ASSOCIATION RELATED ACRONYMS:
MOTEC supply professional and honest service.
SEMA The Specialty Equipment Market Association (SEMA) is a trade association that consists of a diverse group of manufacturers, distributors, retailers, publishing companies, auto restorers, streetrod builders, restylers, car clubs, race teams and more. Today, the 46 year old organization performs many services for its members and for the hobby as a whole. Perhaps most importantly, SEMA works hard to protect consumers&#; rights to drive accessorized, customized and vintage vehicles. SEMA keeps close tabs on legislators in Washington, D.C., and also in each state within the United States, so SEMA members and anyone who loves cars and trucks can protest pending legislation that might harm our hobby, as well as endorse legislation that's good for car lovers. SEMA is the host to the annual SEMA Show which is held each year in Las Vegas as part of AAIW (See Below).
AAIW The Automotive Aftermarket Industry Week (AAIW) is a general term that is used when describing and/or advertising both shows, the SEMA Show and the AAPEX Show, which are both held during the same week in Las Vegas.
PWA The Performance Warehouse Association is an organization of specialty automotive parts distributors joined together to deal with management, financial and legislative matters.
INDUSTRY PARTICIPANTS:
Manufacturer Any company that goes to market with manufactured goods.
Factory The facility that a manufacturer uses to produce partial or finished goods.
Wholesale Distributor (WD) A company that purchases goods directly from many different manufacturers and houses them in warehouse locations. The WD then distributes those goods to jobbers and retailers at wholesale prices based on need. This process is termed 3-Step Distribution (See Below).
Restyler An installer shop that purchases manufacturer goods at wholesale prices and then installs those products and sells to dealerships. Also referred to a dealer expeditor. Depending on where the Restyler purchases the products (Buying Direct or from a WD), this process is also termed 3-Step Distribution or 2-Step Distribution (See Below). The Unique position of this segment is the focus on aftermarket accessories for appearance and customization applicable to, but not limited to, late model vehicles.
Jobber An installer/retail shop that purchases manufacturer goods at wholesale prices and then sells those products to consumers at retail prices. Also often referred to as a Retailer. Depending on where the Jobber purchases the products (Buying Direct or from a WD), this process is either termed 3-Step Distribution or 2-Step Distribution (See Below).
Retailer Term used to refer to national auto parts chains, such as AutoZone, Advance Auto, O'Reilly, etc.
eTailer An internet only Retailer.
Company Principle An owner or officer of a company that has decision making authority.
Buyer An employee of a company, be it a WD or Jobber, who is responsible for maintaining the inventory of a product for resale. This includes part information, pricing, inventory management, and purchasing. Sometimes refereed to as a Product Manager.
Product or Category Manager Person responsible for reviewing and selecting products to add to a WD / Jobber / Retailer's product offerings. This position is often divided into categories, or market segments, such as Performance, Off Road, Truck & SUV, Tire & Wheel, etc. Product and category managers may be responsible for retail pricing, purchasing, catalog and website placement, and product data maintenance.
Manufacturer's Rep A sales person that works for a manufacturer. A Manufacturer's Rep can work directly for a Manufacturer or can be employed by a Manufacturer's Rep Agency who in turn works on behalf of the Manufacturer. Typically, most Manufacturer Reps are assigned to a specific region and would call/visit the Manufacturer's customers, WDs and Jobbers, that are located in his/her region. While making those calls/visits, the Manufacturer's Rep typically presents new products with the Company Principle and/or Buyer, reviews any new Manufacturer policy changes, aids in Manufacturer related marketing discussions, trains in-house sales staff and countermen about products, and may handle any accounting and warranty issues (if needed).
Manufacturer's Rep Agency A Manufacturer's Rep Agency is a company that employs multiple Manufacturer Reps to represent a portfolio of Manufacturer clients. Manufacturer's Rep Agencies typically only work in a specific region and will represent multiple Manufacturers in that region.
DISTRIBUTION:
3-Step Distribution This is a term for a distribution process. In 3-Step Distribution, (1) the Manufacturer sells to the WD, (2) the WD sells to the Jobber, (3) the Jobber then sells to the consumer.
2-Step Distribution This is a term for a distribution process. In 2-Step Distribution, (1) the Manufacturer sells straight to the Jobber, (2) the Jobber then sells to the consumer. For Jobbers, this is referred to as Buying Direct.
1-Step Distribution This is a term for a distribution process. In 1-Step Distribution, (1) the Manufacturer sells direct to the consumer. For Manufacturers, this is referred to as Selling Direct. For Consumers, this is referred to as Buying Direct.
