Federated CEO: ‘Supply Chain Disruption Remains A Top Concern’

[Counterman]

In our 2022 Distribution Preview in

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, aftermarket leaders talk about some of the key issues affecting the industry, and discuss their plans, goals and expectations for the year ahead.

This year, we added several fun “Lightning Round” questions that you won’t want to miss.

Here’s our Q&A with Sue Godschalk, president of Federated Auto Parts.

AMN/CM: What did your organization accomplish in 2021 that you are most proud of?

SG: Last year, the Federated team was determined to get back to some sense of normalcy. We put more emphasis on finding ways to help our members improve their businesses. We ran a very successful sales-driven promotion that benefited both our members and supplier partners, and we tied that promotion to the Federated 400 NASCAR race in Richmond, Virginia. We also focused on enhancements in areas such as training and data services. We worked hard to help our members grow their sales while focusing on improving efficiencies at headquarters through more emphasis on cutting expenses and cross-training employees.

When supply chain disruption created another challenge, the situation was made less painful for our membership due to the Federated Co-Man Warehouse. The Federated Co-Man operation was able to fill orders for many products that members were having trouble sourcing from suppliers.  Having talented buyers and dedicated employees at our Co-Man facility helped to keep the shelves stocked at our member locations.   

I am so proud of the Federated leadership and membership and as they continue to prove that they are determined, innovative and resilient. I look forward to an even stronger 2022.

AMN/CM: What are some of the biggest trends that could have an impact on your business in 2022?

SG: Supply chain disruption remains a top concern for 2022. Many companies continue to face shipping delays, making order fulfillment difficult. I believe we can also expect to see an enormous amount of ensuing price changes continue in 2022, and persisting labor shortages will have a major effect on businesses. I think COVID-19 will continue to impact the labor shortage, as will the uncertainty surrounding the implementation of a new federal vaccine mandate.

In 2021, we saw a change in consumers’ vehicle preferences. Light trucks (pickups, SUVs, CUVs) became a larger share of the overall vehicle population. I believe this trend will continue in 2022. Replacement parts for these vehicles typically cost more. Plus, these are the types of vehicles that consumers like to accessorize – two positives for aftermarket sales.

Another trend that will continue to be strong in the coming year and beyond is online retailing. Before COVID-19, many automotive companies were hesitant to provide online ordering to consumers. Statistics have clearly shown that online selling has become the new normal.

Increased production of electric vehicles with digital technology will certainly impact the aftermarket. All indications are that electric vehicles will come sooner rather than later. I expect we will see OEMs create EV-specific maintenance plans with the intent to convince consumers that they are the only source qualified to work on these vehicles. Having trained technicians with access to vehicle-repair specifications, along with the proper diagnostic equipment, will be key for independent repair shops to manage the complexity of the next generation of vehicles.

AMN/CM: What do you feel is the greatest opportunity in the automotive aftermarket right now?

SG: Increased sales of pre-owned vehicles will certainly benefit aftermarket sales. All indicators show that the demand for used vehicles will continue to be high. Late-model used vehicles feature the latest technology, requiring automotive repair shops to have well-trained technicians to correctly install parts and service vehicles. Because consumers are keeping their vehicles longer, the chance of component failures will increase the need for vehicle service and aftermarket parts.

AMN/CM: What phrase describes your “words to live by?”

SG: That which does not kill us makes us stronger.

AMN/CM: What is your best icebreaker at a networking reception?

SG: How is everything going for you so far?

AMN/CM: What is your dream car, or favorite vehicle you’ve owned?

SG: I love my current vehicle … a 2014 Audi Q5.

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