Archive | October, 2012

CAT retail lives: Revolution Motorstore

CAT retail lives: Revolution Motorstore

Revolution Motorstore

Revolution Motorstore

This year marks the 15th anniversary for performance specialist Revolution Motorstore. The outfit won our Retailer of the Year Award in 2010, but in truth it’s a mix of heady Halfords parts and busy tuning shop.

Last September Revolution lost the ability to take orders on its old website when the company which provided it went into administration. There’s a spanking new site now, developed locally, and despite the pause in e-sales, and an overall decline in the performance market, the husband and wife team of Glenn and Lisa Campbell have thrived.

Adapting to new markets, new customers and new demands means turnover increased 8.5 percent last year and is up 11 percent so far in 2012.

In it’s first day online the new site took double the amount of orders that the old site would do, and Glenn says Revolution is also getting ten to 15 enquiries through its Facebook page which now has 6500 likes.

“The old site was very black, very dark with white text,” says Glenn. “Now it’s white, clear easier on the eye. It’s got a lot of dropdowns and is really easy to get around. It’s fantastic now.

“We’ve lost some day-to-day customers. It was last September that the checkout ended. The website was all there, but you couldn’t press the buy button.

The workshop is busy too

The workshop is busy too

“It’s amazing how many loyal customers we’ve kept from the old site, though.”

Developed at the cost of £50,000, the site is as slick as the store and gives visitors numerous ways to search the tens of thousands of parts online. This online range will double by the end of the year as braking, tyres, exhaust and suspension is added to the mix.

At the moment Glenn says about 40 percent of sales are online but that this will shift to 60 percent in the next couple of years, perhaps more. As well as revolution247.com, Glenn has registered a host of other domain names, like justsubaru.com, to catch specific customers and offer them a narrowed down range.

Japanese brands have done brisk trade for Glenn in the past, and he’s hoping to drum up some more exposure for Revolution with a heavily modified 1100kg, 500bhp Subaru that the firm has been building. The aim is to beat the 7:55 Nordschleife Subaru lap record, currently held by Tommi Mäkinen, on October 6.

“I do a lot of track days and take customers out on flying laps, but this is a bit serious so we’ve hired Charlie Kaufman, a GT3 driver. He’s done about 30,000 laps of the Nurburgring.

The retail front is clean and orderly

The retail front is clean and orderly

“If we break the lap record we’ll build ten of the cars, all with numbered plaques.

“It will be £40,000 plus the donor car which are going for between £6000 and £10,000. It’s pretty amazing, we’ve got to smash it.

“People are sticking with French, but a lot of Japanese drivers have moved over to Germany with the better build quality.

“There’s a huge scene in German marques, it’s massive, the biggest growth we’ve seen on the last 12 months – Audi RS4, Golfs, E46 BMWs.

“They’re very switched on, it only ever seems to be real modifications. They won’t do sticky-on bits, only exhausts, manifolds, high-flow cats, camshaft work. I’m very impressed by the level of detail they expect from us.

“It needs to have a friendly feel. You might walk into a shop for a TV and pay £499, job done, but there’s got to be more than that with us, there’s got to be a reason to come back.

“We’re also looking to expand – more workshop space would be fantastic. We’re looking to get more servicing products which has a cracking margin.

Glenn Campbell

Glenn Campbell

“That’s probably part of the business we develop more – general workshop services. That’s probably a weakness of the business. We should get the calls for servicing work in the first place rather than chase it.

“If we get that workshop we can release a bit of space in the shop, put in a nice little café upstairs. We’ve already got a breakfast bar by the windows so you can watch the workshop and a little waiting area, with tv, magazines, free coffee and so on, but you could do that little bit extra couldn’t you?”

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Eurozone fallout – will it affect your business?

Has your business taken adequate steps to protect it from any future eurozone currency changes, considers Stephen Sidkin.

For many, the question on their lips is which country will be the first to exit the eurozone.

Whether an existing eurozone member jumps or is pushed is irrelevant. The consequences for many businesses are likely to be severe. This is particularly so because there is no English or EU law which addresses the legal effect of a change of currency resulting from a eurozone exit. This stands in stark contrast to the situation in certain US states that have such laws.

Take, for example, a British company selling into the Italian market. What will happen if Italy leaves the eurozone and the new lira emerges as the Italian national currency? For some businesses there will be a formal agreement providing for it to be governed by English law and for the English courts to determine disputes. However, even if this is the case does the agreement provide that payment can only be made in sterling or euros, or is it written in such a way that the Italian buyer might try and pay in new lira?

