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DIGRAPH TO OPEN 16 NEW SITES

DIGRAPH TO OPEN 16 NEW SITES

CV factor Digraph is set to open 16 new branches in the next six months as part of a growth strategy described as ‘aggressive’. This will be in addition to several acquisitions of similar businesses and expansion of existing branches.

The move follows significant investment in the company by Euro Car Parts as well as Sukhpal Singh Ahluwalia and James Rawson. The expansion could create and create 164 jobs.

The new outlets are in various locations across the UK, stretching from Glasgow to Crawley. At this point it is unconfirmed if the new locations will be from LKQ’s existing portfolio, newly acquired sites, or a mix of the two.

The strategy doesn’t seem to phase the management team.  Sukhpal Singh Ahluwalia commented: “Locations, stock and logistics are relatively straightforward – indeed we once opened 12 Euro Car Parts branches in a single day. Our challenge is to find the right people and partners to join us in delivering our vision of market-leading customer service … nationwide. We are building our new branches around the best team players”.

“We are shaking up the industry in other ways too, with major investment in stock ranges, accelerated delivery speeds and added-value programmes, as we continue to build the UK’s most powerful team.”

Branch expansions and upgrades are happening in Gloucester, Northampton, Nuneaton and Stoke. The Northwich branch is relocating to larger premises in Ellesmere Port which will greatly increase stock holding and give improved deliveries to the customer base.

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GKN FIGHTS ‘OPPORTUNISTIC’ HOSTILE TAKEOVER BID

GKN FIGHTS ‘OPPORTUNISTIC’ HOSTILE TAKEOVER BID

UK engineering company GKN is under threat from a hostile takeover from investment house Melrose Industries.  

Melrose  has made an unsolicited offer to shareholders to  acquire the entire issued share capital of GKN for 1.49 new Melrose shares and 81 pence in cash per share.

Melrose is known for turning engineering companies around and under the strapline ‘buy, sell, improve, sell’ it attempts to add value to the brands it acquires before selling them on, in a similar vein to a private equity. It’s website states it “finances acquisitions using a low level of leverage, improves the businesses by a mixture of investment and changed management focus, sells them and returns the proceeds to shareholders”.

However, the management of GKN do not want to sell to Melrose. In a letter to shareholders GKN Chairman Mike Turner blasts the approach as ‘entirely opportunistic’ and ‘low price and high risk’ before barbing: “Your board believes that Melrose is more focused on financial engineering than real engineering”.

“GKN is six times the size of Melrose’s largest acquisition and your Board believes that Melrose’s management team lacks relevant experience at Board level in several critical areas” wrote Turner, adding that he doen’t believe that Melrose has the necessary relationships with VMs and aircraft makers to make a success of the business. “Cars and aircraft are researched, designed, produced and serviced over several decades – your Board believes that a short term, private equity-style strategy is not the right way to provide sustained shareholder value in our sectors” he said.

GKN said in an earlier letter to shareholders that it would sell non-core assets and return £2.5bn to shareholders in response to the offer. 

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ASA FINDS SERVICING STOP ADVERT ‘MISLEADING’

ASA FINDS SERVICING STOP ADVERT ‘MISLEADING’

Two complaints against aggregator

The ASA received two complaints over claims made on repair aggregator Servicing Stop’s website.

One complainant, who believed that Servicing Stop continuously charged the ‘sale’ price for their services and that the savings were therefore not genuine, challenged whether the savings claims quoted within the ads were misleading and could be substantiated, while the other complaint challenged if the prices were misleading because their vehicle required a specific oil with VM approval that incurred an extra charge.

On the first complaint, the ASA looked at a series of complex savings offered on the website that were promoted as being ‘up to 60 percent off’. In response, Servicing Stop stated that at certain points throughout the year, they ran sales during quiet periods. It provided the ASA with dated and undated invoices showing the price history of the Kia Sedona vehicle servicing. It said that the period of time for which the new lower discounted price was available was not longer than the period of time that the item was listed for at the previous higher price.

It provided a spreadsheet of the sale dates for the servicing of the Kia Sedona and Honda CRV vehicle models over a six-month period from April 2017 to October 2017. There were variations between the ‘previous’ prices stated over this period. Its data showed that the Honda CRV services were on sale for a total of 37 days over a six-month period and the Kia Sedona had a sale period of 41 days over the same six-month period. It explained that there were fluctuations between the previous prices due to the many variants in price between the number of makes multiplied by the number of postcodes.

