2018 Cummins Sales and Service South Region* Dealer Manual - 2

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1 January 2018 ver. 5 effective January 1, 2017 updated March 2, Cummins Sales and Service South Region* Dealer Manual - 2 Contents Page Dealer Requirements 2 Parts Ordering Procedures & Policies 3 Freight Policy 6 Discount Programs 7 Core Policy 8 Parts Return Policy 9 ReCon Engines 10 Notes: Cummins Sales and Service South Region may change Dealer policies or terms at its discretion Current edition is published on Cummins Sales and Service website. See Published version supersedes all prior versions. * Cummins Sales and Service - South Region includes dealership located within the following branch territories: Nashville and Knoxville, TN. Florida, Georgia, North & South Carolina, Virginia and Chattanooga, TN. This specific manual excludes Manassas, VA and the Florida panhandle are supported by Dealer Manual 1. 1

2 Dealer Requirements Sales Staff - A Dealer agrees to maintain a sales force (parts & new engines) that actively solicit the sale and promote the advantages of Cummins products. Parts Staff - A Dealer agrees to provide personnel with the skills & training to properly identify the Cummins Genuine New and ReCon replacement part(s) needed to fulfill all customer requests for the Cummins products for which the dealer is certified. Service Staff - A Dealer agrees to maintain the competency level of its personnel by having one or more service technicians complete and pass training for the Cummins products for which the dealer is certified. Parts Inventory - A Dealer agrees to maintain a 45 day supply of parts for the Cummins product they are authorized to support. This volume should be consistent with the sales volume of Cummins parts in the most recent (12) month period. Annual Minimum Parts Purchases Dealers are expected to purchase a minimum dollar amount of parts and ReCon engines annually. Annual parts and ReCon engine purchase volumes will be established based on market size and estimated engine population. Tooling - A Dealer shall provide & have available for use at its facility the special tools and equipment required to service the Cummins products for which the dealer is certified. Signage - Signage is required based on products and dealer certification level. Signage shall be arranged in a dominant or equal position to the signage of any Cummins competitor. Parts and Service Information Dealers are required to purchase the appropriate parts and service information and tools as required in accordance with Cummins dealer certification requirements. Contract All dealers will be required to execute a contract with Cummins Sales and Service South Region. 2

3 Parts Ordering Procedures and Policies Order Types Type Stock Daily BR Daily Emergency Warranty Onan Stock Location IRDC IRDC Local Branch IRDC IRDC IRDC Cummins Stock Orders and Onan Stock Orders Stock orders are to be placed through CUMPAS 2.0 on the Cummins Indianapolis Regional Distribution Center (IRDC). CUMPAS 2.0 order type: Stock. Stock orders will typically be delivered in 2 days. Stock orders may qualify for discount programs (see Discount Programs page 7). Daily Orders Daily orders are to be placed through CUMPAS 2.0 on the IRDC. CUMPAS 2.0 order type: Daily. Daily orders may qualify for discount programs (see Discount Programs page 7). - The local Cummins Sales and Service South Region Branches are available to support the immediate parts needs of the dealer. Stock Orders and Daily Orders should continue to be placed on the IRDC. The intent is to allow the dealer to respond to an immediate customer need, not to provide Stocking quantities. - Dealers are not to order parts from the local branch if the part is not in the local branch s inventory. The branch cannot process a backorder. Orders received at the IRDC by 3:00 pm ET will ship the same day. Emergency Orders An Emergency parts order should be placed when the current availability cannot meet the customer s need. CUMPAS 2.0 order type: Emergency. All Emergency Orders should be placed on the IRDC. Based on availability, orders received before 4:00 pm ET will ship from the IRDC, actual freight or Tote/ Drop Site. Orders received before 5:00 pm will ship from the IRDC, actual freight. All others will ship from Memphis and Premium Freight charges will apply. Based on availability, Emergency orders received before 11:00 pm ET will ship same day. (See Freight Policy page 6 for details pertaining to Emergency orders and Premium Freight charges.) Warranty Orders Once order type Warranty is selected, the dealer is prompted to supply an Engine Serial Number (ESN) or RapidServe control number. CUMPAS 2.0 order type: Warranty. 3

