Genuine Strategy pays dividends

Motorsport
Genuine Strategy pays dividends

Selling genuine OEM parts through the Internet has paid dividends for Honda New Zealand with a 60 percent increase in Internet sales recorded in the last 18 months.

It’s also paid dividends for the repair trade and their customers.

Honda marketing manager Graeme Meyer says that repairers who have embraced technology are enjoying better margins and even quicker turnaround by using the Honda parts website.

Honda New Zealand offers a guaranteed margin of 35 percent for phone orders of mechanical parts but 40 percent if the customer orders online. This required a change to the distribution style to streamline the process and remove cost to retain competitive prices at retail for the trade.

“Seven years ago we had a change of philosophy regarding spare parts and decided to create the website so that customers could identify a vehicle using a VIN or a registration plate and see a visual picture and a list of components online,” says Graeme Meyer. “It’s a lot more accurate and quicker than a suite of parts books which requires human interpretation.”

“While this makes life a lot easier for mechanics, by giving them more information with less chance of ordering the wrong parts, we didn’t get the uptake we initially wanted. The core need of workshops is to make profit,” he says.

 “Collectively the motor industry has done a lot of marketing to encourage consumers and suppliers to use genuine OEM parts but most are not addressing the core issue which is margin. There is still a reluctance to buy genuine OEM if a more profitable  option is available from an aftermarket supplier.

“What Honda wanted to do was offer the service and repair trade a transaction that was of equal value if not better than the aftermarket suppliers, and reduce the cherry picking approach that many took when buying parts.”

Meyer says that the accuracy of the online parts system has seen many independent businesses come to Honda because there is less likelihood of the wrong parts being sent which leads to frustration and inconvenience for the repairer and client.

As well as offering a competitive margin, Honda New Zealand offers menu prices on a range of fast moving items, as well as holding stocks of frequently used items in 33 locations nationally.

“For the mechanic time saved by not having to make multiple phone calls to find a part means more productive billing time too. That’s more on their bottom line.”

Meyer says the need for garages to embrace online computer technology has been around for some time as they have been sourcing industry information such as WOF and LTNZ, so adopting our online ordering system is a simple and small step.

“Honda is pleased to be able to add progress that delivers efficiency and value collectively to our customers and ourselves. It’s a great win for everyone.”

 

 

 

 

 

 

 

 

 

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