Achieving Best Practice Performance In Automotive Parts Distribution

Supercharging Your Distribution Operations

Globalization and structural issues have caused the automotive market to become more competitive than ever, with pressure to deliver increasing levels of service at lower costs. The companies that establish themselves as dominant players in this market will have a streamlined supply chain that can deliver extraordinary customer service levels. Additionally, the flexibility to handle a variety of value added processes as easily as standard processes will be a requirement for success. Today's automotive parts distributors must balance these demands with:

• Increased customer service expectations– Customer demands have created pressure for decreased cycle times, increased fill rates and additional services. Many customers now demand special handling, product grouping and/ or packaging.
• Greater emphasis on productivity – Increased competition has put pressure on parts distributors to reduce costs and improve margins while providing advanced service levels. In many companies, parts sales provide significant financial contribution.
• Increased complexity of operations – An increasing number of services are being required to remain competitive, including kit creation, delayed branding, and emergency shipments. Contributing to this complexity, is the on-going proliferation of new SKU's to the same warehouse.

These business pressures have caused many automotive parts logistics operations to struggle in their effort to manage costs while remaining competitive. Consequently, operations executives have struggled to increase order accuracy and meet new customer requirements in their DC's, while trying to keep costs under control. To combat these issues, top organizations have focused on achieving best practices through investment in advanced warehouse management systems to meet these challenges.