The Evolution of the Auto Parts Industry with E. Fletcher Lord, Jr.
This week on the Be Epic Podcast Matt sits down with E. Fletcher Lord, Jr., Chairman of the Board for Bumper-to-Bumper/Crow Burlingame Company and 2023 inductee to the Arkansas Business Hall of Fame. During the episode, they discuss the history of the company that Fletcher’s grandfather founded with J.G. Burlingame in 1919 along with their growth across a 12 state market area. The company started in Little Rock, Arkansas and continued expanding across the state and then to neighboring states even through the Great Depression and World War Two. They wrap up their discussion with a focus on the technological evolution of the automobile industry including their company focus now on data just as much as auto parts.
Transcript
The only way you're gonna be successful
E. Fletcher Lord, Jr.:is you got to be involved. You got to get in it. You can't just
E. Fletcher Lord, Jr.:stand around and ponder it and worry about it and think about
E. Fletcher Lord, Jr.:it. You got to get in it and do the best you can to get all of
E. Fletcher Lord, Jr.:it you can and and figure out what's going on.
Matt Waller:Excellence, professionalism, innovation and
Matt Waller:collegiality. These are the values the Sam M Walton College
Matt Waller:of Business explores in education, business, and the
Matt Waller:lives of people we meet every day, I'm Matt Waller, Dean of
Matt Waller:the Walton College and welcome to the be epic podcast. I have
Matt Waller:with me today Fletcher Lord Jr., who is the chairman of
Matt Waller:Replacement Parts, Inc. He has a very interesting career but most
Matt Waller:noteworthy. He is being inducted into the Arkansas Business Hall
Matt Waller:of Fame in February, and we have been running the Arkansas
Matt Waller:Business Hall of Fame. Since 1999, inductees include many
Matt Waller:names you would recognize like Sam Walton, Don Tyson, JB and
Matt Waller:Johnelle Hunt, you know, Warren Stephens, many, many, many
Matt Waller:others who Bill Dillard, many very successful people, Arkansas
Matt Waller:Business Hall of Fame, the purpose of it really, is to
Matt Waller:celebrate the achievement of business people in business,
Matt Waller:celebrate their achievement, recognize it. And we pick people
Matt Waller:who not only have had huge impacts on industries in
Matt Waller:Arkansas and business, but also are great role models in terms
Matt Waller:of integrity and ethics and so forth. And so Fletcher,
Matt Waller:congratulations on being inducted into the Arkansas
Matt Waller:Business Hall of Fame.
E. Fletcher Lord, Jr.:Thank you, came as a big surprise.
Matt Waller:Well, well deserved. I remember reading
Matt Waller:your background and all you've accomplished and it's so, so
Matt Waller:remarkable what you've done in the automotive accessories
Matt Waller:business as a privately held firm. Would you tell us a little
Matt Waller:bit about the company?
E. Fletcher Lord, Jr.:Well, we are a Little Rock based auto
E. Fletcher Lord, Jr.:parts distribution company. We operate both warehouses and
E. Fletcher Lord, Jr.:store operations. We're in the 12 state market area, from west
E. Fletcher Lord, Jr.:of Atlanta to the east or west of Tulsa and down to Beaumont,
E. Fletcher Lord, Jr.:Texas. We have 210 of our own stores, and about 180
E. Fletcher Lord, Jr.:independent part stores that are owned by independent
E. Fletcher Lord, Jr.:individuals, but buy their products from our warehouse.
E. Fletcher Lord, Jr.:They use our signage, our marketing, our computers. And
E. Fletcher Lord, Jr.:they are, for all practical purposes, an affiliate of ours.
E. Fletcher Lord, Jr.:This business was founded by my grandfather back in 1919.
Matt Waller:So that is an unusually long time for a firm
Matt Waller:to be around. Fletcher, how did the company start 102 years ago
Matt Waller:and what was it actually doing back then?
