Top Trends In Diesel Engine Repair - The DL S3E04

Top Trends In Diesel Engine Repair - The DL S3E04 is now available on Apple Podcasts, SoundCloud, IGTV, and YouTube.

In this episode of The DL, Diesel Laptops’ Founder and CEO, Tyler Robertson, is joined by Bill Mirth, the Director of Business Development at IPD (Industrial Parts Depot, LLC), during an HDAW live interview for The Heavy-Duty Parts Report, Episode 154. Bill discusses his insights on the trends that we are seeing in diesel engine repair, where they are headed, and what effect they will have on the diesel repair industry.

As always thank you for watching and listening!

CONNECT WITH BILL MIRTH, IPD, AND IDS:

Linkedin - https://www.linkedin.com/in/billmirth/

Websites – www.ipdparts.com and https://idsrx.com

CONNECT WITH THE HEAVY-DUTY PARTS REPORT:

Linkedin - https://www.linkedin.com/company/heavydutypartsreport/

Website – https://heavydutypartsreport.com

Transcript for Top Trends In Diesel Engine Repair - The DL S3E4: 

Tyler Robertson (00:06):

Welcome to The DL. I am your host, Tyler Robertson, and this will be a little bit of a special and different episode. I was recently at Heavy Duty Aftermarket Week in Texas, and another person that we work really closely with is Jamie Irvine with The Heavy-Duty Parts Report. Unfortunately, he wasn't able to make the event, but he already had a podcast booth set up on the floor of the trade show. And I said, "No problem, Jamie. You can't make it. I'll do your show for you as long as we get to use the content as well on our platform." So this is a little bit of a crossover episode with The Heavy-Duty Parts Report. So sit back, enjoy, and thank you for listening. We are at the Heavy Duty Aftermarket Week here in Grapevine, Texas. We are at the Gaylord, just a big, huge hotel convention center.

Tyler Robertson (00:51):

Absolutely fabulous atmosphere here. It's great to be back at live events. Your normal host, Jamie Irvine, is not able to attend this show. We're doing it live here. And unfortunately, with Canada restrictions, COVID, all that fun stuff, he's unable to attend. So I'm your guest host. I'm Tyler Robertson. I am the CEO and founder of Diesel Laptops. I've also been on the show. So I said, "Jamie. No problem, man. I'll take over and do some guest episodes for you," which is great because our guest today is actually a company Diesel Laptops works with as well. So I want to introduce you to Bill Mirth, the Director of Business Development at IPD. Bill is actually a returning guest. He's given me a hard time. What do we do? What do we talk about? Bill, you've been in episode 10, episode 74, episode 101. I think you've done this more than I've done this.

Bill Mirth (01:34):

It's not getting any easier.

Tyler Robertson (01:36):

Well, Bill, welcome to the show. Welcome to Grapevine, Texas. How's everything been going for you guys so far here?

Bill Mirth (01:41):

Thank you, Tyler. And sorry to miss you, Jamie. It's like having Ed McMahon step in and host a show. It's a little strange, but it's great to be here.

Tyler Robertson (01:51):

Yeah. So I think traffic's a little light here and everything. Obviously we lost some people and people are still a little nervous, but it's been busy. People are walking. People are networking. There's things going on. Is this your first event or have you guys started to do them again? Where's things at?

Bill Mirth (02:06):

Well, we had some events that were really early on just to kind of put our foot forward, but the HDAW event has always been a fantastic event and it is so good to be back. Yeah. It's not quite as the crowds in the aisles as normal, but it's been a very, very predictive show and we're very excited. And just to see these faces, the industry is made up of phenomenal people. It's what makes this industry great, and to get back after two years and see everybody has been a phenomenal experience.

Tyler Robertson (02:40):

So I've been talking to Vince [Barbarie 00:02:42], your company for two year on Zoom sessions.

Bill Mirth (02:45):

Yes.

Tyler Robertson (02:45):

It felt weird doing a face-to-face.

Bill Mirth (02:47):

Yes. And you realize he's only 4'5''.

Tyler Robertson (02:52):

He's going to love us for this.

Bill Mirth (02:53):

That's a little shocking. It's a little shocking, but yes.

Tyler Robertson (02:56):

Well, let's just say this. We're here at HDAW. There's a lot of discussions that show about the future of trucking, right? There's all kinds of things going on. I mean, there's futuristic robots driving trucks, there's electrification, but there's new technology, new things happening. Any trends you're starting to see kind of unfold here when we talk about just diesel engine repair?

