A FUNNY THING HAPPENED to Northwest Truckstell on its way to building a new truck equipment shop. The company obtained a retail tire store.
The Portland, Oregon, truck equipment distributor had no plans to become a tire dealer. Instead a newly acquired Ford chassis pool was the main reason that management decided to move to a larger location.
Yet while the new shop was under construction, one of Northwest Truckstell's customers lost its tire store location to a street-widening project. Rather than find a new location, the owner sold his tire dealership to the company where he bought his truck equipment.
"I never would have thought that selling tires would be a natural thing for a company like ours to do," says Dave Ross, president of Northwest Truckstell. "But it is something that has fit us well."
While tires and truck equipment are not identical markets, Northwest Truckstell has found that the two activities are complementary. The company has cross-pollinated the two markets-selling tires to its truck equipment customers and seeing some retail tire buyers purchase truck accessories that can't be found at the average tire store.
Toolboxes, bedliners, bug shields, and running boards are all products that may be of interest to those who come in to buy a set of tires, Ross says.
"It used to be that commercial truck buyers were distinctly different from the personal use customer," he observes. "But that line has blurred in recent years. So many people are using light duty trucks for business during the day and for personal use at night. That's why cab steps are selling so well-they make it easier for the family to get in and out of vehicles that ride higher than a car. A lot of the truck dealers in our area are ordering cab steps on trucks for stock."
Northwest Truckstell also has the advantage of selling tires to its established base of truck equipment customers. And the product mix is not just tires. The company offers wheels, tire chains, and batteries and will be participating in The Tire Factory's national agreement with Kendall Oil to provide quick-lube services.
Combining tires and truck accessories works as well in the shop as in the sales department. By performing a variety of jobs in its shop, Northwest Truckstell can increase the productivity of shop personnel.
"When people buy tires, they want them installed immediately," says Norm Ross, vice-president. "Tire stores usually don't have a steady flow of jobs, which means that there are times when the shop does not have any work. On the other hand, the truck equipment business does not demand instant installation. By having our shop install tires and truck accessories, we can even out the workload more easily.
"We can justify having a large enough staff in the shop so that we never have tire customers waiting in line to have their tires installed. And with truck accessories to install, we can keep the shop mechanics busy during those times when they aren't mounting tires."
The priorities in the shop are straightforward:
o Wheel and tire customers receive top priority.
o Light-truck accessories for walk-in customers are installed next.
o Equipment installations for pool chassis can be used to fill in any remaining time. This includes items such as toolboxes, rather than complex equipment installations.
"So far, we have had only one complaint about the speed of our installations," Ross says. "One customer told us we had him ready to go before he had a chance to finish his coffee."
Making the Move
Northwest Truckstell had a ready-made crew for its new product line when it acquired Parkrose Tire Factory, part of a group of more than 100 individually owned tire stores in Washington, Oregon, and Idaho. Owner Bob Wendling came over to manage the operation. Four others made the move with him, including a shop supervisor and three installers.
The Tire Factory is one of the 10 largest tire groups in the United States, Ross says. The group started in the early 1980s when several local tire dealers decided to get together to buy tires. They would purchase containerloads of tires and then break up the shipments for delivery to individual stores.
With the purchase, Northwest Truckstell obtained an established base of customers, employees who know the business, and product lines that include Continental, Dunlop, and Kelly tires.
"The Tire Factory and Northwest Truckstell traded with one another," Ross says. "A few of the individual stores bought truck equipment from us. We bought wheels and tires from them."
The Northwest Truckstell facility contains two separate shops with offices and showrooms in between.
"In our old shop, we installed truck accessories in the same place as truck equipment," Ross says. "We did not have the overhead doors that would have made it easy to get trucks in and out. We spent too much time moving trucks around. In the accessories business, you need to be able to get trucks in and out quickly."
Truck accessories and the tire shop also require a different set of skills from those of truck equipment technicians. The two shops, therefore, have different personnel, different tools and equipment, and two distinct environments for handling customers.
