Archive | August, 2015

MANN+HUMMEL TO ACQUIRE AFFINA FILTERS BUSINESS

MANN+HUMMEL TO ACQUIRE AFFINA FILTERS BUSINESS

Ludwigsburg-based filter manufacturer Mann+Hummel has signed a deal to acquire the filtration business of Affina International for an undisclosed sum.

Affina is best known in Europe for its Wix and Filtron brands. Allthough terms of the deal have not been made public, a statement from Mann+Hummel noted that the acquisition will add around US $1bn to its top line as well as enabling the German firm to gain a strong hold on the commercial filters market.

Commenting on the deal, Alfred Weber, President and Chief Executive Officer of Mann+Hummel, said: “This acquisition fits perfectly with our corporate strategy. It will enable us to grow globally and provide ample opportunity for growth and development for all of our people. Mann+Hummel’s and Affinia’s filtration business will serve customers better through a seamless, comprehensive portfolio ranging from passenger to heavy duty and industrial to hydraulic filtration solutions thanks to a combined 150 years of filtration expertise.”

The acquisition includes all of Affina’s markets apart from South Africa. Completion of the deal is subject to regulatory approval.

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How to make sure you get your money

LendingWhilst the general business outlook appears to be on the up with, it appears, only Greece bucking the trend; there are some cautionary tales that should be borne in mind.
Rather than just wanting to rain on your parade by suggesting that all is doom, gloom and despondency (far from it) I suggest that you ride the current business thermals. You just need to use your innate good judgement and watch the signs.
It is a proven fact that businesses that have stayed afloat during recession often fail in the post recessionary climate. Why? Surviving the downturn is a case of battening down the hatches, keeping business tight and riding out the storm but the period following the storm calls for cash. Surprisingly businesses that fail during this period rarely go down for a lack of profit but are crippled by lack of cash flow.
The danger for businesses such as a motor factor, is that being one step removed from the car-repair coalface you will take the full force of an account failure caused by a garage running into trouble.
Certainly the composite detail on motor factors suggests that both debtor and creditor days are extending significantly and that sets the alarm bells ringing. The difficulty with agglomerated information is that you can see trends… but is this a general trend or another Finelist in the making?

Extending credit

One way for a garage business to extend its credit line a little further is to drop one factor in favour of their competitor. The breathing space thus created rarely, if ever, cures the ills that the garage is suffering, usually badly taken business decisions and imbalance of funding, and so the merry-go-round will continue.
The danger that stems from all of the above is that the parts distributor can be so locked-in that they in turn cannot get out – the problem is how to avoid getting drawn in in the first place. In a business all aspects need to be policed. Within my own businesses we never sent reminder letters, as they just go in the bin. A senior member of staff, most importantly always the same member of staff (reducing the likelihood of being fobbed-off) always phoned immediately the account went outside terms and asked the pertinent questions: When can we collect payment – at this point this is not a demand but a polite ‘It’s that time of the month again….’ Just as you will pay attention to a customer who ‘makes the most noise’ your customers will pay those who ask first.
Just as with any other form of relationship there is a need for honesty and, surprisingly, people do business best with people that they can talk to. Just as important as gathering business information on a would-be customer is the need to explain clearly your trading terms – I have used standard terms for all customers with volume discounts, loyalty bonuses and other incentives dependent on the account being kept clean i.e. within the terms agreed. There is no advantage to you in offering the best terms and then not getting paid.

On the rails

The objective is to keep your customer, the garage, on the rails rather than let them turn into a runaway-train. Let me make absolutely clear, you do not want to lose a customer, any customer, and the best way of achieving this is by keeping the relationship honest. Your terms and conditions of business need to be made clear and concise and remember that ‘all goods remain the property of the company until paid for’ isn’t worth a candle when the motorist has paid the garage for them and they now form a fundamental part of his vehicle.
I was doing some work for a wholesaler a short time ago who was lamenting having to pay a claim on a part he hadn’t yet been paid for. We reviewed and reworded their terms and conditions of business to include elements of accepted Service Level including warranty and withheld payments – as warranty is accepted on goods purchased and this does not take effect until, guess what, – they’ve been paid for.
I’ve heard all the excuses; the accountant’s on holiday, the chequebook has run out, the cat’s been run over and of course I’ll love you in the morning; yada, yada, yada… You are a business not a bank, if you were a bank, I’d be a lot less polite to you (I hate banks) as a business you are involved in commerce, you sell things – they are not sold until payment is taken; if your customer needs money to pay you, they must go to the bank who will take out references and make them jump through hoops before they lend them a penny – are you as diligent as the banks before extending credit? You’re one of the few if you are.
Now is the time to tighten up on payments. It is a high-risk time to be in business. Ensure that your credit terms are strictly adhered to and that ‘good old Bob, who’s been there for years’ isn’t running up a huge bill that, ultimately, you’re going to pay for.

