SEMA News—July 2012
By Chad Simon
A Profitable Partnership
Restylers and Dealers Create a One-Stop Shop for Consumers to Purchase Specialty-Equipment Parts and Accessories
With three retail locations in North Carolina, Truckers Toy Store isn’t 100% dependent on dealerships, making its business better able to carry on when new-car sales slow down.
This seems to indicate a resumption of the longstanding, mutually beneficial business partnership between parts manufacturers, restylers and car dealerships, which had stalled during the recession. That said, there are some differences in the way some restylers do business since the recession, and long-term challenges remain.
Getting in at the Dealer Level
Partnering with car dealers to sell accessories has long been a profitable tactic for restylers, adding sales to their bottom lines and helping to get a foot in the door with new customers, said Ginger Glover, president of Truckers Toy Store based in Morehead City, North Carolina. The question is, how best to do it, and how much is healthy?
“I’m not 100% dependent on dealerships,” Glover said. “It’s nice to have, but for me to build my business solely around their needs—I have no intention of doing that. As with what happened in 2008, lots of folks had their heads handed to them.”
It’s well known that accessorization is an added benefit that helps to sell cars. (See “SEMA Accessorization Study 2010,” available online). Even if dealers have a car that’s not a strong seller, showcasing it on the floor decked out with a brand-new wheel and tire package or the latest technological enhancements might catch the eye of 10 or 15 more potential customers. This increases their chances of getting that elusive sale, and the tactic is an additional point of purchase for parts manufacturers and dealers.
After a vehicle is sold, Glover sends an employee to the dealership, picks up the vehicle, fully dresses it and brings it back to the dealership so the salespeople aren’t off the floor.
“That’s important to them, because they have to leave the floor to take the vehicle to your facility,” Glover said. “They can’t sell anything if they’re off the floor. They may miss the chance to sell that big deal.”
To get involved at the dealer level, Glover suggested building a rapport with the dealership’s general manager and letting the salespeople know you’re there and what you can do for them.
“I liken it to a fishing expedition,” she explained. “You can throw your line in the water, but if you don’t work it, you’re not going to catch anything. Offer up ideas, let them know what you have available and how quickly you can get it and turn it around.”
Help dealerships differentiate themselves by providing products and services not available from the factory.
“We offer an ‘à la carte’ type of arrangement,” Hinton said. “If a dealer needs leather to help sell a vehicle, we can provide that. We also help dealerships move cars by differentiating them. For instance, some cars might come from the factory with two or three interior color choices. We can create two-tone packages with logos and things they just can’t do from the factory.”
Working with dealerships is a completely different business from retail, Hinton explained, so it’s important for restylers to make a commitment and put forth the effort, especially on the sales side, because it doesn’t come automatically.
Another wholesale-to-dealer installer and restyler, Auto Trim Restyling, based in Manchester, Missouri, doesn’t have a retail store, so arranging for specialty-equipment parts to be sold at the dealer level is how it does business.
“I go to market at the dealership,” said Kevin McGowan, the company’s president and self-proclaimed “Ambassador of Aftermarket.” “It’s imperative I have great support from SEMA, the Professional Restylers Organization (PRO) council and product manufacturers to help facilitate sales from the general public through the dealer.”
Current trends tend to vary by customer and vehicle type, but recurring themes for trucks include lifts, rims and tires, followed by leather interiors and chrome packages, according to Glover.
For Hinton, next to leather, the big sellers are sunroofs, mobile video
and navigation systems. He said that it’s important for customers to
have a comfort level with the installation so that they know they’re not
going to get anything inferior to what they would have had from the
factory. Therefore, Hinton will not install any part that doesn’t meet
or exceed factory specs
Trucks have long been a staple of the accessorization market, and one might assume that truck sales would decline with today’s volatile fuel prices, but that hasn’t been the case, according to Alan Farb, editor of Restyling magazine. True, small cars are selling at a higher rate than they have in a long time due to their fuel efficiency, but there is still pent-up demand for trucks. New-truck shoppers are buying grilles and grille guards, tonneaus, truck caps, toolboxes, racks, bed liners, towing systems and running boards.
Also, pinstriping is on the rebound, since most cars from the factory don’t offer it and because it’s an easy sell and doesn’t take much to make the vehicle “pop,” Farb said. Restylers can take a $7 roll of pinstriping material and wind up with $100 in net profit.
Wheels and tires are still huge sellers, which is something restylers should take advantage of. “Tire dealers sell a high volume of wheels because somebody comes in with a slick car looking for tires and they see a great wheel display,” Farb said.
According to McGowan, information technology is also highly popular in today’s market, especially with the younger generation, though it’s difficult to gauge specific sales in each market because there are so many different types of consumers. However, the more products available to the end consumer, the more they will help dealers sell the car.
“For cost reasons, OEMs can’t design a car with a remote start via an Android or an iPhone, whereas we can go to the dealer, help them put something together and promote it, which might help them sell a car to customers who didn’t know this option was available to them,” McGowan said. “The OEM can’t put a $500 or $600 part on every car; it’s unrealistic for them to spend that kind of money.”
How to Promote Accessorization
One promotion by Auto Trim Restyling featured Vaughn Gittin Jr. drifting at the St. Louis Auto Show.
When working with dealers, you’ve got to sell yourself. Glover regularly meets one-on-one with her dealers, supplies them with catalogs that contain examples of the different parts that are available and explains why they need to get involved with the aftermarket.
To read the complete story, featured in the July 2012 issue of SEMA News, visit www.sema.org/sema-news/2012/07/a-profitable-partnership.