Digital Payments Change Rules of the Road for Commercial Vehicle Parts

Like many industries, the commercial vehicle aftermarket has set a course for digital payments, and it isn’t looking in the rearview mirror.

To facilitate the move, sellers of parts for medium- and heavy-duty trucks and trailers are offering financing and payment options that make online buying easy, while in some cases still offering the terms buyers have been given for years.

“The more financing options we can provide, the easier it is for [small and midsize businesses] to buy from us, buy online,” James Windrow, VP of eCommerce at FinditParts, told PYMNTS.

Offering Options in B2B Payments and Financing

FinditParts, an online seller in the commercial vehicle aftermarket, has a customer base made up of fleet operators of all sizes, repair shops, parts distributors and owner-operators. Given that range, it’s important to offer flexible options, because purchases that average around $300 and often top $1,000 can be a tough order for buyers that may be more sensitive to cash flow than others, Windrow said.

The biggest operators tend to use purchasing cards, but for customers seeking open accounts, FinditParts recently switched to a new financer so that customers can open an account with the financer and then make a ourchase from the car parts platform.

While eCommerce vendors typically want a credit card and want to get paid immediately, large buyers in the commercial vehicle aftermarket are accustomed to getting the 30- or 60-day terms that are available from their local distributors.

“With the larger accounts, we’re giving them the ability to invoice and pay, you know, 30- and 60-day payables, which is the way that they’re familiar purchasing from every other company,” Windrow said.

Before switching to the new financer, FinditParts was still sending out invoices and receiving checks from some customers. But no more.

“Just as recently as two months ago — before we moved to that — we were accepting checks for companies that we had set up terms for,” Windrow said.

A User-Friendly Catalog

As the commercial vehicle aftermarket moves increasingly online, the industry is also seeking technology that will help buyers search for, identify and purchase parts online.

To that end, on May 31, FinditParts announced that it had raised $30 million in Series A funding and would use it to further expand its technology and digital content.

For one thing, the company will continue to work on search taxonomy that it hopes will become the gold standard for categorizing and identifying parts.

Windrow explained that it can be difficult to shop for commercial vehicle parts because the industry doesn’t have the sort easily accessible inventory that exists in the automotive aftermarket, where shoppers can type in the year, make and model of a vehicle and be presented with parts that will fit that vehicle.

Buyers in the commercial aftermarket must either know the part number they need or call someone who can look it up in a big rack of paper catalogs.

“Right now, it really takes human power to figure that out,” Windrow said. “Going to a system where somebody can do it quickly and easily online has been a real challenge for the industry.”

In the automotive aftermarket, the rapid lookup of parts is enabled by data that has been standardized. In the commercial vehicle aftermarket, on the other hand, each manufacturer uses different sets of categories and subcategories.

“The investment will allow us to build out that fitment and application data — or that taxonomy — that aligns a particular set of parts with a specific vehicle,” Windrow said.

In another effort to make it easier to find the right part, FinditParts has partnered with Partium to advance parts identification and visual recognition technology in this industry.

“We’re working with a company that specializes in this technology so you can take your phone, take a picture of the part, that would recognize what the part is and that would just tell you, ‘This is part number XXX, there’s five in stock, would you like to order it?’” Windrow said.

Undergoing a Transformation to eCommerce

When it sells parts, FinditParts has them drop-shipped from distributors to its customers. The company reported that it’s been having 100% year-over-year growth every month for the last two years.

Windrow said this is due to two things: the COVID-driven growth of eCommerce across industries and the younger generations of workers that are moving into positions where they’re buying parts for fleets and repair facilities — and are more comfortable than their predecessors with buying things online.

“I expect within five years the transformation to eCommerce is going to be significant,” Windrow said. “Right now, only 1% of transactions in that $40 billion space are happening in eCommerce. I wouldn’t be surprised if in five years it’s close to 20% of the $40 billion industry.”