Aftermarket Parts Guide to Smart Storage and Fast Fulfillment

Top challenges in aftermarket parts distribution

1) Manage high-volume inventory in limited space

Today’s vehicles are complex. Modern vehicles contain more than 30,000 parts,¹ and that number is only growing with the rise of electric vehicles (EVs), advanced technology features and customization options. Parts distribution centers must support thousands of SKUs, from tiny components to bulky parts, across both new and aging vehicle models.

Industry reports indicate that people are keeping their cars longer. In fact, the average age of passenger cars in the U.S. has reached 14.5 years.² Older cars require more frequent maintenance, replacements and repairs. This is great news for aftermarket parts providers—but only if they can meet the demand and allocate sufficient storage space.

Housing and handling more parts can lead to inefficient use of warehouse space, with many parts providers needing to add warehouse capacity. However, real estate is expensive, and expansion isn’t always an option. Optimized space utilization and smart strategies are now essential. Companies are turning to high-density storage solutions to maximize current facility space as SKUs increase, allowing distribution operations to accommodate larger inventories within the same physical space.

2) Ensuring order fulfillment accuracy and speed

Time is money. Automotive aftermarket parts are often ordered out of necessity when something needs to be repaired. The longer the lead time, the longer the repair takes to complete.

Aftermarket parts providers must seamlessly deliver the right parts to the right location at the right time. A fast turnaround time is crucial for aftermarket services because it directly impacts customer satisfaction, profitability and competitiveness.

Next-day and same-day shipping have become the standard. This puts immense pressure on warehouse operations to improve picking speed and reduce order cycle times with accuracy.

Traditional fulfillment processes struggle to meet these demands without errors or added costs. Instead, companies are overcoming these obstacles and optimizing operations by integrating software solutions including warehouse management systems (WMS), warehouse control systems (WCS) and warehouse execution systems (WES).

3) Workforce challenges are impacting productivity

Warehouses and distribution centers everywhere are struggling with hiring and retention. For aftermarket parts, the knowledge needed to handle part variants, warranty items and reverse logistics makes hiring even tougher.

Job openings have vastly outpaced job hires for the past decade, requiring companies to increase wages to attract potential workers. The lack of available workers leads to high turnover rates, which is often compounded by the physically demanding and repetitive nature of the work.

Understaffing and high turnover can also strain training resources, leading to inexperienced and undertrained staff. This increases the risk of safety issues in addition to reduced productivity and higher costs. As customer demands continue to increase, it’s important for companies to strike the right balance between labor and automation.

4) The rise in e-Commerce for aftermarket parts

E-Commerce now accounts for nearly 30% of U.S. aftermarket parts sales.³

Aftermarket parts providers often serve both professional installers and do-it-yourself (DIY) customers. Like in other industries, many consumers find it more convenient to search, compare and purchase their parts online with user reviews and competitive pricing right at their fingertips.

This shift requires distribution centers to modify their standard practices to meet the unique challenges of e-Commerce order fulfillment in addition to standard workflows. E-Commerce amplifies the need for fast, accurate deliveries and seamless order return experiences.

Discover how Moen, the #1 faucet brand in North America, optimized its supply chain operations to meet evolving market demands across a complicated distribution network. Read the case study.

Guide to implementing AS/RS in brownfield facilities

As you start exploring AS/RS solutions for your parts distribution center, consider the following:

• Evaluate horizontal and vertical opportunities: Warehouse capacity can be viewed in two ways: floor space and airspace. AS/RS solutions inherently minimize the storage footprint on the floor while maximizing capacity vertically. Recognizing your facility’s air and floor space, as well as any limitations, can help determine the most suitable solution for your needs.
• Infrastructure check: Before engaging with a warehouse automation partner like FORTNA, it is essential to examine and assess the current state of your facility, focusing not only on structural aspects but also on network and software stability and connectivity. Implementing a new AS/RS solution will place new demands and stress on an operation’s network.
• Future scalability and flexibility: When selecting an AS/RS solution, consider how it will address your operation’s current challenges, including storage capacities, labor costs, throughput and accuracy. Incorporating your organization’s future needs is also necessary, as you’ll require a solution that can quickly scale and remain flexible to respond to growth or disruptions.
• Change management: Planning and managing how your workforce’s roles and tasks will change when the new AS/RS goes live is crucial. There is a natural resistance to any change, but being transparent and thoroughly training your team can facilitate smoother adoption.
• Integration with current assets: Working with a supply chain partner can significantly alleviate the stress associated with integrating your automated systems and software. It can be a delicate and complex process; however, working with a partner like FORTNA, which has previously integrated automated solutions in a brownfield warehouse, can make it seamless.
• Cost and return on investment (ROI): Cost and ROI are vital, as they serve as key metrics that stakeholders and executives utilize when making their purchasing decisions. Comprehending these concepts in relation to your specific organization and operations can facilitate successful integration. Other important metrics to consider include total cost of ownership, labor cost savings, cost per order, warehouse utilization, inventory turnover, and order cycle time.

FORTNA Can Help

Ready to optimize your aftermarket parts distribution center? FORTNA can help you assess your current operations and develop a tailored strategy to support long-term growth, efficiency and competitive advantage.