Market Snapshot

SEMA Financial Benchmarking Program: Retail Sales Stay Strong; Trucks/SUVs Remain Largest Segment

Realizing that the industry needs new tools to help companies survive, in January 2009, SEMA launched the monthly SEMA Financial Benchmarking program. More than 6,500 companies have participated to date, giving the automotive aftermarket industry unparalleled access to benchmarks and key performance indicators.

The program accumulates data to let owners and managers view how their company is doing in comparison to others in the industry. Respondents answer simple questions that provide essential information for business management.

Each month, information from responding companies is gathered confidentially and reports of key performance indicators are generated for manufacturers, retailers and distributors. These reports contain exclusive data specific to the automotive aftermarket industry, including year-to-date sales, sales forecasts for the next three months, gross margins, quick ratio (cash on hand), shipping costs, advertising/marketing expense, inventory turns, the percentage of products sourced overseas, the percentage of materials sourced overseas, customer returns, sales per employee and more.

Anyone who participates in the SEMA Financial Benchmarking program receives three five- to six-page reports for free, covering manufacturing, retailing and distributing. The reports are e-mailed a few weeks after each month's questionnaire closes. Everyone else is able to purchase the reports through SEMA for $50 each, two months later.

Highlights from March's SEMA Financial Benchmarking program include:

  • Retail sales remain strong. Through March, 57% of retailers are showing a YTD sales increase over 2010. Eighty-nine percent of retailers are forecasting increased or flat sales for May, June and July. Only 11% are forecasting a sales decrease.
  • Manufacturers are still very optimistic with sales forecasts. Seventy-one percent are forecasting sales to be up for May, June and July 2011 over May, June and July 2010. Of the manufacturers projecting sales to be up, the average forecasted increase remains at 24%, which is where it was in the January report. One year ago, 66% were forecasting sales to be up, and of those, the average forecasted increase was 15%.
  • Inflation is on manufacturers’ minds. “Poor sales” is usually cited as the most important business problem and that continued in March, but “inflation” was No. 2, cited by 20% of manufacturers. In February, “inflation” was No. 2, listed by 18% of manufacturers. It was No. 3 in the January report, listed by 15%.
  • The truck/SUV market segment continues to be the largest segment for sales. This has been consistent since January 2009 for manufacturers, retailers and distributors and bears watching versus gas prices.
  • Retail margins are tight. In March 2010, small retailers (less than $1 million annual sales) reported a 25.3% gross margin. In March 2011, they are reporting a 23.5% gross margin.

April benchmarking surveys are now live:

For more information on the SEMA Financial Benchmarking program, visit: www.SEMA.org/research or HedgesCompany.com/benchmarking.