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The Internet and Your ShopPosted 9/9/2003Colby Horton
The Information Gateway to Success
A few years ago, the term "dot-com" became synonymous with the direction technology was moving toward - business-to-business transactions taking place electronically over the World Wide Web. All worldwide industries began accepting the dot-com phenomenon as the essential way to conduct business. And why not? Consumers were adopting the technology to keep up with the hectic and fast-paced way of life. However, after an economic slide and a virtual explosion of new dot-com companies that came into existence, it is safe to say the dot-com revolution is over. The "dot-bombs" are defunct, but those that survived are flourishing and redefining the way the world utilizes the Internet. The automotive repair industry is no exception. According to Mike Gingell, vice president of strategic markets for R.L. Polk & Co., there are more than 40,000 vehicle platforms serviced in today's market. The Internet is the vehicle driving information about these vehicles into independent repair shops around the world. And to be frank, if you're not willing to adopt the Internet into your business, be prepared to lose. Making the decision to adapt the Internet to your day-to-day shop operations is not unlike other big decisions you make comfortably every day. And whether you're willing to admit it or not, the Internet can help you with those other big decisions, too. At the Aftermarket e-Forum held in Chicago this past July, John Washbish, president of Dana's Automotive Aftermarket Underhood Group, said, "Technology is moving so fast you can't look at a snapshot, you need streaming video. Don't focus on technology; focus on what it can do." For your shop, the Internet can produce definite results. The benefits are truly measurable and can improve your bottom line, increase positive customer perception, and make it easier for your technicians to find much-needed service information. Connecting Your Shop
High-speed Internet access is also gaining momentum in repair facilities. According to the same survey, 34 percent of mechanical shops and 44 percent of collision shops employ high-speed Internet access, which includes digital subscriber lines (DSL), cable and integrated services digital network (ISDN) lines. High-speed connections are becoming essential in shops. In an ideal, technologically advanced service bay, each workstation would be equipped with a computer connected to high-speed Internet capabilities. The age of "dial-up connections" in the shop is slowly coming to an end. To keep up with the demands of fast and timely information for your shop, you must look at high-speed Internet solutions. Before you shoot the messenger, understand that installing a high-speed Internet connection doesn't have to be a financial burden. High-speed access is becoming more financially feasible for small businesses to implement. And as Internet technology continues to advance, a high-speed connection is quickly becoming a must-have in repair facilities. The bottom line: the money spent on high-speed connections far outweighs the time and money wasted on a technician waiting for information to come across on a standard 56k modem. Companies are beginning to design their Web services around high-speed Internet access. Although a 56k modem works in most current situations, it will soon become obsolete as the Internet continues to progress. Locating, Ordering Parts Online
Ordering parts has certainly evolved as technology has changed. Paper catalogs were eventually replaced by "green screen" technology, allowing shops to connect directly to parts distributors through a computer terminal. But since the evolution of current Internet standards, the procurement of parts has become even easier. The Internet has opened the door for a more efficient, faster parts ordering process. The ability to order parts online is revolutionizing traditional shop management procedures. Many shops, such as C & M Auto Service Inc. in Glenview and Vernon Hills, Ill., allow their technicians to order parts online through Internet-connected terminals in each service bay. Speaking to a group of parts and warehouse distributors at the Aftermarket e-Forum, Michael Starovich, president of C & M Auto Service Inc., explained that allowing technicians to order parts through the Internet increases accuracy of the order, and decreases the number of returns to the parts distributors. He also explained that "the installer is not using the Internet to price shop," but instead, using it to expedite the parts ordering process. Even online parts ordering has changed over the past few years. The leading online parts companies began integrating imaging of parts into their systems two years ago. But providing a picture of the product didn't always yield accurate results. Delphi Corp., a manufacturer of mobile electronics and vehicle parts, took imaging products one step further recently when it launched its Go Delphi Global platform (go.delphi.com). When a repair facility searches for a part, the results provide up to nine different views of the product. Views include the standard front and rear angles, but also a connector, kit, and technician view. "Delphi has made it easier to find products because of the images and product information," said Joseph Oddo, Go Delphi Global program manager. "Our overall goal is for [installers] to pick the right product the first time." As you can imagine, the Internet provides an extensive electronic parts catalog solution. But last year, Internet Autoparts Inc. (IAP) utilized the full capacity of the Web by introducing its aftermarket parts procurement system. This industry-sponsored, Web-based parts ordering and communications platform links automotive service providers with parts distributors, and is meant to expedite the parts ordering process. In 30 seconds or less, shops can locate, price and order the part. IAP allows repair facilities to search for parts by keywords, specific jobs or by catalog lookup. "We believe we will bring new levels of efficiency and profitability to both the auto parts distributors and the service providers they serve," said Jack Furst, chairman of IAP. "We believe we bring new levels of efficiency and profitability to service providers." IAP's functionality surpasses most online parts e-catalogs. It incorporates the inventory of several parts suppliers, which allows for broader searches. When a repair facility uses IAP, the service searches through the shop's preferred vendor store first. If the part cannot be found in the preferred vendor's catalog, it searches a sister store, followed by the distribution center, and then the direct manufacturer. If the part still is not located, IAP conducts the same search in another vendor's store, until the part is found. The extensive e-catalog of parts allows for a successful online parts ordering experience for independent repair shops. More information about IAP can be found on the company's Web site, www.iapshop.com. The use of online parts catalogs will definitely increase in the coming years. WorldPac, a distributor of original equipment replacement