Outside sales may seem way beyond your parts department’s capabilities, but you have more opportunities than you think.
The largest, most recognizable companies invest big bucks in advertising and outside sales to make sure they remain relevant and profitable. Think Coke – they sell 1.9 billion¹ servings a day – and that’s not just by word-of-mouth. They consistently create strategies to improve sales and further increase brand awareness.
Obviously, most companies are not Coke, but this strategy can apply to Manufacturer auto parts wholesale dealers. In all likelihood, your counter staff is too busy fulfilling orders to think about an outside sales strategy. So, as a parts manager, what can you do to get in the outside sales arena with your Manufacturer auto parts?
Strategies that work
I’ve worked with parts managers across the country and they have shared outside sales tactics that worked well and some that, well, don’t. With this insight, here are three successful sales tactics that have worked for nearly any operation and budget:
1. Share an outside sales rep. This is one of the most common (and cost-effective) tactics for outside sales. Share the expense with other dealerships and spend 1/3 of what it costs for a full-time rep. It also allows single Manufacturer brand dealers to join forces and promote the value of Manufacturer auto parts vs. aftermarket parts to repair shops. But note, this method can come with some challenges:
- A sales rep shared among different Manufacturer-branded dealers means you must go in understanding that you’re sharing dealership representation.
- Their knowledge of your individual manufacturer may not be what you‘re looking for if they’re representing different Manufacturer brands.
- Since their time is split, they may not be able to provide enough education/program exposure to shops and potential customers.
How do you make sure it’s worth your time and money? The key is hiring a sales rep who understands your Manufacturer auto parts brand (including various parts programs) and will focus on your business. Large, multi-franchise dealerships take this approach all the time.
2. Pay on Gross. Have a designated parts department employee who works as an outside sales rep and gets paid commission from the Manufacturer auto parts wholesale business (collision and mechanical). This person should be well-versed on your strategy and understand how Manufacturer programs work. They should also be able to educate shops on how to leverage programs to order Manufacturer auto parts for profitability. The Pay on Gross method is one of the hardest to establish; however, if done well, it’s cost-effective. The outside sales rep makes money as the dealer makes money – creating a win-win for everyone.
3. DIY outside sales. This is the least common approach, but the parts manager can double as outside sales. If that’s you, I bet you know your business better than anyone – and you’re the best equipped to sell your dealership’s Manufacturer auto parts. That said, it can leave the department vulnerable without a parts manager available.
But it’s doable. In fact, one Chevy dealer in Northeast Ohio swears by it. Every Wednesday afternoon, the parts manager calls new and existing customers like clockwork. His winning formula includes the ability to make credit and pricing decisions on the spot. He’s also able to build relationships, assess customer satisfaction, and keep expenses low with this method. Admittedly, it requires organization and a solid team to make this approach work.
Above anything else, your outside sales goal should be to supplement the growth of your Manufacturer auto parts wholesale business, but it shouldn’t be your only goal. Don’t forget about your regular customers or you will easily lose them to a competitor.
Keep it going
I saved the best tip for last, and it’s only one word: Repetition. It may take time to discover what method works best for your Manufacturer auto parts business, but make sure you keep at it once you find it.
¹Source: Coca-Cola Company, 2016.