Interview with Alan Gadd from Sussex Auto Parts, UK

Earlier in 2017 go4trans.com had the privilege to interview Alan Gadd, the head of Sussex Auto Parts Ltd, one of the largest UK seller of spare parts for automotive transmission. Here we provide full transcript of this interview with nothing being cut out - this is a valuable material for those who seek some advice and expert glance at the spare parts industry!

Q: How long are you on the market?

A: Sussex Autos started in September 1983 rebuilding gearboxes and selling a few parts and also reconditioning torque converters. In 1993 Sussex Auto Parts was created as a separate company – and we ran the two companies side by side. So Sussex Auto Services reconditioning gearboxes, Sussex Auto Parts selling torque converters and parts to other transmission companies... I parted company with Sussex Auto Services and concentrated solely on the parts approximately 10 years ago because it was very difficult to spread myself between getting ahead around rebuilding Automatic Transmissions correctly, getting production methods as they should be and also concentration on having the parts that would sell. I just found it very difficult to concentrate on both businesses – as I was the Director in both businesses, so I did like a share swap with my partner and he’s next-door recondition gearboxes now, we only sell spare parts and recondition torque converters.

The only transmissions we sell are surplus gearboxes on those manufacturers that have made too many of, or we sell some factory gearboxes – some GM60 series and factory ZF transmissions.

Q: How did you get involved in this business? How did it begin for you?

A: I was a mechanic in school in 1973, and I was working in one of a few garages in the area that repaired automatic gearboxes. When I finished my apprenticeship I went to work for an automatic gearbox company who had a big fire and myself and two other guys ended up buying the remains of the business - that was back in 1983, we built it up to what it is today.

Q: Was it a tough decision to start something your own? How old were you?

A: No, it wasn’t. I was 25-26, I’d already made a decision to actually start to work for myself so I could be in charge of my own destiny and also receive some good money in the industry. So I found the automatic gearbox industry better, more exciting, more challenging than just the automotive repair industry: changing tyres, brake shock absorbers, exhaust – that’s all the things I hated… But getting automatic gearbox repaired correctly, making it work was more of a challenge - and if it’s done correctly, there’s more money to be made in it

Q: So you started with the repairs, correct?

A: Because we took over the existing business, the repair business, as soon as we restarted the company again after the fire (it was closed for some months). We had previous customers’ records, as soon as we opened the doors we did a mailing, we phoned around companies, I personally went up and let all the garages in the South-East of the UK know that we’re open again, though we run with a different name and ownership and so on. So we immediately got a reasonable amount of work come through the doors – we actually borrowed the money to get the company up and running… Offered the existing owners and they allowed us, I think, 5 years to pay it back but we actually paid it off in 2 years. That excluded the premises. We had long lease hold on the premises that we had to pay. Subsequently we got on to purchase the premises we’re in and built another unit as well.

Q: When did your significant growth begin?

A: With the gearbox rebuilding… I personally used to rebuild gearboxes a little bit. I am not massively technical but I spent a lot of my time fitting the gearboxes, and road testing the gearboxes, diagnosing the gearboxes. We are talking of the technology back in the 80s, early 90s. The growth happened when I had an accident in the workshop and actually crushed a finger under a transmission. I couldn’t physically work in a workshop for about 6 months, I had my arm in plaster, stuff holding my finger together, and a lot of stitches, and so on. I went out on the road in a car and went around all the garages in county Sussex, in the south of England, made the workshop so busy that I could never go back into the workshop again. And I also went all round the transmission companies and I promoted our torque converter rebuilding and the fact that we’re selling parts so it made the phones and the fax line in those days so busy that I never again went out into the workshop.

Q: It’s interesting but it’s something that cannot really recommend to someone else. This is your personal way, isn’t it?