The ASA disagreed, noting that the ‘previous’ price varied when the discounted price remained the same. It told Servicing Stop to ‘ensure savings claims are genuine’. However, on the price of VM specific oil, the ASA noted that the aggregator put a disclaimer in saying that the price of such oil can vary. As a result, it was not in breach on this complaint.

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IS BANNING DIESEL BAD FOR THE ENVIRONMENT?

IS BANNING DIESEL BAD FOR THE ENVIRONMENT?

Scrappage Scheme

Evidence suggests that a rise in petrol registrations is contributing to global warming

Diesel-powered vehicles have been in the news a lot over their environmental performance, or lack thereof. Conversely, industry experts have warned that a clampdown on diesel vehicles could result in the UK actually missing European environmental targets.

Mike Hawes, Chief Executive at SMMT warned that demonising diesel conversley will have an adverse effect on the environment. “Customers are not moving straight from diesel to electric. They’re moving to petrol or staying put in older cars” he said when speaking at the Society’s annual dinner in December. “So we’re seeing a falling market, declining revenues, rising costs, rising CO2. And, yes, this will have an effect on climate change goals. This is not a policy without consequences”.

Data firm CAP HPI has authored a report which concludes that the EU’s 2021 environmental targets could be missed if the percentage of diesel vehicles continues to decline on UK roads.

The report points out that some of the environmental criticism of diesel vehicles is misguided.

All the countries in the report achieved the 2015 CO2 emission target for cars registered in that year. While France and Italy were comfortably below the 130g/km line, the UK is closer, and Germany only cleared the hurdle by 1.4g/km.

UNACHIEVABLE
Matt Freeman, Managing Consultant at CAP HPI and the report’s author, commented that without continuing sales of diesel engine cars, this target reduction is unachievable: “Hitting the 2021 environmental targets for CO2 reduction would be a significant challenge without the likely decline in diesel. Therefore it is imperative that diesels continue to command a substantial share of the new car marketplace.

“If consumers, with no option of transitioning to hybrid or EVs, switch to petrol the environmental impact is clear – their CO2 emissions would likely rise between three percent and 23 percent according to model.”

The report argues consumer education is key as there is an apparent risk that consumers are being led to believe that ‘all diesel is bad’ and that any suggestion that there is a good diesel option is due to the automotive industry seeking to resist change and preserve the status quo. This level of miscommunication needs to be countered if diesel is to have a short- to medium-term future.

SKEWED
However, the media coverage on diesel is, to say the least, skewed against the fuel no matter what the improvements and consumers are confused. At the aforementioned SMMT dinner, Greenpeace crashed the stage to hand VW boss Paul Willis a faux ‘award’ for ‘toxic air’ and coverage in the mainstream press has been hardly less hostile. This has resulted in drop in demand (by about a fifth) in new registrations for diesel powered cars and new registrations for light vehicles as a whole are down 5.7 percent compared with last year. This has lead to several analysts making doom-laden predictions about the future of new car retail through franchises coming to an end entirely. These might be a little wide of the mark, but it does seem that for a private motorist wanting to upgrade to the latest technology, the idea of a conventional powertrain must seem a bit old fashioned.

Most people reading this might wonder why they should care, after all, surely this is a hole that the VMs have dug for themselves? It doesn’t affect the aftermarket… Unfortunately, it does. Tens, if not hundreds of thousands of vehicles won’t go through trade auctions and back into the aftermarket as the VMs are holding their own versions of scrappage schemes. As far as I know, no-one has made a serious attempt to retrofit otherwise efficient Euro- 3 onwards common rail diesel engines with devices to clean up their carcinogenic soot, meaning that they are replaced with petrol vehicles that are only marginally less toxic, but will emit greater quantities of greenhouse gas. Meanwhile, the face of the retail motor industry as a whole is besmirched by the failure of the VMs to get a grip on this situation which is a real pity for all involved.

Posted in CAT Features, Exhausts, Factor & Supplier News, Garage News, News, Retailer NewsComments (0)

A NEW CHAPTER FOR ANDREW PAGE

A NEW CHAPTER FOR ANDREW PAGE

Steven Frost and Shay Allen

Of all the places that I thought might be my first visit of the year, a new branch of Andrew Page didn’t seem likely just a few months ago.

