Are you getting your share?
In discussions about dealer-related issues with several manufacturers’ CEOs and other industry experts over the past year, one point has come up repeatedly: there is big money to be made on aftermarket accessories, and dealers are not getting their share. If there were ever any doubts about the opportunity that exists, a visit to the annual SEMA (Specialty Equipment Market Association) show, held in Las Vegas in November, would instantly dispel them. The show is mammoth in proportion, covering more than 93,000 square metres (1 million sq. ft.), and it includes every type of automotive product imaginable - and more. SEMA estimates that specialty equipment of the kind displayed there, primarily performance and appearance parts, represents a North American market of over $34 billion (U.S.). That’s billion, with a B!

While we tend to define that segment of the industry in terms of incremental parts and components, consumers see it in a broader context, for what it allows them to do. Specifically, to personalize their vehicles. To make them different from the thousands of others just like them on the road. To better equip them for the things they do with them. To make them reflections of how they see themselves, how they drive, and how they live.

Shouldn’t you as a dealer help your customers in that quest? Especially when you can turn a profit by doing so? A profit that someone else is ready and anxious to take if you are not?

Granted, many of the products on display at SEMA are too exotic for dealer sale or installation - the show does bring out the most extreme elements. But there are many more that would be totally suitable, ranging from fancy wheels and trim pieces to emissions-legal performance parts. And according to SEMA, new-vehicle dealers are getting less than a 10-percent slice of that pie.
 
OEMs are on board
For their part, the manufacturers are playing a bigger role in this market than ever before. For some, their authorized accessory and performance-parts catalogues run to hundreds of pages. And for almost all, their offerings are rapidly increasing in number. General Motors, for example, has developed over 100 accessory products for its new full-size pickups alone.

For all manufacturers, dress-up items are among the most popular: grille inserts, mirror caps, door handles, exhaust tips, hood protectors, tail-lamp masks, interior and exterior trim pieces, and more. Even full front and rear fascias, with air dams and spoiler packages.

 And, of course, wheels. Especially wheels. And especially chrome, which is back in a big way. But there is a big market for functional and semi-functional components as well. Things such as fog lamps, grille bars, running boards or side steps, tow hitches, ski or luggage racks, bed-liners, toolboxes, and skid-plates - most of which can also be had in chrome!

Winter tires and a second set of wheels fall in that functional category as well. So do remote starters and winter wiper blades. And why not a safety kit with your brand’s or dealership’s logo prominently displayed?

Don’t forget the entertainment units. If they are not already factory installed, there is a market for accessory satellite radios, iPod hookups, DVD players, noise-cancelling headphones, Bluetooth-compatible hands-free cell-phone adapters, NAV systems, and much more.

 While the OEMs are doing a much better job of providing such products from their own catalogues, you are not limited to their selections. What you can’t find from them, you can almost certainly find from aftermarket suppliers. Things such as reverse warning systems and backup cameras, which may not be factory-available on your low-priced models. Truck caps or racks for bicycles or other specialty needs. Or camping packages, with tents that integrate with the specific vehicle.
 
How to get your share
As a new-car dealer, you are in an ideal position to take advantage of the demand for accessories, for you have two big advantages over your independent aftermarket competitors.

For one, OEM-authorized products have generally been developed to the same quality, safety, and reliability standards as the rest of the vehicle - something few, if any, aftermarket suppliers can claim - and many are covered by the same manufacturer’s warranty as the vehicle itself.

For another, many if not all accessories purchased along with the vehicle can be included in the overall price for financing. Customers can get more of what they want for a small monthly payment than if they have to pay for it all at once.

Reinforcing that point, according to a study conducted in the U.S., 73 percent of new-truck buyers surveyed purchased their accessories when the truck was new, whether from a dealer or an aftermarket supplier. So why shouldn’t it be from the dealer? Pickup buyers, incidentally, typically spend the most money on accessories, although entry-level customers are also big accessory buyers.

With those points in mind, there are several things you can do to help increase your share of the accessory business:

1) Ensure that customers are offered a full range of accessories when they buy the vehicle. Don’t feel pushy by asking. People typically want these things, and chances are, if you don’t ask, they will go somewhere else to seek them out.
2) Reinforce the attraction by having accessory displays on the showroom floor, and accessorized vehicles as well. According to a SEMA study, one of four full-size truck buyers say the availability of performance parts and accessories influenced them to buy or lease from a particular new-vehicle dealer.
3) Involve the F&I, parts, and service managers in the process and spread the compensation around to ensure that they all work with the salespeople, as a team.
 
One final point: think used as well as new.
 
The advantage is yours. Use it, and the profits will be, too.

< Prev		Next >