Truck Parts and Service | Heavy Duty Trucking, Aftermarket, Service Info
Issue link: http://read.dmtmag.com/i/510247
T here's nothing worse than discovering you don't have a place to store something you need. It can happen to anyone, but when it happens in the aftermarket it's more than just a point of frustration. It can negatively impact a business. Master warehouses are one option for distributors working to eliminate this problem. Built as standalone parts distribution centers (PDC) with no retail component, master warehouses give distributors the ability to stock large reserves of the products they carry in their stores in a location that is both close and easily accessible. They provide distributors space they so desperately need. But the advantages of master warehouses aren't limited solely to the number of shelves. There are several other advantages that make master warehouse facilities a sound investment for an aftermarket operation. Arguably the biggest selling points are found on the bottom line. A master warehouse requires an upfront investment, but that expense can be recouped over time. Master warehouses save distribu- tors a small fortune in inventory purchasing expenses. There are two reasons for this. Don Devany, senior vice president at Betts Company, says one reason is a master warehouse offers a distributor the space necessary to buy in bulk. Many aftermarket suppliers offer discounted rates to customers willing to purchase an entire truckload of products (or product categories) at one time. Space constraints mean bulk orders are nearly impossible for most distributors' retail stores. But with a master warehouse functioning as an intermediary, a distributor can suddenly take advantage of bulk purchase rates. Such is the case at Betts Truck Parts, where Devany says the company routes bulk pur- chases through its Fresno, Calif. warehouse distribution center. High-volume items are received as bulk orders, broken down and redistributed to each of the company's eight locations, while slower moving parts are stored in the PDC until needed. "[Our PDC] allows us to maximize our purchasing power and pass on the most com- petitive prices to our customers," Devany says. He adds another benefi t of bulk ordering is the positive impact it has on freight rates, 15 Cover Story W W W . T R U C K P A R T S A N D S E R V I C E . C O M M a y 2 0 1 5 | T R U C K P A R T S & S E R V I C E Making a case for adding a master warehouse to a distribution business [Our PDC] allows us to maximize our purchasing power and pass on the most competitive prices to our customers. – Don Devany, senior vice president at Betts Company