Bill Mirth (03:17):

So diesel engine repair, the engines have been getting more sophisticated over the last 10 years and so forth with emissions and so forth. And some of the technology on the pistons have become so sophisticated, but what's phenomenal about that is that the aftermarket is able to keep up. I remember, I've been in the engine parts business for a few decades now, and there's always this talk back in the nineties or late nineties and early 2000s that the aftermarket may not be able to survive because the engines are becoming more and more sophisticated and not just anybody can produce a part anymore and so forth. But we could not have been any further from the truth at that point. The aftermarket on engine is thriving and it's that entrepreneurial spirit, it's the ingenuity, it's the imagination that gets this done. And the aftermarket is alive and well in 2022 and will continue to do so.

Tyler Robertson (04:19):

So I've been around this industry a little bit on the repair side for two decades now. Man, it feels weird to say that. I'm getting old. But I remember, take transmissions and drive axles. I remember our shops actually rebuild those things. They'd only make it half a million miles and then they'd need to rebuild. And then all of a sudden, machining got better and they got more precise and better lubricants. And all of a sudden, transmissions have million mile warranties and we're not rebuilding them. We're just swapping them out because it's quicker and easier. I can only imagine, as new engines have developed with each iteration, the emission cycles and these things, the same things happen. They've just gotten the machining better, the tighter tolerances. That's got to put pressure on an aftermarket provider, such as yourself, to constantly deal with the changes and those things that are happening.

Bill Mirth (05:02):

Yes. And really the neat part about being with IPD is the innovation. We have a long history of innovation, and we tend to look at an engine in its process of being rebuilt. So it's not a brand new engine off the showroom floor. This is an engine that has been rebuilt once, twice, three times, maximizing the life of that engine and actually the resources. It's actually a green process to rebuild and rebuild instead of just throw away. And our innovations of looking at engines as they're being rebuilt and finding problems that occur throughout that process that maybe was not ever thought of when they were designing that original engine. And so we come out with parts to solve problems. Our steel aligner for ISX to prevent a block being ventilated due to a failure or cryo-treated head bolts or special grooves and liners and so forth to give a better fit in an older block. All of this sort of stuff is what we do to make that engine last and continue to be able to be rebuilt over a long period of time.

Tyler Robertson (06:14):

So at our company at Diesel Laptops, we're trying to build these parts platforms, right, and figure out ways to let people do real e-commerce on websites digitally. And a lot of the places we talk to that are like, "Yeah, I'm going to sell parts." And we start having conversations with them and eventually we're like, "Well, show us your line cards. Show us who you're stocking." I'm actually shocked how few of them carry engine parts.

Bill Mirth (06:37):

Yes. Yes.

Tyler Robertson (06:37):

Right? Why aren't they and why should they be?

Bill Mirth (06:43):

My role here as I walk around HDAW is I call myself an engine parts evangelist, and my message to the independent parts distributor is, my goodness, don't send your customer down the street to get engine parts. That entity also has all the brands that you have on the independent side. So if they need an engine part, why do you step over? Why do you walk away from it? Embrace it. And at IPD, our message is we can make engines easy. I actually carry around little cards with our 800 information. It says, "How to become an engine expert." Just call our team of highly trained engine experts, and we will be that extra guy behind the counter that knows engine. And so we will make it easy for you. We'll give you the information you need. We'll back it up with a good warranty and so forth. And you go out and sell this and open up new revenue channels, new margin opportunities, and we'll make it easy for you.

Tyler Robertson (07:40):

Yeah. And I know you guys have been expanding too. I heard there was a deal recently with Redline Emissions Products to stock some other accessories, and you guys are doing other things besides just overhaul kits to help the problem.

Bill Mirth (07:51):

We think outside the box all the time. In fact, with our IPD extra brand, which aligns with good quality companies that focus on areas that we don't focus on, Redline on the emissions and Maxiforce on the smaller more caterpillar coverage, has been very successful. And that makes it really a lot of fun just trying to find ways to make it easier for the customer to gain access and information, place the orders and so forth.

Tyler Robertson (08:20):

And I think part of the conversation, what I'm hearing from you, is sometimes people, it sounds like they know they can sell engine parts. They're just kind of a little scared. It's not brakes. It's not fifth wheel. It's not suspension. It's, man, that's an expensive engine that if we sell something or do something wrong, that's a $30,000 fix, boo-boo, not a $500 boo-boo. So the stakes are high. So how do you guys help them kind of overcome that? Are the stakes really that high or is it just more of a fear and they just don't understand?

