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Our Bureau

Providing end-to-end supply chain services

Chennai , Dec. 13

Third party logistics providers will play a greater role in the automotive industry in the future than merely transporting goods.

They will be required to provide end-to-end supply chain logistics services for which they will have to develop competencies, according to a report by global consulting firm KPMG.

The report focusing on the Indian automotive supply chain was presented at Auto SCM India 2006, a two-day seminar organised by the Confederation of Indian Industry.

Some of the new areas that logistics providers will have to service include module assembly, inventory management, parts sourcing and integration of supply chain management (SCM).

Until recently logistics providers handled only packaging, outbound and inbound logistics and warehousing jobs.

To be able to provide such services, logistics companies would have to equip themselves with knowledge of planning, project management and customised information technology solutions for original equipment manufacturers and suppliers.

Mr Yezdi Nagporewalla, National Industry Director, Industrial Markets, KPMG, said automotive and auto components companies that responded to KPMG wanted to double their export revenues over the next five years.

"For export revenues to double from their present 10 per cent levels, more elements of the supply chain would have to be outsourced to logistics providers," he said.

In the course of handling such wide range of activities, logistics providers would eventually become supply chain integrators.

Supply chain integration, also called end-to-end integration, is the greatest SCM challenge faced by the industry, says the report.

It involves linking up areas such as dealer management, operations planning and vendor relationship for greater efficiency.

More Stories on : Supply Chain Management | Cars

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