Wholesale: Diversified growth
Although Warren Distribution is no longer a traditional jobber, instead selling directly to installers, it faces the same expand-or-tighten-the-focus issue that jobbers face. Steve Fries, director of marketing for the Santa Fe Springs, Calif.-based company, notes that "we will probably grow inventory, as we add locations." Currently, Warren offers five warehouses in California and a sixth in Las Vegas.
Dale Helfrich, sales manager of Hedahls Parts Plus, based in Bismarck, N.D., notes that his company has it both ways — it can keep expanding inventory yet enjoy niche markets through its network of companies. With nearly two dozen stores throughout Montana, Minnesota and the Dakotas, Hedahls has affiliated businesses ranging from NEMAC Warehouse, created to supply Hedahls stores, to BENCO Equipment, offering shop service equipment to professionals. Links to each of the companies are featured on Hedahls' website, but stand alone on their merits — not trumpeting the fact they are owned by a larger company.
"We definitely plan to grow larger," Helfrich says of the family-owned chain, which is approximately 70 percent wholesale.
But Steve Hardesty, owner of Bullhead Auto & Industrial Supply Co. in Arizona, takes a different stance: "We don't even try to completely keep up with all the new parts," he admits. He recently celebrated Bullhead's 40th year in business — and is quick to point out the industry has changed.
"I think the biggest change is the tremendous amount of parts you have to have in order to just scratch the surface," he says.
Hedahls seems to have learned the balance of large inventory vs. core categories more than a generation ago, when it tried to serve perhaps too many niche markets. According to corporate lore, after the Hedahl family opened the first branch store, they began selling and servicing television sets, boats and outboard motors, along with auto supplies, at the two locations. By 1960, they decided to get back to an automotive-only focus. Since then, the company has only concentrated on organic growth.
Hedahls was also a founding member of Automotive Northern Warehouse, a regional buying group known today as Uni-Select USA. This membership, along with NEMAC Warehouse, ensures the chain's inventory stays both current and profitable.
Bullhead is an Auto Value affiliate, which helps, Hardesty says. He adds, however, that he needs to stay diversified to stay current with customers.
Specializing in heavy truck, fleet and industrial welding supplies, Hardesty says that his recipe for growth is to keep a lot on hand, and be able to fill unusual requests fast.
"The Internet has made life grand," he says. "I can easily fill orders that I otherwise would not have been able to stock."
Retail: Focus on customer demand
With market trend technology better than ever, retail auto suppliers are paying close attention to their customers' wants and needs.
"In our area, it wouldn't pay to specialize — you need just about everything on hand," notes Ed Humbert, owner of Mr. Ed's Auto Parts, a NAPA jobber in Strasberg, Colo. As a rural area making the transition to a bedroom community suburb of Denver, Strasberg has an ever-changing mix of farmers and commuters. The challenge is to keep everyone happy, says Humbert, adding that 75 percent of their business is light vehicle and 25 percent is farm and light industrial equipment. "But as more farmland is used for housing development, I'd say in about 10 years we'll be more urban than farm." By then, Humbert believes, he will focus even more on the do-it-yourself market.
Tom Bee, president of B&B Auto Parts in Bronx, N.Y., says his business will continue to expand in selective areas. For example, a few years ago B&B began specializing in Corvette parts — even putting up a Vette parts website separate from its mainstream website. Bee says it doesn't pay to expand in general areas so much as focus on a niche and grow within it.
Mike Meditz, sales manager for Kaiser Willys Auto Supply in Aiken, S.C., knows well his niche market of Jeeps. Kaiser Willys began by selling only Willys Jeep parts, and, although the family-owned business also offers CJ, Wrangler and Cherokee and Grand Cherokee parts, it stays true to its original focus.
"Currently, we specialize in 1972 and back, but we're going to go more modern as demand increases," Meditz says. "We will stay 100 percent Jeep, though, just hitting a larger audience with the more modern parts."
Bee says that a lot of manufacturers "offer suggested inventories, but what they suggest isn't always what's right for our market." Instead, he relies on what his customers buy when stocking parts.
"We look to our computer statistic records for inventory," he says.