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CAT Distributor Lives: Leacy Classics

Outside_Leacy_2Leacy Classics in Birmingham is known for supplying classic car parts, but in 2011 the business was taken over by Richmond Design and Marketing Group and CEO David Keene.

The acquisition gave the classic car factor a new lease of life, as Keene implemented a number of changes including clearing all back orders held by Leacy, improving range coverage, increasing the speed the business worked at and exploiting the advantages of retailing online.

The regime change also saw the business source more parts from British manufacturers or distributors and made small production runs of commonly requested parts possible through parent company RDM.

The changes have made Leacy Classics an efficient operation. It now exports 50 percent of its sales. All of these decisions have their foundation in Keene’s time at Rover as he explains:

David-Keene_Leacy_2

David Keene

“After attending a complete day of psychometric assessments, interviews and tests with 750 other people, I ended up getting taken on by Rover with eight other people.

“Rover were funding my education and bringing me into the fold, so every holiday I was spending a large amount of time in the business and going around the various departments. I finished my degree in 1986 and ended up getting a job in Canley, Coventry, where I worked my way up from junior engineer through to becoming a manager of one of the electrical departments.”

He then headed up the electrical division of Rover Special Projects in Gaydon, which was a small team designing new vehicles as quickly as possible from existing parts. The team led projects such as the Metro and Mini cabriolets, MGF and the Rover 200 Coupé.

However, when Rover management decided to shut down the ‘renegade’ Special Projects team, the whole division was redistributed across the core business, at which point Keene had enough and wanted to pursue a gap in the market. This led to the birth of RDM and a technology business developing automotive products.

Throughout the 22 years the business has been operating, Keene has worked with Inside-Warehouse_Leacy_1a number of OEMs including Ferrari, Bentley, JLR and design firm Pininfarina from the its base in Tile Hill, Coventry. However ten years ago, he decided a parts company was needed to supply the classic parts to supplement all the latest OE work RDM was carrying out.

“I always thought why can’t you take some of today’s technology,” he said, “such as low cost tooling, 3D printing, reverse engineering and apply it into the classic car industry?

“What you want is modern technology to create low volume parts at the right price, and since owning Leacy, we have brought hundreds of parts back into production. When I came here we were getting some parts from China, India, and all over the place. Some of those parts are now made and sourced using British suppliers and manufacturing, which proves there is a lot of skill left over from the old automotive world.”Inside-Garage_Leacy_1

Keene adds that using British businesses to produce parts is not simply to prove the automotive industry is alive and well, but that there is demand for British engineered products especially with collectors of British sports cars:

“Most people went offshore simply because they could get it cheaper, but if you go to China now, their cost of living has caught up with us. So that gap is closing, and it gets to a point where sourcing it in the UK is just a lot easier. Also there is still that quality hallmark associated with getting it made in the UK.”

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CAT Supplier Lives: Newsome Tools

Newsome-Tools_Tools-4Newsome Tools situated in Sheffield began life back in 1967 from hand tools and equipment sourced from across Yorkshire and Nottinghamshire from a van, in 1972 current Managing Director Martin Newsome joined his dad’s company and joined him on the road selling tools, as he explains.

“I had six months to kill before turning 19 and taking up a job I had been offered, so we filled a van I had bought with stock and off I went North of Sheffield and that was it.

“At the end of the first week I knew that was what I wanted to do, and the attraction for me was a motor accessory shop owner I met at the end of my first week, who explained that he left school at 15 and now he had a business and a Jaguar XJ6.

“The point at which we broke even was very low, as you just had your stock and you sold it. We used to sell tonnes of jacks, so we used to go down and pick them up from this barn in Nottinghamshire. What happened was if you bought a second hand car, invariably there wasn’t a jack in it. So a lot of motor shops would have a relationship with a car dealer and they would sell them by the box, we even got them into Asda, and it was good because you could get it turned over.”

Newsome-Tools_Martin-Newsome-3

Martin Newsome

Over time the business grew with a dedicated sales team now on the road visiting motor accessory and other tool retailers across the country, and as with any company looking to grow and expand its operations importing and exporting goods becomes an important factor. Newsome Tools imports tools from the Far East and also exports them to a number of countries including Bulgaria and the Republic of Ireland.

All this experience dealing with businesses and companies abroad means that Newsome Tools has expanded its offering to include providing additional services for other companies, such as allowing online resellers to use the firm as their stock room, as Newsome explains.

