REVIEWS - AUTOMOTIVE AFTERMARKET
GAP 1999 PURCHASING & DISTRIBUTION CRITERIA IN THE GLOBAL AFTERMARKET
Diagonal Reports Global Aftermarket Panel (1999) interviewed 170 marketing channel experts representing more than 30,000 outlets, and 60 million service visits in 18 countries.
GAP 1999 reviewed industry parts/services demand, and company/brand performance. In the fast-changing global aftermarket parts purchasing critera and distribution are increasingly hard to disentange. Here are some of the most important issues...
Parts Purchasing Criteria
Purchasing decisions in most of the aftermarket (service and distribution) are increasingly centralised, due to consolidation. The quality/ price mix is the leading purchasing criterion in every market, irrespective of outlet type.
Independents tend to be somewhat more price-conscious than tied outlets, but it is never a case of "price at any cost." Price consciousness heightens during a recession, particularly for high volume parts. However, even in the most cost-conscious markets (e.g. Egypt) quality over-rides price for safety-related parts, such as brakes.
Service
Service can be decisive in a market where brand differentiation, in terms of quality and price, is thought to be minimal. The two main service issues are the availability of parts and replacement policies.
Reliable and speedy availablity of parts. Generally "as-needed" delivery, is essential due to pressure on inventory and space. Efficient use of space will continue to be important due to parts proliferation. In South Africa theft, rather than space considerations, forces most outlets to keep stock to the minimum.
Replacement policies for defective parts are critical. Current policies by some manufacturers give rise to disgruntlement. In India outlets complain that defective parts are not replaced and about the lack of a distribution service. In China manufacturers demand cash and outlets resent the lack of credit. Some continue to buy brands only due to consumer demand.
Distributors
Distributors are the key to the independent sector. Service outlets change brands only when their distributor changes. In Japan, some service outlets simply order a part allowing their distributor to make the brand selection.
Vol. 2.No. 10. MCMXCIX Copyright © 1999 1999 Diagonal Reports Ltd
