Effectively managing supply chains is an increasing complex challenge, even for best-in-class automotive manufacturers.
This complexity is partly driven by advances in technology. Automobiles have become rolling computers, and a single saloon car requires an average of 30,000 separate parts.
In addition, complex emission targets, autonomous self-driving technology, stringent safety regulations and the consumer clamour for over-the-air connectivity has pushed the management of the supply chain to breaking point.
Automotive manufacturers and OEMs are consolidating their operations for greater efficiency. However, the need for replacement parts — and the ability to ship across borders — continues to grow.
OEM IS CHANGING
The DIY parts market has contributed exponentially to the growth of channels like Amazon and eBay Automotive. These are now the world’s two largest sellers of parts and components. DIY e-commerce is a relatively small niche of the automotive market. Many automotive OEMs continue to sell parts primarily through traditional distribution channels such as dealerships and authorized repair shops.
However, several factors have contributed to a growth in parcel shipping for OEMs. First is the need to send more parts to more places as the automotive industry has become more global in nature. A report by McKinsey indicated that OEM sales in emerging economies such as the BRICs and RoW (Rest of World) rose 65 percent between 2007 and 2012. This outpaced growth in Europe, North America, Japan and South Korea. More than half of BRICs growth came from China.
Vehicles have also become significantly more complicated. This means more individual parts that dealerships and repair shops might have to replace. It isn’t feasible to maintain every part in stock at every dealership or repair location. Therefore, OEMs are increasingly sending parcel shipments of individual parts rather than large shipments of freight.
A third factor? People are keeping their vehicles on the road longer, repairing rather than replacing them. According to Automotive News, the average age of a vehicle in 2016 increased to 11.6 years. In 2002, it was just 9.2 years. This is good news for OEM aftermarket suppliers.
As the OEM business becomes increasingly global and oriented around higher volumes of smaller sales, companies need a way to manage parcel and express shipping.
IS YOUR ERP UP TO THE CHALLENGE?
OEMs are finding that their existing Enterprise Resource Planning and Transport Management Systems aren’t equipped to handle the complexity of global trade, trade compliance and transportation execution. Many TMS solutions focus on managing fewer, larger shipments to a smaller number of destinations via a handful of carriers. As a result, they are not ideal to handle the challenges of high-volume shipping. These challenges include managing a global carrier network, finding the optimal price and route for large numbers of small shipments, working with multiple currencies and fulfilling export requirements.
HOW DO I USE GLOBAL PARCEL SHIPPING SOFTWARE TO LEVERAGE ERP?
Keeping on top of all the details of OEM and aftermarket shipping can be overwhelming. It includes ensuring you have all the correct documentation, controlling costs and checking that every shipment is compliant with current regulations. When all of this information is accessible from one, integrated system, maintaining visibility across your whole operation is easier than ever.
Precision Software helps companies leverage ERP to handle increased volumes of parcel shipping. Our parcel shipping software solutions are tightly integrated to ERP systems. We work seamlessly alongside the ERPs that OEM manufacturers typically use, including QAD, SAP, Oracle and JDA.
PRECISION Transportation Execution is a global, multi-carrier transportation management solution for both inbound and outbound shipments across every region of the world. With PRECISION Transportation Execution you seamlessly integrate into a worldwide carrier network. This gives you the power of choice while still maintaining uniform shipping procedures across your enterprise.You can compare rates and routes from over 5,000 carriers around the world. This allows you to reduce costs and optimize delivery regardless of where your package is going. This functionality is available for any mode of shipment, including parcel, courier, LTL, TL (Truckload) and Freight. Our software also gives you the long-range perspective you need to successfully consolidate shipments and plan for future optimizations, all while holding costs down.
PRECISION Global Trade Management allows you to manage the risks associated with cross-border trade. This includes screening trading partners and streamlining paperwork. Our solutions also offer unmatched support for multiple currencies, including Latin America, Asia, Europe and the United States.
These are just a few reasons that some of the world’s biggest automotive firms choose Precision Software to help them leverage ERP to keep up with the pace of change in the OEM industry.
ONE STORY. ONE STREAMLINED PARTS DELIVERY PROCESS.
“We were facing the biggest of challenges.” That’s how a European heavy truck manufacturer described their parcel shipping and delivery process. Now a Precision customer, when we first met them they faced the daunting challenge of shipping parts to all over the world. Because these packages often contained spare parts – every single one was critically depended on at the other end. Vehicle Off Road (VOR) are time critical.
Worse still, they had little visibility of every parcel shipped. Like most carriers nowadays, they only had access to about 3 status updates. When things went wrong — as they sometimes did — they were usually the last to know about it. And, as often as not, when it was too late to resolve it.
Not anymore. By implementing our Delivery Exception Management Solution they immediately got proactive support for their business. Now they can deal with delivery issues on the spot. They can even notify customers of delays well in advance. This protects their relationships with dealers and customers. We integrated seamlessly with their SAP, JDA and Transportation Management System with a cloud based solution. But what they liked best was the way Precision supports over 5,000 different carriers.
Today, instead of relying on a just a few carriers, they can choose the right one for each delivery. Best off all, they can leverage a multi carrier solution while still maintaining uniform shipping procedures across their enterprise. They even automated their labeling with our solution. “It’s like Precision did the heavy lifting for a change,” they said.
ABOUT PRECISION SOFTWARE – TRUSTED GLOBAL TRADE AND TRANSPORTATION EXECUTION
Precision Software, a division of QAD Inc., provides industry-leading global trade management, transportation execution and multi carrier shipping software solutions from a single, integrated platform. Preeminent industry leaders in every region of the world rely on our global support centers to leverage thousands of carriers and manage millions of shipping transactions every day. The PRECISION solution’s open architecture allows for easy integration with leading Enterprise Resource Planning (ERP), Warehouse Management Systems (WMS) and existing legacy solutions. An ISO-certified company, Precision Software assists companies around the world to minimize shipping costs, optimize first mile and last mile deliveries, avoid compliance delays and mitigate the risks associated with dynamic trading environments. Precision Software’s customers span multiple industries including banking and finance, life sciences, high technology, retail, industrial, automotive, higher education and public sector as well as logistics providers. For more information about Precision Software, visit www.precisionsoftware.com or email email@example.com.