People

Sukhpal Singh:
How He Built an Auto-Parts Empire

by HELEN DUNNE

 

Sukhpal Singh's dreams of a university education were cut short when, at the age of 13, his family was forced to flee Idi Amin's notorious regime in Uganda and move to England.

He worked on market stalls in Liverpool Street and Petticoat Lane, and at the age of 18, was offered the chance to buy a car parts shop that had gone into bankruptcy.

He paid £5,000 for the outlet in Willesden, North London, using funds from his father and a small bank loan.

That was in 1978.

Today the business, now known as Euro Car Parts, has 61 outlets, an annual turnover of £145 million and pre-tax profits of £6.6 million. Its expansion has been funded entirely by cash flow.

"On my first day, a customer came in looking for a part and had to help me find it," laughs Sukhpal, pointing out that, although he knew about cars, the shop carried between 2,000 and 3,000 parts.

Today Euro Car Parts stocks 100,000 different components, with a total value in excess of £30 million.

Sukhpal Singh had learned two essential lessons from his market-trading days. He understood the commercial side of a business and the importance of customer service.

"In those days, car parts shops used to open from nine to five weekdays, Saturdays until one, and close for lunch," he recalls. "I wanted to exploit the DIY (do-it-yourself) customer, so I opened from seven until seven every day, apart from Sunday when I closed at four, and I never closed for lunch."

The move had a dramatic impact. Within its first year, Sukhpal's shop increased sales tenfold to £4 million. "My philosophy is that the customer is always right, even when he is wrong," he explains. "I tell my employees to remember that the company doesn't pay your salary, the customer does."

Initially, Sukhpal's customers were predominantly car owners who did repairs themselves. Today, 80% of his business comes from independent garages; Euro Car Parts serves about 17,000 of the 25,000 across the country.

Not surprisingly, the major dealerships have not welcomed Sukhpal Singh's success.

"They are constantly making it difficult for us to find technical information, which should be freely available," he says. "They have put all sorts of obstacles in my way."

Euro Car Parts deals directly with the parts manufacturers.

"Car companies are responsible for design and assembly, but there are hundreds of manufacturers that produce the parts," explains Sukhpal Singh. And he believes Euro Car Parts' success is, to an extent, due to the high charges levied by dealerships for repair work.

"The credit crunch has brought a reality check for some people. Instead of going to a dealership, they may try to fix their car themselves or bring it to a small local garage," he says. "A dealership can charge three times more for the same work as an independent garage."

Availability of stock is key to serving these garages; branches receive deliveries daily, but they do not all carry identical items.

"In London, there is a strong presence of Japanese and German cars," says Sukhpal. "But in Swindon, for example, it is mostly Hondas, while Rovers abound in Oxford."

Euro Car Parts made 2.7 million deliveries last year, using its fleet of 550 vehicles. A complex logistics system ensures that deliveries, which can sometimes be made hourly, are as efficient as possible.

The introduction of Datatrak satellite tracking equipment meant that it was possible to increase deliveries by 20% with the same number of vehicles.

"Seeing is believing when it comes to our delivery fleet," says Sukhpal Singh.

 

[Courtesy: The Telegraph]

April 21, 2009

read other articles in People