-buying decisions you should find interesting.