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Essay / Research Paper Abstract
The provision of car parts to the manufacturers (OEM's) is problematic for parts suppliers. There is an obligation that spare parts should be ongoing for 10 years for European OEM and 15 Years for USA and Asian OEM. This 4 page paper consider the way that the cost and operational burdens may be dealt with through different forms of stock management. The bibliography cites 5 sources.
Page Count:
4 pages (~225 words per page)
File: TS14_TEcarparts.rtf
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Unformatted sample text from the term paper:
opportunity costs, as well as the costs of maintenance such as the required storage facilities and supporting costs such as insurance. The trend for many companies has bee to try
and reduce stock held with tools such as just in time management. However, with the provision of parts required for between 10 - 15 years and potential different storage areas
the problems could be compounded. The automotive industry needs innovation. One approach that has been used in some industries, including the automotive
industry to reduce the cost of the supply chain has been the system of consignment stock. This is a system where there is collaboration between the buyers and the suppliers,
it is almost the opposite of a just in time management system. This has been seen to work in Italy, where a company that manufactures automotive parts of the
automotive industry has agreed with the suppliers to allow them to hold stock in their own warehouses (Valentini and Zavanella, 2003). In effect, this meant that stock could be
shipped in bulk to gain the benefits of full utilisation of the transportation. To make this worth whole there is a guarantees given by the company that they will use
a minimum level of goods and the level of the stock is kept within a minimum and maximum level (Valentini and Zavanella, 2003). The advantages to this are in
the way the stock is managed. By having the stock on the premises of the customer, but still holding title there is a level of security, and the customer is
bearings cost of storing and maintaining the sock. The company will be able to plan in advance full deliveries to ensure the delivery vehicles are fully utilised. This will help
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