Simple Solutions That Work! Issue 17

47 BACK TO BASICS Importance of Automotive & Truck Service Parts Packaging TONY XIDAS Director of Sales Crown Packaging, Inc. ARTICLE TAKEAWAYS: * Understanding “service parts packaging” * Flexibility and efficiencies with contract packaging Continued on next page You are probably wondering why contract packaging would be a part of the puzzle for someone making parts for a major OEM automobile or truck manufacturer. In the world of manufacturing and supplying parts directly to an OEM manufacturer, there is one aspect of the program that many times gets overlooked. That aspect is the “Service Parts” portion of the business. In supplying the OEM manufacturer, the part supplier is required to supply service parts as well. In the case of an automotive manufacturer, the current assembly part must be available a minimum of 10 years after that model year. Some OEM manufacturers are even requiring that a part is available 15 years after that model was produced. In the case of a truck or construction equipment, the OEM truck manufacturer requires that they have part availability of 30 years after the model is produced. When I say, “Service Parts” I am referring to the replacement part that is needed when the part fails, wears out, is damaged and needs replaced with a genuine OEM part. Most part manufacturers are set-up for high volume production and putting parts in returnable dunnage, and shipping back and forth to the OEM assembly plant. When they are required to make and ship service parts, they are asked to ship multiple part numbers, and typically a small volume of parts. All of these parts have to be packaged in their own individual (unitized) expendable packaging, with specific label requirements, that may have to ship to multiple destinations. Part manufacturers often struggle with these requirements. To take it a step further, you may be providing parts to multiple OEM manufacturers – which all have different rules. If you do something wrong, you stand a chance of receiving a problem resolution report (PRR), which will affect your performance scores, and if that non- conformance continues, it will put you on “business-hold.” This article is to educate you about what a contract packager can do to help manage the “Service Parts” side of your business, and to give you options to help make your supply chain run smoother. EFFICIENCY Typically, when the OEM manufacturer orders service parts, there are multiple part numbers involved and the part volumes are low. For many part manufacturers, when they package their own service parts in-house, they have a difficult time being very efficient because they lack the volume to