When German-headquartered spare parts supplier GEV decided to enter the UK market locally in 2010, the industry reaction was cautious.
“We got quite a hard reception,” recalled UK MD Bryn Vivian. “People would give us enquiries quite reluctantly and they would be quick to criticise. We were being tested, because they wanted to know if they could put their trust in us.”
However, the firm quickly turned this around, as Vivian explained: “The values we started with have put us in good stead. We have always tried to perform with integrity and honesty and tell people if a delivery will be on time or late. We’ve proved ourselves. Giving our customers bad news as quick as good news means they can plan their day and let their own staff and customers know.”
GEV already had experience of the UK market via other spares suppliers prior to its local entry, but decided to pursue a growth strategy to take further advantage of the country’s potential. With a standing start of £500,000 turnover in the UK office’s first year, the strategy has worked, as 2017’s total is set to be around £2.5m. The UK branch is now tasked with contributing to the GEV group’s overall ambitious growth target of €150m in 5 years. And having gone from €15m to €50m in the space of 10 years, that kind of expansion is well within its reach.
As a fully owned subsidiary, GEV UK can draw on the expertise of its German headquarters. Its latest global logistics centre, which opened in Munich in 2013, will have a storage capacity of 10,000m3 by the end of this year. It is also in the midst of installing a new automated picking and storage system. Today the stock comprises 85,000 different parts covering more than 500 brands of commercial catering equipment.
“Some service companies think we only do exotic or lesser known brands,” said Vivian. “We can do those, but in amongst there are all the leading European and increasingly US brands too.” US parts supply in particular is a big focus for GEV.
Another focus area is refrigeration spares, and over the past couple of years GEV has doubled its product range in this sector. It even manufactures its own refrigerator door gaskets at its German head office. A further foray into manufacturing is its four ranges of pre-rinse units, constructed in Far East, which are all WRAS approved.
To help engineers find the parts they need quickly, GEV’s catalogues and website classify products in five main categories: electric components; gas components; mechanical components and equipment accessories; water and beverage technology; and tools, fastening materials and consumables. “It’s a very technical approach which sets us apart from our competitors,” believes Vivian.
“Our business is based on finding the part that fits into various machines and creating one part number for it. We then buy the parts upstream, going to the component producer and buying in bulk.”
He added: “If a part is used in 20 different machines and is the same part number, we buy it from one source and we think it’s transparent and fair to charge one price. The price isn’t brand dependent. If we can pass on savings to our customers then they can make more margin.”
Regarding the debate as to whether this makes a part ‘genuine’, Vivian commented: “There isn’t a clear enough definition in the industry of what is original or genuine. It leaves too much scope open for other people to make use of that.”
However, he was keen to point out that GEV has always been at pains to not overtly compete with catering equipment manufacturers. “That would risk the supply of parts from them, and those are the vast majority of the parts that we sell – a lot are unique to a manufacturer. We have to work with them, not against them, and I think GEV has got a good reputation for that.”
The spares specialist even goes as far as supplying individual components of each part, wherever possible. Furthermore, if there are any queries the UK branch cannot answer, its staff can access the integrated database across the group, where all enquiries are archived. Then if the answer isn’t available on there, the UK office can generate a new query for the technical experts at headquarters to investigate with a manufacturer directly.
“We are always building up our knowledge,” said Vivian. “When we get an answer back from head office we can send our customers a quote, which they can then convert into a quote for end users. It might suit a small engineering company – they can add their mark-up, quoting their customer a price and lead time in an email in seconds.”
GEV receives 50% of its orders online, and so has made sure its website is as useful as possible. Vivian detailed: “We put a lot of information online, but it’s only accessible to service companies; they have to prove themselves when they apply for an account and we verify their details.”
The information online includes the complete part specification, wiring diagrams and instructions, plus stock information graded in a traffic light colour system. “The live stock data is totally accurate, I’ve never known it to be wrong,” commented Vivian.
Users can search for parts in various ways: by inputting the manufacturer’s part number, a component number, GEV’s own part number or simple text searches. The firm is looking at further improving its information access by uploading electronic catalogues for particular brands. These can be instantly updated, as well as downloaded and used by engineers offline, if they are in an area where the internet is inaccessible. The spares specialist also has a mobile app which features almost identical functions to the webshop.
In terms of logistics, GEV offers a range of delivery options, as parts can be sent to an engineer, to site directly, or to ByBox lockers or UPS access points in convenience stores. “These have longer opening hours so give flexibility for engineers to pick up parts on the way to site,” Vivian said. “Or they can return parts through these UPS points as well.” Users can also choose whether to wait for all ordered parts to be in stock for a complete delivery, or just a partial delivery for the products in stock and then subsequent automatic delivery for any remainder once they are back in stock.
GEV aims to get parts anywhere in the world in 24-48 hours. It has bulk discounts with UPS, DHL and TNT, which collectively ship around 1,000 parcels a day for GEV. This means delivery charges can be kept to under £10 even though the spares are shipped internationally. Furthermore, every part comes with a 12 month warranty.
Looking ahead, the UK office has plans to expand further. Having just moved to a new office premises in Grantham, the firm now has space to increase its headcount from the current nine staff to at least 13 people. “There’s even space to buy more parts from local manufacturers for packing them up and labelling,” said Vivian. “These premises should see us through for at least 5 years of good growth.” He reported that the company is aiming to partner further with larger service companies to enable that growth.
The move has also given GEV a separate storage room for any returns. “The more we sell, the more returns we get, that will always be the case,” Vivian commented. “Our returns rate of 3% is extremely low and very rarely is it because we have given the wrong part number. If we ever get it wrong we pick the part up and give 100% credit.”