But things change, and so today, I’m standing at a shiny shop counter in a new branch. There are displays of tools and accessories with a number of brands and a small screen with a noisy infomercial for something called Gorilla Glue on a loop – something which I suspect will get old very quickly for the staff.

The stockroom, loaded with parts across two levels, is just as clean. Incredibly, building the mezzanine plus racking the whole branch and filling it with stock was achieved in just a week, according to Regional Manager Steven Frost, who was there to meet me along with Southampton Manager Shay Allen and Interim Marketing Manager Richard Swan.

Admittedly, this is not an entirely new branch. There was already a satellite of the Southampton branch in Eastleigh that needed to move or be closed as the lease was up and the landlord wished to redevelop the building. At the same time, parent company LKQ had a recently vacated building that had previously been a JCA Coatings counter, so it seemed logical for one business to move into the empty building.

RATTLING PHONES
However, don’t think that this is nothing more than a re-site. The sales team that manages customers around Eastleigh and Winchester are to move from Southampton into a bright new telesales office upstairs at the Eastleigh branch, and the team have plans to increase the headcount in order to win some new accounts.

“You get closer to your customers when you are in a standalone branch” Steven Frost emphasised, “But in a satellite branch, you become a bit disengaged as your customers don’t know that you’re up the road. So part of the investment is to get more people in”. This will likely include an extra van or two (there are currently six) and possibly extra people to handle the increased pareto and anticipated rise in orders.

The problems faced by the management of Andrew Page have been covered ad infinitum in CAT, but from a customer point of view the main issue has been inconsistent supply and ever-changing brands on the shelf. “There’s nothing worse than having to ring a customer back and tell them that you can’t get something” said Frost, adding that as an ex-ECP man, he breathed a ‘sigh of relief ’ when he heard that LKQ were behind the takeover, because he knew that range and availability would no longer be an issue.

So, is this branch a new start for the hundred year-old factor? “That’s certainly what we’ve been told” said Frost. “There are more moves and openings planned as [LKQ] want to heavily invest in this brand and move it forward. It hasn’t moved as quickly as we wanted, because of the CMA thing, but straight away this is what we want to do”.

NEW BUSINESS
Branch Manager Shay Allen believes that filling gaps in existing accounts and winning new business is entirely possible, due to the good and personal relationships the team have with individual customers. This trait goes back to the days of Camberley Auto Factors which several team members worked for, prior to being bought and rebranded by Page.

“It absolutely comes down to the relationship between the garage and the factor. If there is one thing that sets us apart right now it is people, and the knowledge and level of skill that they have” said Allen.

This is emphasised in the firm’s attitude to outgoing sales calls. Rather than badger people on the phone with an offer of screenwash or whatever, the sales team will prefer to visit customers to make sure they are happy with everything the factor is doing, and looking to see if there are any gaps that can be filled.

That isn’t to say that there aren’t challenges to this expansion. Both MPD, GSF and GAU are active on the patch that the branch wants to take more of as well as the ‘friendly’ competition from the local ECP. Nonetheless, the shiny new branch sends out a clear message to the aftermarket: Andrew Page is back and open for business.

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CAT AWARDS HELD IN MANCHESTER

CAT AWARDS HELD IN MANCHESTER

The sky cleared and the sun shone for the 2018 CAT Awards, sponsored by Automechanika Birmingham, held in the Lowry Hotel in Manchester for the second year.

Over 120 aftermarket professionals gathered to enjoy the networking lunch and to find out who scooped a trophy.

The winners are as follows:

Large Garage of the Year (sponsored by Haynes Pro): Motoserv UK

Independent Garage of the Year (sponsored by Euro Repar Car Service): AAK auto Services

Retailer of the Year (sponsored by Haynes): Wrexham Motoring Supplies

Factor Team of the Year (sponsored by Breck): Bridgend Motor Factor

Factor Chain of the Year (sponsored by Boswell Insurance): AutoParts UK

Supplier of the Year (sponsored by PG Automotive): NGK

Outstanding Achievement (sponsored by Noco): Terry Wainwright

 

Full coverage of the event will be included in the March issue of CAT.

CAT Awards Winners 2018

 

 

 

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PREMIER MOTOR FACTORS GOES INTO ADMINISTRATION

Walsall-based parts supplier Premier Motor Factors has gone into administration.

 Timothy Frank Corfield has been appointed as the official administrator, and an auction of the firm’s assets and stock will be held from February 26 through auctioneer Deeley Matthews..  