Bill Mirth (08:52):

It's more of a fear. You also have to know, I mean, somewhere along the line, there's a trained mechanic that's going to be putting those parts on too that's going to say, "Well, this piston doesn't fit in this hole." There's lines of defense along the way to make sure that the parts are going in. We can start with good information. No matter who you call when it comes to engine parts, they're going to want to know the numbers off of the engine. And once we have that, we can go in and tell you what you need. At IPD we use very current part numbers, so there's no ambiguity as to is this the right number to use. And then you build the engine knowing that the last line of defense is having a trained mechanic. So if they're reselling the parts, chances are they're reselling it to a business that builds engines.

Tyler Robertson (09:43):

Well, what I'm hearing, it's not just, "Hey, sign up to be a distributor. Buy my stuff, and you're on your own." You guys are there to help them through that process and get comfortable. I think it's like anything new. Once you learn a little bit, you learn a little bit and all of a sudden you're like, "Oh, now I make more money. I got another product line, another revenue chance." And like we said earlier too, and I knew that at my company. I know I need to sell the $10 cable and the $10,000 tool, because if I point them in a direction for one thing, I'm not sure they're coming back to me for the other thing that I do sell. And that's a thing I think a lot of people miss out on.

Bill Mirth (10:12):

Exactly.

Tyler Robertson (10:13):

So let's talk about the other side of it. Let's say I own a truck, right? And I need an overhaul, right? And I think a lot of people are like, "Oh, I got to have OEM. OEM, that's what came on it. It's better." But a lot of times, what I heard from you earlier is you guys actually make their stuff better because you get to see failure rates.

Bill Mirth (10:30):

In many cases, yes, because we deal with the rebuilding of engines, not a new engine. And it gives us an interesting perspective. It gives us an interesting history and data to look at to help us figure out what parts to design and how to make changes to it. And I would say, if you're an end user, there are really very few. Throughout history, in the early days, the aftermarket on engine parts was kind of will fit, might fit. That ship has sailed a long time ago. There is a certain amount of liability if you blow up an engine, more so if you have a brake failure. And so, for the most part, manufacturers watch this and nobody's really coming out with just something to throw in a box. It's a very technical business, and the quality in the aftermarket's very good overall.

Tyler Robertson (11:22):

I mean, and let's face it, this isn't your guys' first year building these things. Truck engines are kind of the small engines that you guys do. This is well within your wheelhouse.

Bill Mirth (11:30):

Yeah. Yes.

Tyler Robertson (11:32):

So let's talk a little bit about technology, right? HDAW, new things coming in, all that stuff. You guys just launched a new division in your company. Can you talk a little bit about that?

Bill Mirth (11:42):

Actually, it's a whole new company called IDS, and it's Industrial Digital Solutions. And we are taking our first step forward in actually a partnership with Diesel Laptops to provide more of an engine focus to the telematics or a look inside of the engine electronically. Our first iteration is a plugin in a J1939 port, and especially it's really geared towards an owner operator or small fleet. It'll talk to your-

Tyler Robertson (12:16):

Mobile device.

Bill Mirth (12:16):

... mobile device, your phone, and give you a glimpse inside that engine for preventative maintenance, code reading. It might tell you what's brewing inside that engine to say, "You might want to get this looked at because in about a month or so, you could have a problem." And it really opens up the engine and gives you an opportunity to look into it, giving that owner operator more visibility, more control.

Tyler Robertson (12:41):

So was it a big thing inside your company to say, "Hey, we've been making overhaul kits and engine parts for 65 years. Let's go create a technology company?" It's, in one regard, a far leap, but another one, it makes a lot of sense because that's where we're all going.

Bill Mirth (12:57):

And we love to innovate. We love to think outside the box, and we love to find ways to satisfy our customers, give them a way to solve a problem with the end user. It's really about the guy that throws away the box or the guy that owns the equipment and giving them tools to make their lives easier and more productive and profitable in the end.

Tyler Robertson (13:21):

So the other kind of trend I see that I feel we need to talk about, because everybody talks about there's talks going on, speaking engagements. It's supply chain.

Bill Mirth (13:30):

Yes.