E. Fletcher Lord, Jr.:Well, it was started by my grandfather
E. Fletcher Lord, Jr.:who moved from Arkadelphia to Little Rock, and he came to town
E. Fletcher Lord, Jr.:and got a job as a traveling grocery salesman. And back then
E. Fletcher Lord, Jr.:there were no roads between towns so ever, all the commerce
E. Fletcher Lord, Jr.:was done on the railroad. And he traveled the state selling
E. Fletcher Lord, Jr.:groceries and on his travels, he ran into a fellow that was a
E. Fletcher Lord, Jr.:competitor of his and they became friends. Ultimately, they
E. Fletcher Lord, Jr.:became business partners. And he was also a grocery salesman. His
E. Fletcher Lord, Jr.:name was JG Burlingame. And they continue to be in the grocery
E. Fletcher Lord, Jr.:business and my grandfather Elderwood became a salesman for
E. Fletcher Lord, Jr.:a candy company, the Karcher candy company. But they became
E. Fletcher Lord, Jr.:friends and one day Mr. Berlingame invited my
E. Fletcher Lord, Jr.:grandfather over to his house for Sunday dinner. And he
E. Fletcher Lord, Jr.:accepted and the next week on the train, he invited him to
E. Fletcher Lord, Jr.:move in with him. He was older than my grandfather, and he
E. Fletcher Lord, Jr.:didn't have anybody at home with his wife and big ole' house and
E. Fletcher Lord, Jr.:nobody in it and my grandfather was living in the boarding house
E. Fletcher Lord, Jr.:and so he moved in and lived together for about six or seven
E. Fletcher Lord, Jr.:years before he married and they remained competitors and they
E. Fletcher Lord, Jr.:remained friends but like a lot of people do at that age they
E. Fletcher Lord, Jr.:were rattin' around for some way to make some extra money. And
E. Fletcher Lord, Jr.:Mr. Crow started going to St. Louis to the National Automotive
E. Fletcher Lord, Jr.:Show and they would go up and he would go up and he would look at
E. Fletcher Lord, Jr.:the cars that were on show there. And back then there was
E. Fletcher Lord, Jr.:about 102, or three four car manufacturers in the country.
E. Fletcher Lord, Jr.:And he would pick up cars that he thought would sell in
E. Fletcher Lord, Jr.:Arkansas, and he would buy some cars and bring them home. And
E. Fletcher Lord, Jr.:ultimately, that's the way a lot of car dealers started. And they
E. Fletcher Lord, Jr.:did that for a couple of years. But in 1918, he went up and came
E. Fletcher Lord, Jr.:back and said they weren't going to stay in the car business,
E. Fletcher Lord, Jr.:they were going into the accessory business. And back
E. Fletcher Lord, Jr.:then when the Detroit built a car, they shipped it in a box.
E. Fletcher Lord, Jr.:So it arrive without tops and seats and wheels and lamps and
E. Fletcher Lord, Jr.:all the stuff that went on it. And it was up to the dealers to
E. Fletcher Lord, Jr.:locate that stuff, put it on the car and make it roadworthy. And
E. Fletcher Lord, Jr.:so they founded a company to do that ran a big ad in the paper
E. Fletcher Lord, Jr.:and said, if your call main 464 will get your order off on the
E. Fletcher Lord, Jr.:next train. So they did that till about 1922. And about that
E. Fletcher Lord, Jr.:time the car manufacturer started to, to ship cars that
E. Fletcher Lord, Jr.:were complete. And their business had to shift and they
E. Fletcher Lord, Jr.:became a supplier of replacement parts. And at one point in time,
E. Fletcher Lord, Jr.:they had a large machine shop because the engines in cars
E. Fletcher Lord, Jr.:didn't last very long. It had to be rebuilt constantly. And they
E. Fletcher Lord, Jr.:had to rebuild the wheels. Remember the wheels, he said
E. Fletcher Lord, Jr.:wooden spokes and they would break and they had leaf springs
E. Fletcher Lord, Jr.:that had to be retorqued. And there was a lot of effort made
E. Fletcher Lord, Jr.:to keep cars running. And they did that for a long time. And in
E. Fletcher Lord, Jr.:1928, they bought a competitor down in El Dorado, Arkansas, and
E. Fletcher Lord, Jr.:they became a branch operator at that point in time. And then the
E. Fletcher Lord, Jr.:next several years, they opened branches throughout the state.
E. Fletcher Lord, Jr.:They, I think of the stores as numerically as where we opened.
E. Fletcher Lord, Jr.:Number two was El Dorado, and number three was Pine Bluff,
E. Fletcher Lord, Jr.:number four was Hot Springs, number five Stuttgart, Texarkana
E. Fletcher Lord, Jr.:and so forth. So they continued to open stores during the course
E. Fletcher Lord, Jr.:of the Depression. And my grandfather always said that, if
E. Fletcher Lord, Jr.:somebody had a car and it wasn't working, they were going to fix
E. Fletcher Lord, Jr.:it, they weren't going to go out and hook up a team of mules to
E. Fletcher Lord, Jr.:go to town anymore. Pretty much right about that so. The