Stephen Doyle started the company (officially called Direct Wholesale Europe) in August 2008, right at the start of the recession. The company had a strong online presence, with eBay being a particular strength. However, recent feedback suggests that it struggled to fill orders in the past few weeks, and the administrator was called in just before Christmas.

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TEN ANDREW PAGE BRANCHES CLOSE FOLLOWING ‘OPERATIONAL REVIEW’

Ten branches of Andrew Page have been closed.

Carlisle and Ellesmere port closed last week. Cardiff, Peterborough, Kettering, Shrewsbury,Chesterfield and three others closed on Monday. Calls we made to affected branches diverted to a nearby Euro Car Pa

Andrew Page Kettering closed on Monday.

rts.  Meanwhile, managers from other branches took part in conference call on Tuesday.  

In a written statement, a spokesman for ECP said: “We can confirm that we have closed 10 Andrew Page branches, following the completion of a recent business operational review by the Andrew Page Management team.  There are no plans to close any further Andrew Page branches. We are currently working with employees at affected branches to look for alternative options within the ECP or Andrew Page network, and working closely with customers of these affected branches.”

Andrew Page was bought by the parent company of rival Euro Car Parts in 2016 immediately after the former went into administration. Following a lengthy investigation by the  Competition and Markets Authority, nine depots were proscribed to be closed in the interest of not ‘significantly reducing competition’

Interestingly, none of the branches closed over the past week were on the CMA list. Liphook, Scunthourpe, Wakefield and York were on the list, but remain on the company’s depot finder.

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BIG IDEAS FROM A FAMILY BUSINESS

BIG IDEAS FROM A FAMILY BUSINESS

Operations Manager Lorraine Fullers takes CAT around family-run and CAT nominated garage: D&D Autos in Ashford.

Workshop space serves all marques

If you’re on the Eurostar, the chances are that you’ve seen the looming D&D Autos building as you pull out of Ashford International. It is physically the largest independent garage in the town, if not the whole of Kent, and it needs to be. Numerous awards, including CAT’s Large Garage of the Year in 2017 and a strong local reputation have allowed the business to expand to accommodate the volume of work.

However, big ideas start small, and the credit for starting the business goes to Derek Pestridge, who founded it in 1983 after acquiring his first workshop unit in Ashford. The decision for Derek to do this was simple, it was time to ‘better himself’ by taking the next step in his automotive career, having worked for various automotive companies including a VW dealership Euro Charing. “He founded the business with his friend Dave Woollett, hence where the name ‘D&D Autos’
comes from” explained Derek’s daughter and Operations Manager Lorraine Fuller. “He went on to acquire the units adjacent to the main workshop, which saw the start of MOT testing. The business continued to grow”.

As part of major expansion plans, in 2009, the independent relocated from its old site in the town to a purpose-built 10,000 sq ft. facility, situated on the Orbital Park Industrial Estate. Of course, moving to a bigger site didn’t come without its complications as Fuller pointed out: “We were aware that we may lose customers moving away from our Victoria site that was five minutes away from Ashford town centre and the railway station. However, we introduced a courtesy shuttle service and new courtesy vehicles to help customers get to and from the site, so as to help make our customer’s collection and delivery of vehicles as simple as possible”.

EXPANSION
Since the move, the firm has enjoyed steady growth over the years, growing its workforce from 11 to 23 staff whilst building up its customer base through a number of marketing initiatives. On our arrival, the sitting area was neat and tidy with the company logo sported across the foyer walls. We were welcomed by front-of-house staff who were busy dealing with the Monday rush of customer calls and parts orders as the local TPS van made its morning delivery.

Although Derek has taken a backseat to the business, he can still be found around the workshop replacing a clutch or conducting an MOT test to assist sons Matthew and Richard who have stepped into their father’s shoes.

The workshop space itself is quite impressive, home to 13 ramps and two MOT bays designed for servicing class one, two, four, five and seven
vehicles. The move from the old site has also allowed the workshop to take on more diagnostic work for fleets as well as picking up some jobs delegated from dealerships in and around the Orbital Business Park.

ALL MAKES
“We fix cars of all makes and models and that’s basically the crux of it”, Matthew remarked when we asked how the business maintained a steady flow of work. “We never outsource any work. Everything is completed in-house”.