"We didn't want to mix our truck equipment customers and the buyers of truck accessories," Ross says. "Retail and wholesale customers require different services. We thought we should design our facility so that both types of customers were not at the same sales counter."
Truck equipment customers normally are elsewhere when distributor technicians are mounting bodies and installing equipment. This is not the case in the truck accessory business. As such, the truck accessories shop at Northwest Truckstell is designed to provide service while the customer waits. A customer waiting area, complete with television, helps make the time pass more quickly.
In addition to keeping customers comfortable while tires or accessories are being installed, the waiting area provides a positive reason to stay out of the shop.
"Our goal is to get the customer in and out in an hour," Ross says. "No matter how many signs you put up, customers will still go into the shop. But the waiting area gives them something else to do."
The 62,000-sq-ft facility provides plenty of shop area and ample spacing between the two shops. The building is 400 feet wide. Those who routinely have to walk from one end of the building are issued two-way radios in an effort to reduce the amount of travel.
Ten vehicles can fit comfortably in the 80ft. x 78ft. accessory shop. The 80-ft end wall can be removed to accommodate an expansion if needed.
On the other end of the facility is the truck equipment shop. The 150-ft length of the truck equipment wing provides room for 16 bays. Northwest Truckstell staffs the truck equipment shop with 15 mechanics.
Van interior installation is a specialty at Northwest Truckstell. As a pool account for Chevrolet, GMC, Ford, and Dodge, the distributor is cashing in on the special programs that van manufacturers are offering customers who buy these light-duty vehicles for commercial applications.
Adrian, for example, is aligned with GM, while Crown has a similar program with Dodge. Rob Owens, a Northwest Truckstell employee, has won awards from Adrian for new ideas he has developed to reduce installation times.
"Speed is the name of the game when it comes to making money in the van interior business," Ross says. "We were a van interior distributor before we ever got a chassis pool. But the volume increased sharply when we got a pool and GM introduced the Commercial Choice program. If you run these vehicles through the shop on a volume basis, you can develop ways to install van interiors quickly and accurately. That's when van interiors become profitable."
Time Is Money
The extra profits come from beating the flat rate that the chassis manufacturers pay under their van interior programs. To enable mechanics to beat those installation times consistently, Northwest Truckstell has designated a section in the shop for van interior installations.
"We also have a preassembly area," Ross says. "This is an entry level area for our shop employees. Assembling van interiors is like putting together an erector set. Those with good skills here move on to more complicated installations. And by preassembling as much as we can, we make it easier for our installers."
Among the time-saving ideas Owens has developed is a fixture containing necessary fasteners and supplies for mounting the assembled shelves, bins, and bulkheads. The fixture rolls on a base along the shop floor, yet its cantilevered design suspends a wide range of parts bins so that the components can be located easily inside the van.
Perhaps the biggest timesavers, however, are the templates Northwest Truckstell has produced for van interior installations. Each template is designed for a specific model. The templates are placed inside the van, enabling the installer to drill mounting holes quickly.
"We used to set assembled units inside the van to make sure we drilled the mounting holes exactly where they needed to be," Ross recalls. "Now we put the templates in place, drill the holes, and drop the interiors in place. We had to spend a little time making the templates, but they really have reduced our installation times. It's a lot easier to move templates in and out than it is to put assembled units in place just to determine the location of mounting holes."
Another idea has been to install stops on the drilling fixture so that the drill does not break quickly through the floor and damage a chassis component below. With current designs, it is easy to drill too deep and puncture a fuel tank or electrical wiring.
New Sales Organization
Northwest Truckstell recently restructured its sales organization to better serve its mix of end users and the truck dealers who are the source of sales of pool chassis and equipment.
The result is a twofold approach to the overall truck equipment market. One group, consisting of two outside salesmen and two inside, specialize in serving end users. A second group handles sales to truck dealers.