Buy-In Requirements The minimum purchase amount required (in dollars) for a Manufacturer or WD to open a new account with a new customer.
Payment Terms The terms for which a customer will be billed. For example: Net 30 DOI (payment due 30 days from the date of invoice), Net 30/60/90 DOI (1/3 of invoice amount due 30 days of DOI, 1/3 due 60 days of DOI, 1/3 due 90 days of DOI).
Co-Op Program A program in which manufacturers partner with their distributors for various marketing programs. Costs for these programs are usually split with the manufacturer and distributor, or are paid for out of funds accrued based on a percentage of distributor's purchases.
Buy Back or Lift When a Manufacturer or WD needs to buy back previously sold inventory from a customer, or buy inventory that is in stock from another Manufacturer or WD, because that inventory could not be sold at the intended sale price in order to make room for faster moving inventory within the customers business.
Lead Time How long it takes for an item to ship after an order has been received by the manufacturer.
Field Destroy The process of discarding or destroying defective merchandise by a retailer or distributor instead of returning it to the manufacturer. Typically an allowance is given to offset the cost of the goods destroyed.
PRICING:
MSRP Manufacturer Suggested Retail Price.
Jobber Price An industry standard price point used to determine wholesale prices. Jobber price is typically between MSRP and WD price.
WD Price Warehouse Distributor or Wholesale Dealer price. This is the price that WD's pay for products purchased directly from manufacturers.
Price Sheet A list printed on paper, that lists part numbers, part descriptions, and pricing. There are typically different price sheets for the different levels of distribution.
Price File or Setup File An electronic file, usually in Excel or CSV format, that contains all of the information needed by a seller to load in a new part number, or change data on an existing part number. Typically this information is composed of some or all of the data in the PIES file.
MAP The Minimum Advertised Price (MAP) for a product.
Unilateral Price The minimum sales price for a product. Also called a Colgate Policy. A unilateral pricing policy allows a manufacturer to set a minimum retail price, and refuse to sell to someone who sells below the minimum price.
GENERAL:
Jobber Trade Show A regional show that typically hosted by a WD. The WD will schedule the date and time, schedule the manufacturing partners that they want to exhibit, and then bring in their best customers to meet the manufacturer reps.
Parts Look-Up This phrase is used to refer to an online application that is used to look up vehicle parts based on year, make & model.
ACES Stands for Aftermarket Catalog Enhanced Standard. Created by Auto Care Association, ACES is the North American Industry Standard for the management and exchange of automotive catalog applications data. With ACES, suppliers can publish automotive data with standardized vehicle attributes, parts classifications and qualifier statements. ACES also prescribe a machine-readable format (XML) for trading partners to use in exchanging vast amounts of catalog information electronically.
PIES Stands for Product Information Exchange Standard, also known as price file and setup file. Created by Auto Care Association, PIES is the management and exchange of product attribute information in the vehicle aftermarket industry. Product attributes include part numbers, product descriptions, weights, dimensions, UPC codes, and pricing.
MARKETING:
Ad Buy The process involved in researching, negotiating, and purchasing advertising space in a print, television, radio or online media outlet to promote your company's products or services. These can be handled in-house or by an agency, and often involve studying the media outlets reach (audience size), choosing an ad size or duration and selecting the number of ads to run over a given period of time.
Traditional Media This term usually describes print (magazines and newspapers), radio and television outlets. When working on marketing, public relations or advertising campaign, traditional media refers to anything outside the digital realm.
Social Media Refers to the use of web and mobile based technologies to turn communication into an interactive dialogue, allowing the creation and exchange of user-generated content. In contrast with traditional media, which involves one-way communication, social media encourages two-way interaction. Social media includes everything from peer-to-peer networking sites (Facebook, LinkedIn), to video sharing services (YouTube, Vimeo) and photo sharing sites (Flickr, Picasa). Some social media applications are designed to promote content creation, distribution and interaction by blending all of the above (Twitter, Google+, Instagram). Finally, location based social media utilizes mobile devices and social media to promote brick-and-mortar companies, by encouraging consumers to check in at locations to earn points and discounts, write reviews, etc. (Foursquare, Yelp, Facebook Places).
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PR Public Relations. Using the news, enthusiast or trade press to carry positive stories about your company, products or services; cultivating a good relationship with local and national press representatives. In the new media era, PR can also include direct interaction with the consumer and brand management through social media channels.
POP Display Display that sits on a counter or shelf to show actual product or features and benefits.
CPM Cost per impression per a thousand views. CPM is used to determine the cost to reach one thousand pairs of eyeballs in any media.