4 - Orders placed using this process will be shipped freight prepaid. There is no requirement to file for freight charge recovery. Cummins Warranty includes the following programs: - New Engine Warranty - Extended Coverage - ReCon Engine Warranty - New Parts Warranty All Warranty Orders should be placed on the IRDC. Based on availability, orders received at the IRDC before 11:00 pm ET will ship same day. This policy applies only to Cummins Warranty parts sourced from the IRDC or Cummins Sales and Service. Order Cut off Times IRDC cut off time for all orders to ship same day, except Emergency and Warranty, is 4:00 pm ET. Emergency orders placed before 5:00 pm will ship from IRDC. After 5:00 pm, Emergency and Warranty orders will be filled from Memphis until 11 pm ET. CUMPAS 2.0 Orders placed via CUMPAS 2.0 cannot be canceled once transmitted. CUMPAS 2.0 should be the primary method of checking availability, pricing, and ordering Cummins and Onan parts. ReCon engines and Blocks should not be ordered on CUMPAS 2.0. Please contact Cummins Sales and Service South Region Customer Assistance Centers or your local Cummins Sales and Service South Region branch location to place an order. It is the responsibility of the Dealer to promptly notify Cummins Sales and Service South Region when an authorized user of CUMPAS 2.0 leaves their employment. This is necessary to protect the dealership and Cummins from unauthorized parts orders. The Dealer is responsible for all orders placed through CUMPAS 2.0 for users they have authorized until Cummins Sales and Service South Region has been notified to rescind their order authorization. To change the status of a CUMPAS 2.0 user please contact Denise Montgomery at (ext. 3117) or denise.montgomery@cummins.com. QuickServe Online Users It is the responsibility of the Dealer to promptly notify Cummins Sales and Service South Region when an authorized user of QuickServe Online (QSOL) leaves their employment. This is necessary to protect the dealership and Cummins from unauthorized access. To change the status of a QSOL user please contact Denise Montgomery at (ext. 3117) or denise.montgomery@cummins.com. Invoicing Errors, Shortage / Overages, Damages, and Mis-shipments Cummins Sales and Service South Region s intent is to provide error-free invoicing and parts delivery. Shortages, damages, missing components must be claimed within 48 hours (two business days) of receipt: 4

5 Louisville Call Center at (800) Cummins Sales and Service South Region has implemented the following check procedures to limit instances of order shipped short: - Redundant parts packing verification - Actual vs. Expected shipping weight Claims for parts shortages must be submitted within 2 days of invoice. Online Statements cummins-distributors.com Technical support for Cummins engines, power generation equipment, and electronic service tools, as well as facilitate any warranty claim or web navigational needs: CUMMINS ( ) 5

6 Freight Policy Branch Tote/ Drop Site Based on availability, an IRDC order can be shipped by Tote / Drop site to a Cummins Sales and Service South Region location or designated drop site, freight prepaid. Stock Orders Qualifying Stock Orders will be shipped freight prepaid. Qualifying Stock Orders are orders placed as "Stock" or Onan Stock orders using CUMPAS Cummins Stock Orders greater than $3,000 (Cummins New and ReCon parts, less core charges) Fleetguard, manuals, tools, Valvoline, fluids, Cummins Emissions Solutions, ReCon engines, and MerCruiser Diesel parts do not qualify for prepaid freight. Freight on non-qualifying Stock orders, if shipped direct to the dealer, is the responsibility of the dealer. The exception is Stock Orders shipped by Tote / Drop site. Daily Orders Freight on Daily Orders is the responsibility of the dealer. The exception is Daily Orders shipped by Tote/ Drop Site. Emergency Order Premium Charge New, ReCon, and Onan Parts An additional 10% of the Dealer Net price up to a maximum of $650 per line item, or a minimum of $20, will be added to the invoice for inbound freight and handling expense. ReCon Engines, Blocks, and Block Kits L/C/B Series Engines $400 L10/M11, N Series Engines $600 6B/4B Series Engines $400 M/X Engines $600 All Long/Short Blocks & Kits $400 K19/QSK19 Engines $800 Warranty Orders Cummins Sales and Service will waive freight on a part ordered to complete a warranty repair. This policy applies to Cummins New and ReCon components and Engines only. Parts will be shipped to arrive next-day. Must use CUMPAS 2.0 order type: Warranty. Cummins has the right to audit all warranty order types to confirm ESN relates to a valid warranty claim. Bill backs will occur on all non-valid ESN at Emergency Order shipping rates. 6

