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Dana's Perfect Circle

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Tips for Success

Overheard in Poznan

jones2.jpg (5120 bytes)Jeffrey A. Jones, Editor-in-Chief, CEAR™ 

I recently attended a few auto shows in Central Europe, notably Poznan in Poland and Autotec in the Czech Republic. I spoke with scores of companies and learned a lot about what companies are doing and what people are thinking.

Although new cars sales growth rates are down in most Central European countries, the pace of activity in the auto sector is still intense. All companies -- car makers, suppliers, distributors, and financing companies -- are out hustling for business and devising new strategies to capture a bigger chunk of the market. Competition is vicious. It's not a market for the weak or undercapitalized.

One of the biggest complaints I heard? "There just aren't enough hours in the week to do everything we need to do." People are overworked, staffs are lean, demands are high. The Eastern European sales manager for a major Western supplier covers the entire region with a staff of one. Himself. He works eight days a week.

Others were frustrated by the slow pace of infrastructure development in the region. In Poland, for instance, one truck maker noted that there is lots of talk about roads and highways, but few results. "For a transit country [like Poland], it's hard to understand."

I heard a lot about how Central European customers are demanding more from companies. Customers want faster service (such as for spare parts delivery), better availability of products, better aftersales service, and higher quality.

Why is Lucas Autobrzdy rolling out a network of fast fit brake and shock absorber centers in the Czech Republic? It's what their customers are demanding.

Parts sellers told me that Polish customers are now shopping for quality. They have more income and are willing to pay for better built products. In the past, customers were willing to buy cheaper parts and frequently replace them. But today, with rising mechanic's rates (especially in Warsaw), this strategy is becoming cost prohibitive. Customers see the benefit of buying quality.

One common sentiment is that the Central European market is exciting. "You never know what will happen next," said one parts distributor. "Everything is changing so rapidly." Another Tier one supplier happily declared, "Our business is booming."


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