B2B Integration : A Practical Guide to Collaborative E-commerce

436 B2B Integration — A Practical Guide to Collaborative E-commerce
Results
Continued from page 435
• Linked all of MMSA's 526 North American auto dealerships into a
Manugistics-powered Internet-based collaboration system;
• Slashed collective vehicle inventory in half;
• Decreased age of vehicles on dealers' lots by more than 25%;
• Cut vehicle lead times by more than 60%; and
• Eliminated port stock, saving millions of dollars per year.
The order-to-delivery solution, believed to be the first of its kind
in the North American auto industry, allows MMSA to develop a
profile of each dealership, based on factors such as dealer geography,
customer buying patterns, product promotions, and sales seasonality.
Dealers help refine these profiles, which can be shaped to cover
key issues such as required materials and lead times, to help dealers
forecast how many vehicles they should order to meet demand.
Vehicle orders are then submitted by the dealers via the Web to
MMSA.
Since going live, the order-to-delivery solution has helped slash
collective vehicle inventory (the number of cars MMSA and its
dealers have on the ground at any given time) from a high of 80,000
units to less than 40,000 units — all while experiencing sales increases
of nearly 40 percent per month. The average age of vehicles on
dealer lots has also decreased, from 166 days down to 38 days,
resulting in fresher, higher quality products reaching customers.
In addition, vehicle lead times have decreased by more than 60
percent, reducing port and distribution center inventories. Port stock
has fallen from 45,000 units at the start of the project to zero today,
creating millions of dollars in savings for MMSA.
MMSA's outstanding results illustrate the bottom-line success that
is achievable using the power of intelligent Internet collaboration to
create an eBusiness trading network of manufacturers, suppliers, and
distributors that communicate and execute in real time.
Source: Condensed from Mitsubishi Motor Sales of America: Enabling Dealer
Collaboration via Internet, Manugistics Corp.