There are no dogs in LKQ’s 'junk yard' business

Jan. 1, 2020
Keeping business personal not just a heap of information.

They are not called “junk yards” anymore. They are called centers for recycled auto parts, and LKQ Corporation is at the top of the heap. Pardon the pun.

LKQ is the world’s premier supplier of recycled automotive parts, and also, is the only publicly owned company in its industry (LKQX on the NASDAQ exchange). It serves tens of thousands of collision-repair businesses, mechanical service shops and vehicle dealerships throughout the United States. The company estimates it dismantles more than 80,000 vehicles a year, and with a sales force of more than 300, it expects revenues to top $415 million in 2004.

By almost all measures, LKQ, with corporate headquarters in Chicago, is a very successful company. But with products so diverse and consistency of quality a continuous concern, it still has to work very hard on its customer loyalty.

“We are a very relationship-oriented business,” says Laurie Garcia, director of sales and marketing for LKQ Corporation, “and one of the things we do is impress upon our sales force the importance of keeping customers loyal.”

As with many automotive aftermarket businesses, maintaining personal relationships are critical to success. No matter what you call it — loyalty, customer relationship management, one-to-one marketing, or just common sense — building loyal customer relationships is the key to any company’s success.

For LKQ, it means they have to keep track of more than 35,000 “regular” customers with more than 100,000 phone calls a week. That is a difficult task – even if you have only one product. Consider LKQ’s plight with literally thousands of “parts” and a diverse group of customers that includes wholesalers, automotive dealerships, independent shops, chains of repair centers and insurance companies.

“Our sales people spend a lot of time on the phone,” says Garcia. “But we supplement our contact efforts via direct mailings, promotional offerings, outbound sales calls and participation in industry events.”

LKQ also uses what it calls a “book of business, the sales person’s personal customer group.”

“It’s essentially a process, rather than an

actual book or ledger,” says Garcia. “It is a continuous reminder to the sales force about things such as: responsiveness, active listening, timely follow-up, keeping the customer’s best interest in mind, problem resolution — all build trust that equates to loyalty. Our ultimate goal is for all sales people to have a standardized ‘book

of business.’”

While LKQ has integrated many of its processes, it is continuously searching for ways to improve its focus on customer loyalty.

“It’s still a ‘personal’ business,” says Garcia. “Our challenge is to match our intent to keep it personal with the technology that will help us continue to provide that personal touch.”

With that in mind, look into software programs and support systems that will enable your organization to develop an overall business strategy for staying in touch with customers, checking on their satisfaction, and capitalizing on opportunities to increase their business with you.

Your customers now have a lot of choices, and more importantly, they know that! They don’t have to be loyal to any company.

As a parts supplier or distributor, it’s important for you to find ways to cultivate customer allegiance, reduce defections, grow your bottom line, and ultimately get rid of any dogs that might be prowling around your junk yard.

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