Parting Words - Best Practices
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SECTION: Best Practices

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Parting Words

Written By: Mary Sedor

Article Date: 07-02-2007
Copyright(C) 2008 Associated Equipment Distributors. All Rights Reserved.

Dressta formed a dealer council to assist in formulating its new parts policy.

When it came time to start its new parts operation, Dressta North America asked the experts - its dealers. Dressta is the former International Harvester (IH) company, which dates back to 1835. In 1972, IH licensed a company in Poland called HSW to manufacture some of its products. In the mid-1980's, IH's construction machinery business was sold to Dresser Industries. Soon after, Komatsu formed a joint venture with Dresser and became the majority owner. A few years ago, the company became knows as Dressta.

In June 2005, HSW purchased Komatsu's interest in Dressta, including the Dressta product name but excluding the parts business. Komatsu's parts warehouse was used to distribute parts.

Recently, Dressta opened a new parts distribution center in Bolingbrook, Ill., and began to handle its own parts business. The new parts center is located roughly 30 miles from O'Hare International Airport and 20 miles from Midway Airport in Chicago.

Seeking Dealer Opinions

"We had to determine how we wanted to manage our parts operation," says Rich Jilek, vice president of Dressta's North American parts operations. "So we formed a temporary manufacturer/dealer council."

Jilek says he got the idea for the council from his work at a construction equipment dealership.

"I was able to get the dealer side of the story," he says. "I swore if I ever had the chance to work for another manufacturer, I'd do things differently. I'd ask for recommendations from our dealers.

"Having worked at a dealership, I knew there were a lot of ideas at dealerships that I wanted to tap into to make a state-of -the-art parts business."

Dressta developed a small committee consisting of 12 dealers and employees from Dressta and the logistics company.

"We showed them how we wanted to run the parts business," says Jilek. "We asked the dealers to tell us what needed to be changed."

Real Solutions

During the first meeting, held in November 2006, the group came up with a new method for shipping top priority parts. At a second meeting held in March 2007, after the parts operation was open for business, the dealers provided feedback on how they were doing and to get their input on the company's web-based parts ordering system.

"In the aftermarket today, everyone gauges themselves on how fast they can get parts," says Jilek. "At the suggestion of our dealers, we formed relationships with major airlines at Chicago's Midway and O'Hare Airports. If someone needs them, we can easily move parts through our warehouse and have the parts on the first flight out to a major metropolitan airport."

If a dealer wants it, Dressta will insure parts shipments so that if something is lost or damaged, the dealer doesn't have to fight with the shipper.

"The conflicts dealers would have had with the shipper to get a refund are now off the table before it happens," says Jilek.

The company has also extended the period in which dealers can return parts from 30 to 60 days and minimized the number or non-returnable parts.

"We opened up the return window because we know sometimes field service guys have a tendency to leave parts on trucks," says Jilek. "We thought the extension would be helpful for dealers."

The first two meetings were so beneficial, Dressta will establish a permanent manufacturer/dealer council.

Paul Meyer, general manager at RECO Equipment in Morristown, Ohio, says he enjoyed being a part of the first board.

"In my 30 years in this industry, I've sat on several advisory boards and this was the first time anyone has ever asked dealer representatives to come in prior to setting up their policies and procedures and standards, and asked for our input," says Meyer. "That was very good on their part. They did indeed take some of our suggestions to heart and made changes to their policies and procedures."

Jilek says the council is an important step to creating a great working relationship with dealers.

"I don't have all the answers," he says, "but getting a group of people together from across the country to develop processes and procedures to provide better customer service is better than just one person trying to figure it out."

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