“What we do for them is dispatch the goods under their advice note, so it will say the name of an online company, but we have shipped it for them. Another part of the business is importing for other people. There is a certain type of buyer who is getting the best possible terms but then he doesn’t want to go down the road of importing himself because of all the vagaries and the uncertainties, and so they let us do it.

“So we get the product to exactly the specification they want and if they are happy with it, I will give them a fixed price in sterling. After that they don’t have to worry about anything as it is delivered to their door and invoiced in sterling just as if it has come from a UK supplier.

“It comes into the docks, and is then shipped straight to the customer. We don’t really get too involved, and that makes us a bigger player in the Far East, and gives us more buying power than if we were a supplier buying in for our own requirements.”

To offer a credit facility for others to use, doesn’t come easily, as Newsome explains that due to the amount of sourcing that the company has done in the Far East means the business is in a position to receive credit from firms in China. He adds that having such an option to offer makes the business a bigger player and gives new importers the option to get 90-days credit.

Newsome-Tools_Outside-3Newsome adds that dealing with countries across the world and attending the Government’s export missions means you get to grips with different business cultures and have the opportunity to meet local retailers and people from different industries.

“The first ever export I did was in 1990 to the Republic of Ireland and then I attended a Government scheme called Export Explorer, which gave you market research on Belgium, Norway and Iceland and four warm leads. We currently export to eight different countries and 20 percent of our turnover comes from exporting goods, and it is just that little bit of icing on top of the cake for us.

“Last month, we were just ticking over, and then a couple of nice exports came in and that was it – we were off and the whole thing changed. But it is a long-winded cycle from actually going there for the first time to getting the first order. People’s buying decisions aren’t as quick as the fluctuations in the currency, so they are not going to say ‘we are going to drop that range today’ because tomorrow it could be the other way around. In principal importers’ and exporters’ decisions are based on a range of factors over a period of time and that is very much the business today.”

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AUTO WINDSCREENS ACQUIRES AA AUTOWINDSHIELDS

AUTO WINDSCREENS ACQUIRES AA AUTOWINDSHIELDS

Windscreen replacement costs are up 68% in ten years

Automotive glass company Auto Windscreens has announced its acquisition of AA AutoWindshields, the AA’s automotive glazing business, for an undisclosed sum.

The deal will see AA AutoWindshields’ Preston offices and its 200 staff and technicians integrated with Auto Windscreens and, under a ten year partnership arrangement, the AA will continue to use Auto Windscreens to deliver glass services for AA members; its business-to-business and insurance customers.

Chris Thornton, Managing Director of Auto Windscreens commented: “This marks the beginning of a new and exciting chapter for Auto Windscreens and further reinforces our position as a leader in the industry.”

Auto Windscreens has had a turbulent recent past. Following a sale in 1998 by the-then parent company Heywood Williams, it passed through a number of hands over the next decade including HSBC Private Equity, Arques Industries and RAC plc. However it went into administration in 2011 while in the hands of Moguntia Invest. A deal with Markerstudy Insurance-owned investment group Trifords established a newco under the same name, albeit without the OE glass production facility of the original company.

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FIA regulations help align retail with F1 lubricants

FIA regulations help align retail with F1 lubricants

McLaren-Honda-F1During Race Week in the build up to this year’s British Grand Prix, ExxonMobil and McLaren Honda were keen to point out the alignment between the lubricants used for racing with those sold in retail packs.

The last couple of seasons have seen the FIA tighten regulations for the sport, with teams being constrained to 1.6-litre V6 turbocharged engines and 100kgs of fuel per car. While these changes haven’t been universally welcomed, Bruce Crawley, Global Motorsport Technology Manager at ExxonMobil, can see the commercial advantages:

“The engine oil is also remarkably similar to what you would use in the UK. There are a lot of similarities between it and the additive packs and Mobil 1 off the shelf. Our objective for designing lubricants for road cars and for a F1 car is the same, and that is to keep your car running like new. We do it in a F1 engine because that maintains the performance of the engine, so you don’t get any power degradation, and in a road car engine to extend the life of the engine.

“It is not completely the same, there are some differences, but if you compare it to the oils used in Mercedes engines in previous years, they are quite different to what you would use in your own vehicle.”

Crawley added that the new FIA regulations mirror some of the changes in the retail car world, with engine sizes reduced, but power outputs and efficiency going up.

Jonathan Neale, Chief Operating Officer for McLaren Honda, said that the sport has always been a great place to showcase technology and engineering which pushes the boundaries for the benefit of creating tangible products for the commercial sector.

