Automotive Part Logistics: 3 Keys to Strategic Planning
Scott Hothem • July 16, 2014
Do you remember what a lengthy process it used to be to pick up a new movie from the video store? You would plan your evening commute to swing by the local video store on your way home. After rummaging through the hundreds of titles lining the wall, you finally come across the latest installment of Die Hard, or Terminator, or whatever Julia Roberts was doing at the time. You hand over your membership card and are on your way. That’s a lot of legwork for a two hour movie. Those were the days. Today, all you have to do is press the Netflix or Hulu app on your phone, tablet or even television remote to instantly connect to thousands of titles. This saves time on your way home, room in your wallet and space on your shelf.
The way we watch movies and TV isn’t the only thing to drastically change in the past 20 years. There has been a major overhaul in the way automotive parts are ordered, shipped, tracked and used. This evolution was by no means unsolicited. In the same way consumer demand and access forced video stores to go the way of the dinosaurs, customer expectations and market conditions have forced auto part fulfillment processes to become as streamlined as possible. As such, strategic planning in the automotive supply chain is more important than ever.
In spite of volatile revenue results stemming from the economic downturn in 2008, the automotive parts industry is expected to top $170 billion in 2014 according to a report from ibisworld.com. As markets thrive and supply chain functions become more complicated the need for strategic logistical planning needs to be a key priority. The balance between superior service levels and reduced logistics/inventory expenses can be accomplished through three strategy considerations:
- Transition from a “Pull” to a “Push” tactic- Years ago the best practice was for distributors, dealerships to order or “pull” a certain part when inventory became low. This method can be very time and labor intensive because it is reactive in nature and is often a last minute order. Today, to remain efficient and reduce the risk of a poor end-user experience, a “push” strategy is more effective. Instead of low inventory triggering an order, leveraging an Enterprise Resource Plan, an order is sent, or “pushed”, to where it is needed. Allowing technological platforms to maintain inventory and place orders reduces errors and redundant tasks from your labor force and other resources.
- Inventory forecasting- Changing the way that inventory is managed and organized can support these new complex supply chains. Shipping smaller quantities more frequently can increase the efficacy of the entire operation. A high velocity network keeps the supply chain running smoothly. Segregating part types by size, volume and frequency of use is key in optimizing and forecasting inventory. This can be achieved through a customized plan with strategic facility and SKU layouts and management, as detailed here.
- Technology- Many entities are still attempting to get as much as possible from aging and antiquated systems. Not only is this technology becoming increasingly less effective, it is also becoming more expensive to maintain. Your fulfillment technology is the pivotal element of the service parts supply chain. As the demand for replacement parts grows and the number of new model releases increases, legacy systems simply cannot handle the workload.
Integrating new technologies and supply chain functions into more sophisticated strategies is crucial for a supply chain that is fast, lean and cost effective. At Barrett Distribution Centers, the experience, capability and resources to optimize technology, process and warehouse design is at the core of our performance.
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In logistics, problems rarely arrive at convenient moments. A shipment requires clarification, an order needs attention, or a customer discovers an inconsistency that cannot afford to linger. What follows often reveals more about a third-party logistics provider than months of uninterrupted fulfillment. The characterization is not necessarily whether something goes wrong. Even experienced operations encounter unexpected circumstances. What separates a dependable fulfillment partner from a frustrating one is the willingness to assume responsibility when an issue surfaces. At Barrett Distribution Centers, that philosophy has a name: One Call Resolution. Accountability Should Not Require a Follow-Up Few experiences erode confidence faster than repeatedly explaining the same problem to different people. An initial inquiry becomes another email, another conversation, and eventually another responsibility competing for the customer's attention. For brands entrusting their inventory and customer relationships to a 3PL, those exchanges carry consequences beyond inconvenience. Every unresolved concern consumes time that could otherwise be devoted to merchandising, product development, or pursuing the next opportunity. Adam Robertson , Barrett's Vice President of Customer Experience, describes a fundamentally different expectation. “When a customer reaches out to us, they only need to reach out once and they know we will own the issue.” The concept does not promise that every situation will be resolved immediately. Some matters require investigation, coordination, or additional communication. Instead, One Call Resolution establishes something more enduring: once Barrett receives a concern, the responsibility for pursuing a resolution belongs to Barrett. Customers should participate in resolving important issues without having to become the people managing the resolution itself. Service Is a Company-Wide Responsibility Although customer experience is frequently associated with account managers and support representatives, fulfillment performance depends on people throughout the organization. A warehouse associate identifying an inventory discrepancy, a supervisor responding to an unexpected request, or a technology specialist investigating an integration concern can all influence the quality of a customer's experience. Recognizing that interconnected responsibility, Barrett has trained more than 200 employees in its One Call Resolution philosophy, extending the principle beyond customer-facing positions. Robertson emphasizes