Aftermarket finds new customers on eBay

Jan. 1, 2020
Internet sales are an increasingly important source of revenue for many aftermarket distributors and jobbers. In its most recent State of the Industry Report, Aftermarket Business found that 14 percent of sales for WDs come through the Internet, whil
Internet sales are an increasingly important source of revenue for many aftermarket distributors and jobbers. In its most recent State of the Industry Report, Aftermarket Business found that 14 percent of sales for WDs come through the Internet, while online sales for jobbers increased by an average of 13 percent in 2007.

Well over half of all WDs sell products online now, and a growing number of repair shops and do-it-yourselfers are ordering their parts through online channels.

While aftermarket companies largely rely on their own online catalogs to generate those sales, many distributors and jobbers have turned to eBay to sell their parts, particularly slow-moving or discontinued items. According to data from research firm Terapeak, sales of automotive parts and accessories through eBay have experienced solid growth during the past two years. Sales through eBay Motors now are in the billions.

"This is a way for companies to optimize their business," says Tony Jackson, data sales manager at Activant Solutions, which recently released a new software product to help distributors generate eBay listings. "We're seeing an increase in sales in the traditional customer base, and that will continue to ramp as companies figure out what this means to their business."

Price Automotive Warehouse in Lenoir, N.C., a performance and accessory distributor that services a five-state delivery area, has been selling through eBay for more than eight years. Price started selling goods using traditional auctions, but soon opened up an eBay storefront to save costs and eliminate the need to re-list items after the auction period ended.

"I heard from a customer that there was another warehouse using eBay to get rid of entire lines and merchandise he couldn't sell otherwise," says owner Fred Price Jr. "I thought I would give it a try."

Price primarily uses eBay for goods that are being closed out, as well as some damaged merchandise that can't be returned to the factory. The eBay sales augment Price's traditional online catalog, which utilizes Autologue's ePart Connection to provide part status information to customers.

Sales on eBay are entered manually and invoiced through the Autologue Datatron system. Price Automotive's shipping department handles the shipping the same as if the item were sold through the regular catalog.

Price says the company is generating only a few thousand dollars a year in revenue via eBay, but "at least we're getting something out of it, and we're making more room in the warehouse."

Most jobbers and distributors use eBay to offload slow-moving merchandise that isn't selling in their traditional markets, but Jackson says the online auction site could present other opportunities as well.

"There is a focus on stuff that's not moving well in the store, but it doesn't just have to be dead stock," Jackson says. "You have to be careful and do some analysis. You can't just throw everything up on eBay. Some products sell really well on eBay and others don't. There are also some serious seasonality issues."

Manual labor

One drawback to listing merchandise on eBay for companies with a lot of merchandise is posting and managing those listings can be time consuming. "If you're doing any kind of volume, you almost have to have a person dedicated to just handling the eBay business," Jackson says.

Price Automotive manually manages its own eBay listings (as many as 200 parts at any given time), with Fred Price handling those chores himself, spending a few hours a week doing so. He uses images from manufacturer Web sites, when available, or takes his own digital photos to enhance the listings.

Activant Solutions is trying to help reduce the data entry burden with its new AuctionExpert system, a Web-based solution that can help parts distributors create and manage large numbers of parts auctions through eBay Motors. Activant developed the product in conjunction with eBay.

"At the time eBay contacted us, we really weren't hearing about this from our customer base yet," Jackson says. "eBay was seeing huge growth in traditional auto parts being sold on the site."

The system populates the auction listings using existing catalog information. The system can integrate with Activant's software products and most other business management platforms. It can also link to images and other content. Eventually, AuctionExpert will integrate directly with Activant's shipping and inventory management tools.

While eBay sales represent just a small part of most distributors' sales, Remart Auto Parts in Alpharetta, Ga., has built its business around the e-commerce model. The company helps closeout warehouses and distributors with slow-moving merchandise sell their parts on a consignment basis through a variety of online channels.

Remart sells its inventory through a stand-alone e-commerce store and an eBay store, and the company was an early customer of Activant's Auction Expert.

"The value of the product is the efficiency of the process and the accuracy of the data," says Rick Wakefield, president of Remart. "AuctionExpert also provides fitment notes, which you can't get through other systems."

Prior to deploying AuctionExpert, Remart manually created online listings for its products. Wakefield says that process, which used to take up to 16 hours, can now be completed in less than two hours. Remart is working with Activant to integrate the system with its existing Channel Advisor solution to further automate the process.

Managing online auctions is getting easier, but keeping track of e-commerce sales trends can still be at tricky proposition. Because the customer base is more geographically widespread and diverse, sales patterns on eBay don't necessarily follow the same trends distributors see in their brick-and-mortar operations.

"One of the biggest challenges is on the analytics side," Jackson says. "There are a lot of strange market dynamics in terms of how things sell. Your biggest day is Sunday night for parts sales — but not during football season. Those are things that a typical jobber doesn't think about."

Understanding those trends will be even more important to the aftermarket moving forward, as the percentage of online sales increase. Wakefield, who has been selling parts on eBay for nearly five years, says that Remart's business has shown solid expansion as more customers turn to eBay for parts.

"We offer a new channel for companies that are used to traditional wholesaling," Wakefield says.

Selling on eBay requires a resource commitment, but can lead to new sales opportunities and reduced inventories.

"A lot of jobbers will say they don't have the time to do this, but it's worth the time if you can get rid of merchandise you can't sell," Price says. "There is someone out there who wants what you have."