Multispares is not resting on its laurels as a major player in bus parts supply
When Harry Forsyth started selling spare parts for Leyland buses in the 1970s, he never dreamed it would become the biggest independent truck and bus parts supplier in the country.
Things looked promising when Multispares was listed on the Australian stock exchange in 1988, but the writing was far from on the wall and future success was not 100 per cent guaranteed.
Now after 40 years in the game and in the midst of expansion, Multispares is looking to the future with a gleam in the eye.
The bus parts industry can be challenging at times, but Multispares southern states manager Brad Allison says his team is in it for the long haul.
“What we are seeing is the rationalisation of an entire industry,” he says.
“I also think the industry is becoming more professional.”
The Multispares business is split between bus and truck whereby 60 per cent of the parts they supply are for trucks and 40 per cent are for buses.
“We actually started out selling Leyland bus spares about 40 years ago, so we started out as a bus parts supplier and then branched out into truck parts supply after that,” Allison says.
“So bus parts is our heart and soul, it’s in the DNA.
“Now, we’re a big contributor to the bus industry through our role as a parts supplier.”
The business was founded by Harry Forsyth and was initially known as Leyspares in the 1970s and was one of the early micro-companies listed on the Australian stock exchange in 1988.
There were just four branches in the early 1990s, growing to eight by 2003.
There are now four branches in New Zealand alone and 17 in total throughout Australasia.
Multispares was named supplier of the year at the last QBIC conference and is focused on leading the way on service delivery to help bus fleets operate efficiently, safely and at lower cost.
The organisation has 13 branches in Australasia and two in Melbourne alone.
The Sunshine depot predominantly services Melbourne’s western and northern suburbs and is about 600 square-metres in size, while the Dandenong depot services the eastern and southern suburbs and both supply parts to regional Victoria.
“We hold about two million dollars-worth of stock between here and Dandenong, with both branches similar in size and turnover.
The Melbourne branches get regular stock orders and daily deliveries from the Multispares distribution centres and have overnight access to around $20 million in stock held around Australia.
The Sunshine depot employs 12 full-time staff, and the organisation employs 200 across Australia and New Zealand.
Bus mechanics demand excellence and speed these days and Multispares is focused on delivering just that.
“They want original quality product, but at a cost advantage.”
“So they do expect a really high level of service and expertise from their parts supplier.
“Sometimes, when they are planning a job, they might not know exactly what they will need and that’s where knowledge becomes really important.
“They want to deal with people who know their stuff and won’t give them the runaround, because time is money.”
The organisation also has about 50 consignment stores around the country.
The range of parts stocked by Multispares covers most chassis and serviceable body components.
Multispares do not offer an installation service, but does pride itself on comprehensive after-sale service.
Although the parts are becoming more technologically advanced, the core of the business hasn’t changed.
“These days there is lot more regulation that operators need to comply with,” Allison says.
“Some of the parts that are designed for the latest buses, like EBS valves, are very advanced.
“There are all sorts of pollution requirements nowadays, as well as complex cooling systems that manage higher heat emissions from the engine.”
These advances are good, but it all adds up and ultimately puts more strain on the vehicles.
Multispares outlets in different states carry different parts, depending on what make of buses operators predominantly use in each state.
What’s required in Adelaide is different to what’s in demand in Melbourne.
“There are a lot of MANs in Adelaide, so naturally we keep more MAN parts on hand over there,” Allison says.
“You find that everywhere, each state has its own operators, environment and history and it takes a lot of work to determine what products will be in demand.”
Being able to anticipate the market is an important skill for any parts supplier.
Luckily new buses that hit the Australasian market usually pop up in Europe a few years prior to rolling out here, giving suppliers time to prepare for any new developments.
Multispares run a full-time research and development department.
This team is responsible for making sure Multispares have all the latest parts and a large amount of high quality stock for parts that are in demand.
“They know what tends to break down and need replacing,” Allison says.
“We’ve been doing this for 40 years, it helps us to predict and know the movements.”
MOVE TO ONLINE
One of the biggest things that has changed in the bus parts business is the reporting capabilities and increased data requirements.
Multispares national sales manager Brad Jarvis says the organisation has developed a business-to-business portal whereby bus operators and repairers can order parts online with direct access to a comprehensive catalogue, pricing and availability.
“Our consignment customers who use the Trapeze TIMS [transport integration management system] software go one step further and can scan products directly from our consignment shelves,” he says.