Does the agreement include a force majeure clause? If so, is the clause written in such a way as would enable the Italian buyer to claim that exiting from the eurozone is an event of force majeure allowing it to claim that it is no longer required to perform the agreement? Where, however, there is no formal agreement – good luck!
The converse is also the case where a British buyer is purchasing goods from a business located in, say, Greece, another prospective exitee from the eurozone. The possibility of being able to pay in heavily devalued new drachma may be a very attractive option. But will the British buyer be able to take advantage of it?

In view of this, where you are selling to businesses in countries that may exit the eurozone the steps that you should be taking now are as follows:

Existing agreements

Firstly look at the provisions in your contracts that deal with currency and payment. Run some scenarios to test if these provisions work in your favour. If they do not, seek to accelerate performance of the contract so as to reduce or limit your risk. Do your existing agreements provide for force majeure? If so, what would be the results if the buyer should be in a country that exits the eurozone? Do you use a credit insurer? How robustly does your agreement with it deal with the buyer being in an exiting country? Does the credit insurer have a way out if a prospective exitee exits? Lastly, do you rely on a third party guarantee of your buyer’s obligations? If so, consider how all of these issues may apply to the guarantor.

New agreements

‘Forewarned is forearmed’ so in respect of agreements which you will enter into during the course of 2012, you should ensure that the agreement is expressed to be governed by English law and that the English courts will determine any disputes between the parties. As the seller, a failure to do so is likely to leave you exposed.

Consider issues such as what is to be the currency of payment? How are you going to be paid? You should also ensure that the contract provides for payment in an exact currency, for example, sterling. To include a provision where payment is to be made ‘in the currency of the Republic of Portugal’ is only likely to result in very severe problems.

Will you require the buyer to put in place a letter of credit? If so, ensure that the letter of credit is confirmed by the nominated bank; this may help avoid the problem where the bank issuing the letter of credit is in an exiting country. It is equally important that the letter of credit is stated to be irrevocable. This will avoid the issuing bank revoking it and you losing out.

Where you are trading with businesses in countries that may be about to exit the eurozone the above steps should be taken; they should help you find the best way to ensure that a eurozone exit is a grey cloud which may actually have a silver lining.

In some ways, the problems caused for businesses by the eurozone crisis have been a long time in coming. For those companies trading with businesses in likely exitees from the eurozone, the widely publicized problems may be about to come to a head.

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What you see isn’t always what you get

What you see isn’t always what you get

What you see isn't always what you get

What you see isn't always what you get

What you see isn’t always what you get and two suppliers are making just that point with battery and oil labeling.

Ken Clark of Rozone and Adrian Hill of Morris Lubricants have both been out in the market testing batteries and oils and say too many products don’t stack up.

Factors, garages and retailers could all be in line for headaches if they supply or use batteries and oils which don’t perform as they should, they say.

Warranties are being rejected and the potential for significant damages to delicate engines from using substandard oils could result in bills of £1200 and up.

Morris’ Hill said: “The biggest issue of recent years with low emission engine hardware is that the lubricants have become more of a critical fit. DPFs, and other after treatments, are very sensitive to the oil going in.

“An incorrect lube can cause physical damage to parts, which concerns us.

“We’re finding more and more now where what’s on the label and what’s in the can are sometimes two very different things.

“We’ve done a bit of a round robin, gone to shops on the high street and car service centres, and had them independently tested in a German laboratory.

“It wasn’t everybody, but there are one or two out there putting product out that isn’t what it says it is.

“It does irritate us quite intensely, because we put a lot of research, development and care into what we do. It costs a lot of money to do this properly.

“It’s a bit like the Chinese company making a copy version of the BMW 3 Series, saying its exactly the same as the original but cheaper. A lot of these products are just too good to be true.”

Without the ability to test lubricants yourself you have to go by what’s on the label, something Rozone’s Ken Clark says companies are also doing with batteries: “Users generally go by labels. In reality some of these batteries never get anywhere near the specification. Either they are mislabeled or they’ve not been produced in the right way.

“We measured batteries through the course of their lifetime, looking at what happens to the battery internally, how the voltage differs and how long the battery might last.

“In CV it’s a big problem because you’re looking at bigger batteries that are used a lot more than in an automotive application.

“If the label says it can meet a specification, the battery needs to at least meet that – a reputable battery will quite often exceed that mark. Some of the less credible brands’ products might be nowhere near what the label says.

“By the time garages realise, they could have already invalidated the warranty so the supplier won’t honour it. The industry is losing a hell of a lot of money in battery costs.”