"Because of our chassis pools, sales to truck dealers have increased significantly," Ross says. "Most of the people that have chassis pools believe this type of structure works. It's a lot to ask one person to be able to sell effectively to all the markets in our trade area."
"Truck manufacturers and dealers speak their own language," says Larry Williams, chassis pool manager. "Our dealer sales and service department handles GM, Dodge, and Ford dealer networks. When we talk with them, we talk about model numbers, incentive programs, and other concepts. We work with them on special shows and dealer open houses."
By contrast, the other group specializes in sales to end users. Ross characterizes this market as one that frequently is involved in bid specifications requiring a lot of technical expertise. This department, too, participates in shows such as those aimed at logging and other specific industries.
"The two groups handle different customers, but the boundary lines aren't hard and fast," Williams says. "Both know enough to be able to help the other when needed. The bottom line is that we all want paychecks that cash. We all work together to make that happen."
Operating the Pools
The new facility is designed to accommodate a growing acceptance of chassis pools. The truck equipment shop is equipped with such timesaving features as powered shop doors and supplying each bay with the necessary air and electricity. However, the main reason the company needed a new location was yard space. With its new location, Northwest Truckstell has grown from a 4.5-acre site to one that encompasses nine acres.
Chassis pools require secured lots. Northwest Truckstell has a chain-link fence topped with barbed wire around the perimeter of its property. A paved yard helps keep the chassis clean, and striping the yard into individual, numbered parking locations makes it easy to find each vehicle.
With its multiple pools, Northwest Truckstell may have 200 to 300 vehicles in stock. Because of GM's current chassis production problems, most of the Chevrolets are vans to be equipped with interior packages. Fords and Dodges primarily are chassis cabs.
"We want to keep the number well below 300," Williams says. "When chassis are in short supply and deliveries are unpredictable, you don't always know when trucks will arrive. The last thing you want in this business is to be overstocked with chassis."
The Northwest Truckstell shop includes large display areas for accessories and truck equipment. Most of the truck equipment display area includes products mounted on chassis.
Having the equipment mounted serves two purposes. It gives the customer a better idea how the products will look and function when installed. Mounted equipment also makes the displays easy to change.
An easily converted display area is an advantage for a company that operates a chassis pool. The space inside the Northwest Truckstell facility sometimes begins the day as a display area and finishes the day as a banquet facility or meeting room for meetings with local or regional truck dealer personnel.
"One of the responsibilities of a pool account is to provide training for truck dealers," Ross says. "Converting our display area into a classroom has been a big help. We can conduct our sessions and still keep our shop open-something we couldn't do if we held the training in the shop. Instead, we can convert the display area, hold the training session there, and then move into the shop to demonstrate the points that we discussed in the training session."
Northwest Truckstell is in the process of installing a $20,000 satellite system to serve as a communication link with General Motors.
"This is something new for pool accounts," Ross says. "We have had dedicated computer systems for each chassis pool we operate, but more communication is needed. For General Motors, the chosen method is satellite communication. Dodge has decided on an Internet link. Ford is evaluating which method would be best for its needs."
Obtaining the Ford chassis pool is what led Northwest Truckstell to build its new facility.
"We could have stayed in our old location otherwise," Ross says. "But once we obtained the Ford pool, we needed more room. We tried to lease property for chassis storage lots, but nothing was available."
Northwest Truckstell obtained the Ford pool in October 1997. However, the company did not really begin receiving chassis until April 1-a date that corresponds with completion and occupation of the new facility.
"The pools we operate are the result of the long-term effort we have put into them," Ross says. "They have helped us grow to the point that we needed this new facility. But they are only one reason."
The truck equipment shop where pool chassis and other commercial trucks are equipped can be expanded. Meanwhile, at the opposite end of the facility, the company continues to establish itself as a source for tires, wheels, and light-truck accessories. Northwest Truckstell may not be burning the candle at both ends, but the shops at opposite ends of the building are helping to heat up sales for the entire company.