7 Discounts Discount Orders are defined as orders for Cummins New, or ReCon placed on CUMPAS 2.0 using order types: Daily or Stock or Onan stock on IRDC. - LTA Parts are defined as: 2007 or newer Cummins engine parts and all I/QSX engine parts - Legacy Parts are defined as: 2006 and older Cummins automotive engines (typically Tier 3 or older industrial engines) - Core charges do not apply towards the total order amount - Dealer must pay the monthly statement in full. Daily Order Discounts Part Type* $1 and greater Daily Order on IRDC LTA 5% Legacy 0% $1 and greater Stock Order Stock Order Discounts $2,000 and greater Stock Order Part Type* LTA 5% Legacy 0% * It is at the discretion of Cummins Inc. to designate what parts are categorized under the terms Legacy and LTA. Fleetguard, manuals, tools, Valvoline, fluids, Cummins Emissions Solutions, Cummins high horsepower parts (HHP), ReCon engines, and MerCruiser Diesel parts do not qualify for Stock Order discounts. Additionally, parts for 2006 and older Cummins engines (Legacy) do not qualify. 7

8 Core Policy Standard Core Return Components (Parts and ReCon Engines) To receive core credit, the core must meet ReCon Core acceptance return standards. - Cores are to be inspected by the returning dealer and properly identified and packaged. - Core charges are not to be deducted from the Dealer s monthly statement. Core charges are to be paid in full. Liability expiration All dealers will be on 365 day return program o Full core credit on like-for-like application. o Core liability will expire 365 days from date of purchase All core returns must be packaged and adhere to Cummins Guidelines and meet Cummins core acceptance criteria. Returns must be facilitated with the use of CUMPAS 2.0 core returns. o Returns will have RID number assigned o Returned core will be added to dealer s core bank based on receipt and acceptance of product at MDC. o Credits issued on a like for like basis. o Any core not credited will remain in customer s core bank and can be used for core swapping. Dealer is responsible for the return and cost to return core to either Cummins branch location or other assigned location. Full Core Acceptance Program Core will be accepted regardless of condition if visual inspection indicates the following: The core component must be a current part offered for exchange by ReCon. Core must be in off-engine condition. This means: o There has been no prior attempt at rebuilding the component. o The core component is a complete unit and not disassembled in any manner. o Core that is damaged by non-operational causes such as rough handling, fire, improper protection during storage is not acceptable.* o Rust that occurs on exterior surfaces of components exposed to weather conditions from normal operating conditions is acceptable. Interior surfaces and components, such as rods, or any machined surface can only have light flash rust. Heavy rust due to improper storage is not acceptable. * Improper removal, storage or packaging of core could result in the rejection of the component Please check the Core Acceptance criteria published on QSOL.Cummins.com as core acceptance varies by product type. Please contact Jerry Cheek at (260) or jerry.e.cheek@cummins.com with core questions. 8

