Online parts services - parts.com, partsvoice, worldparts, e

[mbowers]

First there were Worldparts, PartsVoice, and Parts.com. Now we have the as yet unnamed joint venture between ADP & Reynolds, the new mega-purchasing site by GM, Ford, and DaimlerChrysler, and Toyota's entry into Internet parts sales.

On the Web Retailing forum there was a thread covering parts.com, etc. I asked those managers to bring the discussion to the Parts Managers board.

What do you think? Is anybody using these services? Any comments, comparisons, reviews?

[Bob Smith]

Good day...

We're on the ERA system, have GM and Nissan franchises and utilize the One-Touch locator as part of the ERA software. The nice part of the One-Touch service, with regards to GM, is that the locator gives you the option to do a RAPID locate (GM's locator) with the simple command on a/= after One-Touch searched it's own base.

We also employ PartsVoice, as a last resort, to locate items but chances are good that if it's not found on the One-Touch or RAPID systems, it isn't available locally!

Now - the PartsVoice service has a nice little feature that allows you to get leads from the internet action at the PartsVoice website. I signed up for the service about a year or so ago and have had limited success.

It has gotten us into areas that we would never have sold a part in. (i.e., Africa, Iceland, Korea, Saudi Arabia, and of course, just about every state in the union.

So what do I think of it? It's definately another profit center!

I have not as yet looked at the other services to see what's involved but I certainly plan on it.

[Chuck Hartle]

B2B should end up being big some day. Quite honestly, I have never seen so much hype and scambling going on over the quest to be "The Silver Bullett" provider for either B2B (Business to Business) or D2D (Dealer to Dealer) internet sales.

Quite honestly, I feel that the emergence of ADP and ERA coming together for the D2D could have the most significant impact of the all. These two giants control somewhere between 80-85% of the dealer systems in the Country and who better to integrate your current system without having a 'hybrid' hook-on for another product.

As far as Dealer to Dealer business, I feel the solution every parts manager wants to see is an up to date, accurate inventory that will save his parts people time and effort in attempting to locate the parts they need. A system that is updated nightly with dealership inventory, and a purging of dealers who don't update regularly would be the right answer. ADP used to have a great locator system that was updated nightly and was 'by far' the most accurate locator there was once upon a time. Then came PartsVoice, who offered a cheaper solution, yet the information was not a timely. D2D needs to be accurate, up to date, and easy to access and exchange for it to work.

As for B2B business and all the dot.com's scrambling for the ultimate parts utopia, Bob Smith has the right perspective. Look at it as incremental sales. The reality is that it is microns versus electrons. You still have to get the product from point A(the dealer) to point B (the customer). This poses very little problem when it comes to smaller parts that can be shipped UPS.

However, I am waited for someone to answer the million dollar question here, "HOW DO YOU SHIP A QUARTER PANEL OR FENDER VIA THE INTERNET WITHOUT LOSING YOUR SHORTS?" Once you get to common carrier shipments, the price goes sky high and the chances of damage increase tremendously. The easy answer, of course, is don't ship anything like that. But, isn't that alot of what seems to go on backorder that would constitute considerable demand?

Let's get some feedback here.

Chuck Hartle'

[DRG]

In reply to Chuck's statement "I feel the solution every parts manager wants to see is an up to date, accurate inventory that will save his parts people time and effort in attempting to locate the parts they need. A system that is updated nightly with dealership inventory, and a purging of dealers who don't update regularly would be the right answer."

That is the backbone of the parts.com business model. The thing is, they aren't trying to update inventory weekly or even nightly, they will have REAL-TIME inventory. They have filed a patent for their OCTANE software which allows them to do this. This company is in the early stages of existence, but I think they will be a serious force to be reconed with in the future. Real-time information and speed is the key to e-commerce, and parts.com is building their infrastructure to support that. I'm in the process of joining on as a gold dealer right now (the platinum was already taken in my area).


FROM THE MODERATOR: Messages like this come very close to violating the spirit of the board. We want to promote an open discussion of issues affecting dealership parts managers. We do not want participants to use the forums to promote their own products or services.

[This message has been edited by mbowers (edited 04-04-2000).]

[Chuck Hartle]

Hi DRG,

That is wonderful news about the REAL-TIME inventory, if they can pull it off. Two questions that maybe you or someone could answer:

1) With REAL-TIME inventory is this going to mean that the dealer expose his DMS on the internet for you to constantly poll the system for updates? What kind of firewall protection will there be for this, or do they plan to have a dedicated connection to the DMS without the internet involved?

