It's happened again –– I wasn't included in Motor Trend's Annual "Power List" of automotive movers and shakers nor were any of my colleagues, bosses or casual friends. Believe me, I know I could screw up some of these car companies just as badly as some of those who received this lofty recognition.
Seriously, I certainly don't expect to be listed, but I do expect that some of our aftermarket leaders would be recognized. After all, the aftermarket keeps motorists on the road. And just a little observation: The majority of the advertisers in Motor Trend and the rest of the consumer car magazines are aftermarket companies. Am I the only one to see the irony in this?
Alright already, enough bellyaching. Let's discuss what I really want to talk about: the specialty parts market that we feature this month on our cover. It is not only a viable market, but a vibrant market. And, in my final analysis, I would say it's a vital market for parts distributors, because surviving by selling replacement parts alone is a dead-end strategy. With vehicles and their parts lasting longer, not to mention their more comprehensive long-term warranties, supplemental profit centers are a necessity.
There doesn't appear to be a better niche than specialty parts when you consider the higher profit margins that they offer.
Emotion drives the market. Specialty parts are things that people don't need but want nonetheless. Who really needs 21-inch chrome wheels or a navigation system that tells them they're 50 feet away from the next turn?
It's not like the importance of the specialty market to the traditional replacement parts market is a secret. According to the Specialty Equipment Market Association (SEMA), the overall specialty parts market is $34 billion at the retail level. Of that, the traditional aftermarket has close to 25 percent of it.
Further evidence of the specialty parts infiltration can be seen in our annual State of the Industry survey. More than 87 percent of the retailers report that they sell specialty parts, almost 80 percent of the jobbers sell them and almost 80 percent of the independent repair shops install them. As our study shows, all of these market segments had significant increases in specialty sales last year and expect larger increases this year.
Not surprisingly, new car dealerships also want a chunk of the specialty business. Our study shows that 82.4 percent of the dealers install these parts. And why not? Sales were up almost 24 percent last year and are expected to grow slightly this year.
If you think I'm leading up to something, you're right. In a few months, our West Coast team will launch Specialty Parts, the only publication designed to help you get your share of specialty parts sales by providing you the same sort of news and analysis and business solutions that you're accustomed to receiving in Aftermarket Business.
Even with the premiere of this magazine, we still may not make next year's Motor Trend's "Power List," but we think we'll be high on yours.
Larry Silvey, Editor-in-Chief/Group Editorial Director [email protected]
