Is the devil in the planogram?

By Terry Herbert October 12, 2015 Auto Accessories

Auto accessories as a category continues to do well for the hardware channel, but suppliers of name brands who traditionally supply this category are feeling left out. Terry Herbert reports.

It’s been a solid year, sales-wise, across the retail spectrum for auto accessories in the key areas of auto electrical, car care, car cleaning, oils and tools. But the same suppliers who stock the shelves at specialist chains like Repco and Supercheap Auto are feeling disenfranchised by the hardware chains.

Almost to a man they asked for their comments to remain anonymous but one woman who is prepared to go on the record is Darlene Smits, Director at GPI Automotive.

Pondering aloud she tells me: “It’s fair to say that there have been some dramatic changes at Mitre 10 in their planogram. In terms of automotive, for Mitre 10 it’s definitely a growth category. Premium automotive products have had a slight reduction, but the category has increased as a whole. You’ll have to ask Mitre 10 where they’re going as a category. That has to come from them not us.”

I put the same question to Mitre 10’s auto accessories Category Manager, Bonnie Somers-Edgar, who politely declined to comment but did ask me to email my questions.

At this point I will make it clear that any independent opinions expressed in this article are not shared by this magazine.

Delving deeper I ask Darlene Smits to define what she meant by “premium”. “The Meguiar’s car care range for example is a premium product. From an overall market point-of-view it’s a hugely growing brand for us.”

 

BENEATH THE SURFACE SHINE

Feeling a bit like an investigative journalist protecting the identity of his “deep throat” sources (that’s “deep throat” as in the Watergate scandal by the way), suppliers I spoke with insisted they were not to be named.

Supplier A told me that dealing with the hardware channel was “bloody difficult”. He once had a lot of products on DIY retail shelves but now he’s down to just a few and he worries that any day now with the click of a cursor he will disappear off the planogram and the shelves.

Most told me they don’t even bother trying to sell to DIY retail these days. Bunnings we are told no longer appears to favour New Zealand suppliers. Supplier B for example says: “It seems very clear to me that they’re bringing in a lot more product from Australia.”

Getting out from behind my desk I decide to take a field trip to check out the auto accessories aisles in a couple of local national DIY retailers. What I discovered was a lot of house brands especially in the car cleaning area.

There was plenty of CRC and Turtle wax evident but at prime shelf level were the sponges, cleaning cloths and hose attachments, most of these house brands.

 

A POWER TOOL IS A POWER TOOL

Power tool suppliers however are finding it easier to get listings. Yes both Bunnings and Mitre 10 have their house brands but the hardware chains recognise that many DIY customers and professionals are brand loyal and they hunt out their favourites.

Andrew Way from Accent Tools tells me his Hitachi tools are enjoying strong growth in automotive channels. “We’re a power tool and water blaster supplier. We have tools specifically for automotive but you won’t find us in the auto accessories aisle. We’re down with the other power tools in the area that hardware like to call the ‘power garden’.”

When you consider that neither the lower pressure water blasters – predominantly used to clean vehicles – or automotive power tools actually appear in the auto accessories aisle it is a somewhat confusing and anomalous category.

Andrew Way describes his marketing strategy: “We deliberately target the end user with above the line and online advertising, and then we let them buy our products from wherever it’s most convenient.

“Our Lithium-ion cordless drills have been designed for car and truck maintenance enthusiasts and those sales have been a real growth area for us. If a Mitre 10 is closer to a mechanic’s work shop than a Repco he’ll definitely go there.”

 

IS DIY IGNORING THE ENTHUSIASTS?

Back in the DIY channel’s automotive aisle but still talking “enthusiasts”, we return to Darlene Smits for comment.

“Everybody has Turtle Wax and everybody has CRC on their shelves,” Smits says somewhat resignedly. “The question is: Does the enthusiast shop at Mitre 10 or Bunnings? I say yes and they shop in higher numbers than hardware believe.

“A DIYer is a DIYer, whether he’s waxing his car or fixing a fence. If a Meguiar’s enthusiast comes into a DIY store to buy his car care product he’s going to leave with five other DIY products. In saying that, hardware has to be able to compete with the specialist auto chains by stocking the full range.”

And that’s where we leave the auto accessories aisle. At the end of a trading day, successful retail is all about real estate. Each shelf in every aisle has to generate an ROI.

But spare a thought for those New Zealand-based auto & accessories suppliers – by and large SMEs, the very backbone of our economy – who are snubbed by the hardware channel. That aisle like every other needs to generate a profit.

As Mitre 10 records its biggest ever sales in four plus decades of trading history and likewise Bunnings New Zealand reports record sales for the last year there is no denying that the chains are very successful traders.

We need them and we need them to do well. Category Managers and buyers have to weigh the value of every product on their shelves carefully. If they have to skew the SKUs with house brands and must-have brands like Turtle and CRC to attract the customers, so be it, because the profit is all in the planogram.  

share this