December 1, 2023
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In today’s rapidly evolving business world, aftermarket logistics has become integral to the supply chain process. Aftermarket logistics refers to the management of the flow of goods and services after the initial sale. This may include transportation, warehousing, returning products to the manufacturer for repair, exchange, or disposal, and delivering spare parts and components necessary for the maintenance of the original product and customer support.
In India, the aftermarket logistics sector is still in a nascent stage, but it is rapidly growing as more and more companies realize the importance of having a robust aftermarket logistics strategy. According to a report by TechSci Research, the sector is expected to grow at a CAGR of 9.5% over the period to reach $462 billion by 2024, which demonstrates the growing demand for logistics solutions for aftermarket products. One of the key drivers of this growth is the increasing number of automobiles on India’s roads. This has led to a surge in demand for spare parts and components, which in turn has driven growth in the aftermarket logistics sector.
Another trend that is shaping the Indian aftermarket logistics market is the shift towards e-commerce and online sales. With more and more people shopping online, companies need to ensure that they have a robust logistics strategy in place to support their e-commerce channels. This may include options such as same-day deliveries, free returns, and real-time order tracking. Finally, the Indian government’s “Make in India” initiative also impacts the aftermarket logistics sector. Under this initiative, the government is encouraging companies to manufacture products locally, rather than importing them from abroad. This has led to an increase in local production and a corresponding increase in the demand for aftermarket logistics services.
Safety and reliability are also important factors driving the growth of the Indian aftermarket logistics market. Consumers are becoming increasingly concerned about the safety and quality of aftermarket products and are willing to pay a premium for products that meet high standards. As a result, aftermarket logistics providers in India are investing in quality control processes and are working closely with manufacturers to ensure that products meet safety and reliability standards.
Finally, the Indian government’s “Make in India” initiative also impacts the aftermarket logistics sector. Under this initiative, the government is encouraging companies to manufacture products locally, rather than importing them from abroad. This has led to an increase in local production and a corresponding increase in the demand for aftermarket logistics services.
A well-crafted aftermarket logistics strategy is critical in today’s business climate. Here are some thoughts on why the aftermarket logistics strategy is so crucial to a company’s success. Firstly, customers expect speedy and efficient service when they need to purchase replacement parts or have a product repaired. A poor aftermarket logistics strategy can easily lead to delays, frustration, and a loss of business for the company. An effective aftermarket logistics strategy can help companies meet and exceed customer expectations, enhancing customer satisfaction and loyalty.
To establish an effective aftermarket strategy, it is necessary to design a customer service plan that encompasses all aspects, ranging from order fulfilment and tracking to handling returns and exchanges. It should be designed to provide a seamless customer experience from start to finish, ensuring that customers receive their products on time, in good condition, and with the right level of support. This approach not only enhances customer satisfaction but can also reduce the costs associated with returns and exchanges.
Aftermarket logistics can be a costly endeavour for companies, particularly those with a large volume of returns and repairs. However, a well-designed aftermarket logistics strategy can help reduce these costs significantly. By optimizing the logistics network, businesses can streamline operations and reduce waste, which can lead to significant cost savings.
A well-designed aftermarket logistics strategy ensures the effective handling of products and services, thereby reducing the risk of delays and increasing operational efficiency. Using efficient logistics processes, you can track the transportation, storage, and distribution of products, minimizing complications affecting the timely delivery of products.
Scalability and Flexibility
A successful aftermarket logistics strategy can accommodate a growing business, allowing for a scalable, flexible, and customizable approach. For instance, you can quickly adjust your delivery routes, transportation modes, or storage facilities to match the demand or fluctuations in your business environment.
Improved Inventory Management
Companies that operate a well-planned aftermarket logistics strategy can anticipate demand for spare parts and store them accordingly. By doing so, companies can prevent overstocking or understocking, which can lead to additional costs and lost sales.
Finally, aftermarket logistics can impact a brand’s reputation. Poor aftermarket services can result in negative feedback and damage a brand’s reputation, while efficient and effective services can boost brand perception and strengthen customer loyalty.
In today’s highly competitive business environment, an effective aftermarket logistics strategy can provide a significant competitive advantage. By providing superior post-sale services, businesses can differentiate themselves from their competitors and build a loyal customer base. This can lead to increased market share, improved customer retention, and greater profitability.
In conclusion, an effective aftermarket logistics strategy is crucial for businesses that want to remain competitive and profitable in today’s dynamic marketplace. By optimizing the supply chain companies improve efficiency, reduce costs, enhance customer satisfaction, provide a competitive advantage, and enhance brand reputation. As we have seen, the Indian aftermarket logistics market is poised for significant growth, driven by factors such as increasing automobile sales, the growth of e-commerce, and government initiatives. To stay ahead of the curve, it’s important to keep up with these trends and invest in technology and infrastructure that can support the evolving needs of your business and customers.
Therefore, it is essential to develop a comprehensive aftermarket logistics strategy that addresses all aspects of the process, from spare parts management to repairs and maintenance, to reverse logistics. Companies can attain long-term success and outperform competitors by partnering with reputable 3PL providers that possess extensive experience and capabilities in handling aftermarket logistics, thereby optimizing the effectiveness of their operational strategies. TVS Supply Chain Solutions is India’s one of the leading and reputable 3PL companies offering aftermarket solutions to fully address the end-to-end needs of our clients.
TVS SCS offers bespoke solutions to meet the specific needs of our clients. These solutions provide a scalable and cost-effective way of managing your aftermarket supply. We offer a full range of services and can support customer needs on a global basis, whilst delivering benefits such as improved product cost and process efficiency. TVS SCS creates value in the supply chain by applying best-in-class planning, inventory management, and procurement services, working with suppliers globally.
Our approach to purchasing reduces unnecessary stockholding and purchasing of goods through intelligent inventory management, driven by historical and forecasted usage data and known event planning as well as just-in-time deliveries. Improved availability of goods, accurate inventory planning, and effective expediting activity ensure that the required amounts of goods are available when they are needed to meet the KPI time based on the order type.
TVS SCS improves the customer experience by offering an automated electronic ordering system that is intuitive, and efficient and provides the required level of order acknowledgment and tracking information for orders and deliveries. Customers can use TVS SCS’ E-commerce Platform to allow dealers and customers to order spare parts. The E-commerce Platform can be fully integrated with the customer’s systems. Once orders are placed, the parts are picked from one of our facilities.