Apr. 21, 2008: A searchable dealer network … consider the possibilities

Sea-change.
A profound change in thinking, in the way we live, in the way we perceive our universe and in the way we regard our world. Change beyond our imagining. A change that cannot be stopped.
With age, you gain perspective. And believe me, I’ve got perspective.
I remember working the phones in desperation trying to find just one Z-50. It was the week before Christmas, and I had somehow oversold that model by one. Now, put this together: Christmas coming, 11 deposits on cute little motorcycles designed for younger riders and only 10 in stock. Got the picture? Been there yourself? Disaster.
So I’m working the phones, trying to find that one more unit. I began of course with the dealers closest to me, and then worked out, eventually calling every Honda dealer within 100 miles.
Nothing.
So I expand the search. And finally, in Jackson Hole, Wyo., 236 miles away, I find that one unit I need. Hop in the truck, and two days later I’m back home with that little Z-50. Disaster averted, but it was close.
And I see it every time two or more dealers get together. There’s the usual talk — about the low-ball discounter in their area, about the cost of workman’s comp, about keeping techs busy in the winter and finding sales guys that can actually sell. And then it always, always, always gets down to: “…and hey, what are you heavy on? and “…hey, do you have any extra ________’s”? (fill in the blank here).
Product is the life blood of our business. Too little and we wither. Too much and we drown. Finding the right balance is an art, not a science.
Now, here comes the sea-change part.
In the past 12 months I have seen a dramatic increase in the rate that technology is impacting our dealerships. In the beginning, everybody was trying to figure out just how to best use the new technology that was rushing at us. We all wanted to dance, but the first to get a partner and actually make it to the floor were the OEMs who delivered to us our first DCS’. That was in the early 1980s. Great, we thought. Now we can order even more parts!
Truth was, it was a great improvement over trying to order parts on our touch-tone telephones (ever try that?!). And it has grown, quite steadily, from that point. Until just about a year ago. Suddenly, we saw OEMs concerned about dealership parts inventory levels. OEMs had been curious about dealers’ parts inventories, but now they wanted hard information. And now, programs are in place transmitting dealers’ parts inventories to suppliers who can guard against overstocking and help with lost sales. We saw an increased interest by manufacturers and reporting groups alike, to gather, understand and report uniform accounting data. While there have been partial solutions in the past (PCSAS one of the best among them), in these past 12 months this need has been met with new methods, and disparate charts of accounts are now mapped and delivered uniformly in a much easier manner.
In the past, Same Store Sales across the country were impossible to track and measure accurately. It is now gathered and reported to the penny each month for almost 200 rooftops.
Parts price books now flow freely from the supplier through the DMS to the parts counter. No more paper, tapes, CDs or DVDs. Pure information, from source to use.
Computer programs, delivered in the past via CD, are now simply downloaded over the Internet. National averages are now factual and statistically based. Unit margins, average parts counter ticket sales, hours per RO and a hundreds of other benchmarks are now available and distributed via e-mail within a few days of month end. A million parts invoice lines, 50,000 unit sales and 70,000 repair orders from all over the country are collected here each month, summarized and reported by the 10th.
And now. Announced this week by one of our major industry DMS providers, instead of sitting on the phone for hours trying to find that one CRF70F, instead of calling all your dealer buds and begging, you can now simply “inquire” at your keyboard who has this particular unit in their inventory. The searchable dealer network involved could eventually house as many as 500,000 units, and the search report will rank findings by their distance from your dealership. The same goes with parts, where as many as 50 million parts records from 2,000 dealers could eventually be visible. And this is all fresh, at your keyboard, every morning.
This is cool.
But only when you have perspective.
Things we didn’t dream of just one year ago are now in place, affecting the way we work, the way we think and guiding our daily business actions. Information, hidden and confined to the dealership, now begins to flow. It — information — is somewhat like money. When it is buried in the earth, when it is hidden in the attic, when it is gripped tightly in the hand, it does no good. It is only when it flows freely that it produces jobs, inspires action and creates wealth.
Some will shudder at the thought. Others will quickly grasp the concept, and use this as a springboard to action. We truly are in the midst of …a sea-change. Fun, huh.

Hal Ethington has been associated with the powersports industry for more than 30 years. Ethington is a senior analyst at ADP Lightspeed. He can be reached at Hal_ethington@adp.com.

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