“Engine technology has changed enormously, we have gone from using six V10s engines in a weekend, to V8s and now V6s with a lot more hybrid technology,” he adds.

“The fundamental change is towards looking after our environment and we are working with ExxonMobil on a molecular level designing products specific for our racing programme, but that can be further developed for our commercial programmes.”

For retailers, stocking lubes that are associated with the highest level of motorsport can only be a good thing.

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Saab Parts change distribution model

Saab Parts change distribution model

SaabThe company responsible for distributing OE parts to the remaining Saab dealer network has established a UK parts hub.

Orio, formerly known as Saab Parts UK, came into existence following the collapse of the parent company after the then owner Spyker called in the administrators in 2011.

At the time, there were some 226,000 Saab vehicles registered in the UK. Four years later, the number has dwindled to 180,000. Despite this decline, Corin Richards, Managing Director of Orio remains upbeat about its future as a parts supplier. The firm has recently opened a UK distribution hub in Hatfield, which has turned a four-day lead time into overnight delivery as the parts no longer need to be shipped from Sweden. “We’ve got an opportunity now to say that if you want Saab parts, you can order them from us and receive them the next day, rather than having to go to one of 100 outlets and get them in four days’ time,” he explains. “As the cars are ageing, only a minority go through the dealer network, so we felt there was a disconnect between where the parts are and where the cars get serviced.”

Following a relaunch of the customer portal to order OE parts, the plan is to use a third party courier and further reduce the lead time to same day delivery in the South East and East Anglia, where 75 percent of remaining cars are based.

Further to this, Richards plans a new line, provisionally titled ‘Saab Select’ on certain fast moving items. This will be aftermarket parts for some older cars. “Although they are a second tier, the quality is still good, and they’ll carry a two year guarantee,” he says.

Although Orio exists to support the remaining Saabs on the road, Richards will not rule out stocking lines for another brand at some point in the future. “We are known as Swedish specialists, so we’ll have to see,” he says.

Saab AB as a brand continues to enjoy considerable goodwill from enthusiastic owners as well as from the motor industry as a whole. However, a restart of production seems further away than ever following an announcement in June that the most recent owner NEVS, a Chinese EV maker, will not be renewing the rights to the Saab brand, having run out of money.

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CAT Garage Lives: Automobile Technik Reparatur

Automobile-Technik-Reparatur-1If garage owner Andreas Golembiewski was surprised about what was happening in his modest workshop one Thursday morning, he wasn’t showing it. Mind you, it can’t be every week that he has a current F1 car on one ramp and various top-end AMG-Mercedes cars on the others. In the same vein, it can’t be often that a F1 driver Nico Rosberg turns up to perform an impromptu oil change flanked by dozens of media and PR people.
The reason for all of this razzmatazz is that Automobile Technik Reparatur GmbH is the first garage to be signed up to a new garage network run by oil brand Petronas.
OK, a garage scheme on the continent might not sound like the most relevant case study for CAT magazine, but where Automobile Technik Reparatur stands out is that the Petronas Network Two is being rolled out in the UK at the same time. A chat with UK Head of Market Tony Lowe confirmed that the inaugural branch on these shores (a CV workshop) will receive the branding by the end of summer, followed by others in the coming months. The launch of the concept has come at a fortunate time – as a few weeks ago the Autocrew network (which was set up in the UK as a project between Bosch and Euro Car Parts) told its members it is to close. As ECP has exclusive rights to distribute Petronas oil in the UK (excluding bulk sales) it may be that former Autocrew garages may want the benefit of a new scheme that offers signage, a reduced rate on Bosch diagnostic equipment and so on – and has the added bonus of a brand that anyone with even a passing interest in F1 will recognise and will hopefully associate with a winning team.

Recognised garage

Automobile-Technik-Reparatur-2The German garage itself is clearly well-run and well-trusted in the local area, though the PR material from the oil company describing it as the ‘flagship’ outlet is a little wide of the mark as a four-bay workshop is standard among independents in Germany – perhaps a better description with a military metaphor might be the ‘vanguard’ as it is the first to try the new concept and branding out on an existing customer base.
Apart from the ramps, the garage has a fastidiously neat pegboard covered in tools and a number of pieces of Bosch-branded diagnostic equipment, including a brand-new 1234yf machine, hooked up to one of the AMG Mercs brought in for the event. A steel machine resembling a forecourt air compressor was built into a wall – but instead of Luft und Wasser, the machines four spring-coiled hoses have nozzles that dispense different grades of oil, of which we can find the correct type for any make and model via a small computer built into the machine.

