automotive local spare parts distribution drives sales … · 2019-10-09 · local spare parts...

Deutsche Post DHL – The Mail & Logistics Group

Automotive

DHL Supply Chain Solution

• Warehousecollaborationtoprovidelocal,shared-usedistribution

• Optimalsitelocationusingrouteplanninganddesignexpertise• Cross-trainingofexistingstafftohandleburstsofactivity• Flexiblewarehouseteamprovidingreceipt,putaway,pickand

despatch

Customer Challenge

• Upgradesparepartsdistributionmodelfromovernightnextdaytouptofourdeliveriesaday

• Needforlocaldistributionwarehouselocationswithgoodproximitytoservicecenters

• Costeffectiveandflexiblewarehousingsolutionneededtohandleburstsofactivity

LOCAL SPARE PARTS DISTRIBUTION DRIVES SALES AND IMPROVES CUSTOMER SERVICE

CUSTOMER CHALLENGEIncreasedcompetitionfromindependentmotortradersandservicegroupsoverrecentyearshaspromptedmanycarmanufacturerstoexplorenewwaysofoperatingtheiraftersalesbusiness,withafocusonimprovingcustomerservicelevelsandincreasingtheirshareofthelucrativeaftersalesandsparepartsmarket.

Historically,thismajorcarmanufacturerhadoperatedamodelinwhichservicecentersreceivedjustonesparepartsdeliveryperdayonanovernightnextdaybasis.Thiswasimpactingservicelevelsbyforcingcustomerstoreturntothecentertocompleterepairsorleavetheirvehicleovernight.Also,notbeingabletofitpartsonthedayoftheserviceorrepairmeantcustomerswouldseekoutalternativeindependentsuppliers,withasubsequentimpactonthesaleofspareparts.

Whenoneoftheworld’sleadingcarmanufacturersneededawaytoradicallyupgradeitssparepartsdistributionmodel,itcalledonDHLSupplyChain’sprovenexpertise.Theinnovativeshared-userlocaldistributionsolution(currentlyrolledoutacross11regions)enablesthebusinesstomakeuptofourdeliveriesadaytoitsserviceandrepaircenters,resultinginhigherlevelsofaftersalescustomerserviceandincreasedsalesofspareparts.

Customer Benefits

• Improvedaftersalescustomerservicelevels• Increasedsalesofhighmarginspareparts• Reducedinventorycostsatservicecenters• Highervolumeofserviceandrepairwork

Deutsche Post DHL – The Mail & Logistics Group

Automotive

For further information

Contactourexperts:supplychain@dhl.comwww.dhl.com/supplychain

Toreversethistrendandimproveitsoverallaftersalesoperationsthecompanydevelopedaradicalnewstrategythatwoulduselocalsparepartsdistributiontosupplyclustersof20to30servicecenterswithuptofourdeliveriesperday.ThisnewapproachwasputouttotenderandDHLSupplyChainwereselectedbasedontheirinnovativeproposal,thelocationofitswarehousingfacilitiesandprovenautomotiveexperience.

DHL SUPPLY CHAIN SOLUTIONKeytotheDHLSupplyChainsolutionwastheuseofshared-userwarehousingfacilities.Collaboratingwithlargerclientsofthesiteandcross-trainingDHLSupplyChainstaffenabledtheshortburstsofactivityrequiredforfoursparepartsdespatchesadaytoberuninacost-effectiveway.

Inaddition,thespreadofexistingDHLSupplyChaindistributioncentersinanygivencountryorregionenabledtheoptimumlocationforlocalsparepartsdeliverytoaclusterofservicecenters.ThelocationswerechosenusingDHLSupplyChain’sextensiverouteplanninganddesignexpertiseusingamilkrunroundtriptominimisetransportationmileage.

Tofacilitateshared-useDHLSupplyChainworkedcloselywiththemanufacturertoensureselectedmembersoftheexistingwarehouseteamwerecomprehensivelytrainedonthenewoperationalrequirements.Thisbenefittedbothclientsinthecollaborationbycreatingamulti-skilledworkforcethatcouldbedrawnintomeetfluctuationsindemand,includingtheburstsofactivityrequiredtodespatchsparepartsuptofourtimesaday.DHLSupplyChainreconfiguredpartofthewarehousetoprovideaflexiblesolutionthatincludedreceipt,putaway,pickanddespatch.

Makinguptofourdeliveriesadaywouldalsomeanthatdealersandservicecenterswouldnolongerneedtostockcostlysparepartslocally,freeingupbothresourceandspace.

Toensureasmoothstart-up,DHLSupplyChainuseditsprovenDePict®projectmanagementmethodologytoclearlydefineroles,responsibilitiesandactions,andtrackthemtocompletion.

FollowingthesuccessofthefirstdeploymentDHLSupplyChainwaschosenbythisleadingcarmanufacturertodevelopandoperateshared-userlocal

“WeselectedDHLSupplyChainbecauseofitsinnovativeproposalofcosteffectiveshared-userlocalsparepartsdistribution,andbecauseofitwasabletoprovideuswiththeoptimumlocationsrelativetoourservicecenters.Thesethingstogetherenabledustomovefromovernightnextdaydeliveriestouptofourdespatchesaday–whichiscentraltoourstrategytoimprovecustomerserviceandincreasethesalesofspareparts.”

partsdistributionin10otherregionsacrossEuropeandtheUnitedStates.Eachsubsequentprojecthasbeencompetitivelytendered.

CUSTOMER BENEFITSPartneringwithDHLSupplyChainhasenabledthisleadingcarmanufacturertoradicallytransformthewayitoperatesitsaftersalesandsparepartsbusiness.Thishasnotonlyledtoimprovedcustomerservicelevelsandincreasedsalesofhighmarginsparepartsbutalsoseveralknock-onbenefitsforitsauthorisedservicecenters.

Eliminatingtheneedtocarrysparepartsinventoryhasenableddealersandservicecenterstoreducestockingandobsolescencecostsandfreeupspaceforincreasedservicingandrepairwork.Inaddition,completingmorejobsinagivendayhasledtoanincreaseintheoverallvolumeofservicingandrepair.Finally,marginshavealsoimprovedby,forexample,reducingtheneedforovernightandlongertermcourtesycarusebycustomers.

Buildingonthesuccessofthisflexibleandresponsivelocalapproachtosparepartsdistributionisalsoenablingthebusinesstoexplorewaysoffurtherincreasingitsmarketsharebyprovidingacosteffectiverouteforsupplyingsparepartstoindependenttradersandrepairshops.