Here we sit in the grip of the biggest credit crunch in modern history, and on the one hand, we are informed that the worst of the financial part of the recession is over. On the other hand we’re being informed that unemployment is far from its peak, and in the UK is expected to swell from the already historic high of 2.2 million, right up to 3 million.
Already drivers are cutting back on the mileage they do in their cars, therefore they need less and less servicing and wear parts, and as the credit crunch continues to take effect, in particular when unemployment adds to it, there will be many people giving up their cars completely.
Consequently, if you’re a car parts retailer, what items should you stocking so that you can maximise your sales, and so minimise the negative effect of the credit crunch on your income?
You’ll probably already know that, universal wear-parts and consumables are constantly good sellers, and as the credit crunch takes hold, more and more people switch to doing their own easy repairs. That means that bulbs are an excellent item to stock. There aren’t too many different types to fit the entire range of cars in the marketplace. Wiper Blades are the same. Not too many sizes cover the whole market, they’re easy to fit, and regularly need replacing. It’s a similar story with items like Oil and Air Filters, Spark Plugs etc., as drivers start to do their own simple repairs.
As a retailer, you’ll also see that sales of car care products such as quality car shampoo and Car Care Wax will increase as drivers graduate away from using car washes as they try to minimise costs, and take steps to better maintain the condition and value of their vehicle.
Other items to stock in a credit crunch are upgrade or luxury items like in-car entertainment and Sat Nav Systems, as well as items for customising your vehicle, like sports steering wheels, seats etc. These items cover a vast range of prices with the cheapest items beginning at less than ten pounds, being things like Gear Stick Knobs, performance Wiper Blades or even retrofit Flat Wipers. At the top of this range of products people will spend thousands on a customised interior, sports suspension, performance brakes etc , etc.
The contradictory thing about a credit crunch is that sales of this type of product will hold up, or even increase. That’s because those people who are still in work often find that they have more money to spend. Interest rates drop, reducing their mortgage payments, and many commodity prices also drop. Nonetheless, as a result of worries about their job security, these same people are reluctant to commit to major capital expenditure such as buying a new car. They therefore end up keeping their car longer, and so they begin to indulge themselves by spending their increasing disposable income on upgrading, updating or personalising their car.
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