Editor ： Loo Kok Shiang
There are different segments in Malaysia parts market; Genuine, OEM, IAM, House Brand, White Brand and counterfeit. While vehicle makers (known as Principals) sold trucks, the parts market is always dominated by parallel importer and aftermarket parts. Principals always lament that the aftersales business go to private workshop, parallel importer and aftermarket parts while the authorized workshop and genuine parts doesn't enjoy the benefit of truck sales.
Why Principals lose in aftermarket?
Common reasons given are high import duty and high prices of Genuine parts deterred end users to utilize Genuine parts and opt for aftermarket parts. This is inaccurate description of the weakness of Principals.
The correct answer is: Principals lose to competitors is due to weakness in handling market information and dealers management. Principals can capture substantial market share from competitors if they overcome these two problems.
1) Market information:
Parts number, specification, interchangeable number, competitors prices and activity, total industry volume, purchase channel, sales channel, delivery channel are important information for Principals to decide sales strategy that will success. The problem in most of the Principals is do not know from where ... and how to gather these information from market. Managers from management background only able to analyse information from parts catalogue and sales history...and that is not enough to compete with parallel importers.
Who is the person that possess these information?
Counterhand. Also known as 头手/taochew/tousou in mandarin and local dialect. This is the key person to run the business in parts wholesalers and retailers’ company. Some of them is owner while most of them are employees.
The crucial ability of wholesalers to dominant the market is not strong purchase power to get competitive prices from manufacturers... but the counterhand with the ability to get correct spare parts ready in their warehouse before the market notice it. This will not only made them the exclusive seller in market with huge profit margin, but also strong selling point to attract retailers to purchase from them. Eventually, their business will become bigger and bigger like the rolling snowball. On the others hand, if they wrongly predict the market trend, they will pile up death stock in warehouse and affect their competitiveness.
Hence, the skill to estimate TIV and to predict sellable parts number is important for wholesalers to stay competitive in market. The ability to collect and accumulate useful data take more than 10 years to train up, but the result is easy to be copied by competitors. To ensure their competitiveness and protect their profit, the information of parts numbers, sales channel and sales locations are keep confidential. And most importantly, they will needs to ensure their counterhand loyal with them. If the counter-hand resign and go to their competitor or become their competitor, their business will drop drastically, in the worst case... more than 50%.
How to train up a competent counter-hand? In short: Get your hand dirty.
All counterhand are started as apprentice, even the second generation from the founder family. Why? Because the systems of parts numbers, warehousing and inventory are in such a mess that only the persons who get their hands dirty know how to handle.
Parts Number : For Principals, parts number is not precious information because they only have genuine parts number for dedicated models, and the information is open to public. But for wholesaler, each spare parts not only have Genuine parts number, but also interchangeable numbers, OEM number, factory number, white brands number, counterfeit number, suitable/flexible numbers, and even own created number. There are no logical linkage between all these parts number, counterhand record it in their hand book for quick reference. The hand book call “秘籍 (mi4ji2)”, literally means “secret and precious book”. They never disclose it to others, in some cases ... not even to their employer...as a tactic to protect their employment.
Although in digital era, most of the wholesaler already have computer system to record these information, but the jargon used are difficult to decipher by outsider. For example: Dog Bone (tie rod end) , Banana Leaf (mud guard), Ball-stick (handle) etc. So train up a new staff to decipher it will take 4-5 years. Besides that, the measurement method used by wholesalers is different from one another. For example: Flywheel, some measure the max diameter of flywheel, while another is measure the effective friction area of clutch disc. Both of the measurement methods above are meant for different objective, but useful to get the business done.
The knowledge on parts number itself is already a big hurdle that unable to pass by parts managers at principle. Not to said the inventory control, sale channel management and delivery. Besides that, debt management, and cost control are another aspect that wholesalers and retailers have advantage against vehicle makers. We will discuss these in future if possible.
Contact Number : 0132966766 ( Mr Loo)
Whatapps: https://wa.me/60132966766
More Expert Articles: https://bit.ly/3p74NAS
Comments