E. Fletcher Lord, Jr.:depression made it hard for people to afford it, but they
E. Fletcher Lord, Jr.:weren't going to do something different. And so the business
E. Fletcher Lord, Jr.:continued to grow and expand. And then after the depression,
E. Fletcher Lord, Jr.:the war came along and everything went on allocation.
E. Fletcher Lord, Jr.:They didn't make very many cars, they made jeeps and tanks, and
E. Fletcher Lord, Jr.:tires weren't available and fuel was on allocation. So people
E. Fletcher Lord, Jr.:who've had cars continued to get them repaired and keep them
E. Fletcher Lord, Jr.:maintained because they couldn't afford not to. And then at the
E. Fletcher Lord, Jr.:end of the war, when all the GIs came home, there was all kinds
E. Fletcher Lord, Jr.:of people availability to go into the business. And they
E. Fletcher Lord, Jr.:opened 19 stores in a year during that era, with the GIs
E. Fletcher Lord, Jr.:coming home, and that was in essence what we did for a long
E. Fletcher Lord, Jr.:time. And then back in the early 50s they formed a holding
E. Fletcher Lord, Jr.:company and and merged with a group in Memphis and one in Fort
E. Fletcher Lord, Jr.:Smith. And it was called OCY. And OCY at that time was the
E. Fletcher Lord, Jr.:largest buying group in the country. And we had one of us
E. Fletcher Lord, Jr.:had nine stores and one of us had 12 stores, another one had
E. Fletcher Lord, Jr.:10 stores. So being great big didn't mean anything back then.
E. Fletcher Lord, Jr.:But they they merged and continued to grow and open
E. Fletcher Lord, Jr.:branches. And in about 1953 the government sued them and said
E. Fletcher Lord, Jr.:that keeping your own goods for redistribution doesn't cause you
E. Fletcher Lord, Jr.:to be eligible for discounts from factories. And if you're
E. Fletcher Lord, Jr.:going to stay in the distribution business, you've
E. Fletcher Lord, Jr.:got to sell 40% of what you sell to somebody beside yourself. So
E. Fletcher Lord, Jr.:at that point the industry started to sell to independent
E. Fletcher Lord, Jr.:operators. And so we started trying to establish and sell to
E. Fletcher Lord, Jr.:people who ran their own part stores. And we did that for a
E. Fletcher Lord, Jr.:number of years due to the requirement that we had to sell
E. Fletcher Lord, Jr.:a certain percentage of our stuff to somebody else.
Matt Waller:And that sounds like a very significant change
Matt Waller:in the business.
E. Fletcher Lord, Jr.:It was it was a significant change. And it
E. Fletcher Lord, Jr.:was the formation of what became known as the warehouse
E. Fletcher Lord, Jr.:distribution business. And that's it. We are an unusual
E. Fletcher Lord, Jr.:business in that we are a multi step distribution business. We
E. Fletcher Lord, Jr.:ship to the vendor ships to the warehouse who ships to the
E. Fletcher Lord, Jr.:stores, who ships to the installer, who is basically the
E. Fletcher Lord, Jr.:retailer, the fellow who bolts the parts on.
Matt Waller:what's really a that's, that's a huge change.
Matt Waller:Were there any other types of big changes? That was clearly a
Matt Waller:change? Were there any big changes that really affected
Matt Waller:aftermarket from maybe, maybe like technological?
E. Fletcher Lord, Jr.:Well, the the major thing that was
E. Fletcher Lord, Jr.:changing was the dynamics of the automobile. You know, when we
E. Fletcher Lord, Jr.:first started selling parts, there weren't many parts. You
E. Fletcher Lord, Jr.:didn't have starters, and alternators, and air
E. Fletcher Lord, Jr.:conditioning and transmissions and all that sort of thing, you
E. Fletcher Lord, Jr.:go out and grab hold of the crank and crank the car up and
E. Fletcher Lord, Jr.:started that way. And that was replaced by starters and
E. Fletcher Lord, Jr.:batteries. And the technology just continued to evolve and
E. Fletcher Lord, Jr.:cars became more complicated and, and so the parts required
E. Fletcher Lord, Jr.:to keep them going became broader and broader and broader
E. Fletcher Lord, Jr.:indoors today, they're astronomical in the number of
E. Fletcher Lord, Jr.:units required to take care of the industry. That's the way
E. Fletcher Lord, Jr.:they started. We didn't really get into the technological stuff
E. Fletcher Lord, Jr.:very often until way up into the when a computer age started to
E. Fletcher Lord, Jr.:come along. Way back in the 70s, we put a IBM 34 into our office
E. Fletcher Lord, Jr.:to manage accounts receivable. And that was when we first
E. Fletcher Lord, Jr.:started seeing some computer technology changed the business.
E. Fletcher Lord, Jr.:And of course, it's dramatic and changed everything since then.
Matt Waller:Fletcher, what would you say, is your most
Matt Waller:important formula for success?