“All these transactions are automated between the customer and Multispares’ IT systems.”
This makes life a lot easier for those who order parts on a regular basis and this is the direction in which the industry is headed.
This digital integration with other businesses has taken years for Multispares to develop, but is now managing large numbers of transactions every day around the country.
Multispares has its own in-house catalogue, which is a never-ending job to keep up-to-date.
“It’s all about getting our knowledge base into a useable format so the transactions get easier and our staff can focus on other skilled services,” Allison says.
“They are doing jobs that didn’t exist and we are doing things we didn’t do even five years ago.”
The organisation’s business-to-business catalogue has been running for the last decade and demand continues to grow every year.
FAST TURNAROUND
The crew at Multispares know that turnaround time is one the most important things bus operators and their mechanics expect every time with no order delays or excuses.
“The biggest thing to them is the availability of buses. They want their vehicles back on the road as soon as possible,” Allison says.
“That’s understandable, because they are under a lot of contract pressure to provide the scheduled services they are paid to deliver.
“At our end — this means we need to have parts delivered that same day or the day after, depending on what kind of part they are after.”
The organisation runs three daily deliveries at 9am, midday and 3pm to operators in metropolitan areas.
This system is designed to accommodate bus operators and give them a good level of service throughout the day.
“We ran contractors for a while, but we found we had less control over their performance and even if we got our order out on time, things would sometimes arrive with the customer far too late,” Allison says.
“Now we have our own dedicated drivers so we have control of the whole supply chain.
“This works well for us and our customers like it; we’ve had our own delivery fleet for the last 10 years now.
“An order’s not complete until it’s fitted to the bus — it’s as simple as that.”
In an industry where time equals money, the time difference between certain states can also be a distinct advantage in connecting supply with demand
“The guys in Perth are open two hours later, so if we do get a late order — they can get it on an aeroplane that night,” Allison says.
“Customers need you to have that flexibility.
“As a parts supplier, you need plenty of stock on hand at all times.
“Not all parts are small, so you have a lot of storage space.”
Also the primary function is to supply bus parts and the physical product is just part of the equation.
“We’re a service company now really,” Allison says.
“We’re always looking at ways we can help customers and the digital integration with their operating systems is just a part of that.”
EUROVISION
The Asian ‘takeover’ has not been as dramatic and overbearing as it was anticipated to be in the Australian bus market.
“The Australian market is still dominated by European vehicles,” Allison says.
“The bottom line is that reliability is paramount.
“I think that’s the key and the main reason why operators still favour the European buses. The Chinese influence is there but at this stage it hasn’t had the impact many though it would.”
While operators are looking to keep their overheads down, they can’t afford to be replacing parts and repairing their fleet every other week.
It seems paying a little but more for a bus that comes with quality components when it rolls off the factory floor is still valued by Australian operators.
“The Europeans have been resilient and smart if you look at how well they are holding their ground against their Asian competitors,” Allison says.
Things are changing all the time in the bus industry and the team at Multispares are committed to keeping in step with the latest developments.
“We are highly involved with the associations so we stay up with the trends and can adapt quickly,” Allison says.
Just as operators need to keep their fleets within environmental standards, the industry that supplies bus components must also adapt.
The release of the Euro 6 Environmental Standards next year will have an impact on the parts that Multispares supply.
BIGGER IS BETTER
The organisation is in the process of expanding and increasing the storage capacity at various locations around Australia.
The Brisbane site was relocated to a larger site at Darra 12 months ago, Perth has just relocated next door and the Sydney branch and distribution centre are moving later this year to larger and better premises.
Multispares is increasing its capacity and is in the process of repositioning itself to make the most of future opportunities.
“We have doubled our size in the last five years, so we have been very busy,” Allison says.
“The new Sydney distribution centre at Pemulwuy will be huge and we will be employing more staff there.
“It’s due to open at the end of this year, so that’s been a big project that we’ve been working on for the last three years at least.
“This will more than double our capacity, which is great because at the moment our distribution centres are full.”
In a curious contradiction; Allison is fond of the bus industry for the unity shown by operators when it comes to advocating for their industry, even in the midst of fierce competition.
“They really want the industry to be strong and successful, but they do compete hard for business and contracts — that’s for sure.”
From humble beginning to the giant that stands today, the people behind the force of nature that is Multispares are not content to do business as they have always done, but rather have embraced the future and the potential of technology to retain and build on their enviable position.