Matthew notes that he is keen to get all his technicians qualified on these systems over the year. He explained: “We have started seeing more hybrid and electric vehicles coming through the workshop. Some of the technicians and I have started training on these systems through Bosch, but the company plan for D&D Autos is to get everyone in the workshop into some hybrid training”.

Another project is to sell used cars on site, following a new partnership with the AA. Matthew elaborated: “With the reputation we have, we’re always getting customers asking about buying cars, so we are going to see if we can make it work for the business as another add on for D&D. He concluded, “When we roll this out, we are going to do AA warranties, because we’re already signed up for the recoveries when we went through the process of becoming an AA-approved garage.”

For the future, the family have yet more big ideas, possibly including an extra site. We’ll be interested to see how they get on.

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CHARGING UP BUSINESS MARGINS

CHARGING UP BUSINESS MARGINS

There are plenty of battery charger brands out there, but how are firms standing out from the competition?

Noco Genius series

Consolidation is the buzzword of our industry at the moment, but it isn’t just reserved for the factor groups, suppliers are part of this trend too. “There has been a lot of consolidation of battery brands with only a few major players left in the market.” said Gary Vincent, Sales Manager of American battery charger firm Noco.

While battery brands are shrinking, he says the opposite is true of chargers, “In terms of battery chargers, there is an increasing number of battery charger brands entering the market from the far-east with little actual battery charging experience and just looking to make quick money on places like Amazon,” he said, adding that this has had a knock-on effect on product quality and safety in the marketplace.

TRAINING
To maintain quality standards and be one of the ‘go-to’ brands for battery chargers, Noco has heavily invested in a number of marketing initiatives, technologies and training programmes to maintain customer retention while providing new clients with the technical know-how to up-sell its chargers in store. “Technical training forms part of the Noco on-boarding process for new customers so they can confidently advise and sell across the range,” said Vincent. “We see a continued trend towards lithium-ion batteries in all markets, and all of our chargers contain a specialised lithium charging mode. However, most competitors focus on their attention on charging fast, whereas we focus on return of capacity whilst restoring the specific gravity to optimal level, which can sometimes lead to slightly longer recharge times.”

The design and packaging can also bring many plusses to retailers stocking them as Vincent highlights: “Our chargers and packaging is extremely compact, which typically saves retailers upwards of four times in retailer footprint. These not only allow retailers room to add additional SKU’s, but also saves on logistical costs.”

NEW PRODUCTS
Taking a slightly different stance on battery charging is Swedish battery charger firm CTEK. As previously mentioned in CAT, the firm recently introduced its ‘CT5 Time To Go’ device, which informs users when their battery is fully charged, through a series of LED lights that monitor the state of charge of the battery. The tool is used in conjunction with the firm’s new ‘Battery Sense’ dongle, which tracks the vehicle’s battery health. The concept behind this was to encourage more motorists to check their battery regularly in order to prevent further breakdowns, particularly during the colder months when this component is at its most vulnerable. Sten Hammargren, Consumer Business Unit at CTEK, elaborated: “The Battery Sense tool is easy to install and data is delivered through a free to download iPhone or Android App. Battery Sense means no worrying about charge levels or when to charge; providing valuable information about the vehicle’s battery in a simple, user-friendly way.”

In addition, the maker is conducting ongoing training sessions for factors and distributors via its Skillsbase programme, allowing them to gain a thorough understanding of the firm’s wares. This is further supported with marketing materials such as product sheets, brochures and promotional films for additional advice and guidance. “Understanding how our products can be used to meet the needs and demands of the end user is a strong factor in choosing the right products to generate sales opportunities”, said Hammargren, “Our Skillsbase programme is helping our customers to gain comprehensive CTEK knowledge and develop essential skills and understanding to maximise profit margins.”

In a similar vein, Banner Batteries is raising awareness and the importance of battery chargers and maintenance to its retail network in the form of ‘visually appealing’ display units and marketing materials including a pocket guide leaflet for its Accucharger range. Lee Quinney, Country Manager at Banner, elaborated: “Developed to ensure that modern lead-acid batteries attain their anticipated long service life through regular and necessary equalisation charges, each Accucharger is more than capable of powering up any starter battery easily, fully automatically and safely. In addition to their functionality and suitability for all 6/12V lead acid batteries, they are appealing in terms of their design aesthetics and have already been widely adopted by Banner’s distributors and their customers.”, he concluded.

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