Building business
It is a matter of debate if adding truck service to a parts distributor’s portfolio is necessary for future survival. What is not in question, though, is branching out into service – whether on- or off-vehicle – can yield stronger customer relationships, a new revenue stream and greater long-term viability.
“I think you become more of a value proposition to the customer,” says Bill Ryan, chairman and CEO of Point Spring & Driveshaft Company, a 10-facility parts-and-service organization headquartered in Pittsburgh. “It’s one thing to be able to bring them a box, it’s another thing to be able to solve their problem.”
Another benefit, of course, is there is money to be made.
“Certainly, you’re going to make a profit on the labor side, and the service business is a higher-margin business overall than the parts business by itself,” says Dave Fulghum, vice president of MacKay & Company. “You don’t necessarily get shopped as much as you do on the parts pricing, and if a customer brings a truck in to get it serviced, then you’re going to get all of the parts business that it will take to fix that truck.”
So how do you know the time is right to branch into the service arena?