the importance of making customers feel that Barrett is “not only responsive, but we're extremely accountable.” Responsiveness initiates the conversation. Accountability determines what happens afterward. A prompt acknowledgment has limited value when the underlying concern remains unresolved. Meaningful service requires someone to carry the issue forward, coordinate the necessary resources, and remain engaged until there is a satisfactory outcome. Listening Is Only Valuable When Something Changes An organization can sincerely welcome customer feedback and still fail to act on it. Surveys may produce impressive reports, while recurring frustrations quietly persist. Barrett approaches feedback as an ongoing responsibility rather than an occasional measurement exercise. According to Robertson, the company conducts customer surveys twice annually and reviews the findings across its management and operational teams. Critical feedback becomes a documented case that remains open until the identified concern has been addressed. If a customer requests improved reporting, for example, that feedback is not simply recorded as an observation. It becomes an item requiring follow-through. This approach reflects a broader understanding of customer relationships. Expectations change as brands introduce products, expand distribution channels, and encounter new demands. A fulfillment partner must be prepared to listen carefully and respond constructively as those needs develop. The Relationship Is Tested When Something Goes Wrong Reliable fulfillment will always depend on accuracy, consistency, and sound execution. Yet the strength of a partnership also emerges in less predictable circumstances, particularly when a customer needs assistance and cannot afford to spend the day searching for answers. For brands evaluating a 3PL, service deserves the same scrutiny as warehouse capacity, technology, and pricing. An impressive distribution network matters, but so does knowing that the people responsible for your operation will remain accountable when circumstances become complicated. Ultimately, the measure of customer service is not how confidently a company promises support. It is how consistently that promise translates into action. A good 3PL answers your call. A great fulfillment partner makes sure you do not have to keep calling about the same problem. Looking for a 3PL that takes the time to understand your business? Start a conversation with Barrett Distribution Centers.
By the time your inventory reaches the Port of Baltimore, it has already completed a considerable journey. But for the brand waiting on those products, arrival at the port is hardly the finish line. The merchandise still needs to clear the next stage of its journey, reach a warehouse, become available for distribution, and ultimately find its way to a retailer or customer's doorstep. When those steps involve unnecessary distance or too many handoffs, an exciting arrival can quickly become another source of complexity. For brands importing through Baltimore, the location of the warehouse deserves a closer look. Keep the Next Step Close When your inventory finally reaches the Port of Baltimore, you want the next step to feel like progress, not another logistical hurdle. Barrett Distribution Centers' Curtis Bay facility is located within 10 miles of the port, creating a natural transition from international transportation into domestic fulfillment. Rather than viewing Baltimore simply as the place where products enter the country, brands can use it as the starting point for what comes next, whether that means preparing inventory for retail, fulfilling ecommerce demand, or moving products farther into their distribution network. For Horseware, an Irish equestrian brand working with Barrett for its United States fulfillment, that location carried real significance. “Barrett’s strategic Mid-Atlantic warehouse location, near the Port of Baltimore, is pivotal for us,” said Conor Farrelly, Logistics Manager at Horseware. Horseware's decision was not based on proximity alone. Barrett's experience supporting retail, business to business, and ecommerce fulfillment also mattered because imported inventory rarely has only one destination. Your Inventory Arrived. Now What? Picture a container filled with products arriving in Baltimore. Inside, some of that inventory may eventually be purchased by an ecommerce customer. Another portion could be destined for a retailer. Certain products may require labeling, pre ticketing, palletization, cross docking, or other preparation before they are ready to continue moving. Suddenly, the warehouse is doing much more than providing square footage. That is where the conversation around port proximity becomes more interesting. Barrett's Baltimore operation can support ecommerce fulfillment, retail distribution, omnichannel operations, and value added services, giving brands the ability to move inventory from international arrival toward the channels where it will actually generate demand. For a growing brand, that versatility matters. Sales strategies evolve, retailer opportunities emerge, and a business that once relied predominantly on one channel can gradually become far more complex. The warehouse receiving imported inventory should not become the obstacle standing between today's operation and tomorrow's opportunity. Look Beyond the Distance on the Map It is easy to evaluate port warehousing by mileage alone. Certainly, distance matters, but a nearby building is only useful if the operation inside it can support the business waiting on the other side. A more revealing question is: What can happen to our inventory once it gets there? Does the location make sense not only for receiving products, but also for moving them toward the markets and customers they ultimately need to reach? Those questions transform warehouse selection from a real estate decision into a broader fulfillment decision. For brands importing through the Port of Baltimore, proximity can create a valuable beginning. What ultimately matters, however, is where the operation allows the brand to go from there. Your products have already traveled a long way to reach Baltimore. The right warehouse should help make the rest of their journey count. Looking for a 3PL that takes the time to understand your business? Start a conversation with Barrett Distribution Centers.