Exciting times

Golembiewski is happy to diagnose and repair all makes, although he is known locally as a BMW and Mini specialist and he has certificates showing the workshop to be proficient in the service and repair of ZF/GM automatic gearboxes. Similar to most UK garages, Automobile Technik Reparatur derives a good amount of revenue from vehicle testing and associated repairs, and on days when the ramps are not clogged with racing cars and exotica no light vehicle will be turned away. Signs promote the fact that the business uses Bosch equipment, and apart from the new air-con machine, we noticed the firm also had a modern Bosch KTS diagnostic platform with a built-in oscilloscope. Throughput at the garage is high, with around 60-90 vehicles per week – although not every car needs such in-depth diagnosis of course.
At the front of the building, a small showroom houses a number of used cars, the sale of which makes up half of the company’s operating profits. “The workshop has been here for 18 years, but this is the most exciting time for us as we hope the marketing and strength of the brand will help move us forward,” he said.
For its part Petronas is riding high at the moment, as it is both the lead sponsor and major technical partner of the Mercedes AMG Petronas Formula One team, known as the Silver Arrows, which has dominated the podium for the last couple of seasons, due in no small part to team mates Nico Rosberg and Lewis Hamilton.

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Some useful tips from used car salesmen

used-car-salesman

Have you been struggling with sales? Matthew Moore is the hub lead at Johnston Press, explains four cunning techniques for success we can all learn from used car dealers.

If you were a used car dealer, the chances are you would possess some hugely valuable sales skills.
If on the other hand, you run a workshop, motor factor or an accessory shop, the skills of the used car dealer are worth studying – for the entire automotive industry and beyond.
Ignore the film clichés and hard-selling stereotypes, in which used car dealers are unfairly pigeonholed as deceptive salesmen.
This hackneyed idea may be true of some used car dealers, but the majority are very different.
Selling cars is not as simple as meeting a buyer, sending them off on a dainty test drive and signing contracts with a big toothy grin. Unless you’re a very lucky dealer, that is.
Buyers are rigorous and used car dealers aren’t selling the newest, most luxurious of motors, so they have to work extra hard to meet sales targets.
Whether you’re selling online, over the phone or face-to-face, there’s a lot the masters of sales can teach you about effective techniques, which you can apply to your own business.

1. Know your customer

When it comes to car buyers, one size doesn’t fit all; everyone has different backgrounds, budgets, wants, needs and desires. The same goes for every business.
Think about it – what was the last thing you purchased? Guaranteed, at least one of these factors will have influenced the decision to part with your cash.
Knowing your audience is crucial to identify, move and sell to people. If you’ve done your customer research and can see things from their perspective, you become better at picking up on their signals and getting the results they want.

2. Sell the sizzle

Matt-MooreSpending a significant sum on anything – especially a car – is an emotional process for buyers. One thing great dealers do is really focus on the specifics of a buyer’s situation, rather than selling a car.
OK, selling them some car shampoo or a mobile phone holder in an accessory shop might not have the same level of emotional involvement, but your customers should still be the focus of the conversation. Don’t sell them the product or service: sell them the excitement of owning the product, sell the money they will save, sell the difference it will make to their lives…
Dealers devise experiences based on empathy. How will the buyer feel showing their new purchase to their friends? How perfect will their new ride be for that road trip they have planned?
Even for small items delivering pleasurable and gratifying scenarios establishes a real, emotional transaction – rather than a hard sell. Whatever you’re selling, make your customers feel great about it.

3. Go the extra mile

The mighty Joe Girrard is the archetypal car salesman, listed in the Guinness Book of World Records as ‘the world’s greatest salesman’.
He’s sold more than 13,000 vehicles (an average of six cars per day) and all retail – one motor at a time. One of the secrets to his success? Focusing on the little things.
He would store his customers’ personal information, such as their birthdays, their children’s birthdays, what they did for a living, and use it to personalise his conversations with them.
Every month, year after year, he would send a greeting card to every customer on his list. Inside wouldn’t be a sales pitch; but a tip he knew they’d be interested in, a news story, a new idea or a birthday message.
The result? Customers who couldn’t stop themselves talking about Joe’s service, resulting in a flurry of new customers.
Any business can pick up these simple, but highly effective, sales techniques. If you’re an online company, share content on your social media pages that may interest your customer, or email something useful.
It all builds your reputation as an expert in your field and a trustworthy brand to do business with.

4. Ask for a referral

Within a few weeks of selling a car to someone, Joe would give them a call and ask how the car was running. If they were another delighted customer, he’d ask for a referral. If not, he’d resolve the problem – and then ask for a referral. Find out more at: thehub.tips

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