B to B (Business to Business) The term "business-to-business" was originally coined to describe the electronic communications between businesses or enterprises in order to distinguish it from the communications between businesses and consumers ("business-to-consumer"). It eventually came to be used in marketing as well. Today it is widely used to describe all products and services used by enterprises. Many professional institutions and trade publications focus much more on B2C than B2B, although most sales and marketing personnel are in the B2B sector.
B to C (Business to Consumer) Business-to-consumer (B2C, sometimes also called Business-to-Customer) describes activities of businesses serving end consumers with products and/or services. While all retail sales are technically B to C, in most cases this phrase is used to describe companies that participate in online retail sales, either through marketing to the consumer or selling directly to the consumer. B to C can also be used as a marketing term to describe communication from a business to the potential customer through marketing, advertising and public relations.
Contingency Program Program that a manufacturer puts together for racing sanctions. The race teams that mark the manufacturer's names of the decals they run on their vehicles when they register for a race will get either cash, product or a product credit if they place either 1st, 2nd or 3rd. Generally the amounts are different for each place and sometimes only cover 1st.
Product Sponsorship The exchange of parts from a manufacturer (often free or at a substantial discount) for either logo space, marketing content, endorsement or all three on a project vehicle or racecar. Examples of this include companies providing parts for a show car build in order to use the vehicle in their booth at shows, or a motorsports team using products and then displaying the sponsors logo on its car and driver. Many product sponsorships now involve social media interaction as well, where in exchange for parts support builders and teams provide sponsors with photos, videos, and news updates for company websites and social media outlets.
Aftermarket car parts make up a significant portion of the automotive industry. In fact, the sector brings around 20% of the revenue to the industry. Whenever someone looks to replace or modify components of their car, they can either turn to parts built by original equipment manufacturers (OEMs), third-party manufacturers, or second-hand equipment. Aftermarket car parts are those made by third-party manufacturers, which refer to a different company other than the vehicle&#;s original manufacturer. Aftermarket parts are also sometimes known as generic, non-OEM, and/or competitive replacement parts.
It&#;s important to point out that there are currently over 230.5 million licensed drivers in the United States. Likewise, the age of vehicles on American roads averages out at around 11.8 years. It should come as no surprise then, that the entire automotive aftermarket industry is about $381 billion as of , $282 billion of which is comprised solely of light-duty vehicles. In addition, personal consumption of auto parts in June reached an all-time high of $50.5 billion.
And given the current COVID-19 pandemic, DIY automotive projects have seen a steady rise. Likewise, buying auto parts online has also seen a steady increase. In fact, in the North American auto parts eCommerce business is expected to exceed $20 billion. Traditionally, the eCommerce aftermarket sector was increasing between 3.5% and 3.9% per year. Yet, in light of the coronavirus pandemic effects, aftermarket eCommerce is expected to grow at an even faster rate for the foreseeable future.
It should also be noted that the digital environment has had a significant influence on the overall automotive aftermarket industry. Around $140 billion worth of parts, components, tools, accessories, and services that have been sold through all sales channels, including brick-and-mortar stores and service shops, have been influenced to varying degrees by the digital environment. By , that influence is expected to further increase to over $168 billion.
When it comes to car repairs, some insurance companies may have the option of using aftermarket parts, instead of original equipment manufacturer components. However, many vehicle owners may feel a bit concerned since these aftermarket components are not made by the same company as their cars. Nevertheless, there is more to these third-party manufacturer components and accessories. This guide to aftermarket car parts will shed some light on what automotive parts business owners need to know.
The topic of aftermarket parts and accessories has been going on for a long time among car enthusiasts. Many worry whether aftermarket parts are as good, safe, or reliable as their OEM counterparts. But over the years, aftermarket parts have gained a lot of popularity and acceptance as a good alternative to original manufacturer parts. In some cases, they are even seen as superior by using better materials and more advanced technologies than the car manufacturers, themselves. And according to the Insurance Information Institute, automotive aftermarket components should not interfere with a vehicle&#;s warranty.
That said, it&#;s essential to keep in mind that there are different types of aftermarket parts; structural and cosmetic. According to the Insurance Institute for Highway Safety (IIHS), aftermarket cosmetic parts have absolutely no effect on safety. Everything from fenders, quarter panels, door skins, bumper covers, trims, etc., will not impact the safety of the passengers. Structural parts, on the other hand, are directly responsible for the safety of the occupants in the event of the crash. And according to the IIHS, some aftermarket structural parts can meet these requirements.