Tyler Robertson (13:30):

Right? It's is there product available? Is there not product available? When's it going to get better? You guys obviously manufacture parts. You're a global company. You're shipping things literally on almost every continent. Give us just a little overview. How are things? Are they getting better? When's this going to get better?

Bill Mirth (13:47):

Well, there's an old Depeche Mode song. I don't want to spread any blasphemous rumors, but I think that the aftermarket gods have got a poor sense of humor and they've ramped up demand and they've taken away supply. So it's like, "What?" And it's been okay. We've been getting through it. At IPD we like to ship the same day at at least a 98% fill rate. Those days are temporarily out the window, but we're doing a very good job. We've been actually having record sales. And in the end, we look back and say, "Wow, we've shipped more than we ever did, even though we think we can't get product." But we're getting a lot of product. I think the worst of the backlog or the slowness of getting product is behind us. It doesn't mean it's going to fix itself anytime soon. But we think the worst is over. We're able to adjust now, and I see better days ahead. But we've weathered the storm rather well.

Tyler Robertson (14:49):

So as a company, is this now like, "Hey, we need to start thinking about if this ever happens again and have contingency plans."? Does that start coming to the conversation then at a strategic level?

Bill Mirth (14:59):

I think everybody's looking at it and saying, "How can I retire before it happens again?"

Tyler Robertson (15:05):

I'm thinking the same thing. I mean, we're a seven-year-old company, right? But we're growing fast doing these things. I literally, and this is a big deal to us, we literally have a seven figure purchase order that we can't fill and we're on day 90 or whatever it is now. And it's so frustrating. It's a tough thing.

Bill Mirth (15:23):

It's frustrating. And as I hear people talk about their own businesses at the distributor level, it's like, "We're going to have a great year if we can get parts." So it's really being experienced by everybody. We think we're faring better than others. And that could take air freights. It could take expedited shipments. I mean, we're spending a fortune to get product in, but in the end, we got to keep engines moving. The engine parts business, much like the trucking business, it keeps our economy going. I always challenge young people when talking about what to do and what industries to go in. I'll say, "No matter where you're standing, look around and know that a truck built that. Your house, that TV, the apple sitting on your counter, it's all trucks." And we've got to keep that going. And then behind that for IPD on the industrial side is the oil and gas and the construction and the industrial. So these are critical markets, and we will go above and beyond to keep those parts in stock, to keep those engines being built, to keep us all moving forward.

Tyler Robertson (16:29):

Well, I'll tell you the person I feel bad for or the persons in the company is these people that have been in the back office of procurement and purchasing. No one's ever cared, right, because things have just flowed. And all of a sudden, they must be getting hit from the CEO down to the counter guy. Like, "Where's my stuff?"

Bill Mirth (16:43):

I worked with a person for 32 years. I never knew his name. And now I'm like, "Hey, Bob. I need you. Come here. Want lunch?"

Tyler Robertson (16:52):

You're my new best friend. Where's my stuff? Yeah.

Bill Mirth (16:54):

I'm joking. It is. And they deserve a lot of credit, even though they often reach the frustration end of things. But at IPD, I can tell you that our team is phenomenal. And it's funny. Either you're buying too much or you're not buying enough, and it's always too much from the finance people and not enough from the sales people. So they drink a lot, but.

Tyler Robertson (17:20):

I'm a CEO. I thought that was my job to drink a lot, but apparently I got some company.

Bill Mirth (17:26):

Everybody's drinking now.

Tyler Robertson (17:28):

Buy stock and alcoholic companies, right?

Bill Mirth (17:29):

That's right.

Tyler Robertson (17:29):

That's what everyone needs to learn about this. Well, hey, with all that said, I want to say to everyone here you've been listening to The Heavy-Duty Parts Report. I'm your guest host, Tyler Robertson. We've been speaking with Bill Mirth, the Director of Business Development at IPD, a wily veteran on The Heavy-Duty Parts Report. I'm sure we'll get him back on here again. To learn more about IPD, visit ipdparts.com. I also know they have the other website as well they've launched to do with the technology side of things. I think it's idsrx.com I believe is the website. So Bill, thank you for being on The Heavy-Duty Parts Report and for joining us at HDAW.

Bill Mirth (18:02):

Well, thank you for having me. And if this is like Saturday Night Live, don't I get a big party or something after five visits?

Tyler Robertson (18:10):

Wait, I thought you were buying though. As long as you use your credit card, bar's open.

Bill Mirth (18:13):

Okay. All right. Thank you, Tyler. (silence).