Apex Supply Chain Technologies addresses supply chain inefficiencies in the automotive aftermarket and offers solutions to fix them. Kent Savage, company CEO, said the solution in an "industrial vending machines" at the point of installation in auto repair shops. He answered the following questions in an exclusive video interview with Aftermarket Business World.
Q: Give us some background on you and your company:
Apex Supply Chain Technologies is a business that helps suppliers of critical parts, components, materials and supplies to become more efficient and serve their customers better by using automation and information. We provide systems that are sometimes like a vending machine, sometimes like a locker, sometimes like an open shelf, but all are Internet appliances that allow information to be paired with the flow of materials, parts and components. That allows suppliers to eliminate inventory and eliminate manual processes and reactive behaviors. That allows customers to be more competitive, reduce costs and follow best practices.
Q: What is your assessment of the state of the market as it pertains to inventory and supply chain management?
A: There is a great evolution in process in the automotive aftermarket. The onus is higher up the supply chain, meaning distributors and OEMs are expected to respond to the needs of service providers (independent shops or fleets) faster. Current systems are not working. Part of the reason for that is they have been very reliant on having lots of inventory in lots of places and lots of people fetching and sorting. In the past, the distribution chain has been measured by how quickly they react to a crisis or a need. Today that’s not enough. We need to be ahead of that and using information in a cost-effective way.
Q: You want to help program groups and automotive parts retailers dispense parts and supplies through your vending machines. How would that work and what kind of parts and supplies would be stocked in these vending machines, since SKUs in this industry are in the millions?
A: There are two levels. Certain routine parts, supplies and materials are used on an ongoing basis and those are stocked near where they are used. There also is the ability to have parts delivered on an as-needed basis into locker systems 24/7 for the last mile. So we have an already there component and a last-mile component working together to serve the needs to make sure we have the right stuff at the right place as fast as we can at the lowest possible cost.
Q: What is the process of working with the distributors to get the vending machines into the shops?
A: The answer is not buying more trucks or hiring more people to stock bins or to pull parts faster. The answer is to have a better system. Putting technology, dispensing devices, at the shop is the first step. We work together with the distribution partners to make sure that it happens in an efficient way. To bundle that with the service offering so it is a seamless process for the shop. Instead of pulling parts from the shelves, they now pull it from the machine. The advantage is that we have control over what is in the machine and we know for sure it is there and the inventory is correct. The distributor can supply that service more efficiently, everyone can have the parts where they need them and the supplier knows in real time what has been used and needs to be replenished.
Q: Return of parts is a persistent problem in the industry. How does the vending machine handle returns?
A: We have locker systems that can accept returns and even note the condition. The beauty of the system is that you have accountability. If a technician enters incorrect information, the system knows that and reports it for everyone to see. So it changes behavior.
To see the entire interview, click on Apex Supply Chain Technologies.