While there’s not the same potential damage to parts as with substandard fluids, Clark says one fast fit company he works with has had warranty rejections costing £160,000 per year, while one vehicle manufactuer is losing £400,00 a year.

Also unlike lubricants, however, it’s easy to test the performance of a battery with a simple twin output diagnostic and charger set up which can cost from as little as around £2000, says Clark.

“In a commercial setup there is very little time and cost involved. A full service test takes 90 seconds, so if you check the batteries every time a vehicle comes in you can help to make the unit last at least another year.

“Some might say a battery is maintenance free battery, but most of us know that if you don’t look after a battery it fails prematurely.”

People say the charging of batteries is dangerous and it takes too long, but with modern systems it’s so simple to look after. The analogy that we use is that a workshop wouldn’t let a flat tyre leave the garage, but they will happily let a flat battery go.”

Clark says half of all vehicles coming into a CV workshop need battery attention but, on average, it takes an average recondition and charge of an hour to put it right. Left untreated it will damage the unit and lead to those failed warranty claims.

All good for batteries, then, but what about lubricants? How can the market be sure of the quality of oil it’s using? Hill says the UK Lubricants Association is on the case with a testing and approval process, a kind of E-mark for oil.

“We our pioneering one as we speak. We are looking at what we can do in order to get our own version because we are not policed as well by trading standards as we are like other markets like pharmaceuticals.

“We’re trying to find a mark of quality which would make the competition fair. We want a structured framework, put that together and then get Trading Standards involved to give it some legal teeth so people can’t flaunt it.”

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Industry needs to raise its game, says Mazza

Industry needs to raise its game, says Mazza

Mazza says the industry needs to raise its game

Mazza says the industry needs to raise its game

Jim Mazza has challenged the aftermarket to raise its game for the future.

The Groupauto Managing Director says the industry needs to react to the conditions it is currently facing.

Mazza says that the growing threat from VMs and franchises, rather than galvanizing businesses into action, seems to have dulled the wits of the independent sector: “Although it’s clear that the vehicle manufacturers are no longer content to sell cars and accept that they’ll lose the aftersales business to the independent aftermarket, but are intent on ensuring that they keep a large slice of the business for themselves, how is the independent sector responding?”

The GAU leader also pointed to research showing that many factors are pointing workshops to franchised dealers for parts that are freely available to the independent sector.

Mazza says that when ten factors were contacted with a list of parts, all suggested that three or four of the items on the list were only available from a dealer.

“Although this may not be a totally new phenomenon and the products weren’t the most everyday of items, it is at best foolish to suggest that a potential customer source their products from a competitor, but when that competitor is intent in putting you out of business, this attitude is simply suicidal,” he said.

Mazza ended by saying that whether a factor is a member of Groupauto or not, the entire industry needs to raise its game to survive the current climate.

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Webasto donates heater to Help for Heroes

Webasto donates heater to Help for Heroes

Webasto has donated one of its heating units to the Help for Heroes charity.

The Air Top Evo 3900 will be fitted into a specially adapted minibus which is used to transport recovering patients at the Defence Medical Rehabilitation Centre in Headley Court.

With the minibus being used at such a critical stage in patient care the minibus needs to provide fast and consistent warmth, even in the midst of a British winter. That’s why Webasto has stepped in.

The company says its Air Top range of heaters heat the vehicle quickly, efficiently and uniformly because of their unique design. Air is heated independently from the engine so hot air can be provided fast.

The retrofit system used by the company is available for a whole range of minibuses and midibuses.

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JCA Coatings moves Autoparts business to Slough

JCA Coatings moves Autoparts business to Slough

JCA moves Autoparts business to Slough

JCA moves Autoparts business to Slough

JCA Coatings has announced the move of its Autoparts business to Slough from its current location in Reading.

The refinishing products distributor says the move is motivated by the larger and more convenient premises found at the new site, which in turn should help to improve customer service.

Autoparts is the arm of JCA Coatings responsible for supplying vehicle parts to bodyshops when normal repairs aren’t possible.

Managing Director Richard Steer is excited about the move: “In relocating our Autoparts operation to Slough, we’ll be able to improve the high level of service we offer to our customers in the area. The new premises are better equipped to handle our business growth, and having greater access to the M4, M25 and London will enable us to provide a more efficient service to our customers and devote more time to meeting their needs.”

Steer also commented that the Autoparts business has seen significant growth in recent years, prompted by insurers wishing to cut down on key-to-key times with customers.

