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Trying to Understand State Farm’s Parts Trader Procurement Program Part V

HomeNewsTrying to Understand State Farm’s Parts Trader Procurement Program Part V

State Farm

With PartsTrader, we can handle the entire ordering process from the computer. We can request and order parts within 30 minutes, cutting the investment of time in half.

Second, we’re getting more accurate parts orders. The system scrubs the vehicle VIN to ensure we’re asking for the accurate part the first time. We don’t have to make phone calls to verify parts with the supplier.
We’re saving up to 30 minutes on each parts order through PartsTrader, totaling about three hours of time savings daily. I handle all of our shop’s State Farm jobs, and I’m on the phone half the amount of time compared to the other front office staff.

Morris: We did a time study with PartsTrader. We put timers on the desk, and compared the time spent sourcing parts with and without the application. We found that it took more time to call all of the various parts suppliers with traditional methods compared to submitting bids through PartsTrader. The quoting period also allows the office staff to do other things rather than constant labor sitting on the phone.

FB: What impact has PartsTrader had on your parts profitability?

McDaniel: There has not been any impact on our parts bottom line. State Farm cannot see our MSRPs, costs or margins, which makes me feel more comfortable with using PartsTrader. Our profitability has been the same before and after implementation.

Hunsaker: To date, there has not been any impact to our bottom line on parts. Profitability has not been affected because we are not getting any price quotes under the MSRP.

Huffstutler: I get a 25 percent discount on parts, regardless of whether the dealer chooses to reduce the MSRP. If the MSRP on a $100 part is dropped to $95, I get 25 percent off the lower price. That’s not going to change; there has not been an instance when a dealer dropped their MSRP but kept my cost the same. It doesn’t cost me any money if a dealer reduces the MSRP. Our parts profitability has not been affected.

Todd Sudeck

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