2) Based on the comment you had about "Platinum" and "Gold" dealers, it sounds like this is more of an exclusive type arrangement for selected Dealers willing to pay for it? Can any dealer sign on to Parts.com?

It sounds like Parts.com is more of a B2B solution in e-commerce. What about a D2D solution?

Thanks,

Chuck Hartle'

[David S]

This is directed to Scott G. on the Web Retailing Post.

Scott G.:

You should be working for the distribution network of a manufacturer with beliefs like that. The fact is that the data a manufacturer would collect from parts.com would be almost useless.

1) For proper inventory controls you need to know not only true demand information but also supply information including accurate lead times.Parts.com is still only going to give you a small portion of the total demand picture.

2) As much as the logistics people talk about wanting actual demand data, the fact is the only way they are going to get true actual demand is to tap in to ever dealer DMS system in America collecting sales data off of every invoice. (Wouldnt the consumers interested in privacy love that!)? Even then it would be of limited help since demand on individual part numbers at the retail level is quite erratic, in contrast to the belief of the logistics people that cumulative demand is level and steady.

3) Orders from the manufacturers are placed in large quantity lots. In the best case scenario, there is always going to be a delay between when the order is placed and when received. Currently, these lead times are erratic at best and can be months in length. More and more manufactures provide daily orders. But, even with weekly orders, because of the delay between order and receipt from suppliers the DELAY you refer to is immaterial.

If manufacturers can work with suppliers to measure and define consistent lead times, the demand history from orders placed by dealers (which would reflect actual demand) would be more than sufficient. Therefore, I dont see how parts.com could possible save manufacturers a cent.

David S

[David S]

I starting reading this thread from the Web Retailing portion of this site. The post was titled Anybody been contacted from parts.com. To understand the context of this post you may want to read from that thread first.

Its true through our automotive history that the manufacturers and dealer networks have continued to give away sales and profits to the aftermarket, and thats a shame. But, we have only ourselves to blame.

Because dealers did not recognize the need to change and adapt we have let others eat our $600 billion lunch. In this new era of e-commerce dealers and manufacturers will continue to lose ground only as long as we allow them to.

Looking at the Grey market, small companies found a niche in the automotive market by taking advantage of pricing variations and exchange rates to purchase parts overseas and import them in to the U.S. The customers they found were in fact OEM dealers. Dealers around the country, seeking increased gross profit, purchase these Grey market parts at less than dealer net cost and resold them for an increased profit margin. Now that we dealers have given these Grey market suppliers the start that they needed to grow and prosper, these companies are now starting to go around the dealers and sell directly to our customers. We got them started, we supported them, and now they are starting to cut us out of the market and there is little we can do to stop it now.

Next, the internet.

Now, I do believe the internet is a valid source of marketing. But, I believe the dealers that partner with some of these e-companies will prosper in the short term, but most will suffer in the long term. The next step will be the e-companies marketing the Grey market and aftermarket. In the long run if a dealer is to be successful in the internet arena they will need to build a strong presence on their own or better yet in co-operation with a number of other dealers.

There are 2 different business models that I see as being successful.

Recognize first that for the retail customer the location of the supplier really doesnt matter much. There are many shipping companies that can deliver parts from anywhere to anywhere in a reasonable period of time. The business model for retail that I see with potential is one where several large dealer organizations representing all manufacturers teams together in resources and commitment to provide OEM parts to the general public. I believe in the future there will be a few of these complete OEM sources to chose from.

For the ultimate B2B solution to the body shops and repair shops that is also good for the OEM supplier, the model would have to include an independent company that is dedicated to OEM only. Linking all dealers representing all manufacturers and working in conjunction with DMS systems, Software suppliers to the independents and the insurance industry, a common platform will need to be designed that integrates all systems so that orders can be placed and receipted electronically. As and example. part numbers on an estimate generated at a bodyshop would need to be accepted through the insurance company system and transmitted and accepted by the dealers system to instantly check availability, order parts not stocked and generate a picking ticket and invoice seamlessly. In the B2B solution for our wholesale accounts there are 2 concerns that need to be addressed. 1) Time is money. The sooner the account receives the part the sooner the account can turn their time in to money. The entire dealer network would have to be included to insure prompt delivery of parts throughout the country. 2) The only way a B2B solution for these customers will be successful in the long term is to provide these accounts with a one stop source for all their OEM needs.

Sorry for being so long winded but I wanted to get my thoughts across.

David S.