After stopping in York, editor Tom Henman continued his journey to Scotland. There, he met Parvaz Arshad, who owns Motor Factors Scotland. Based in Bonnybridge, near Falkirk, Parvaz’s – or Parv, more commonly known in the industry! – automotive journey has gone full circle and has made a strong start in wanting to see the motor factor return to former glory.
Parv kindly picked me up from the train station in Falkirk, with the factor only a short drive. We exchanged pleasantries, then I asked him about his automotive background and that’s where this story begins: “I was born and raised in the car industry – it’s a passion of mine.
“In my previous jobs, I travelled thousands of miles and missed out on a lot of family time, so when the opportunity arose to take on the Motor Factors Scotland business, it was too good to turn down. It was also a chance to be self-employed, which I’d never been before.”
The obvious question then followed: how did the prospect of taking over a motor factor business come about?
Parv replied: “The motor factor has been running for around 16 years, but the previous owner – I know him well! – was looking to sell the business. It helped that the previous owner and I have a relationship, as he was brutally honest about what I was potentially taking on.
“I spent time within the business, getting a feel of how it operates and the rapport among the staff and customers. I also observed what the business was doing well, not so well and where improvements could be made. I also knew that the factor had a good chunk of garages that bought regularly. I weighed up the pros and cons, looked at the potential, and the rest is history.”
A word on the staff too: “Without the staff, the business just wouldn’t operate! They are the backbone of the business. Everyone in the business is doing their specific role to the best of their ability; it’s like an engine, in that everything within it needs to do its job to perform. It’s a great team, and I love working with them.”
Just over a year since the acquisition and gaining experience in the process, I was curious to ask if he had any regrets in owning responsibility of the business and livelihood of his four staff.
Parv was emphatic: “It’s been a fantastic first year; looking at the previous figures of the business, to where we are now, the business turnover has quadrupled in just 12 months. When I started to run Motor Factors Scotland, the business was just about covering its costs.
“How have we turned it around? Business development has been a crucial area; I’ve spent considerable time going out and speaking to customers and building relationships. It was a significant investment and, naturally, no-one knew how business would flow; therefore, I didn’t inject further capital into the business. My strategy was to grow the customer base slightly then grow my supply base – continue that philosophy to ensure I wasn’t investing too much too quickly.
“I spent quite a bit of time on the phone as well; I rang around the garages and asked if they needed a service kit, for example. Once the transaction was complete, for the right price, and parts were delivered promptly, the customer remembered that and gave us subsequent opportunities.”
Trust with suppliers
While Motor Factors Scotland is a CAAR member – and was before Parv took over – there was still a mixed reception from suppliers. While there was a fresh outlook and exciting ideas that could support business growth, understandably, there were nerves among suppliers.
Parv expanded: “There were a few suppliers that we had to phone up and explain our situation. To begin with, some suppliers put on us terms that perhaps weren’t favourable – we had to earn their trust, which was fair and logical.
“With others, they were happy to give us an account, but it was on a pro forma basis for the first few orders. As long as the order was paid, we’d then move to a 30- day account. We had a limited credit amount too. Over the last year, though, every supplier has offered us a credit account with a healthy limit. Every single supplier is paid every month.”
What’s the target in 2023?
Repeating or building on success is always tricky, but, as it was becoming clearer as the interview progressed, Parv has his principles – and he sticks to them. Likewise, he stays with his convictions.
On 2023 expectations, he said: “I’m a firm believer of organic growth. While it may be the slowest form, it’s also the strongest. I’m going to stick with a method that has proven successful in other roles.
“We’re going to increase our steering and suspension range, as well as braking, filtration and rotating electrics. We’re also going to expand the parts within those ranges. Now we’ve established relationships with our suppliers, we have the flexibility and opportunity to develop our offering.
“The garages, meanwhile, are happy with the brands we stock, in terms of quality, pricing and availability. The business is in a good place and primed to take the next step.
“We have even discussed expanding the warehouse across the road or even investing in other facilities, but that’s way into the future so long as the momentum remains. Immediately and more pressing, we’re looking for another full-time member of staff. It’s always a gamble, but it’ll give other colleagues some help and allow me to press harder on the business development side of the business.”
Health of the automotive aftermarket
Like many interviews recently, we couldn’t stop ourselves from discussing the cost of living crisis, inflation, threat of recession, energy prices etc. Given Parv’s objectives, I was interested to know how these threats impacted his way of thinking and strategising.
He replied: “Everyone is watching the pennies – no doubt about it. People wanted to enjoy Christmas, so perhaps they put off the work on their cars until the new year. I think that’s why there’s been a bit of a decline in recent weeks; however, to contradict that statement, the bare essentials are being done to keep cars safe and on the road.”
That brought us onto the topic of MOTs – Parv jumped straight in: “Advisories on an MOT should be acted upon immediately – and perhaps this is where garages could be stronger in their dialogue with their customers, particularly if safety-related parts on a vehicle need to be replaced.”
Impact on part availability
It’s already been made clear that business is heading the right way – and that’s in the face of an industry-recognised parts shortage.
Parv was transparent on the challenges Motor Factors Scotland has faced: “It has been tough; there has been a shortage of deliveries on certain parts due to the impact of Brexit and COVID-19.
“Courier companies are overloaded with work and demand. Some couriers can’t manage the amount of product going through their depos. We have suppliers that offer a next-day delivery, but we found that because the depos were struggling to cater demand, next-day delivery wasn’t guaranteed. That had a knock-on effect, and it did upset a few customers. As soon as we let the customer down, we are on the back-foot and have to work to regain that trust.
“What these delays did was force us to up our stock level, which, as I mentioned before, isn’t something we wanted to do – particularly in the beginning – but there were times where we didn’t have a choice. It was becoming detrimental to the customers.
“Mercifully, the supply is getting better; a lot of part numbers that were on a reorder list has shortened, which is obviously good news for us and our customers. It reduces the stress and necessity of having to reorder parts as soon as they go out the door.”
Final word – a pitch!
Taking everything into account, listening to how the business has transformed in a short space of time, building relationships with suppliers and staff, adjusting to challenges and hopes for the future, I wanted to conclude the interview by offering Parv a pitch – imagine me as a garage manager and try to sell Motor Factors Scotland to me.
Chuckling, he didn’t deviate from the challenge: “We like working with local garages; we’re huge advocates of supporting local businesses. Being nearby, we can offer quick delivery – within minutes – and we can provide quality products at affordable prices.
“Tom, you’ve just opened an independent workshop, so you’ll be relying on the local community to run your business and earn a living. You’ve got to build trust and relationships to stop the locals from deflecting to big dealerships. You need the local community to run your business, and I rely on you to run my business. We need to work in tandem.”
It was a long journey up to Scotland but a valuable one. Nothing beats being thrust into the day-to-day working environment; it’s an experience one simply doesn’t get from video calling – plus there’s no offer of a bacon sandwich either!
I was grateful for Parv’s time and openness, and I wish him and the team the best of luck in reaching their goals this year.