When it comes to safe structural components, buyers need to make sure that they have the Certified Automotive Parts Association (CAPA) certification. The association has very high standards and guidelines when it comes to aftermarket parts. The CAPA runs numerous tests on both the production and quality of materials, as well as part integrity. To become CAPA certified, the aftermarket components need to be considered as &#;functionally equivalent&#; to their OEM counterparts. By comparison to some insurance companies&#; requirements that the parts should have a standard of evaluation of &#;like kind and quality,&#; the aforementioned CAPA &#;functionally equivalent&#; certification is a stronger alternative of the two. While the &#;like kind and quality&#; requirement doesn&#;t typically include the function and/or crash test performance, a CAPA certification does.
And aside from the fact that aftermarket products are more readily available than their OEM variants, they can also help buyers save more money. According to the Property Casualty Insurers Association of America (PCI), aftermarket parts save consumers over $1.5 billion. Generally, OEM parts are 60% more expensive than those made by third-party manufacturers. And it&#;s because of these cost savings that some insurance companies choose to use aftermarket components after accidents.
Given the proliferation of the automotive aftermarket eCommerce sector, more and more auto part businesses are looking to enter the online marketplace. However, the majority of them do not feel prepared to make the transition. While some lack the necessary technical skills and know-how, others lack a comprehensive strategy and business plan to do so. There are also those that do not have the necessary digital resources to operate their car or truck part business, at least partially, online. This guide to aftermarket car or truck parts will also provide some information on how to make the transition.
Starting a business almost always involves a fair degree of market research. One of the fastest and most effective ways of doing this is by talking with anyone buying and selling auto parts. This can include everyone from car enthusiasts, auto repair shop owners, local mechanics, and even people who decided to do a small project on their car some time ago. Ask them about their wants, needs, expectations, and pain points. Try to figure out what manages to drive a sale or a purchase for them. Also, ask them about the experiences they had while they made an online purchase. This data will help you learn what to use and what to avoid to improve the overall shopping experience of your buyers.
Like with any other type of business, successfully running an aftermarket auto parts company means that you need to know the customers. These consumers can be divided into two broad categories: B2B and B2C consumers. Business-to-business consumers typically include wholesalers such as auto shops, garages, and other such vendors. The benefits of selling aftermarket car parts to B2B consumers typically translate to higher sales volumes, more stability, and lower costs overall. By and large, auto shops and garages tend to purchase components that need to be replaced more frequently, such as tires, oil filters, plug wires, spark plugs, fuel pumps, and more.
Retail customers (business-to-community buyers) such as end-users and car enthusiasts, will tend to provide less stability and lower volume than is usually the case with B2B buyers. Nevertheless, you will have access to a wider customer base and will be able to provide them shorter delivery times, such as same day shipping. By extension, this means that you will also be able to provide a better customer experience. Likewise, car enthusiasts are generally more interested in cosmetic parts, such as mirror accessories, suspension kits, seat covers, car covers, center caps and other such accessories.
While some aftermarket auto parts businesses choose to sell parts to both B2B and B2C customers, it&#;s often better to focus your services on a specific niche. If for example, you will be building your eCommerce website, catalog, and business predominantly on repair shops, garages, and other such vendors, the bulk of your inventory should also be geared towards parts that are most frequently used by these consumers. It&#;s a good idea to analyze which car parts are most commonly replaced, such as control arms, brake pads, fuel tanks, air filters, fuel pump, wiper blades, headlight bulbs and tail lights, oil filters, batters, spark plugs, oil pans, etc. You should also take a closer look at the components that are most prone to wear and tear, such as fuel systems, water and oil pumps, tires, belts, fuses, alternators, engine sensors, mufflers, etc.
When it comes to B2C customers, such as car enthusiasts and people who commonly engage in DIY projects, you can focus more of your inventory on cosmetic, rather than strictly functional and/or structural parts. By doing so, you will be able to provide a much better shopping experience, greatly increasing the chances of repeat customers. That said, you will also need to keep a constant eye on the best-selling auto parts, as these have a tendency to change over time. Nevertheless, there are certain parts and accessories, such as tires, GPS trackers, car DVRs, smart locks,mirror accessories, seat covers, car covers, plug wires, headlights, tail lights, fog lights, or jump starters, among others, that are fairly consistent top-sellers.
Once you have a general understanding of your target audience, it&#;s a good idea to take a quick look at your competition. Examine all of their sales channels, such as Amazon, eBay, eCommerce websites, and other third-party aftermarket automotive sites. Determine how these auto parts businesses set their prices and how they operate to get a better understanding of how to outcompete them. Compare this information with what you&#;ve learned during the market research phase and determine how you could do things better.
