Stepping up as business picks up

March 1, 2011
READY for a little good news? For most truck equipment distributors, it's been a tough economy. But many upfitters were facing challenging business conditions

READY for a little good news?

For most truck equipment distributors, it's been a tough economy. But many upfitters were facing challenging business conditions long before the downturn. For years, distributors have been contending with fundamental changes that bring into question the very role they perform.

Chassis pools. Ship-through programs. Direct selling. The growth of manufacturer-owned truck equipment shops. The channel of distribution is far more complex today than it has been in the past. And for the local, independent truck equipment distributor, it's tougher to compete than ever before.

Or so it seems. There just may be some opportunities emerging as recession recedes, leaving some customers in search of the things that distributors can provide.

The 2011 Work Truck Show had a special session titled “What Your Customers Really Want.” It was based on the latest survey of the managers of truck fleets — both large and small. The good news — in a time where many types of companies are competing for the truck equipment dollar — is that the truck equipment customer is looking for the kinds of things that truck equipment distributors historically are good at providing.

Strip it down to the essentials: They want to do business with experts they can trust. And NTEA has some research that indicates distributors are doing just that.

According to research commissioned by NTEA, most fleets looked to truck dealers as their primary contact for truck and truck-mounted equipment purchases in 2006. For large fleets, it was 53%. Smaller fleets contacted truck dealers first 71% of the time.

But according to the results of the 2011 survey, the distributor/upfitter had become the primary contact for truck fleet buyers. For both large fleets (more than 50 trucks) and small fleets, approximately 40% turn to dealer/upfitters first.

The downturn caused profound changes in the market. General Motors got out of the medium-duty truck business. The Sterling brand no longer exists. Some truck dealers closed their doors, while others downsized or scrambled to acquire new brands.

Truck buyers have been deeply affected as well. Substantial numbers of fleet truck experts — the people who manage them and those who service them — are gone. The survivors are left to perform the same tasks, but with fewer people. Roughly half of the fleets surveyed reported having to get by with reduced resources, and 80% say job stress has increased over the past three years.

So with the recession costing many truck experts their jobs, who will provide the truck expertise as the industry recovers?

The “What Do Your Customers Really Want” session (see next month's issue for a detailed report) did more than recite survey statistics. NTEA brought in two fleet executives to tell the story in person. Both of them said staffing levels have been slashed, but the work remains. Fleets do not want or are able to do things in-house like they did before. As one of the fleet managers said, he just wants someone to take on these tasks. Someone he can trust. Someone who will do a turnkey job and send him a bill.

This sounds like an opening big enough to drive a Mack truck (or any other brand) through. But not without some qualifications. Fleets are not looking for just anyone with a crescent wrench and a line of truck equipment. They demand a level of sophistication and the kind of truck equipment provider that a fleet can trust.

By all indications, commercial trucks are only going to become more complex. Who is going to step up to offer that expertise?

According to the research, fleets commonly complain about missed delivery times. Who will have the production control system in place to orchestrate the arrival of all components so that the truck will be finished when promised? Who will be responsible if it's not?

Who will be the expert in the latest truck and trailer regulations? A speaker at the recent Heavy Duty Aftermarket Week sees service opportunities for shops, because of the Federal Motor Carrier Safety Administration's recent Comprehensive Safety Analysis initiative. But technicians must know their stuff, and the stakes are high for customers whose vehicles are out of compliance.

As the truck equipment business recovers, companies have an opportunity to become valued suppliers to their customers by providing high levels of service. Someone in the channel of distribution will step up to provide it. But this type of business won't be something a competitor will grab. It will be business that companies will have to be earn. Will that company be yours?

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About the Author

Bruce Sauer | Editor

Bruce Sauer has been writing about the truck trailer, truck body and truck equipment industries since joining Trailer/Body Builders as an associate editor in 1974. During his career at Trailer/Body Builders, he has served as the magazine's managing editor and executive editor before being named editor of the magazine in 1999. He holds a Bachelor of Journalism degree from the University of Texas at Austin.