A: I don’t know if you can’t suggest it. I still think to this day that you can do all the emailing, all the phone calls in the world but if you go knock on someone’s door, you’re there in person, you can discuss with them where they buy their automatic transmissions: they get them from another transmission rebuilder, they fit second-hand ones if they had problems with, they only go the OE route… And often they don’t get the job because it’s too expensive. Then I turn up in the reception area: smart clothes, have a haircut, you know, have a professional brochure that I can show them, the prices we charge, no hidden extras, we’ve been going for this amount of years, we’ve got our own workshop, if there’s a warranty we send a transporter out and recover the vehicle, we give a 12 months 12,000 miles or 12 months unlimited mileage guarantee, and so on.

And I think the key is doing that in person. I used to be on the road, and the phones used to start ringing, and I was quite often in a garage and I hear that they have trouble with a car; I would road test the car, I’d tell them what was wrong, and I’d phone into work and fix the car - I used to get dopes every week. This carried on to the extent where we grew from having 2 or 3 rebuilders up to 10 transmission rebuilders.

Q: Can we say that your biggest growth happened when you discovered your sales talent?

A: (laughing) I don’t know if it’s a talent but it was the only way I knew how to. Maybe communication skills… I was very nervous in the early days. It wasn’t something I’d ever done professionally, had any training or info but I wanted this business to succeed and I couldn’t work in a workshop anymore so I got out there to tell people about ourselves and it really worked. To this day this is my major role in the parts business, I personally do the exhibitions in Asia, Europe, Americas, and I stand at the booth, build the booth, stand there talking to people, talk to people in the bars in the evening, and promote my company, and it’s made us pretty busy.

Q: Can you say that this is your major instrument of success along with the exhibitions?

A: I think… I visit transmission companies around the world from time to time and we do exhibitions. We obviously receive a large amount of our emails nowadays which has helped us with the international business because of language barriers. Years ago, we have people here who would do with UK customers and we have a few people who’d do with overseas customers – so probably 90%, even 95% of the overseas business is done by email.

There’s language barrier but there are also time zones. We come in the morning and we have orders from the USA and Australia, we go home in the evening – we have emails coming in. So yes, different time zones around the world, different languages. People can Google Translate or they can get someone else in their office to actually translate for them whereas it’s just isn’t that easy verbally. We’ve had phone calls with Asian and Arabic countries and it’s very difficult to understand – emails have been a massive break-through in getting sales to these countries.

Q: There’s Google Translate feature incorporated on your website. Does it work for you?

A: When French, Spanish, Italian, Arabic speaking people send us an email ( in their language) we just do not understand it – of course, we’d better Goggle Translate it and try to converse that way. Joe ( Joe Logue, North and South American Sales Manager ) in America is totally fluent in Spanish and also Italian – he’s of the Italian descent. So sometimes it’s quicker and easier for us to pin an email over to him – he would just translate it to English and even write in Italian or Spanish for us. But yes Google Translate is not perfect but it’s pretty good – these modern tools are so valuable. Also many years ago, probably the most valuable tool in our industry is this. You know, I used to be tired at the desk, we used to have to wait for the phone calls to come in, we used to have the fax machine but now I can travel around the world, I can see transmissions, I can walk into a warehouse that has a thousand transmission, I can walk them all over with my mobile phone and click-click, take pictures – and I did this on a regular basis. Then I email that back to England, we can email to some people who we know are looking for those parts of transmissions, I can negotiate a deal – the things can be sorted out before I get on the plane to come back home. That is something that was totally impossible 20-30 years ago.

Q: You probably had some obstacles during your company’s growth. What was the biggest or maybe you still have some?

A: There are always obstacles. You have to just try and overcome those obstacles one by one. The obstacle that we’ve always had and probably always will is currency. Currency fluctuation can work in your favor sometimes but sometimes it can be a major obstacle with pricing. We actually purchase parts in Japanese Yen, Euro, and US Dollar.

Q: Does it mean that Brexit has made some good for you?

A: Yes, it has. We have been incredibly busy since the announcement of Brexit, our currency has been weakened. Having said that, we’ve kept, we’ve tried to keep our prices the same. Our margins have lowered but the sales have gone up since Brexit. That’s something that is OK to publish.