Professional images go a long way whenever you are selling car parts and accessories online. People want to see how these components look as they try to gauge the overall quality of the product. Low-resolution photos or stock images will typically deter people from making a purchase and can even end up hurting your brand&#;s image.
When it comes to describing the car parts and components, you should really take your time and go as in-depth as you can. By using fitment data in your listings, your customers will also be able to find what they are looking for much more easily. Fitment data will tell them whether the part they are looking at will actually fit their vehicle and if it will be able to satisfy all of their needs. Lastly, when you are putting together the product descriptions, don&#;t forget to mention whether the part is aftermarket or made by original equipment manufacturers.
Due to its huge customer base, Amazon makes for an excellent sales channel for automotive aftermarket parts and components. But in order to have access to the Automotive & Powersports product category, you will also need to have a Professional Seller account. So, you can either get Amazon&#;s approval in this product category or get it to review your independent eCommerce website. There are several basic requirements that will get you qualified to sell auto parts on Amazon. These include the following:
While most automotive parts and accessories can be sold on Amazon, some tend to work better than others. By and large, exterior and interior parts, as well as lighting and LED products, tend to be best-selling categories on the platform.
Among these we can include the following:
Exterior Parts:
Interior Parts:
Other Parts and Accessories
The second most prolific third-party sites to use when selling automotive parts and accessories is eBay. The platform is designed in such a way to streamline the entire process for both the buyers and sellers. Selling auto parts, components, tools, and accessories on eBay is pretty straightforward. If you don&#;t have an account, you will need to sign up on eBay and select the Sell option. You start by creating a product listing and provide eBay with all the details about that component. You will need to select eBay Motors in the Categories section and choose Parts and Accessories. These categories will become more and more specific as you advance with the listing.
However, for an auto parts business, creating listings one at a time can be incredibly labor-intensive and time-consuming. Luckily, eBay&#;s Seller Hub can greatly streamline this process. Also, when you are creating parts and accessories listings, you can also use eBay Motors Parts Compatibility. This tool allows you to add fitment data, such as the year, make, and model of the vehicle, trims, manual or automatic transmission, engines, fuels, and other such information.
Some of the most commonly-sold parts on eBay include:
Whether you decide to sell auto parts and accessories on Amazon, eBay, or both, as a business, you should also consider building your own eCommerce website. To build an eCommerce site basically means that you will be building on an open-source framework or self-hosted eCommerce system. Most commonly WordPress is the go-to open-source website platform. But if you are not particularly tech-savvy and don&#;t have the necessary know-how, you should look to collaborate with a web developer and designer to help you design and develop your site. While there is more investment to be made, building your own site provides you with plenty of opportunities to customize and integrate the pages and information however you want.
A different alternative is to host your eCommerce site. You can do this through hosting platforms such as Shopify or Bigcommerce. These hosted systems will spare you from having to upgrade, maintain, or host your site. That said, the customization possibilities are fairly limited when compared to building your website from scratch.
Whether you are looking to sell fog lights, bumper covers, floor mats, brake pads, or any other type of car parts, accessories, components, or tools on eBay, Amazon, or your own eCommerce website, you will need to keep in mind that simply setting up your channels is only the start. There is plenty of competition out there, and you will need to do as much as you can to make sure that you stand out. Among the most important aspects here will be to always stay up to date on all industry trends and new components that enter the automotive aftermarket on a regular basis. You will also need to know what digital tools to employ to give you an edge in managing your eCommerce catalogs on all of your sales channels.
When you are optimizing your auto parts store and eCommerce platform listings, you will need to make sure that you use the highest-quality product images possible and provide comprehensive and relevant product descriptions. To avoid confusion for potential customers looking to buy car parts online, make sure that each product is backed up by the necessary fitment data. In doing so, you will maximize visibility whenever these customers perform a keyword search.
Most importantly, however, is that detailed and up-to-date fitment data will ensure that every time a potential buyer looks up an auto part or accessory, they will know whether or not it will actually fit their vehicle. What&#;s more, that fitment data will also let them know if that particular car part will be able to satisfy all of their needs. However, making sure that every listing in your auto parts catalog has the correct fitment information attached to it, it&#;s easier said than done. As new vehicle configurations are being introduced and new aftermarket products enter the market on a regular basis, fitment data will change. This means that keeping your own data up-to-date will be an ongoing process. MyFitment can help you with building your online catalog, as well as updating and maintaining it on a regular basis. At myFitment, we have decades of automotive aftermarket industry experience. We will help you increase sales with clear, accurate fitment data that eliminates buyers&#; doubts as to whether the part will fit the intended vehicle. Ask us how we can help you identify opportunities, save time, beat the competition, and build your brand.
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