Co-location with Motovan brings efficiencies
If you can’t beat ’em, join ’em. That’s the approach Motovan and MTA Distributing are taking to the aftermarket parts distribution world in North America.
For approximately the past year, Motovan, the leading distributor in Canada, and MTA, with facilities in California, Louisiana, South Carolina and Ohio, have combined their purchasing power as they seek to become bigger players in the industry.
And while the partnership is less than one year old, MTA owner Larry Popp is already calling it a success. All he needed to do was look at this summer’s meeting with vendors and dealers at the Monte Carlo in Las Vegas to know his 30-year-old business made the right move.
“They needed to expand in this country, and we needed to expand also,” Popp said. “We started talking about what we each have in mind, and if things work out, it will all be one. We’re sharing some expenses and product lines right now.”
The combined MTA/Motovan show in Las Vegas brought together vendors of both brands. Motovan staples like Scott, Nelson Rigg and Dowco that were previously unavailable to MTA are now part of the family, and brand staffers were in Las Vegas educating the MTA dealers and reps about the products.
Similarly, Motovan has gained access to brands like STI Tire & Wheel, EKS Brand goggles and AudioFormz roofs.
“Basically we traded back and forth, and now we both have massive catalogs we have to print,” Popp said.
Popp has seen the size of some of the competition’s catalogs, and he figured the only way to grow his product lineup was via an arrangement like the one he formed with Motovan.
“We’re just trying to put our resources together,” Popp said. “It’s gotten to where Parts and Tucker and Western and these guys are getting big. To grow that big is very difficult, so this is a merger between two companies to get there quicker. Understand that you have to be of some size. It’s become very difficult for a small distributor anymore, because that’s what we started to feel. You have to understand your place in the world, and that’s fine, but we just don’t want to stay there. It seems like things started passing us by that were going to the other guys. They were pressing the fact about how big they are, and so we need to get a little bit more exposure and do more things like the show.”
Motovan hosts a show every other year in the U.S. The two-day event was expanded to three days in 2013 as part of the dual-hosted event.
“We did things together like the appreciation dinner for vendors, the chips we handed out for placing orders, those kinds of things,” Popp said. “We had training one day and their salesmen walked around the show, then they had training the next day and our people walked around the show. We probably cut our expenses in half by doing it this way.”
A trip to Motovan headquarters in Quebec to finalize a contract for MTA to distribute Motovan’s proprietary Zox helmet brand led to Popp mulling the partnership further.
“I’ve done a couple of programs with them over the past 20 years or so. We’ve both been around for the same length of time; we both come from one person starting the company and making it bigger. The backgrounds of the two companies seemed to be instant replays of each other,” Popp said.
And while there are plenty of ways to grow the business, Popp realized it made sense to combine forces.
“On the flight back, I started thinking about ways to get bigger, and I don’t really have the time to get to that size quicker,” he said. “And I knew they were in the market to try to do something in the U.S.”
Strong show debut
“I couldn’t have asked for anything better.”
That’s how Popp assessed the Las Vegas event. MTA hosted 80 vendors and more than 100 dealers. Motovan brought an additional 180 dealers.
“We were panic-stricken a little bit, because we didn’t want to make any mistakes,” Popp laughed. “Motovan did all the planning and arrangements and did an incredible job. All we had to do was hold up our end of it.”
In fact, Popp was so gratified by the results of the show that he figures MTA might be best served to hold the event every year.
“I don’t know if we can wait and go every two years,” he said. “I’d like to get it moving around so that we go to Southern California or New Orleans or South Carolina. We’d like to get 200 [MTA] dealers to the next one.”
Popp says the company continues to sign up dealers, and sales are “most definitely” on the positive side compared to 2012.
“You get out there against mail order and Amazon and the rest, and you can see the dealers trying. Everyone’s seen their profit margins slide a little bit. You hear people say profit margins are up, and I say ‘Really? I don’t think so.’”
Slasher brand growing
MTA continues to be the exclusive distributor of STI Tire & Wheel. Slasher, MTA’s latest house brand, got plenty of attention in Las Vegas. Its lineup ranges from windshields, tiedowns and cargo nets to exhaust systems and batteries.
“It’s growing and we’re really happy where it’s going.”
Popp describes MTA’s dealer base as trending toward independents, with plenty of franchise partners as well.
“We try to keep everyone happy,” he said.
Both MTA and Motovan appear to be on the track to bigger futures. With their combined efforts, dealers can benefit from a broader product lineup.
“The U.S. dealerships that place an order come through us, and the Canadian dealerships that place and order go through Motovan.”
As the two distributors have seen from their competition, a bulky lineup of products and reps can bring growth trends.