ST. ANDREWS, N.B. - Heavy Duty Distributor Council members who attended the group's 18th Annual Business Conference, heard they'll soon need to transform into partners of the fleets they serve if they...
ST. ANDREWS, N.B. – Heavy Duty Distributor Council members who attended the group’s 18th Annual Business Conference, heard they’ll soon need to transform into partners of the fleets they serve if they haven’t already.
Wes Armour, chief executive officer and president of Armour Transportation Systems, told the attendees, the future relies on suppliers working with companies like his own for the betterment of both.
Armour – whose success has made him one of the true big wheels of the Canadian truck game – controls more than 2,500 pieces of equipment, 1,400 employees, 22 freight terminals and more than 400,000 square feet of warehousing. In one year Armour Transportation Systems spends $12-$15 million on parts and outside repairs at various places from Ontario to Newfoundland and into the U.S.
“I am pleased to say we have one of the safest and well-maintained fleets in Canada,” says Armour.
He explains being a company with such versatility – ranging from LTL to pick-ups and deliveries – there is a need for not only new equipment, but also for low cost used equipment.
“So as you can see, leasing, whether it’s full service or basic leasing, does not make good economic sense in our company,” he says.
He insists his company is largely unique in its situation, however, as he has spoken to truckload carriers where leasing has made a lot of sense in both tractors and trailers.
When purchasing vehicles, Armour explains they are looking for long life components and the standardization of these components across the entire fleet, regardless of the make of the vehicle.
“This enables us to stock less parts, get better pricing from our suppliers, re-use some of the parts from trucks we may have wrecked or vehicles we may have cannibalized,” he says. “Above all, it allows our own mechanics to get to know our vehicles and these components better than anyone out there.”
It is not unusual for companies such as Armour’s to have to fly their own technicians great distances to fix one of their vehicles sitting in a dealer’s shop because they didn’t have the people to fix a given component. Sometimes these jobs take the mechanic as little as 15 minutes to fix; meanwhile the vehicle has been sitting for two or three days.
In choosing a supplier, Armour feels this company needs to become a partner.
“Price is important, however the supplier must have operating hours that work for us. They must carry or have quick access to parts that we require. They must have IT flexibility, know their product, must be prepared to share new ideas and products with us and also have a good relationship with the manufacturer,” he explains.
He stresses the last thing he needs is a fast-talking sales rep in one of his shops trying to sell them products they simply don’t need.
“We do not have the time to spend with these people.”
Repairs which are completely computer automated are being done in company shops or the shops of distributors, and this is what drives the purchase of parts and repairs on vehicles, not the banter of a salesperson, he says.
Truck parts, tires and labor costs will continue to increase as the future rolls on, “But components will continue to get better.”
He cites permanently lubed drivelines, new transmissions, engines going up to a million miles, cabs that don’t rust, as well as LED lights as advances that save companies like his money every day.
“The list goes on,” he adds. “Don’t fear, we are still going to need you. Even with the longer life components, carriers will keep their vehicles longer and run them more miles as new vehicles will cost more and owners cannot afford early trades.”
The future trend, Armour reports, will see O/Os keep their vehicles five or six years longer and second owners will run them a good number of years after that. The same applies to trailers.
“Components do wear out and at some point need to be replaced,” he ensures. If a carrier is going to be successful, a good strong partnership with a supplier is necessary.
“We need customers to pay our bills, but we must also control our costs. Without that we won’t have a business and we won’t need customers,” he explains. “A good relationship with our supplier is just as critical as a good relationship with our customer.”