Holiday volume rarely arrives politely. It does not wait for receiving to quiet down, retail orders to clear, or every incoming shipment to find its place. Customers simply begin buying. Promotions launch, popular products accelerate, retailer requirements continue, and inventory keeps entering the building while orders are moving out at an entirely different pace. For an omnichannel brand, that is what makes peak season particularly demanding. The challenge is not merely fulfilling more ecommerce orders. It is sustaining the rest of the business while one part of it becomes considerably busier. Peak Does Not Replace Your Normal Business A holiday forecast might predict a significant increase in direct to consumer orders, but those orders do not exist in isolation. Business to business shipments still need attention. Retail commitments remain. Inventory must be received. Special projects may continue. Personalized orders can require additional touches at precisely the moment speed becomes increasingly important. Harrison Smith , Director of Commercial Revenue at Barrett Distribution Centers, emphasizes the importance of examining these patterns rather than relying on broad annual averages. “It’s looking at yearly trends, looking at within the year, what does that look like? Do you have those peaks?” Understanding the peak is important. Understanding everything happening around the peak is equally consequential. A brand could finish the year with an average of 5,000 monthly orders, for example, while experiencing dramatically different volumes from one month to another. Once promotions, seasonal inventory, retail activity, and multiple sales channels enter the equation, the average begins to conceal more than it reveals. As Harrison explains, “When I work with brands, I wanna understand everything about the business.” That broader perspective gives a fulfillment partner context. It helps explain not simply how much work is coming, but when it is coming, where it is coming from, and what else the operation will be responsible for at the same time. Omnichannel Growth Changes the Peak Season Equation A growing brand may begin with a relatively straightforward direct to consumer model. Success often introduces something more complicated. Retail opportunities emerge. Business to business volume grows. Marketplaces become relevant. New products require different handling. Suddenly, fulfillment is no longer about moving one type of order through one channel. Scott Wilkins has spoken about this progression throughout his years working with Barrett customers. One of the advantages of building an operation capable of supporting multiple channels is that a brand does not have to reinvent its fulfillment strategy every time a new opportunity appears. That experience becomes especially valuable during peak because each channel brings its own requirements. A direct to consumer order and a major retailer order may contain the same product, but they are not necessarily the same fulfillment task. Without the right experience behind the operation, Scott cautions that “brands can get into trouble really, really quickly.” During the busiest months of the year, there is considerably less room for that learning curve. Your 3PL Needs More Than a Forecast Forecasts provide a starting point, but numbers become far more useful when brands explain what is driving them. If marketing is preparing a major promotion, tell your fulfillment partner. If a retailer order is expected during an already busy week, communicate it early. If inventory is arriving later than planned or a particular product is suddenly outperforming expectations, that information belongs in the conversation too. This is where a strong 3PL relationship becomes less transactional. Bryan Corbett at Barrett has described the relationship between brands and their fulfillment partners as one built on expertise, honesty, and trust. His perspective is refreshingly practical: “Sometimes the customer's not always right. And sometimes Barrett's not always right. Sometimes we make mistakes.” Peak season does not eliminate those realities. If anything, increased volume magnifies them. Plans change. Forecasts miss. Unexpected problems emerge. The strength of the operation becomes visible in how people respond. As Bryan puts it, “You show your expertise through your honesty and your trustworthiness. You can’t separate the two.” Growth Should Create Opportunity, Not Fragility The ultimate objective of peak planning is not to construct a perfectly predictable holiday season. That would be unrealistic. It is to build enough visibility, communication, and flexibility into the operation that success does not destabilize everything surrounding it. Your holiday promotion should be allowed to outperform expectations. A retailer opportunity should feel exciting. A sudden surge in demand should represent momentum rather than an immediate operational crisis. That requires a fulfillment partner capable of seeing the entire business, not simply the orders accumulating in one queue. Because when holiday volume accelerates, the rest of your business does not disappear. It keeps moving, and your 3PL needs to be prepared to move with it. Looking for a 3PL that takes the time to understand your business? Start a conversation with Barrett Distribution Centers.
