For Original Equipment Manufacturers (OEMs), managing spare parts is beyond just smooth logistics or efficient operations. Global manufacturing giants often juggle the complex task of providing spare parts to customers across the world.
When the right parts arrive on time, service continues uninterrupted, and customers stay happy. But one error down the line can lead to delays, breakdowns, and rising costs. A 2024 industry report estimates that supply chain inefficiencies are draining billions annually for OEMs. This makes it necessary for OEMs to streamline spare parts distribution. Electronic parts catalog software offers a transformative solution, enabling OEMs to navigate through these complexities swiftly.
Through this article, we’ll discuss why getting parts distribution right is critical for OEMs, the challenges that come with it, and how global OEMs can overcome them.
Why Streamlined Parts Distribution Matters for Global OEMs?
Streamlined parts distribution is the foundation of a growing OEM, a critical factor in the aftermarket where profit margins are thin and customers are demanding. The OEM’s capability to provide parts where they are required, within time, determines their efficiency, growth, and brand loyalty. This leads to the need for an organized parts distribution process, especially when the OEM operates across multiple time zones.
Let’s discuss the factors that created this demand for a streamlined spare parts distribution:
Optimizing Costs
Storing too many parts or paying for slow shipping eats into profits. A lean parts distribution system is essential to manage warehouse costs and keep operations functional without breaking the bank.
Improving Delivery Performance
Customers don’t have time to wait. Fast, reliable delivery of parts is necessary to keep operations on track and helps OEMs stay competitive in a cutthroat market.
Scalability for Growth
To enter new markets, OEMs require active supply chains. Streamlined parts distribution equips OEMs to expand to new regions without logistical restrictions.
Enhancing Brand Loyalty
In a global arena, consistent delivery builds customer trust, which is more valuable than ever. Streamlining processes ensures parts reach customers reliably, fostering loyalty toward the brand and bringing repeated sales.
Key Challenges in Global Parts Distribution
Global spare parts distribution is chaotic, with shortcomings that can drive up even the most competent OEMs. A 2024 McKinsey report flags a terrible reality: 60% of OEMs lack a clear view of their supply chains, leaving them exposed to costly disruptions. These hindrances surfaced for decades in the spare parts channels and demand prominent solutions. The common challenges faced by OEMs in distributing spare parts globally include:
Catalog Management
Keeping parts catalogs accurate across regions is a tough job. Outdated parts data can lead to blunders like shipping the wrong parts, costing OEMs weeks of equipment downtime, and lost trust among customers.
Global Pricing Complexities
Unpredictable taxes, tariffs, shipping costs, and currency variations make pricing a terrible task for OEMs operating in multiple countries. It also squeezes their profit margins in unstable markets.
Logistical Complications
Overcrowded ports and varying customs regulations across countries often stretch delivery schedules. This impedes the supply chain, prolongs equipment downtime, and leaves customers frustrated.
Varying Export Regulations and Compliance
Every country has its own regulations on international trade, and handling them together might be challenging. A single inaccuracy might cause shipping delays and slow down the whole supply chain.
Communication Gaps
Working with teams from various time zones and administrative schedules may cause communication gaps. Additionally, language differences may create further confusion. These gaps increase the risk of mistakes, causing things to move slowly.
Inventory Management Complications
Balancing stock levels globally is a tricky affair. Overstocking inventories holds up capital, whereas understocking causes shortages.
Diverse Supply Chain Operations
Maintaining consistency and coordination throughout the global network can be challenging since various countries often have unique systems, suppliers, and procedures.
Rising Operational Costs
As labor, fuel, and shipping costs grow, OEMs are under pressure to develop cost-cutting measures that retain efficiency.
How Electronic Parts Catalog Software Reshapes the Game?
Electronic parts catalog software redefines how OEMs manage their spare parts, making the grind of parts distribution go more smoothly. Intelli Catalog stands as a premier solution, which is built to address the challenges of the spare parts industry and serve the needs of the current digital era.
Here are the distinctions on how Intelli Catalog, as an electronic parts catalog software, helps global OEMs in streamlining their international parts distribution:
Speedy Parts Search
Interactive, user-friendly navigation allows users to find parts in minutes, cutting order times in high-stakes service shops where every second counts.
Multi-Country Flexibility
When operating in multiple countries, several parameters change as per the regional conditions. Intelli Catalog helps OEMs manage these changes easily. Here’s how:
Parts Pricing: Depending on varying costs, like customs duties and shipping charges, the part prices may change in different countries. To help OEMs manage global parts pricing, Intelli Catalog offers a centralized platform where they can display prices considering all the variable costs in that particular region.
Model Applicability: To cater to specific customer requirements in a regional market, the same products may have different models or versions. Intelli Catalog automatically displays the parts data relevant to the regional applicability, which means the user will only see the composition available at their location.
