With slowing freight volumes and high fuel costs squeezing fleet profits, your customers may be looking to trim costs wherever they can, including in their parts purchases.
Yet price, while it is an issue, is actually not the most important factor in most cases.

"Regardless of what part the fleet is seeking to obtain and regardless of which channel of distribution the fleet is utilizing, product quality is driving the purchase decision," explains Molly MacKay Zacker, operations manager for MacKay & Co., which tracks replacement demand for parts and components used on Class 6-8 vehicles based on thousands of surveys. "Still important, but notably further down the list of factors, are warranty coverage and immediate availability. Past experience is rated fourth. Price is not a deciding factor and is, in fact, dead last.

"That being said," Zacker explains, "if a prospective purchaser perceives that quality, warranty, availability and past experience are relatively equal for two or more suppliers, then price will drive the decision."

Take Brad Eads, parts manager for Waste-Away in Elkhart, Ind. Since he came on board in 2007, he's been taking a close look at the company's parts buying and inventory processes, including re-evaluating vendors.

"We were kind of operating on the good ol' boy system, where we had people we knew at different places," Eads explains. "I kind of leveled the playing field for all of our vendors, gave them all an opportunity to go after our business and see which businesses would raise the level of performance."

For Eads, a higher level of performance included things like raising inventory levels on the parts he uses so they'll be available when he needs them, getting parts delivered faster, and providing some guaranteed pricing programs.

"Availability is always critical in the business we're in," he explains. "Being a smaller fleet, we can't afford to have trucks sitting for a period of time."

The Big Picture

Life would be easier if someone could give you a 1-2-3 list of why truck owners make the purchase decisions they do, but it's not that simple, explains Bruce Plaxton of BGP Marketing Solutions, which consults with businesses in the heavy-duty equipment supply distribution chain.

"There are at least 1,001 reasons why fleet managers buy replacement parts," Plaxton says. Those reasons vary according to factors such as fleet size, vehicle age, the part in question, operational issues, and the personality of the individual doing the buying.

"Everyone is price conscious in the products we buy, in our personal lives and in our business," Plaxton explains. "We all buy some things on price. Some people buy everything on price, but most people have various purchase rationales that vary by product and situation."

For instance, he says, you can divide replacement parts into predictive and non-predictive. Predictive parts are things like filters, coolant, motor oil and brake shoes. Non-predictive parts include clutches, evaporators, hoods and fenders. "The more predictive it is, the more price-sensitive it is," he says.

Vehicle age is another critical factor in buying decisions. If it's under warranty, about the only parts the end user's going to buy are things like filters, wiper blades, or marker lights that have to be replaced because a driver backed into a dock too fast.

"If it's a fleet that's 100 percent under warranty, there's not a whole lot of opportunity except maintenance parts," explains Michele Calbi, vice president of procurement and shop operations with Swift Transportation, who has experience on the supplier side with companies such as Freightliner and Toyota. "If they run a truck that's five years old, you're looking at about 13 cents per mile parts and labor maintenance expense. So you're looking at a good 6 to 7 cents per mile spent on parts."

After the warranty expires, the amount of time until the anticipated trade or disposal makes a difference in parts buying decisions. If the warranty was up three months ago and the owner doesn't plan to trade or dispose of the vehicle for several more years, he'll likely choose a premium product that will give him the reliability and durability he needs until it's time to trade.

On the other hand, if the trade cycle is 10 years, and something needs to be replaced at nine years and six months, the decision's going to be different, Plaxton says. "So the end user is going to find the most cost-effective alternative, and that is different depending on how old the vehicle is."

Then there's what Plaxton calls the operational situation. One summer, he was at the Sacramento 49er truckstop in California when two late-model tractors from the same fleet came in with air conditioner problems. One tractor was headed back toward company headquarters in a neighboring state, so the company said to patch it and get the rig back to the home shop - about a $200 repair. The other truck, however, was headed toward the East Coast, so the fleet manager authorized a $1,300-plus repair to get it fixed right.

In this case, the situational factors affected not only the type of repairs to each truck, but also the facility the fleet chose to make them.

"Why weren't the drivers directed to the [OEM] dealer?" Plaxton says. "Someone [at the company] told them to go the truckstop. The answer was turnaround time. The dealer couldn't get those tractors in and out the door in the time frame required by management. And those kinds of situations occur hundreds, if not thousands, of times every single day."

While you can do surveys and get some overall numbers about the main factors fleets consider in their parts purchasing decisions, Plaxton says, "In the real world, it's a very complex decision. I think the complexity of it too often gets overlooked."

Get To Know Your Customers

Darry Stuart, who runs DWS fleet management service and owned a parts business in Florida in the '80s, explains it this way: The parts distributor "has to have a pulse on the customer. Every one is different. One wants to buy on price, another one wants baseball tickets, another wants a particular brand."

Yes, Stuart says, there are fleet buyers who will shift from one supplier to another for pennies. At some of the smaller fleets, he says, "the director of maintenance or the shop manager is egotistically empowered by the ability to beat someone up for 3 cents a part - they love doing that."

The more sophisticated and successful fleets, however, realize that there's more to a successful parts purchasing program than the price per part. Customer service is key, Stuart says, especially since there is a trend right now for fleets to narrow their list of suppliers. The supplier that can provide the parts the customer wants, when the customer needs them, at the right price, and back that up with good customer service, is more likely to be on that final vendor list.

But in order to do that right, because each fleet is different, you need to learn more about your customers.

"Get to know your customer - not just, 'How do you do and when's your birthday?'" Plaxton says. He recommends building a profile of your better customers. Start with your top 10, and when you get that done, expand it. Some of the things you need to know:

How many trucks

- What brand(s)

- What are they used for

- How many miles a year do they go

- How old are they

- Is equipment purchased new or used

- What are the fleet's trade/disposal intervals

- How many vehicles are under warranty

- Parts most frequently purchased

The most logical person to gather this information is your outside sales person. Plaxton suggests making up a simple one- or two-page questionnaire and sending it out your outside parts people along with a clipboard, and a deadline.

Then set up a simple database so you can not only track information on the individual f