Q: Do you find this solution to have an outside sales office with no stock valuable?

A: I think sales offices in different time zones are essential for the world market. Because myself and everyone here are always able to ask other people: ‘What are parts numbers these?’, ‘Do we have these?’, ‘Do you recognize these?’, ‘Where can we buy one of these?’, ‘Do you know where we can get these?’, ‘Have you been asked for these before?’. It’s much quicker to ask these questions verbally than it is via email with different time zones and so on. So it is good to have people in different countries but the most happens from under this roof.

Q: Can you mention about Joe ( Logue) from Pennsylvania?

A: Joe in Pennsylvania has been in the industry for 20+ years, worked for Transtec and Lubegard, speaks fluent Spanish, fluent Italian, knows the South American and Mexican markets very well through past experience and speaks the language which is pretty valuable to us. Also the time zones… and he knows the American market. You know the American market speaks the same language as us but they like to buy from Americans as well. They like to buy from someone who they know and trust in the industry and it seems to work. We do have people working for us in Europe and the Far-East also.

Q: So possibly you need some additional partners in the distant regions?

A: I think possibly it’s the way to go. We do have people in Europe and the Far-East – Taiwan, Poland – but we would like to even increase our presence in the South-East Asia, China, for example.

Q: What are your target markets?

A: I haven’t set any one country at a time to be our target market. The world is our market. We target wherever we get the most enquiries from because we consider if they are enquiring with us from these markets then obviously the demand is there. So if there’s an exhibition or a show going in an area of the world where we’re getting a lot of enquiries from then of course we go on to this show – either walk the show or exhibit at the show. We have some times when we get funding from the British government for exhibiting at some of the shows and obviously that is quite a help to us. An adverse side to Brexit is that the British government are a little bit wary in what sort of funding to give us to exhibit at some of these overseas exhibitions. Whereas, we used to say that we’ll do Shanghai, Dubai, and Mexico and we get 50% of our money back. But at the moment nothing has been promised back to us so we don’t know where we stand and how that fits on.

Q: What do you think of such markets as Brazil that have high import duties applied?

A: We have got customers in Brazil and I know the market is quite reasonable in Brazil but it’s a very difficult market too because those invoice import duties are crazy I think. We supplied some 50 DPO brand new transmissions to Brazil and by the time they landed in Brazil they doubled in price, they had gone from 500 to 1,000 pounds and they could buy them per not much over that on their own market so it puts us at a disadvantage sadly. How to find ways around that? I don’t know. I think that is why a lot of large manufacturers have their own factories in those countries: they employ people, they don’t have to pay extras…

Q: Or the other way around maybe too: they are protecting the market when there are some manufacturers inside and nothing is imported?

A: Maybe that is possible too, we wouldn’t know.

Q: Some of the final questions coupled together: what are the tendencies on the market and what is the industry still lacking? Should we have some innovations?

A: As far as the innovation is concerned, the market is permanently evolving – we have to try and keep up. I am primarily in sales with technical understanding because I was involved hands-on many years ago. But it’s no idling about with the technology – you have to have basic understand to know what you’re selling to people and try to get your head around what they would need to be able to repair transmissions in our industry. I am aware that valve bodies and multitronic units are the big head ache for anyone – this is the main problem with automatic gearboxes, as we know them nowadays. 20-30 years ago a car used to come in, the gearbox used to be slipping, I would road test the car – clutch is slipping, pull the dipstick out – the oil is dark, it means it’s burnt; and it is rebuilding! It was so simple, though it seemed to be complicated in those days. But looking back – it was so ridiculously simple. Meanwhile, nowadays the oil is always clean before it ever gets to the slipping stage. Problems that are quite often: thumping shift, slurring shift, not changing gears, quite often cools by either an external component of the gearbox or the valve body mechatronic unit, or whatever TCM. Diagnosis is massively difficult. We do a few seminars a year to try help people overcome these diagnostic problems because until it’s diagnosed correctly you don’t really know what parts to replace.