A strategic overhaul of aftersales operations
At the time of the project, our client was challenged with increasing Competition and evolving market dynamics. The automotive industry was undergoing significant transformation due to stricter emissions regulations, the rise of electric vehicles, and changing consumer preferences, driving the need for a strategic overhaul of their operations to stay competitive and meet new market demands.
One of the critical areas our client needed to address was its aftersales operations, particularly the parts distribution network in Italy. The company aimed to improve efficiency, reduce costs, and enhance customer satisfaction. Key challenges included ensuring optimal stock levels at distribution hubs to minimize stockouts, reducing excess inventory and associated costs while maintaining service levels, and streamlining the flow of parts from warehouses to dealerships to reduce delivery times.
A strategic overhaul of aftersales operations
At the time of the project, our client was challenged with increasing Competition and evolving market dynamics. The automotive industry was undergoing significant transformation due to stricter emissions regulations, the rise of electric vehicles, and changing consumer preferences, driving the need for a strategic overhaul of their operations to stay competitive and meet new market demands.
One of the critical areas our client needed to address was its aftersales operations, particularly the parts distribution network in Italy. The company aimed to improve efficiency, reduce costs, and enhance customer satisfaction. Key challenges included ensuring optimal stock levels at distribution hubs to minimize stockouts, reducing excess inventory and associated costs while maintaining service levels, and streamlining the flow of parts from warehouses to dealerships to reduce delivery times.
The evolution and impact of the parts sales program
Launched in 2018, the program spanned nearly three years and evolved significantly over time, particularly due to the impact of COVID-19. Initially, the focus was on achieving parts sales targets for both the client’s authorized and multi-brand repair network by implementing 13 hubs dedicated to the sale of branded and private label products across Europe. In 2019, the program shifted its emphasis to optimizing internal processes at these hubs to boost the sell-out of original, multi-brand, and Independent aftermarket spare parts. By 2020, it had further evolved into a Dedicated Parts Sales Program for the brand’s multi-brand car service.
The implementation phase took approximately two to three months, dedicated to Project structuring and recruiting over 40 individuals, both internally and externally. These resources included a management team consisting of one project manager and two analysts, four Hub Development Managers, and various sales representatives for different repairer categories. We utilized a data visualization platform to create comprehensive and easily interpretable reports, which enhanced our ability to analyze information and optimize our parts distribution strategies effectively.
MSX’s data-driven approach provided crucial insights for our client during the launch of their parts distribution hubs in Italy. These analyses included national-level geographic coverage based on UIO (units in operation), advanced stock analysis beyond simple reorder mechanisms, and customer profiling. To optimize the distribution network, 13 hubs were divided equally among four MSX Hub Development Managers, considering the size of each business. Each manager was responsible for a team of nine field resources dedicated to supporting dealers, authorized repairers, and multibrand car service shops. Additionally, a central remote sales team was established to provide further support.
The evolution and impact of the parts sales program
Launched in 2018, the program spanned nearly three years and evolved significantly over time, particularly due to the impact of COVID-19. Initially, the focus was on achieving parts sales targets for both the client’s authorized and multi-brand repair network by implementing 13 hubs dedicated to the sale of branded and private label products across Europe. In 2019, the program shifted its emphasis to optimizing internal processes at these hubs to boost the sell-out of original, multi-brand, and Independent aftermarket spare parts. By 2020, it had further evolved into a Dedicated Parts Sales Program for the brand’s multi-brand car service.
The implementation phase took approximately two to three months, dedicated to Project structuring and recruiting over 40 individuals, both internally and externally. These resources included a management team consisting of one project manager and two analysts, four Hub Development Managers, and various sales representatives for different repairer categories. We utilized a data visualization platform to create comprehensive and easily interpretable reports, which enhanced our ability to analyze information and optimize our parts distribution strategies effectively.
MSX’s data-driven approach provided crucial insights for our client during the launch of their parts distribution hubs in Italy. These analyses included national-level geographic coverage based on UIO (units in operation), advanced stock analysis beyond simple reorder mechanisms, and customer profiling. To optimize the distribution network, 13 hubs were divided equally among four MSX Hub Development Managers, considering the size of each business. Each manager was responsible for a team of nine field resources dedicated to supporting dealers, authorized repairers, and multibrand car service shops. Additionally, a central remote sales team was established to provide further support.
Significant growth and strategic adaptability
Despite its age and numerous iterations, the program demonstrated significant positive outcomes, particularly in its final phase. The multi-brand car service network, which marked the culmination of the project, experienced a remarkable 70% increase in annual parts sales. Additionally, the network expanded by 100 workshops, underscoring the solution’s potential to drive growth and broaden the service network. These impressive results, although specific to the later stages, provide valuable insights into the project’s overall impact and its capacity to stimulate substantial growth.
