Importance of Automotive & Truck Service Parts Packaging
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and needs replaced with a genuine OEM part. Most part manufacturers are set-up for high Importance of Automotive & volume production and putting parts in returnable dunnage, and shipping back and forth to the Truck Service Parts Packaging OEM assembly plant. When they are required to make and ship service parts, they are asked to ship multiple part numbers, and typically a small volume of parts. All of these parts have to be packaged in their own TONY XIDAS Director of Sales individual (unitized) expendable CROWN PACKAGING, INC. packaging, with specific label requirements, that may have to You are probably wondering automotive manufacturer, the ship to multiple destinations. why contract packaging would current assembly part must be Part manufacturers often be a part of the puzzle for available a minimum of 10 years struggle with these requirements. someone making parts for a after that model year. Some major OEM automobile or truck OEM manufacturers are even To take it a step further, you may manufacturer. In the world of requiring that a part is available be providing parts to multiple manufacturing and supplying 15 years after that model was OEM manufacturers – which all parts directly to an OEM produced. In the case of a truck have different rules. If you do manufacturer, there is one aspect or construction equipment, the something wrong, you stand a of the program that many times OEM truck manufacturer requires chance of receiving a problem gets overlooked. That aspect is that they have part availability resolution report (PRR), which the “Service Parts” portion of the of 30 years after the model is will affect your performance business. produced. scores, and if that non- conformance continues, it will In supplying the OEM When I say, “Service Parts” I am put you on “business-hold.” manufacturer, the part supplier referring to the replacement is required to supply service part that is needed when the This article is to educate you parts as well. In the case of an part fails, wears out, is damaged about what a contract packager can do to help manage the “Service Parts” side of your business, and to give you options to help make your supply chain run smoother. EFFICIENCY Typically, when the OEM manufacturer orders service parts, there are multiple part numbers involved and the part volumes are low. For many part manufacturers, when they package their own service parts in-house, they have a difficult time being very efficient because they lack the volume to run 10 PARTBUYERS AUTH RITY continually. And because of this, eventually be shipping from the the material needed to package they experience downtime which OEM manufacturer’s warehouse the parts. We have suppliers that negatively effects productivity. directly to the car or truck come 2 and 3 times a day to deliver dealership. packaging material JIT A contract packager however, for your parts. packs hundreds of work orders The packaging materials for per day, which allows a constant service parts include corrugated, ECONOMIES OF SCALE flow of work and naturally wood, foam, bags, bubble wrap, Contract packagers order millions increases efficiency. pad pack cushioning, tape, of dollars of corrugated and labels, inserts, rust inhibitors, packaging supplies each year. The PACKAGING MATERIALS pallets, and stretch wrap. These caliper for one OEM manufacturer The packaging materials used materials are needed to pack and is about the same size as the for packaging service parts protect the part in shipment and caliper we pack for other OEM is much different from the in long-term storage. Packaging manufacturers. This allows us materials used for the assembly materials also need to be to use the same box for both packaging process. The parts purchased, managed, and stored. customers. Contract packagers shipping to an assembly plant naturally receive better pricing tend to be packed in returnable Every part we pack is built in our due to large volume buys and pass metal racks or plastic dunnage, computer system and has a Bill those savings on to customers. or returnable corrugated trays, of Material of the parts needed in which are used over and over the pack, and all material used in COMPUTER SYSTEMS again. Service parts are typically the pack. When we get an ASN How it works packed in corrugated boxes or (Advance Shipping Notice) from As soon as your parts ship and the if heavy enough, may require a customer that parts are on Advanced Shipping Notice (ASN) wood crating. These parts will the way, our MRP system orders Continued on page 12 Click here to SUBSCRIBE or CONTRIBUTE as an author. 11 there is an accident or natural the service parts as they came disaster (e.g., fire, flood, or to the warehouse and parts were tornado)? Or you cannot keep warehoused until they were up with production and you’re needed to ship to their OEM out of warehouse space. Or the customers. temporary or special projects CASE STUDY: (such as recall programs) you Large Truck – emergency manage have disrupted your A major OEM truck manufacturer normal daily business. Or you had a supplier give them notice find yourselves getting involved that they were going to stop in things that are not your core supplying parts to them. To business, like kitting, dunnage maintain production, they needed management, import/export, to store a year’s supply of these and light assembly work. You can parts. We leased the space they benefit from having a contract required, inventoried and made packager as your Plan B. The daily deliveries to them while better you protect yourself, the they focused on getting a new better you protect your customer. supplier. Their Plan B kept their is sent, the production work FLEXIBILITY production up-and-running. Contract packagers can come order is automatically produced CASE STUDY: to you. They can work in your in our computer systems, material Manufacturer needs more facility, open a facility near your is getting ordered, and routing production space production plant, or often have to where the part is going to be A major manufacturer was a facility of their own to package packed is established. Material is experiencing high growth and as your parts. tracked as soon as it is delivered a result was running out of space and tracked through the process CASE STUDY: ‘Near Site’ Solution to warehouse their parts. Using a as it moves through the building. – meeting seasonal automotive contract packager to inventory, Parts are scanned into the part demand warehouse, and daily sequence warehouse, and scanned at job their parts allowed them to A major automotive parts set up, with labels generated and bring in additional machinery manufacturer provides service ready to pack. to expand production and grow parts to a variety of OEM car their business. Depending on AUTOMATION manufacturers. The parts they your production requirements The volume of parts you package manufacture get replaced as the this could be a temporary or in many cases cannot justify season changes (summer to fall, permanent solution. getting automated packaging winter to spring). This means systems. Contract packagers they have to build parts ahead SUMMARY have already invested in auto of time to be able to handle the Having a contact packager lined baggers, sprint machines, foam seasonal demand of product. This up can offer your company a part in place machines, heat bundlers, particular customer benefited time or full time option to help shrink machines, and skin from a “near site” packaging with packaging, warehousing, machines that cost thousands solution that was close to their and distribution of automotive, of dollars. manufacturing site. large truck, and construction equipment parts quicker and PLAN B A “near site” solution allowed more cost effective. (What is your back-up plan?) the manufacturer to open up In today’s world, changes in floor space in their plant so they business are happening at could focus on manufacturing. Contact: lightning speed. Do you have a The contract packager packed TONY XIDAS Plan B set up? What happens if [email protected] 12 PARTBUYERS AUTH RITY Automotive Service Parts Causing You Headaches? Let Crown Handle It! Crown specializes in automotive/truck service parts handling by providing complete packaging, warehousing and distribution…near your facility, on-site at your facility, or at one of our company sites. WE HANDLE • 60 million automotive/truck OEM service parts each year • 250,000 automotive/truck service part numbers • Heavy engines to delicate trim parts • Service parts for almost every OEM car/truck company (directly or through suppliers) • Packaging specifications for your product • Packaging material inventory and warehousing WE MANAGE • Recall or Campaign Programs • Special Projects • Temporary Programs • Dealer Returns • Complete Service Parts Management www.crownpkg.com 937.294.6580.