E. Fletcher Lord, Jr.:I was at a cocktail party a number of
E. Fletcher Lord, Jr.:years ago, for some of the older fellows in the industry. And we
E. Fletcher Lord, Jr.:were standing around this and I was talking to several of the
E. Fletcher Lord, Jr.:guys that run genuine parts company in APA. And one of them
E. Fletcher Lord, Jr.:said, I'm the guy that opened the distribution center in
E. Fletcher Lord, Jr.:Little Rock. I said, really? He said, you know, it's the most
E. Fletcher Lord, Jr.:unsuccessful distribution center we ever opened. And I said, why
E. Fletcher Lord, Jr.:do you think that is? And the other ones that I know why it is
E. Fletcher Lord, Jr.:he said, because you never left. You most people when we come to
E. Fletcher Lord, Jr.:town decide they're gonna sell out, and they call us an want to
E. Fletcher Lord, Jr.:see if we will buy the company. And you never did. And you're
E. Fletcher Lord, Jr.:still here. So I think our formula was, don't quit.
E. Fletcher Lord, Jr.:Whatever you have to do you just stay in there and keep plugging
E. Fletcher Lord, Jr.:away and do what you got to do. Nothing particularly fancy about
E. Fletcher Lord, Jr.:it. It's just surround yourself with good people and do what you
E. Fletcher Lord, Jr.:got to do.
Matt Waller:Fletcher, there's so many things going on in the
Matt Waller:world right now that are changing rapidly. How do you see
Matt Waller:these changes and so forth, affecting your industry in your
Matt Waller:business out into the future decades from now?
E. Fletcher Lord, Jr.:Well, there's a lot of changes going
E. Fletcher Lord, Jr.:on, which are a challenge for everybody, not just privately
E. Fletcher Lord, Jr.:held, but publicly held companies that are in this
E. Fletcher Lord, Jr.:business as well. One of them is the challenge of trying to find
E. Fletcher Lord, Jr.:the kind of people that would do well in the industry. When I was
E. Fletcher Lord, Jr.:growing up and first got in this business, every boy around knew
E. Fletcher Lord, Jr.:something about automobiles, and was interested in em, in finding
E. Fletcher Lord, Jr.:somebody that wanted to be in the parts business was pretty
E. Fletcher Lord, Jr.:easy. That's not true today, the vast majority of young people
E. Fletcher Lord, Jr.:grow up without ever looking under the hood of a car and
E. Fletcher Lord, Jr.:don't really have a lot of interest in what's under there.
E. Fletcher Lord, Jr.:Another challenge that's that's significant is the parts
E. Fletcher Lord, Jr.:proliferation problem that, that dynamic, the number of cars on
E. Fletcher Lord, Jr.:the road, or the number of parts to service them is growing
E. Fletcher Lord, Jr.:geometrically. In addition to that, the stuff that we used to
E. Fletcher Lord, Jr.:sell, it gave us a lot of turnover and a lot of solidity
E. Fletcher Lord, Jr.:in our business is going away and it's been replaced by things
E. Fletcher Lord, Jr.:that you used to sell 200 of, now you sell none of and you
E. Fletcher Lord, Jr.:sell a lot of items that are expensive, but you sell one or
E. Fletcher Lord, Jr.:two of them at a time and not in mass. So you got to have a lot
E. Fletcher Lord, Jr.:more coverage that cost a lot more money. And you've got to
E. Fletcher Lord, Jr.:have that to be able to be able to service the business and
E. Fletcher Lord, Jr.:there's just a limit to how much dollars and money you can throw
E. Fletcher Lord, Jr.:at a problem because it's past a certain point. It doesn't make
E. Fletcher Lord, Jr.:any sense, no matter how much money you got, there's just not
E. Fletcher Lord, Jr.:enough statistical evidence to support how much inventory you
E. Fletcher Lord, Jr.:could put in, in the field and be successful doing it. The
E. Fletcher Lord, Jr.:other thing that's that is a challenge. And this continued to
E. Fletcher Lord, Jr.:be a real challenge is the fact that we're really not in the
E. Fletcher Lord, Jr.:parts business. We're in the data business. And having the
E. Fletcher Lord, Jr.:right part in the right place at the right time at the right
E. Fletcher Lord, Jr.:price is a challenge. And that was always what we had to do.
E. Fletcher Lord, Jr.:It's just harder today. And we spend most of our time talking
E. Fletcher Lord, Jr.:about things that don't have to do with auto parts they have to
E. Fletcher Lord, Jr.:do with data and how to determine all the things that we
E. Fletcher Lord, Jr.:need to know so that we can go to the street be profitable and
E. Fletcher Lord, Jr.:successful.
Matt Waller:Fletcher again, congratulations on your
Matt Waller:induction to the Arkansas Business Hall of Fame and
Matt Waller:congratulations on your amazing career and your successes. We're
Matt Waller:really proud of you.
E. Fletcher Lord, Jr.:Well thank you, it's an honor to be
E. Fletcher Lord, Jr.:sitting there talking to you.
Matt Waller:On behalf of the Sam M. Walton College of
Matt Waller:Business I want to thank everyone for spending time with
Matt Waller:us for another engaging conversation. You can subscribe
Matt Waller:by going to your favorite podcast service and searching Be
