In our third and final installment of this series, we are going to examine the business practices of two well-known manufacturers, Goodman and ICP. Like their predecessors in this series, both are highly focused on the growing parts business.
“Parts and supplies represent an integral portion of our business,” says Wayne Hartman, director of parts and supplies, Goodman Distribution, Inc. “I am a firm believer that a strong parts structure will help increase equipment sales at the OEM and at the distribution level. Who wants to buy any piece of equipment, regardless of the initial value, whether it is an HVACR system or automobile, if you can't get the parts when it requires service or maintenance? I also like the daily challenges that result in our ability to help our customers increase the sales and profits of their businesses.”
And here are their responses to our questions:
What do you call your replacement parts business?
Goodman: We conduct our replacement parts business primarily through our company-operated distribution organization, Goodman Distribution, Inc. In addition, we are in the process of introducing the brand name of GoodParts®. We will use this brand to promote all of our aftermarket parts and supplies. We will offer this strategy throughout all 700+ distribution points in North America, including more than 150 company-operated stores.
ICP: FAST® HVACR Parts.
What is your strategy for your replacement parts business?
Goodman: Simply stated, we want to be the sole source for all parts and supply needs of every HVACR dealer in North America. Our goal is to provide the best customer support service in the HVACR parts and supplies business. We strive to have a focused offering of parts and supplies at competitive prices. We have more than 700 store locations. As such, we strive to be the preferred choice for both OEM and generic parts and supplies for any HVACR dealer.
ICP: First and foremost, FAST is dedicated to providing OEM replacement parts for International Comfort Products LLC equipment brands (TEMPSTAR,® HEIL®, COMFORTMAKER®, KEEPRITE® and ARCOAIRE®) through its network of distributors in the United States and Canada. Second, FAST also supports the same network of distributors by offering one of the largest aftermarket product offerings in the industry — generic replacement parts that can fit most major brands of HVACR equipment.
How do you work with distribution in expanding your replacement parts business and how does your distributor relationship(s) fit within your strategic plan?
Goodman: We are actively adding new store locations to ensure that we are not located far from any customer. Convenience is a major element of our store location strategic plan. In many cases, we will relocate to a more convenient location or remodel an existing store to make certain that we have the right parts and supplies that our customers need. We fully stock each new store we open with parts and supplies that GoodParts customers identify as critical. Should a specific geographic area require a part or supply that we typically do not stock, we are capable of stocking that specific item at all stores in the area where the customers need that part or supply item.
ICP: FAST takes a growth position with its distributors. Continuous improvement toward better performance builds their confidence in us. One of the key elements is to compare our performance against our own standards. We use internal means and measurements to drive us nearer to perfection. Granted, we may never obtain the perfect measurement; however, we compete today against the performance of yesterday.
We also offer a wide range of distributor services. Some of these are:
- Store planning.
- Advertising/co-op support.
We grow the national FAST business by helping distributors grow theirs.
The breadth and depth of our product offering is certainly an area that places FAST in a favorable position. This, combined with the distributor programs, a strong customer service department and good two-way communication, enhances our position in the market.
The FAST/ICP distribution team does an excellent job of executing our strategy in the field. Put it all together and you see why FAST is the choice of many HVACR contractors.
Is your OEM parts business open to just your distributors or can “anyone” participate. In short, what are the barriers, if any, to participation?
Goodman: Our OEM parts business is open to both company-operated and independently owned HVACR distributors who carry our brands of HVACR equipment.
ICP: We are dedicated to distributorships of ICP. Our distribution has done a great job with our product offering, and we're confident that we'll continue to see great results through our joint efforts.
What is the breadth of product line? Do you intend for your offering to serve only as replacement for your own equipment line or do you intend to expand it to include other products? If you expand the product line, what niche areas are you considering? For example, would you consider line sets or chemicals?
Goodman: At the present time, our offering consists of our OEM parts. With the establishment of our new parts distribution center in Houston, TX, we are rapidly expanding our parts offering to include key supplies, installation products and service replacement parts designed to be used to repair any OEM's equipment. We will utilize a mix of brand name products along with products using the GoodParts brand name.
ICP: I always enjoy discussing this topic because, throughout the year, I hear many comments about the fantastic amount of products we are able to distribute to the HVACR contractors. We have everything that it takes to fill the needs of a professional HVACR technician service truck. Yes, we carry line sets, and yes, we have cleaning and maintenance chemicals. The short list would be what we don't have to take care of a repair or installation job.
How is your replacement parts business different from your competitors? In other words, what is your unique advantage (s)?
Goodman: We believe that our competitive prices, convenient store locations and our extensive line of parts and supplies combine to make us a unique and profitable business partner for our customers. The combined strength of our company-operated distribution and independent distribution creates a network of more than 700 locations across North America. This vast network allows us to provide unrivaled service and support to HVACR dealers compared to other OEM parts suppliers.
ICP: We are in an industry of ultra-keen competition. Many companies with talented individuals are working together to provide affordable comfort for homes, businesses and institutions. We have a winning team spirit. Our people are relentless in striving to give the best service they possibly can, working toward daily improvement over the previous day. It isn't an easy task to keep abreast of an ever-changing world and the expectations that come from it; however, the FAST administration has a strong, positive attitude toward our distribution. It's a race to the finish, and we want to see them win with FAST. Competitive programs, our fill rate, lead time and our team attitude should certainly demonstrate our commitment to winning for our customers — which translates to wins for us.
What is your marketing plan or approach to expand your parts business, and what mechanism do you use to publicize this sector of the operation?
Goodman: We use both internal and external communication tools to market our parts and supplies business and send out monthly direct mail pieces on a nationwide basis to a myriad of HVACR dealers. In addition, we have in-store promotions on a frequent basis that we sponsor exclusively within the store location. Further, we attend and conduct regional and national meetings to help communicate our parts and supplies marketing programs.
ICP: As you might expect, we are staying focused on the standard blocking and tackling. Specifically, some of these initiatives include:
- Distributor technical and sales training.
- Electronic parts marketing system.
- Most importantly — listening to our distributors.
The continuous service level FAST offers will remain high — whether it's a direct fax, Web posting or direct mail, we keep our customers in the know.
Where can distributors find out more about your program? Is there a dedicated website? If not, can a distributor who doesn't carry your equipment line go to your main site and find out all the details that he or she needs?
Goodman: Distributors seeking information about our parts and supplies programs can request information directly from their assigned sales and customer support contacts. In addition, they can contact us directly and request to talk to our parts organization. We will also be using our GoodParts web-site to advertise and promote our products and services.
ICP: Our distributors use a dedicated website. To find out more about our company, visit www.icpusa.com or use a search engine and key in INTERNATIONAL COMFORT PRODUCTS.
How will you keep distributors informed about updates, program changes and added products?
Goodman: We employ internal memos, mailings, telephone conferences and similar communication tools on a consistent basis to make certain that our parts and supplies program information is current.
ICP: FAST keeps distributors informed with the use of Web postings, broadcast faxes, distributor meetings, and product catalogs and bulletins. However, the FAST sales team is one of the greatest means of keeping our distributors up to date.
Who is in charge of your parts replacement business?
Goodman: Wayne Hartman, director of parts and supplies.
ICP: Bob McDonnough leads the FAST management team of sales, marketing, customer service and technical support for the division.
Tom Peric' is the editor of HVACR Distribution Business. Contact him at [email protected] or 856/874-0049.