Parts supply is a popular business for many small-time entrepreneurs but it’s essential to keep a few things in mind before getting started.
The unsung heroes of modern industry are the local parts suppliers. When components break and machines fail, these mom and pop companies come through in the clutch, providing the replacement parts needed to keep engines running and factories operational.
Given the localized market and minimal overhead, parts supply is a popular business idea for many small-time entrepreneurs. If this describes your situation, it’s essential to keep a few things in mind before getting started.
Keep it simple
Are you an auto parts supplier, a machinery parts supplier, or a specialist service? Select one specific area to focus on and forget the rest, at least for now. That’s because you’re unlikely to provide the level of service and expertise for customers if your range of products is too broad. If you’re unsure which to choose, conduct research to uncover the current saturation level of similar services. Find an underserviced niche and make that your specialty.
Assemble a fleet
Whether your customers are manufacturers, mechanics, or construction contractors, chances are they’ll expect parts to be delivered. That means you need a fleet of delivery vehicles. It could be trucks, cars, or a combination, but whichever make and model you choose, make sure your fleet vehicles are well maintained. Have delivery personnel report any problems they’ve noticed and schedule for repairs as soon as possible. If a car is out of commission, that’s one less delivery route, which means reduced business!
The accessibility of sophisticated business technology has become a gamechanger for startups. Your local parts supplier service cannot function at optimum capacity without customer relationship, inventory, and delivery management software getting used daily. These and other vital programs do the work of dozens of employees, enabling your startup supply company to service customers in a way equal to or greater than the existing competition.
Find repeat business
Like most small companies, parts suppliers thrive on repeat business from regular customers. A dozen car mechanics or half as many industrial operations turning to you for parts and other supplies can be the difference between turning a profit and going out of business. Such business-to-business relationships take time to build, so don’t get discouraged if you lack repeat clientele at the start. As time goes on and your company develops a proven track record of reliability and quality service, your core group of regular customers will assemble themselves organically. Run your business well, and good things will happen.
Invest in marketing
Every business needs marketing to grow. While seemingly expensive, marketing is an investment that typically pays off for companies willing to spend the money. Invest in marketing from the very beginning. If that’s not practical, make marketing a priority for any reinvestment plans once your parts supply venture is underway.
Whether to prevent business disruption or fulfill their customers’ needs, many businesses rely on local suppliers to quickly deliver replacement parts. Such consistent demand makes the parts supply business an enticing option for aspiring entrepreneurs. However, it’s crucial to consider the points featured above before going forward. Doing so will be a benefit to your customers and your bottom line.