Modernise your spare parts supply chain with third-party fulfilment
Spare parts form a tricky part of any business's inventory. Find out how third-party fulfilment can help you manage this part of the supply chain.
"Spare parts," sang Bruce Springsteen, "keep the world turnin' around" – a sentiment that will be all too familiar to many business owners.
But while spare parts form an essential part of many businesses, they don't form a
predictable one. They are to your inventory what your spice rack is to a kitchen cupboard – you know you're going to need it one day, but you can't say exactly when.
In practice, this means that business owners tend to find themselves in one of two situations. The first is that they're cluttering up valuable space with parts they don't need. The other is that they're ordering them only when needed, which means a higher cost per unit and slow lead times.
If you find yourself caught between the rock of clutter and the hard place of expensive delay, don't despair. There's a solution at hand in the form of third-party fulfilment.
What is third-party fulfilment?
Third-party fulfilment is where you outsource your fulfilment process to an external company.
If you're a young company, the concept of outsourcing might seem daunting – the preserve of blue chip companies, city traders and Silicon Valley gurus. But really, outsourcing your fulfilment process is no different from hiring a cleaner or using a cloud service. It's about handing routine jobs over to a specialist so that you can focus on building your business.
In the case of fulfilment, it's easy to see why this is an attractive proposition. When time is tight, you don't want to be knee-deep in bubble wrap, answering work emails in the Post Office queue, or trying to juggle inventory management with product development.
Those are the headlines for third-party fulfilment in general. But when it comes to spare parts, they provide more specific benefits.
What are the benefits of third-party fulfilment for your spare parts supply chain?
For most companies, there are two scenarios in which spare parts need to be delivered. The first is sending aftermarket spare parts to customers. The second is sending spare parts to in-house technicians for repairs.
In both cases, it's difficult to predict exactly what inventory you need. Let's say you produce humidifiers. Every now and then, a customer will need a replacement cap for the filter – but that could be once a week, once a month or once in a blue moon.
This makes it difficult to budget, plan and manage your stock. You run the risk of either paying extra to store stock you don't need or paying extra to buy single items as and when. Neither situation is a recipe for efficient inventory management.
But with third-party fulfilment, you can keep your stock in a safe, secure warehouse at affordable rates, knowing that it's ready to be delivered whenever needed.
Does your customer or technician need a small but essential screw, cap or other small part? Simply alert your fulfilment partner and they'll dispatch it in no time.
But not just any partner will do. You need a 3PL that's dependable, well-located, scalable and communicative.
What makes a good 3PL for spare parts fulfilment?
If you've never worked with a 3PL before – or rather, never worked with a
good one before – then you might think it's simply a case of chucking your goods in storage: a glorified lock-up run by faceless overlords.
It doesn't have to be like this. A good 3PL will give you a dedicated account manager – a first port of call for all your questions and requests. It will also give you full visibility of your stock via a cloud-based WMS (warehouse management system).
Naturally, you will want to work with a 3PL that's well-located. What that means exactly is for you to decide, but your chosen warehouse should be close to your core customer base or your premises, depending on where your spare parts need to be delivered.
Finally, scalability is key. In fact, it's one of the biggest selling points of a 3PL. A 3PL without scalability is like a kitchen without running water. You can make it work, sure – but it's ultimately a waste of your hard-earned budget.
Demand for spare parts changes as your equipment and product ranges evolve. You need a 3PL that will be quick and responsive when your inventory needs updating – no ums, ahs or late replies.
Make sure that your 3PL ticks all these boxes and you'll be delighted with the results.
What's next for spare part fulfilment?
3D printing has all sorts of applications – from prosthetics and implants to lab-grown meat, from pharmaceuticals to design prototypes.
In recent years, it's also begun to be used for economically sound low-volume production. In theory, this reduces the cost per unit as well as the lead times for spare part production.
However, the integration of 3D printing into spare part production doesn't come without its challenges. In particular, steps need to be taken to ensure that the parts produced are in line with industry standards as well as intellectual property and copyright laws.
Conclusion
Inventory management is one of the biggest challenges of running an SME – and spare parts are an especially tricky part of the problem. You can only do so much to predict demand and are either lumbered with a stock cupboard full of unused bits or disgruntled staff waiting on a delivery.
One way around this is to work with a 3PL that keeps your spare parts in stock. In this situation, you've got your own personal Amazon Prime-style delivery service for spare parts. Those crucial bits and bobs are there when your customers and technicians need them – but they're not eating up space (and rent!) on your premises.
So if you're looking to modernise your spare parts supply chain, consider third-party fulfilment as an option. You might be surprised at how efficiently it works.
Are you looking for a
3PL for spare parts fulfilment?
Contact Stowsafe for a free, no-obligation consultation today.