Service Bill of Materials: Depending on their usability, the engineering and design of a product may vary in different locations across the globe. This causes variations in the service bill of materials of the same product globally, surfacing another challenge for OEMs. Intelli Catalog displays the product’s composition specific to the user’s region, overcoming the hassle of looking for an exclusive part.
Supports Multiple Languages: Intelli Catalog supports multiple languages, making it an exceptional choice for global OEMs. It provides dealerships and their teams with the flexibility to access the parts catalog in their native language, all while ruling out regional hassles.
Real-Time Inventory Visibility
The software allows dealers to have real-time visibility into parts stock levels and helps them keep shortages at bay. This specifically comes in handy when the OEM manufacturers or sources the parts from one location and supplies them to a dealer in another part of the globe. Reports indicated this visibility led to a 25% drop in parts stockouts in 2024 alone.
Easy Parts Ordering
Users can directly place parts orders from the catalog, overcoming the need to navigate through another application. This streamlined ordering process saves time, minimizes errors that impact the global supply chain, and keeps things going.
Boosts Sales Through Dealer Online Storefronts
Intelli Catalog allows OEMs to expand their market reach through online dealer storefronts. The OEM can set up a storefront where the end-customers can directly place an order through the web portal, select the dealer of their choice by entering the zip code, and track the order in real-time.
Smooth Sync with ERP and DMS Systems
The software seamlessly integrates with OEM’s existing systems like Enterprise Resource Planning (ERP) and Dealer Management Systems (DMS). This overcomes the need to manually export Excel or CSV files, all while saving time and reducing errors.
How AI Assists OEMs in Managing Global Parts Distribution
In the current scenario, Artificial Intelligence (AI) has taken over industries and provides a competitive edge to the OEMs operating globally. Introducing AI functionalities into Intelli Catalog improves its speed and intelligence. Here’s how:
Predictive Demand Analysis
AI analyzes ordering trends and historical sales data to identify changes in demand before they occur. To provide an accurate forecast, it also considers secondary elements such as dealership location, operating terrain, local holidays, and regional weather patterns like heavy rain. This enables OEMs and their teams to strategically stock up parts in unstable markets.
Multiple Parts Search Functions
AI-assisted machine learning algorithms allow users to search for parts directly in their natural language, overcoming the usual step-by-step process. The AI-powered visual search feature further saves search time by allowing users to simply click a picture of the required part to identify it and check details like its availability and price. These search functionalities enable dealers to find required parts easily and deliver quick service, improving the OEM’s brand reputation.
AI-Powered Image Cleansing
This functionality helps OEMs in building training materials for new onboardings in their team. Dealerships can add parts images directly from their phone, and AI algorithms improve the image quality, making it high resolution and removing the background. It ensures the digital parts catalog displays real part images along with the usual 2D and 3D illustrations, making them easier to identify.
These AI functionalities assist OEMs and their dealerships in finding parts quickly and with accuracy. Supporting quick and reliable service, it helps in improving the brand’s reputation, providing a competitive edge in the global parts market.
A Simple Plan for OEMs to Master Parts Distribution
To excel in parts distribution across varying markets, global OEMs need a strategic plan. It not only improves operational efficiency but also ensures a productive global supply chain that is prepared for the upcoming technological challenges.
To begin with, here is a five-step guideline:
Deploy Digital Systems
Execute a parts catalog software like Intelli Catalog, which provides real-time data on the inventory levels, helping you have complete visibility of what is moving across the supply chain.
Integrate Global Data
Draft a global standard guideline for spare parts to ensure each warehouse in your network is aligned, regardless of its location.
Use AI-Driven Analytics
Use AI-assisted tools for predictive analytics. It will provide insights, like weather-induced demand, much in advance, and help in avoiding stockouts.
Enhance Workforce Proficiency
Your team is your foundation. Training teams on using parts catalog software and other tools will improve their expertise and maximize productivity.
Monitor Performance Metrics
Track the inventory and delivery schedules and evaluate supplier performance regularly. It will help in spotting avoidable patterns like poor quality parts from a specific supplier, ensuring smooth operations.
These actions focus on improving operational efficiency and help OEMs in creating a robust global parts distribution network. OEMs may gain the advantage by adopting digital transformation into their parts distribution strategy.
Conclusion
Inefficient parts distribution strategies have no place in the international space. Digital solutions like parts catalog software help global OEMs overcome distribution challenges and turn them into successes. Intelli Catalog streamlines this process, enabling OEMs to ensure smooth distribution operations across geographies.
Streamlined parts distribution across regions helps OEMs cut costs, minimize inefficiencies in logistics, and create sustainable customer loyalty. It ensures they stay competitive in the highly demanding aftermarket industry and establishes a new standard for excellence.
Source: https://www.bbntimes.com/companies/how-global-oems-streamline-parts-distribution-worldwide
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