Many small businesses now rely on parcel delivery than ever before. And if there is one industry small business should look to for inspiration in this area, it’s auto parts. You won’t find a more cut-throat industry than this particular industry.
For instance, if a mechanic or repair shop can’t source a part quickly, they can easily find another supplier willing to step in. Also, deliveries are often next day, and many are requested and completed on the same day – the auto parts industry had quick turnarounds figured out long ago.
While you might expect such an industry to be dominated by bigger players, in fact many small businesses thrive in this environment. But they have been incredibly smart about the way they go about it. I have seen many of these smaller businesses succeed amid huge changes in product, technology and demand.
There are five key lessons from the auto parts industry which any small business can take on board:
1. A dedicated solution: even the smaller auto parts companies tend to have dedicated delivery transport, often a mix of company-owned vehicles and drivers combined with outsourced vehicles and drivers, although many smaller businesses outsource because they don’t want any of the fixed costs from running their own fleet. They don’t trust parcel delivery to ad-hoc providers such as couriers – their business depends too much on timely delivery to take any risks with potential late or misplaced items.
2. Parcel delivery is a service: auto parts companies appreciate the delivery driver as their most frequent direct personal contact with their customers, and they prioritise good, well-mannered and reliable drivers. A good delivery driver will form a strong rapport with regular customers and make themselves indispensable. Even outsourced drivers will often be in company uniform, driving company branded vehicles, and will often be engaged for many years at a time, as auto parts companies appreciate continuity for top level service and performance.
3. Customers are informed: auto parts firms are known for using telematics technology, which tracks vehicles and deliveries. While this technology has been available for some time, there’s still surprisingly low take-up among many small-to-mid-sized delivery fleets in other industries. Auto parts companies want to see where their drivers are at any time – but most importantly, customers can receive reliable updates on their deliveries using the same tech.
4. Fleets are efficient and tracked: efficiency boosts performance, which builds company loyalty and business growth. Many auto parts companies do very well at monitoring their performance. They know efficiency is not “set and forget”; it requires constant attention but brings strong rewards. This same efficiency enables them to be more transparent with clients on fleet and delivery tracking. An inefficient fleet may be shown up via tracking technology – if clients see vehicles taking the scenic route or constantly returning to the depot they’re likely to be less than impressed.
5. Agility to adapt and grow: many auto parts firms look for partners who can grow with them and respond to their needs. They recognise it would be foolish to own and run their entire transport fleet, due to huge fixed costs and inflexibility. Fleets need to be agile, they need to either scale resources up or down to meet demand peaks and troughs. They need to be able to trial new delivery runs to grow the business without having to go and buy or lease a new vehicle or hire new drivers. Canny outsourcing gives these companies the control they need to be responsive and agile.
Walter Scremin, General Manager, Ontime Delivery Services