Jack Steinkamp wants Ford Motor Co. dealership parts managers to band together to combat increased competition and decreased warranty revenues.
A co-director of the Ford Manager's Association, Steinkamp is trying to create seminars and workshops for Ford parts managers throughout the United States. Steinkamp's 4-year-old association, which is not affiliated with the automaker, is an advocacy and watchdog group for parts and service managers at Ford dealerships worldwide.
'Our business is changing tremendously. It is becoming so much more competitive,' Steinkamp said. 'We have to raise our professionalism through education, training and networking.'
In May, Steinkamp's association participated in its first grassroots gathering in Omaha, Neb. Ford parts managers from Nebraska, Iowa and Kansas attended the two-day workshop to discuss industry trends and share problems and solutions.
'We had a dealer principal and his parts manager drive 356 miles to attend,' said Jim Slimp, manager of the Ford dealer parts sales warehouse division at H.P. Smith Motors Inc. in Omaha. H.P. Smith hosted the event, which was sponsored by the Nebraska Ford Parts and Service Clubs.
'It was like an NADA convention for parts and service people,' Slimp said.
Participating vendors included Signett Systems of Harrodsburg, Ky.; SCS Frigette of Fort Worth, Texas; Durakon Industries of Lapeer, Mich.; and Bell & Howell of Cleveland.
About 35 participants representing 20 Ford dealerships attended, Slimp said.
WARRANTY GROSSES DROP
Steinkamp's association, which has 1,200 members in the United States, Canada, Great Britain and Australia, wants to expand the size of the seminars and offer at least six annually.
The gatherings have gained urgency because Ford Motor dealers anticipate a steep drop in warranty work in the next three to four years.
Ford has told its dealers to increase repair and maintenance work 50 percent by 2001 because warranty work is about to plummet. Ford expects warranty repair revenue at a typical dealership to drop $115,000 annually by 2000.
Today, an average Ford or Lincoln-Mercury dealership grosses $300,000 annually in warranty repairs.
Ford has said warranty grosses will drop because of improvements in vehicle quality. In addition, Ford is recalculating 1,600 service repairs and may reduce warranty reimbursements to dealers.
RECAPTURE LOST PROFIT
'We have to combat this and get back that lost profit,' Steinkamp said. 'It can be done through better customer retention, cost control, more competitive pricing and better marketing of the dealership's parts and service operations.
'Through networking we can find out what works for people and share tips we've learned from other members,' he said.
For example, the Nebraska seminar covered everything from hot line phone numbers and parts inventory issues to the need to advertise to combat independent service shops.