Basic HTML Version
MOTORINDIA
l
July 2012
79
and
delays.
If the FMCG
and beverage
industry can
adopt
this,
should
the
auto parts in-
dustry be far
behind?
Incorpora -
tion of instant
order booking with available to promise feature on
hand-helds and low-cost sms-based technology solu-
tions can provide distributed access to order fulfilment
for dealers and retailers eliminating uncertainty of
parts availability for sale.
Knowledgeable sales persons who can match appli-
cations to parts will dramatically improve service in
the field. Investment in e-learning that permits self-
paced, flexible learning by sales persons in the field
is already a norm in the pharma industry and can be
replicated if vehicle and parts manufacturers come
together.
The auto parts industry has almost resigned itself
to accepting 20-25 per cent of stock as obsolete or
slow/non-moving. It does not however have to be that
way. Nor is it axiomatic that the only way to deal with
stock pile-up is to have periodic fire-sales to liquidate
material or operate with simplistic rules that force
write-down of over 180 days’ old stocks. Smart ware-
housing with proper warehouse management systems
to store, locate and retrieve parts, aggregated inven-
tory with logistics that reaches the material to stock
points or customers on demand can greatly reduce the
problem.
Use of proper demand-modelling and use of rule-
based reordering instead of gut-feel based order
placement can improve inventory turnover ratios
while simultaneously improving service levels.
T h i r d - p a r t y
logistics service
providers
too
must think of
adapting the ex-
isting solutions
like milk-runs,
supply to de-
mand, and hub
& spoke models to best serve this industry. With GST
likely to be introduced, many earlier assumptions and
ways of working will have to change any way.
Evaluating credit-worthiness of retail accounts
again is mostly a trial and error (mostly error!) based
exercise that can definitely do with formalised sys-
tems if industry players are willing
to share data and syndicate efforts.
Businesses with superior credit
rating will be able to differentiate
themselves and ensure higher serv-
ice levels for their customers.
The auto parts industry is ripe
for change. There is huge oppor-
tunity for players in the enterprise
systems space, mobile app devel-
opers, 3PLs and others. Is anyone
willing to start the effort to de-
velop a credit rating product for
retailers?
w
focus on aftermarket