Automobile suppliers play a key role in the supply chain management of any organization. They play an important role in keeping the assembly line churning, which means that they must be seen and they must be easy to find. In other words, the visibility of the automobile parts and accessories that you order through the automobile supplier, is imperative to the proper functioning of the assembly line. In addition, excellent visibility is also necessary for customers who locate the automobile parts and accessories on their own, as well.
As an automotive supplier, your primary objective will be to meet customer requirements. This can only be achieved if you have a plan. In order to meet these needs, you have to have the right inventory, the right parts, the right price, and excellent customer service. If you have these characteristics, but you do not have a plan for how to keep all of these elements in check, then you are doing more than failing at the basic function of the business. You are failing at the very purpose of the automobile supply chain. There are two primary factors that contribute to the proper visibility of the automobile parts and accessories that you offer: physical and asset quality.
The physical quality of the automotive supply chain can be viewed in many different ways. For instance, it can be seen in the product design and its conception. In other words, the automobile products that you manufacture should have the right proportions, so that they are attractive to consumers. It can also be seen in the way that the consumer demands are being met. In other words, the automotive supply chain should have a sufficient number of distribution points so that it can meet the demand of the consumer.
Asset quality pertains to the way that the automobile accessories are designed and built. It can also pertain to the way that the distribution systems of the supplier are designed and structured. This relates to the way that the automobile parts and automotive supply chain managers to address customer needs. If an accessory is not meeting consumer demands, then the automotive supply chain manager will have to consider changing the distribution system that he or she has in place. Otherwise, the automotive accessories manufacturer may find itself stuck in a position of either having to change manufacturing processes as a whole or at least changing one aspect of that process – for instance, changing the warehouse in which the accessory is manufactured.
Visibility means that the automotive supply chain management process must allow for changes in the prices and variable costs of the automotive accessories that the manufacturer is manufacturing. Price volatility is something that occurs on a time-to-time basis and that is a direct outcome of changes in the level of output that is being provided by the supplier. Variable costs refer to the aspects of an automotive production system that are outside of the control of the manufacturer, such as labor and material costs. The process of maintaining constant levels of output is a challenge that many automotive suppliers are unable to meet.
The ability to meet consumer demands is only part of the criteria that Automotive supply chain managers must meet. They must also meet the economic viability of the company. Automotive manufacturers that rely solely on consumer demand without considering these other factors will find themselves at a loss when it comes to profitability. At the end of the day, Automotive supply chain managers must be able to recognize changes in consumer demands and the impact that they will have on the profitability of the company. If they do not, then they are destined to fail.