On Demand Hotshot Delivery – The #1 Way to Improve Wholesale Service

On Demand Hotshot Delivery Services

Fast Parts Delivery Matters

Hotshot delivery is the key to increasing mechanical wholesale sales.  In fact, o single factor has a larger impact in increasing sales than fast delivery increasing customer purchase consideration by as much as 5X.  Decreasing delivery time to less than 45 minutes has a 5X improvement in your shop customer’s willingness to buy parts from you.

And this need for fast delivery is not arbitrary so pushing mechanical shops into the dealer’s normal delivery structure won’t increase sales.  Shops receive and deliver customer vehicles in one day.  So shops need parts quickly to effectively service their customers.  Aftermarket jobbers deliver parts quickly or risk losing the the sale to a jobber with better delivery while dealer dispatches typically push shops into same day or next day delivery.  While same day/next day delivery is great for collision shops, mechanical shops need their parts faster.

Dealership Wholesale Parts Business Benefits

The mechanical parts marketplace is TEN TIMES LARGER than the collision parts market, yet dealers sell 4X as many collision parts.  So if dealers who wish to grow their wholeasle parts business should start focusing on the mechanical parts marketplace.  And other benefits for selling mechanical parts include:

  • Mechanical shops pay their bills faster than body shops
  • Selling to mechanical shops inventory turns, which helps with department profitability.
  • There are 7x as many mechanical shops in the marketplace as collision shops. So you can travel less and make more money
  • Mechanical parts fetch a higher gross margin than collision parts

On Demand Dealer Hotshot Delivery

Solutions that solve a problem completely and cost effectively are rare.  That’s exactly what “on demand” hotshot delivery does for the dealer mechanical parts delivery.

It has been difficult for parts departments to justify the cost of offering a hotshot service for a variety of reasons.  Using on-demand hotshot delivery offers an excellent solution to these issues. These issues are listed below:

  • Idle driver time: Using an on-demand service means you don’t have an idle employee during slow periods and on slow days.
  • Peaky Demand: Shops all tend to order their parts at the same time, which means service levels at peak hours go down.  With an on-demand service, you have a limitless store of drivers so you can offer all of your customers the same service levels.
  • Lower Investment: There’s no need to pay for another truck that will sit idle.
  • Per Delivery Cost: When accounting for lease, insurance, gas, maintenance and labor, the average fleet vehicle costs around $25 per hour to operate.  Rideshares offer a service that’s around the same cost per hotshot delivery to operate.
  • No Ramp up Time: Just sign up for a service and start deliveries.  No need to lease a vehicle and hire a driver.

Finding On-Demand Hotshot Delivery Services

Identify the on-demand solutions that cost effectively meets customer needs. Some services offer a low cost on short deliveries and smaller parts while other offer delivery routes and can accommodate large orders. There are also services such as RevolutionParts Local Delivery and Elite Extra On Demand that integrate with multiple providers. The guide below outlines the services to help you find the service that is right for you.

Building Mechanical Parts Delivery Service

It is easier than ever for a dealer to build a wholesale parts business.  As a car dealer, you will get there faster if you have the right launch plan.  Fortunately, the following process will help get up and running quickly and effeciently. 

Use Available Dropship Services

Some OE suppliers offer direct delivery service to your customers.  But many dealers reject this in favor of delivering with their internal fleet.  The most common reason –  because the dealer wants the vehicle with their company name to deliver the part.  But in reality, time and money spent receiving and then delivering parts is better spent delivering other parts. 

Some dropship services available inlcude:

  • The powertrain suppliers for the GM, Ford and Honda programs will deliver an engine or transmission directly to the customer.  This speeds service, increases driver availability and reduces the possibility of delivery damage.
  • Many automakers have truckload programs that will deliver maintenance parts directly to a customer site.  This reduces costs on large orders and can lead to significant sales increases.

Organizing Dealer Dispatches

Professional dispatchers and dedicated delivery services use dispatch software to improve their efficiency and track drivers.  Parts countermen are not professional dispatchers and driver fleets need accountability.  Subscribing to a dispatch solution brings expertise to your dealership in both areas.

A dispatch solution will also create more predictable service levels and provide efficiencies that allow for the delivery of mechanical parts. So, subscribing to a service who offer a consulting process to get you started will improve your results.

Using Faster Delivery to Increase Sales

Planning a Market Rollout

There are thousands of shops buying billions of dollars in parts per year, so there’s no reason to be all things to all people right away.  Flexible services such as on-demand hotshot delivery gives dealerships the ability to plan their market expansion.  Because there are thousands of shops buying billions of dollars in parts, there’s no need to be everywhere.  Dealers can target their customers and market areas. 

So instead of broad marketing that makes a commitment to everyone, plan your geographic focus. This will help your team provide the service you are promising to your customers.  Some strategies you can offer include:

  • Target the shops close to your dealership to minimize delivery costs
  • Concentrate your sales team on a small area
  • Focus on shops have more flexible repair speeds such as transmission shops and vehicle customizers
  • Tell only selected shops about your new service

Marketing Dealer Services

Ask for the Sale

Tell your shops about your delivery time when they call for quotes.  It’s no secret that shops call for price and availability a lot more than they buy parts.  Offering delivery in less than an hour when quoting price will be a pleasant surprise for the shops and leads to additional sales.

Area Target Marketing

Have your outside sales reps and countermen target a geography and type of repair shops. This will focus your business and help  reduce your costs overall. It will also make it more profitable to add a hotshot driver in the future if you have a large concentration of shops in a single area.

Deliver Your Message Frequently

provide fliers to shops with the parts delivery.  Shops have spent years learning that dealer delivery is slow.  That perception will not go away overnight and will take 10 or more sales contacts and successful deliveries before shops know your dealership is different.

Sign up For an On Demand Service Now

Just changing your parts supply can result in a a fivefold increase in shop interest in buying parts from your dealership.  And since you already have the inventory, qualified counterman, wholesale billing structure and built-in brand reputation there’s no reason to delay any further.

Look for Support

Mobile Service is a new opportunity for automakers and dealerships.  Here are some resources that can help get you started:

Karl Krug

Karl Krug

Karl Krug is the Chief Strategy Officer of 3NG Consulting and specializes in automotive parts and service solutions and marketing. 

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