Managing pricing in an inflationary environment is a tough job. As HDMA confirmed during its Pulse webinar last week, raw materials, production labor and logistics/freights costs all continue to rise across trucking’s supply chain, and the rate at which these costs are rising are forcing suppliers to update their pricing biannually or even quarterly.
For an industry long accustomed to annual pricing adjustments, the new normal is taking some getting used to.
“This is new to all of us,” says John Ferry, executive vice president, Turbo Solutions. “We are not living in normal times in the truck parts industry right now.”
“We’ve had four increases since the beginning of last year. I don’t think that’s ever happened before,” says Walt Sherbourne, vice president of marketing, Dayton Parts. “Now, not every product group got hit every time, but for us to send out four new pricing sheets in that time is unheard of.”
With so much of the parts market already in upheaval, suppliers say they are doing their best to provide ample warning and explanations before implementing these additional but necessary price increases to reduce their burden on their distributor partners.
Just because everyone knows price increases are coming doesn’t excuse sudden, unexplained hikes, suppliers say. In the same way customers value transparency in component availability, suppliers recognize their distribution partnerships are stronger when they can communicate why, as well as when, a price needs to change.
“I think everybody understands we are absorbing higher costs all the time and sometimes we have to adjust our prices accordingly,” says Sherbourne. “That’s happening to [our distributors] too. What has made this situation unique is rate [of increases].”