parts for the import repair specialty market, reports that almost 50 percent of its total parts sales are e-commerce sales, and predicts that percentage to rise to 80 percent in three to five years. Service Technology and Bay Productivity Obtaining updated service information is an integral part of shop operations, and the Internet can bridge the information gap between vehicle manufacturers and independent repair facilities. Just a few years ago, repair facilities received reference manuals and compact discs with read-only memory (CD-ROMs) that contained the data they needed to repair vehicles. However, that information was essentially out of date the moment it reached the shop. But because of a historic agreement reached between the Automotive Service Association and vehicle manufacturers, independent repair facilities can receive the same service information and diagnostic tools provided to dealerships. The only medium that streams this information into shops is the Internet, thus providing the most up-to-date information available. Most of the service information Web sites are subscription-based; although Hyundai and Kia currently offer the information free of charge. Many of the Web sites allow shops to customize their subscriptions as well. Repair facilities have seen an evolution of data delivered to their shops from paper to CD and now, the Internet. In fact, many information providers currently offer Web-based solutions for repair facilities. And because of the overall comparative costs of paper products versus electronic products, the information providers will eventually force repair shops to integrate to electronic communications. It will improve both the information providers' and shop owners' bottom line. The procedure of vehicle diagnostics is also migrating online. Recently, Identifix, which has been helping technicians diagnose vehicle problems since 1987, launched Identifix Direct-Hit. The new product allows technicians to enter the make, model, year and symptom and then it supplies specifications, code descriptions and fast fixes. The product also supplies anti-lock brake system descriptions, technical service bulletins and wiring diagrams. Most importantly, the information is available seven days a week, 24 hours a day. Marketing and Business Solutions Consumers are experiencing a different type of relationship within other industries - driven by technology - that they are beginning to expect from repair facilities. As the Internet and its capabilities continue to evolve, motorists will depend on the Internet to receive service reminders and access vehicle service history. This information is usually delivered in a traditional, direct mail approach. But the Internet is quickly complementing this approach by enhancing motorists' response rate. "The Internet has become a synergistic relationship with direct mail," said Barry Silver, founding partner of Mailmark Enterprises, a marketing solutions provider. He believes most repair facilities are able to capture 30 percent to 40 percent of customer e-mail addresses. His company helps repair shops with customer retention by sending out both e-mail reminders and traditional postcards that mirror each other. The result: a better customer return rate and less money spent on postage. To help you decipher through the countless numbers of Web sites for automotive service companies, AutoInc. has developed a special pullout directory to serve as a Yellow-Page listing of industry companies with a Web presence. The directory was developed using survey responses and additional Internet research. AutoInc. does not endorse companies, but has included them as a benefit to its readers. Although 350 companies are represented, space restrictions limit us from including all automotive-related Web sites. In detailing specific services offered by these companies, we have focused on 12 general categories. The companies surveyed selected the categories that best represented their services. We have also included the specialty of each company - whether it caters to the mechanical or collision sectors of the industry. In some instances, the companies selected both sectors as their specialty. Companies highlighted in purple conduct business online. This includes e-commerce capabilities, online downloads, or features of their products that are accessible in an online format. Dollar signs ($) appearing under the specialty fields indicate the company charges a nominal fee for its online services. The Future In 1999, Forrester Research predicted that U.S. e-commerce between businesses would reach $1.3 trillion by 2003. In actuality, the online business-to-business transactions are now expected to total $2.4 trillion by year end. So, contrary to what some experts predicted, the age of dot-coms is not gone. Perhaps the dot-com phenomenon has been redefined - synergistically combining traditional business practices with online business practices. You'll be hard-pressed to find a major automotive company without a Web presence. And as the Internet continues to evolve, companies will continue to develop online products catering to our industry. Only you know what's best for your business. The Internet produces measurable benefits and shop owners should embrace the technology, but only at their own pace. Don't jump into the Internet environment without fully researching companies. Dot-com companies are still teetering on success and failure. Those that survived this long should be around for a while. But make sure the services they offer are valuable to your shop. Speaker John M. Richardson Jr. once said, "When it comes to the future, there are three kinds of people: those who let it happen, those who make it happen, and those who wondered what happened." As shop operations become more and more Web-based, don't be the one who wondered "what happened." Be part of those who "make it happen."
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Author Jesse Conrad once wrote, "Learn the past, watch the present and create the future." In the automotive repair industry, history has taught us that change is inevitable. We work in an industry that is dominated and driven by technological change. From computers in the automobiles we repair to the computers in our shops that are essential to daily operations, our industry learned to adopt technology in order to survive.
In AutoInc.'s latest "How's Your Business?" survey, 86 percent of mechanical shops and 97 percent of collision shops reported having Internet access in their repair facilities. This should supply leverage to the surviving dot-com companies in the automotive repair industry to continue marketing electronic business-to-business transactions to independent repair shops.
According to a recent survey conducted by the International Automotive Technicians' Network (iATN), 5.1 percent of respondents say they order 75 percent to 100 percent of their parts online. However, 17.2 percent say they order 1 percent to 9 percent of their parts online. Although the percentage isn't high, it shows there is a lot of growth potential in the online parts ordering market. It also shows that more and more shops are at least beginning to order parts online.
