Parts Trader..Northeast Launch

[Mike Nicholes]

this particular question/observation is what this forum is all about . The ability to get straight answers from those with first hand experience and knowledge; my kudos go out to the question maker and the answer/opinion givers.
Mike Nicholes

[nansorbdarb]

Awesome post! I wish my parts and service director would understand this. Since he has taken over we have had a complete 3rd party bs takeover! Tires, body parts, accessories, lube rack, you name it. The parts department gross profit has just plunged since this take over. But its all good, we don't measure success in GP anymore, we measure it with kickbacks. (sarcasm)

[X476]

Just to add another reason to hate this program, State Farm does not own or control Parts Trade and this system can (and most likley will) be used by other companies. I bet Parts trader is working on that plan

[jdpetey]

Thank you for the kind words Mike.

In my opinion, I believe the whole Parts Trader dilemma will end due to its own miscalculations.

The only product they have to offer is software. They have no skin in the game in regards to capital outlay, except the expense to create this fiasco.

An interesting evaluation, on my part and opinion, would be that their program will die on the vine, when dealers, the ones who are supposed to pay their fees, refuse to willingly participate, therefore not having to pay for the extortion.

The only ones who will end up paying the fees are the large wholesale dealers that actually use the software to sell to these customers under the threat of losing business to smaller entities. And with that in mind, I would suspect some of the larger wholesale outfits will begin to pay dearly for this wonderful arrangement and eventually begin to question themselves as to whether this nuisance program is worth the sacrificing of their own profits trying to keep customers they had already won over.

Whoever instituted, or came up with this idea, has banked on the idea that there would be widespread participation, generating widespread fees.

I, on the other hand, anticipate shortcomings in their evaluation of expected participation. If they can’t collect enough fees, when ‘repairers’ disregard quotes and ‘direct buy’ from their same old, same old suppliers, there won’t be enough fee collection to sustain their operations.

I would also foresee Parts Trader attempting to force repairers to, on occasion, order from different suppliers that they would not normally purchase from, just so Parts Trader could impose the fee on more dealers. BTW, not possible if no one participates.

Kind of like how government works. Look at the failures there. Bureaucrats are constantly counting on what they perceive as ‘static’ information to make calculated, long term, decisions in an ever changing environment with too many unknown variables to accurately predict the actual outcomes.

They always forget, miscalculate, the one variable that they think they’ve figured out, how humans will react to outside forces that are being imposed upon them.

We shall see.

[MultiLineManager]

The only thing with parts trader is that your customer's can not order from you for State Farm jobs if you are not on the program. As a wholesale dealer this was the one thing that pushed me into enrolling. The biggest problem with it is it is way to cumbersome to use. I have seen the repairer and the supplier sides and it adds 3 times as much work as collision link. I do have a feeling that this program is here to stay as the Northeast is the last (I think) part of the country to go live. If it was going away it would have been shut down after the first few pilot programs. If smaller dealers want to minimize the amount of quote requests you can change your settings to different zip codes and the radius from those zip codes. So if you only have one or two shops that are going to use it enter their individual zip code with a 1 mile radius and that will keep all the other unwanted quotes out.

My one question to my shop owners is why does State Farm care so much about how much you pay for OEM parts? They are going to reimburse you list price no matter what you pay. I can see State Farm trying to get a percentage mark up instead of list if the shops are getting a big enough discount.

The one positive of parts trader is it is fairly cheap. $19 a month on the low end and $200 on the high end. It all depends on how much you sell. Also amazingly there is no contract, so if you don't like it you can cancel at any time.

[camaroman]

My first shot at quoting a job was to another GM dealer's body shop. Gotta love it. Would have been a good test to really low ball them and see what would have happened. LOL

[CMayne]

"The one positive of parts trader is it is fairly cheap. $19 a month on the low end and $200 on the high end. It all depends on how much you sell. Also amazingly there is no contract, so if you don't like it you can cancel at any time."

Sorry multiline but I do not see that as a positve. I have NO reason to pay someone else to "sell" my business. I know there are plenty of arguments to the adverse of that statement, IE: Internet cost, advertising cost,etc., but State Farm is not in the parts business and I do not see any advantage to advertising well out of my area. The Bump program has already taken 3% plus out of my wholesale profit and I do not see any reason to expand the issue with customer I do not even know.

[steve@gmdealer]

Perhaps what State Farm should do is to have Dealers responsible for a reasonably sized area rather than quoting parts across the Nation. It would certainly lower dealer expenses and create a bit of order to the entire process. How can you ship parts two states away, prepaid and be profitable? Why do people even consider doing it?

[dave1959]

Why not just play within the rules.....low ball the price to get the sale or at least make life misarable for the other dealers..We only accept cash, no checks, no charges..No returns ( including damage), check you parts before our driver leaves....and oh yea.. We now charge for delivery, An amout equal to the lost gross profit.

[CMayne]

This just in from "Body Shop News" magazine
"Collision Experts, a New York-based MSO, said it will no longer be a part of State Farm’s Select Service program because it wants to have the right to decide where to purchase parts."

I am "guessing" the Northeast launch is not all it cracked up to be.