Over the past 20 years the supplier and manufacturing elements of the automotive supply chain have focused a great deal reducing costs and improving productivity, with initiatives such as just in time and lean manufacturing. Until now, the same focus has not been applied to the sales and distribution elements of the value chain, which are estimated to account for 25-30% of the cost of a new car.
In response to the challenges resulting from the economic downturn, car manufacturers must consider how to reduce costs and improve efficiency in sales and distribution.
Diluted focus – The core focus for National Sales Companies (NSCs) should be on sales and distribution, but many NSCs also have to manage customer contact centers, systems development and integration, logistics, technical support, dealer support and audit, warranty administration, finance administration, procurement, HR etc.
Volume challenges – Often NSCs have grown over time as new functions are added and expanded while the volume does not always justify the complexity of the NSC operation.
Process complexity – For multi-marque manufacturers, brand differentiation and independence can result in brand specific processes. Process complexity is often increased as each brand undertakes its own process development even where this adds no value to the brand image or vision.
Systems complexity – Process differentiation leads to systems complexity as group systems are adapted to support specific brands. In addition, brand independence means that systems are also purchased to support brand specific solutions and requirements, leading to a proliferation of systems and complexity.
Economies of scale – With multiple systems and service providers and solutions supporting multiple brands, economies of scale cannot be realized.
Our lean national sales company approach provides a framework around which the NSC operation can be measured.
It recognizes that one size does not fit all and so creates a component-based market approach based on defined market types such as emerging, mature, or regional. Each market type contains a process, systems and services footprint to support the core NSC business.