Auto-Wares Group of Companies stands as one of the largest distributors in the US automotive aftermarket, boasting annual sales of $330 million and experiencing continuous growth. Established in 1976 in Grand Rapids, MI, Auto-Wares has evolved into a robust distribution network, specializing in comprehensive inventory, product expertise and full-service programs. The company's presence spans over 200 company-owned stores, operating in five states.
Rebates play a crucial role in the company's success, often contributing significantly to year-end profits. While Auto-Wares maintains a commitment to prudent expense management, there is an acknowledgment that strategic investment in rebates is essential for sustaining competitiveness in pricing. John Sanford, Vice President of Procurement at Auto-Wares, with 15 years of experience with the company, explains why adopting Enable is a game-changer for their business.
Recognizing the need for a more efficient approach to managing over $10 million in rebates alongside their extensive product lines, $140 million worth of inventory and 10 distribution centers, Auto-Wares sought a solution beyond their existing ERP system and spreadsheets.
Sanford explains, "The existing in-house ERP system, developed many years ago, has undergone evolution to align with our requirements. However, the process of capturing deals on a line-by-line basis within the ERP presents challenges in terms of maintaining real-time accuracy and accessibility. The absence of a traditional user manual stems from the system's unique construction. To address these issues, we recognized the imperative to modernize our approach to rebate management."
Sanford tells us, "As we experience continuous growth with a workforce exceeding 2000 employees, the significance of training has escalated significantly. It's not just about capturing rebates; it's also about ensuring uniform understanding across the organization regarding how to access them and interpreting the associated terminology. Enable will give us a unified approach across the multiple teams involved with rebates."
Growth Through Acquisitions
Sanford says, "As Auto-Wares expands and acquisitions become more common, the scale of our operations will continue to increase. With our current portfolio managing over 1100 product lines, our focus is on cultivating partnerships that yield the highest volume and financial benefits. This dynamic landscape necessitates constant adaptation, involving changes in product lines and enhancements to our deals, consequently driving an upsurge in rebate dollars. The evolving nature of our business led us to seek a tool like Enable to effectively navigate and manage this growth trajectory, recognizing the pivotal role it will play in this aspect of our operations."
Comprehensive Deal Repository
Sanford says, “Enable is an exceptionally comprehensive rebate management platform, and its versatility across various industries is truly impressive. While our industry-specific programs may be complex, involving factors such as volume, buying groups, and tiered structures, Enable stands out for its flexibility. It seamlessly handles any rebate type we encounter, providing a comprehensive repository for all our programs. The platform's capability to manage our diverse programs, including how we've coded and processed rebate amounts, is critical to ensuring we stay on top of expected returns and their timing.”
Supporting Future Growth
Sanford tells us, “Within our sector, the importance of efficient rebate management cannot be overstated. As our company and rebate amounts grow, Enable proves invaluable in solving the scalable challenges associated with rebate management. Enable not only addresses the immediate needs of rebate management but also provides a scalable and adaptable solution for future growth and changes.”
Professional Customer Success Team
Sanford praises Enable, “Whenever we require assistance from Enable, the process involves hopping on a collaborative call or zoom session. This approach fosters a highly collaborative environment, and I appreciate that. The team's willingness to engage and share insights is evident in these sessions. It's not just about receiving answers to our immediate questions; rather, each interaction leaves us with additional knowledge that proves beneficial down the road. While the software itself is an excellent tool that continues to evolve, it's the global Enable team that truly makes a difference, contributing to the overall positive experience.”
Reducing Key Person Dependency
Sanford initially spearheaded the implementation of the rebate management platform, taking the lead to set it up, establish the necessary rebate programs and commence the receipt and application of rebate funds to specific program lines. Now, the responsibility for managing the platform has transitioned to a couple of other colleagues within the company, which is a positive development as it has increased the user base.
Sanford comments, "The transition has introduced greater internal flexibility, enabling the distribution of work among multiple individuals and reducing dependence on key personnel. This internal adaptability is paramount for smooth operations, promoting knowledge sharing and ensuring continuity in our processes. By mitigating the risk of disruptions when key individuals are unavailable, we have established a seamless and uninterrupted flow of operations. This shift has allowed me to redirect my focus to other responsibilities while ensuring the ongoing progress and development of our rebate programs."
High Volume of Credits
Sanford comments, “Having Enable is particularly crucial for managing the substantial volume of credits efficiently. Monthly submissions, quarterly peaks, and end-of-year influxes all contribute to the workload, and having a streamlined rebate management platform helps ensure that these credits are matched, applied, and distributed within the organization without the need for extensive manual intervention. Overall, the software plays a vital role in maintaining the health of the business by efficiently managing the complexities associated with rebate credits and fostering strong partnerships with suppliers.”
