Aftermarket barriers force dealer restructuring

Aftermarket barriers force dealer restructuring

“Should I continue to work in this industry? If I choose to stick to it, where is the future?” At a car dealership experience sharing meeting held in Beijing on December 28, 2014, one did not want to disclose The name practitioner throws the above questions to the participating experts.

Go, or stay, this Hamlet-style question is now very popular in car dealership circles. From January 1st this year, the “Guidance Opinions on Soliciting Transformation and Upgrading of Auto Maintenance Industry and Enhancing Service Quality” jointly issued by 10 ministries and commissions will be formally implemented, which means that original parts manufacturers can now sell to autos. The market offers original accessories. This provides a rare opportunity for Internet companies to enter the post-market, but it also makes the 4S shop more difficult to survive.

At this point, in order to complete the sales task, the OEM is still pressing the dealers. According to the latest data released by the China Automobile Dealers Association, in November 2014, the inventory coefficient of China's joint venture, independent, and imported automobile brands all increased at different rates, and all of them were above the warning level. Dealers generally report that the inventory pressure is high. In addition to the luxury car brand, joint venture brand dealers represented by FAW-Toyota have also begun co-branding to subsidize the OEM.

But this is not a long-term solution to the dilemma. "The biggest advantage of 4S stores is the availability of venues and high-end services." Zhu Weihua, a long-time expert in the automotive aftermarket, said in an interview with the 21st Century Business Herald that in the future, 4S shops can completely use taxis and turn the stores into something like "Wanda." Square-style department stores, and this attempt has now appeared in the Beijing market.

4S shop can also cooperate with the Internet

In fact, most car dealers now believe that Internet companies are more terrible than inventory. In December last year, after an Internet company named “Love and Maintenance” opened its doors in Shenzhen, many owners of the main plant began to worry that the maintenance and repair policies they formulated would suffer a “disaster”.

“A lot of people told me that they are considering implementing a three-year free maintenance program to attract customers. If this proposal is to be completed, the maintenance status of the 4S shop will further deteriorate,” Zhu Weihua said.

In general, 4S stores are mostly maintained in a closed state. The owner cannot see the actual maintenance of the vehicle and is often in a weak position in the bargaining process. The Internet company can precisely solve these pain points with the above services. Those seemingly mysterious high-end services, after being transformed by the Internet's business model, became transparent and touchable.

Compared with Internet companies, one of the biggest disadvantages of 4S stores is that the maintenance of the back-end has to support front-end sales services, which makes the maintenance costs of the owners high, and the Internet can instantly eliminate the cost of sales services, making the price become The weapon to attract customers.

However, in the face of the impact of the Internet, 4S stores are not useless. “The reputation of 4S stores established in high-end services for a long time will not be eliminated from the minds of the owners in a short period of time. Talent advantages will be one of the reasons for the future survival of 4S stores,” Zhu Weihua said. As a matter of fact, some Internet projects that are now online are not eager to rush business with auto 4S stores, but are eager to form alliances with them.

Taking the "one-stop" car-keeping service software for car ownership as an example, this product has received extensive attention from vehicle owners and the media since its listing in January last year. After the business has become a large-scale development, its pain points have begun to show, that is, how to ensure the value experience of offline service experience.

"Some car maintenance products that survive in O2O mode can provide convenient on-site service. However, because the people who provide services also belong to roadside shops, their offline service system cannot be standardized, even during the busy season. Roadside shop staff will also suspend cooperation with Internet companies and focus on their own offline business.” An industry source said, now how to attract high-quality repair and maintenance staff like 4S stores to join, and form a long-term stable cooperative relations, It is already a headache for many internet companies entering the auto market.

In order to open a channel for cooperation with the offline mall, Yangcheon is trying to shift from the terminal's toC toB, trying to stream online customers to offline 4S stores in a public commentary. “Actually, in real life, many car owners have information blind spots on the service levels of different 4S stores. We hope to level the previous asymmetric information through the mobile internet platform. This will lead to the relationship between us and 4S stores. Turning from previous hostility to cooperation, said Li Peng, general manager of the Che Yangbao project.

Turn 4S shop into "Wanda Plaza"

As a matter of fact, some 4S shops that are currently struggling to survive have already begun to rent part of their maintenance workshops to Internet companies to replace their operations in order to obtain profits. "4S stores can focus on their own strengths and business, and make a fuss about high-end services. Other venues can be leased to different brands, turning 4S stores into department stores, or a small Wanda Plaza," Zhu Weihua said.

And some of the stronger car dealership groups have now begun to integrate resources to turn their 4S stores into offline outlets. According to Li Xiang, executive director and assistant president of Rundong Group, “In the future, the vision of Rundong is to use the existing offline resources to build the O2O automotive e-commerce platform and become the most powerful used car dealership brand in the region.”

To this end, the delivery platform development plan formulated by Rundong is to build and renovate existing 4S stores with a radius of 300 kilometers as the core, and to build used car inventory and display centers, and spare parts and automotive supplies inventory centers. At the same time, the existing 4S stores will be remodeled, new experience stores will be built, and in each city in East China, there will be an offline delivery platform with used car display, sales, and warranty functions, as well as new vehicle delivery, equipment installation, and comprehensive maintenance service provision. In the four-and-five-line market at the county and township level, Rundong plans to renovate its existing two-tier dealer network to provide basic new and used car delivery and maintenance services.

"Actually, compared with Internet companies, the biggest advantage of 4S stores is offline. The investment of many years also makes it impossible for us to close these stores because of the arrival of mobile Internet. So our idea is to turn 4S stores into logistics and distribution. The base provides all kinds of products for all websites.” Li Xiang believes that this shift is very similar to the current Wanda Plaza or Outlet model, as long as dealers can use the site advantages to deliver more goods and services to customers. The existence of 4S stores still has value.

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