9 Parts Return Policy New and ReCon Parts Excess Return Policy Annual return allowance for dealer is unlimited up to previous (12 months) total purchases No offsetting order is required Return Frequency: Monthly return up to 10% of annual return allowance until October 31 Parts must be in saleable condition. Credits for returns will be issued at invoiced Dealer price less a 10% handling and restocking charge. Dealer must submit list of requested return parts to distributor for approval before return Final credit determination will be given upon items passing physical inspection. Product must meet Cummins published return guidelines Freight on parts return is responsibility of dealer All ad-hoc or one-time returns should be included in monthly return. One-time returns will incur a 20% handling and restocking charge Unit cost must be greater than $5 Unacceptable Returns This section outlines examples of unacceptable return items for which no credit will be issued: Used parts. Literature / catalogs. Damage that affects salability or function. These conditions include but are not limited to: o Any deformation on machined surfaces such as nicks, scratches, or dents. o Any deformation of gasket surfaces such as nicks, folds, cracks, tears, etc. o Rust impacting salability of part. o Cracks or dents on surfaces. o Rubber or plastic items that are cracked, rotted, deteriorated, etc. Parts where the factory packaging has been removed or opened (including gasket sets, kits, quantity packs, etc.). Extra parts on assemblies such as plugs or fittings which are not part of original assembly, or extra hardware (bolts, screws, etc.) unless part of original factory package. Incomplete assemblies (such as alternators without fan or nut, barrels, plungers, injectors without the ball or link and tubes without grommets) Unidentified parts Parts not purchased through the Cummins Global Logistics (CGL) vendor base (such as special order parts sourced directly from PowerGen suppliers, typically these parts are unique Customer specifications, etc.) Parts not purchased from Cummins Piston pins except as part of piston or cylinder kits Hazardous materials such as paints, sealants, flush kits, lubricants, spray cleaners and other materials 9

10 Consumable products Software and ship-direct products from National Accounts. Printed circuit boards and other electronic components that were shipped in ESI packaging which have been opened Make-to-Order and Customized items (calibrated fuel pumps, custom specified radiators / alternators / mufflers / adapters / etc.) Superseded and obsolete parts. Contact your local representative for any special programs. No belts, service tools, and rebuilt or non-genuine parts. All items must have been purchased from Cummins Sales and Service South Region within the past 2 years to qualify for return. Process Submit return request on an Excel spreadsheet to: Paul Lattis: paul.lattis@cummins.com. Once reviewed, Cummins Sales and Service South Region will provide a list of accepted items with a Return Goods Authorization (RGA) number to identify your return. Cummins Sales and Service South Region will inspect return items when received. The RGA number must be visible on all boxes/skids with correct quantities listed. This will insure prompt and accurate issuance of credit. 10

11 ReCon Engines - ReCon Engines are not to be ordered over CUMPAS All ReCon engine purchases must have a Cummins Sales and Service South Region quotation documenting part number match to engine serial number.* - ReCon Engines are available as exchange or outright purchase - Core Acceptance is style for style - Prices are subject to change without notice A direct ship program is available to ship engines to Dealers or the customer. Restrictions apply. Engines / Blocks are shipped at actual freight rates, unless ordered as Emergency Order (see page 6 for rates). Engines core must be returned with dry oil pans. Engines returned with oil will be invoiced an additional $250. Damaged Core Charges Visibly cracked, broken or welded blocks All engines will be shipped on metal skids and engine cores must be returned on metal skids. Extra charges will be billed for engines not returned on metal skids. Engine cores are accepted on an external inspection only. It is not necessary to remove the oil pan and check the crankshaft, connecting rods, or rod and main bearings. ReCon Engine Warranty See Cummins QuickServe Online for current warranty information Extended Coverage and Extended Major Components Coverage is available. ReCon Engine Core Return Policy Standard Core Return Components Policy applies (see Core Policy on page 8). * Important information about Cummins ReCon engines: Installing this engine/block for any purpose other than for its intended application provided on the engine s dataplate may be a violation of federal law subject to civil penalty. ReCon engines/blocks cannot be installed in new equipment. The ReCon engine to be installed is to be of the same or newer model year as the model year of the engine, or engine with aftertreatment system, it is replacing, or if this is unknown, the model year of the vehicle/equipment in which it is to be used. 11

Parts Ordering Process

Parts Ordering Process Placing an Order with the Part Number Dealer parts orders can be sent via Web CUMPAS, fax, or phone to any Sales and Service location. Our professional order processing team is available