Business partners Amit Maheshwari and Dinos Constantine wondered why car dealers don't sell more auto accessories.
“Accessories are a $34 billion dollar market, but dealers have just 15% of it,” Constantine says. “We spent six months studying why more dealers aren't in the accessories business. We found that dealers would like to be in it, but they haven't figured out how to make it work.”
Stumbling blocks for dealers include:
- Not knowing what to choose among the thousands of accessories on the market.
- The fear of selling low-quality accessories and developing customer-satisfaction problems as a result.
- The investment in inventory.
- Concerns about carrying items that may never sell.
- Fear of adding another selling process.
The partners say their new web-based system, AutoStyleMart, is designed to eliminate those issues and let dealers enter the accessories market without having to invest in inventory or puzzle over the multitude of aftermarket products to figure out which to offer.
Here's how it works:
Using a “visualizer” on a computer screen, a dealership employee shows customers how their vehicles can be customized with products from AutoStyleMart's catalogue. The catalogue offers accessories from a various manufacturers.
Once a customer picks accessories, they are shipped to the dealership, with written installation directions and phone support for technicians. AutoStyleMart is offered on a subscription basis, with a one-time system-installation fee.
“Dealerships sell accessories without having to stock inventory, which is clearly a huge advantage,” says Maheshwari.
He is an information technology entrepreneur who worked with ADP Dealer Services to establish a global technology and support organization in India.
Constantine is founder of CRM solutions provider Automotive Directions, which ADP purchased in 2002.
The AutoStyleMart system is used at Fremont Motor Co.'s three dealerships in Lander and Sheridan, WY.
“It allowed us to get into the accessories business, which is something we've wanted to do, but didn't know how to do properly,” says Fremont dealer principal Chuck Guschewsky.
Says Tom Koshko, Fremont's fixed operations director: “In the past, when customers have asked about accessories, we've had to send them to a competitive shop, which of course isn't something we liked doing,”
Constantine likens the entry of dealers into the aftermarket accessories business to the industry's entry into F & I in the early 1980s.
He says, “Dealers knew there was money in F & I, but making it work was complicated. Outside providers put together all the elements and then teamed with dealers to make it work for them. What we're doing is very similar.”