Receiving Rebate Income in Full and on Time
Auto-Wares effectively utilizes the rebate management platform to validate rebates through Enable's established programs, eliminating the need for proactive pursuit of payments from suppliers. This approach allows suppliers to initiate discussions, addressing discrepancies, variances, or potential opportunities that may arise. In the event of a payment being overdue by more than three months, a conversation can be initiated with the supplier.
Sanford emphasizes the importance of this process, stating, "All rebates flow through my team, and we manage their distribution within the company. With figures exceeding $10 million annually and a consistent growth pattern, it becomes crucial to ensure accuracy in receipt and timing. The ability to accrue or forecast expected amounts, along with optimizing tiered rebates upon achieving growth targets, is paramount. Our previous reliance on spreadsheets hinted at an opportunity to enhance our process, but the revelation of a tool like Enable was a game-changer we didn't anticipate."
Saving Rebate Processing Time
For Auto-Wares, the rebate management software has significantly reduced manual effort in processing their rebate credits. They used to manually break down credits across different departments or buildings—a time-consuming task. Today, automation streamlines this process.
Sanford tells us, “Enable has proven invaluable in this regard. By being able to apply credits, upload PDFs, and document any supplier-specific details tied to a credit and linked to a specific program line, we have saved significant time. This proactive approach allows us to easily and quickly match incoming credits, avoiding the need to run credits through our organization without clear information. Not only can we promptly match and apply credits, but we also receive a breakdown that we pass on to our finance department for immediate handling. This has significantly shortened the time spent dealing with credits and rebates compared to the manual processes of the past.”
Sanford continues, “Quantifying the exact time savings can be challenging as it depends on various factors such as the timing of quarters, spikes in volume, and the frequency of monthly submissions. On average, I would estimate the time savings to be around six hours per month. However, this can vary, with higher volumes of rebate credits typically observed after quarters and at the end of the year.”
Improving Supplier Communication
Sanford comments, “Often, when rebates are paid to us, the accompanying information can be confusing, sometimes unintentionally so on the supplier's part. They assume we understand the purpose behind the rebate, but there are instances where intentional vagueness is employed. We often had to reach out to suppliers for additional details, but now, thanks to Enable, that's no longer necessary. We can now collaborate with suppliers to enhance the usefulness of the information on documents, reducing the time wasted on deciphering the purpose and destination of received rebates.”
Strategic Approach to Pricing
Enable’s role in managing rebates has proven crucial for Auto-Wares, especially given the recent shifts in sales performance. Coming out of the challenges posed by Covid in 2020 and experiencing strong sales in 2021 and 2022, the softer performance in 2023 has prompted a need for strategic pricing considerations.
Sanford comments, “Understanding the exact details of our rebates provides a valuable tool for navigating this changing landscape. In the current market scenario where pricing is a significant factor, having a clear understanding of our rebates allows us to make informed decisions about pricing strategies. This knowledge empowers us to be more aggressive with pricing, when necessary, while also being aware of the limits dictated by the rebate structure. While a sales slowdown is never ideal, Enable has provided a silver lining by helping us navigate these challenges with a more precise and strategic approach to pricing. We remain optimistic that, in time, the sales momentum will return.”
Future plans: Forecasting
Sanford says, “We're interested in incorporating forecasting into our operations, and fortunately, Enable facilitates that process. Our goal is to share forecasts with our finance team, providing them with a monthly overview of expected revenue based on purchases and program changes. Rebate programs may undergo occasional modifications or improvements throughout the year, and staying abreast of these alterations is crucial. Keeping our finance team in sync and up-to-date on these fluctuations would be highly beneficial for both parties. The consistent use of the forecasting tool day in and day out would not only ensure this synchronization but also offer us a distinct advantage in managing our business operations.”
Future Plans: PROS
Auto-Wares has forged a partnership with PROS pricing optimization software, which is now integrated with the Enable platform. Currently, they are independently managing both Enable and PROS. However, a plan is underway to merge these two systems.
Sanford comments, "Acknowledging that Enable provides crucial insights into net cost, rebates, and discounts, while PROS excels in managing pricing, the idea of merging the strengths of both platforms appears to be a logical next step for us. This integration holds the potential to significantly enhance the efficiency and synergy of our pricing and rebate processes, offering a comprehensive view of our pricing strategy from start to finish. The prospect of improved clarity and streamlined operations is particularly promising."
The transition to Enable allowed for greater internal flexibility, reducing dependence on key personnel and ensuring a seamless flow of operations.
Enable significantly reduces manual effort, leading to time savings in processing rebate credits. On average, there is an estimated saving of around six hours per month.
Enable provides clear insights into net cost, rebates, and discounts, allowing for a more precise and strategic approach to pricing in response to changing sales performance.