A key component of the project’s success was the data-driven approach employed by MSX. Utilizing UIO analysis, the team provided critical insights that were instrumental for our client during the launch of their Italian parts distribution hubs. These analyses were heavily relied upon to not only simplify reorder mechanisms but to also include advanced stock optimization strategies. This comprehensive approach ensured that every hub visit was informed by precise and actionable data, enhancing the efficiency and effectiveness of the parts distribution process.
Throughout the project’s duration, flexibility and adaptability were crucial. The evolving landscape required MSX to continuously pivot and adjust their strategies to meet changing circumstances. This ability to remain agile and responsive not only addressed immediate challenges but also positioned the project for long-term success.
Significant growth and strategic adaptability
Despite its age and numerous iterations, the program demonstrated significant positive outcomes, particularly in its final phase. The multi-brand car service network, which marked the culmination of the project, experienced a remarkable 70% increase in annual parts sales. Additionally, the network expanded by 100 workshops, underscoring the solution’s potential to drive growth and broaden the service network. These impressive results, although specific to the later stages, provide valuable insights into the project’s overall impact and its capacity to stimulate substantial growth.
A key component of the project’s success was the data-driven approach employed by MSX. Utilizing UIO analysis, the team provided critical insights that were instrumental for our client during the launch of their Italian parts distribution hubs. These analyses were heavily relied upon to not only simplify reorder mechanisms but to also include advanced stock optimization strategies. This comprehensive approach ensured that every hub visit was informed by precise and actionable data, enhancing the efficiency and effectiveness of the parts distribution process.
Throughout the project’s duration, flexibility and adaptability were crucial. The evolving landscape required MSX to continuously pivot and adjust their strategies to meet changing circumstances. This ability to remain agile and responsive not only addressed immediate challenges but also positioned the project for long-term success.
The multi-brand car Service network, which marked the culmination of the project, experienced a remarkable 70% increase in annual parts sales.
Future considerations: Data-driven insights and collaborative success
Looking ahead, the program is set to build on its foundations, particularly its data-driven approach. The project has proven the critical role that data-driven insights play in optimizing distribution networks. By continuing to leverage advanced analytics and UIO analysis, MSX can further refine stock optimization strategies and enhance the efficiency of parts distribution, which will be pivotal in navigating the complexities of evolving market demands and ensuring sustained growth.
Equally important is the emphasis on collaboration. The success of the project so far has hinged on the strong partnerships between key stakeholders. Effective communication and coordination have been essential in aligning goals and executing strategies seamlessly. Moving forward, fostering these collaborative relationships will remain crucial. By maintaining open lines of communication and working closely with all parties involved, MSX can continue to drive innovation and achieve shared objectives, ensuring the program’s ongoing success and adaptability in a dynamic industry landscape.
Future considerations: Data-driven insights and collaborative success
Looking ahead, the program is set to build on its foundations, particularly its data-driven approach. The project has proven the critical role that data-driven insights play in optimizing distribution networks. By continuing to leverage advanced analytics and UIO analysis, MSX can further refine stock optimization strategies and enhance the efficiency of parts distribution, which will be pivotal in navigating the complexities of evolving market demands and ensuring sustained growth.
Equally important is the emphasis on collaboration. The success of the project so far has hinged on the strong partnerships between key stakeholders. Effective communication and coordination have been essential in aligning goals and executing strategies seamlessly. Moving forward, fostering these collaborative relationships will remain crucial. By maintaining open lines of communication and working closely with all parties involved, MSX can continue to drive innovation and achieve shared objectives, ensuring the program’s ongoing success and adaptability in a dynamic industry landscape.
Fast facts
Customer: A multinational volume manufacturer
Business Opportunity: A multinational volume manufacturer sought an opportunity to optimize its aftersales operations with the aim of enhancing efficiency, reducing costs, and improving customer satisfaction amidst evolving market dynamics.
Geographical coverage: Europe
Solutions implemented: A dedicated parts sales program restructured operations and utilized datadriven insights and advanced strategies to increase revenue and expand market reach.
Fast facts
Customer: A multinational volume manufacturer
Business Opportunity: A multinational volume manufacturer sought an opportunity to optimize its aftersales operations with the aim of enhancing efficiency, reducing costs, and improving customer satisfaction amidst evolving market dynamics.
Geographical coverage: Europe
Solutions implemented: A dedicated parts sales program restructured operations and utilized datadriven insights and advanced strategies to increase revenue and expand market reach.