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EUROPEAN SLUMP BLAMED AS MANUFACTURING STALLS

EUROPEAN SLUMP BLAMED AS MANUFACTURING STALLS

Tough trading for manufacturers

Tough trading for manufacturers

European trading conditions are taking a tough toll on several manufacturers and suppliers.

Ford announced that it will close it’s Genk production facility in Belgium by 2014. Ford also confirmed that its Southampton Transit facility will close alongside a diesel plant in Dagenham. Total job loses stand at more than 5500.

PSA Peugeot Citroën has also been having difficulty and had to secure a €7 billion state guarantee for its finance arm.

Dark times for Europe indeed, and it’s not just VMs that are feeling the pinch. Parts supplier GKN has also issued a profits warning for 2012, blaming the slump in car sales in Europe.

The company’s interim management statement shows that while trading profit is up on the same time last year, expectations for the full year have had to be revised down.

“Macroeconomic conditions have deteriorated in recent weeks,” reads part of the statement, “and some softening in order books is now evident, particularly regarding European automotive and industrial markets.

“The fourth quarter is anticipated to show the usual seasonal improvement, although the softening markets are expected to have some impact on performance.”

Speaking to The Financial Times, analysts at Killik & Co said they expect earnings downgrades of around five percent. Oriel Securities said: “Our initial instinct is that full-year pre-tax profit will comeback to £480m-£490m from £510m.”

There could be light at the end of the tunnel, however, with news that the UK finally came out of its double-dip recession with 1 percent growth between July and September.

There is already evidence of investment in the aftermarket, HgCapital’s support of The Parts Alliance is just one example, so this upturn could prompt the influx of more funds. The service and repair sector could still boom further as new car sales drop.

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UKPA CELEBRATES NEW MEMBER

UKPA CELEBRATES NEW MEMBER

BBC joins UKPA

BBC joins UKPA

Hot off the heels of Motex joining the UKPA last month comes news of another new member.

Lancashire based BBC Superfactors has joined the Parts Alliance bringing six new sites to the group.

Parts Alliance Chairman Steve Fulford said: “We’re delighted that BBC Superfactors has chosen to join the Parts Alliance. They are the leading car parts distributor for the Lancashire region and their addition to the group will further strengthen our coverage and service offering to garages and workshops.”

BBC Managing Director Gary Shulman is similarly pleased: “I was delighted when Steve Fulford gave me the news of the decision.  We now look forward to joining The Parts Alliance and developing key strategic relationships within group.”

The addition of BBC grows the UKPA’s coverage to 145 branches in the UK and Ireland.

More good news for the group came earlier this month with more investment being delivered to Allparts Automotive. The investment came from venture capitalist group HgCapital, the same group which pushed new investment into fellow UKPA member CES a few months ago.

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CAT reaches a Twitter milestone

CAT reaches a Twitter milestone

CAT Magazine has passed a Twitter milestone by reaching 500 followers.

We’re always at the heart of the UK independent automotive aftermarket and we’ve been impressed by how many companies are exploring the opportunities social media can bring.

So if you’re a Twitter-talking business and want to join our growing list of followers, you can find us @CAT_Mag.

We haven’t stopped at Twitter, either. We also recently launched our own Facebook page which is quickly becoming equally popular. You can find that by clicking this link.

With the CAT Awards 2013 fast approaching we’ll be keeping you up to date here on the website, in the magazine and also on social media. Follow, like and stay tuned for all the latest news.

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Fast times at Brooklands

The banking is still a steep climb

The banking is still a steep climb

Motor racing circuits in the UK don’t come much more famous than Brooklands. Built in 1907 as the World’s first purpose built circuit the famous banked oval has seen plenty of action over the years. It still does, and the complex steeped in motoring history regularly finds itself hosting events for both the public and trade. The RMI held one of its many roadshows at Brooklands, for example.

The recent Autumn Motorsport Day gave the perfect opportunity to see the delights of Brooklands up close – whether it be taking a stroll along the famous banking or marveling at some of the gathered metal taking to the track at the adjacent Mercedes Benz World complex.

Lucas Oil's racing monster

Lucas Oil's racing monster

The track has a certain air of nostalgia rarely found at most modern racing circuits. Faded adverts cling grimly on to bare brickwork and olde-worlde signs still keep the spirit of Brooklands’ heydey alive. There was some modern aftermarket presence too, thanks to Lucas Oil showing off its drag racer at the show too.

It’s easy to see why the aftermarket and motorsport at places like Brooklands go so well together. Many companies in our industry have long and illustrious histories to rival Brooklands, and even today many businesses find motorsport an attractive sponsorship opportunity.

So, who fancies the CAT Awards 2014 at Brooklands, then?

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