Sparkhorse Report...We Will Cease Operation

EXCLUSIVE--Sparkhorse, an e-commerce and technology provider to the aftermarket, has ceased operations.

Sparkhorse reportedly was saddled with difficulties in obtaining a second round of venture capital funding. However, an industry source noted that the business was successful and its customers quite happy with the services provided.

Sparkhorse, based in Atlanta, was founded in 1999 and launched its initial product last March. The program linked WDs with their service dealers and provided the shops with “integrated shop-management tools for quick service order creation, parts ordering and labor estimating.”

Like Autovia, Sparkhorse management believed there is enough value in online parts ordering that increasing numbers of shops will do it to increase their productivity. Also an increasing number of WDs will pay transaction fees because they see benefits in reduced returns and increased productivity of counter people.

Sparkhorse pointed out that, for repair shops, moving an additional car per day can generate an additional $30,000 in profit annually. Moreover, the company said there has been a huge increase in the number of shops reporting Internet access: From 14 percent in January 1996 to more than 50 percent in January 2000.

However, Sparkhorse contended that it employed a marketing position far different from that of Autovia, which has a separate sales force for selling the shops, as well as one for selling WDs. Sparkhorse President Brian Eustis said it is more feasible to sell WDs, who number less than 1,000, than to reach 250,000 independent repair outlets.

Thus Sparkhorse’s strategy was to sell its services to WDs and use their help in signing up service dealers. The idea was to enhance the relationship. To this end, shops were given software that increased their productivity through fast parts searches using an electronic catalog, a labor guide for job estimating, shop management programs and other features.

Sparkhorse was even providing computers to shops that needed them. Sparkhorse claimed its parts ordering software is a hit with installers because it is fast and user friendly. “Once the shop has entered the customers make/model/year data it doesn’t have to re-enter that information each time it needs to estimate a job for that customer.”

Sparkhorse would connect repair shops to a single WD that they would designate as their preferred source. If they wanted to check alternative suppliers they could do so as they traditionally did--by phoning a counterperson.