LKQ Europe cracks the ‘bullwhip’ on efficiency

Parts distribution giant LKQ Europe has introduced a new software system in a bid to increase supply chain efficiency.

Software brings further efficiencies in pilot programme. (Stahlgruber DC pictured)

The custom AI software has been developed by 09 Solutions and Supply Chain Insights with the goal of using data gained from outside of the company, often known as ‘from the outside looking in’, with a view to improve the company’s demand and supply sensing capabilities and create a more agile and profitable supply chain.

READ: LKQ Europe piloting outside-in logistics project

LKQ also hopes the new systems will reduce the ‘bullwhip’ effect, a phenomenon known in supply chain circles when a small number of customers asks about a specific product or part, and the supplier responds by vastly over ordering said product, much like the wave of a bullwhip. Using o9’s predictive analytics and external market signals, LKQ Europe reduced the bullwhip effect on its business from 48% to 37%.

A pilot project, known as ‘Zebra’ has been held across the firm’s Stahlgruber business in Germany and yielded a result that exceeded expectations. The ‘Forecast Value Added’ (which, simply put, involves finding steps that work and removing those that don’t) improved by 17.3% – giving LKQ Europe insight into market signals.

“For some time, I had been convinced of the power that outside-in planning could have on our supply chain,” said Nicole Miara, Digital Transformation Lead, LKQ Europe. “Our participation in Project Zebra was quite the eye-opening journey. This wasn’t a software or IT project but rather a business implementation project that came with a fantastically diverse group of data scientists, business leaders, and supply chain professionals who are part of the Project Zebra think tank community. The outcome of the pilot has led us to rethink the orchestration levers that can be pulled in the future to make better supply chain decisions based on market, supplier, and channel data.”.

Published by Greg Whitaker

Editor of CAT Magazine and an experienced motoring journalist @GregWhitaker5

Latest Factor & Accessory

View all Factor & Accessory articles

GSF Car Parts to open national distribution hub

Wolverhampton-based centre makes the firm “a formidable national player in the automotive parts industry”

Read More

LKQ Euro Car Parts signs exclusivity deal with RAC

The four-year deal will see LKQ exclusively supply the rapidly expanding RAC Mobile Mechanics service

Read More

Juratek awarded Premier Data Supplier status by TecDoc

The quality standard requires a company to meet 13 targets and have a minimum 99% degree of accuracy

Read More

Autoglym acquires GnG Sales as it expands into Australasia

The wholesale supplier of car care products has marketed and supplied the Autoglym range for over two decades

Read More

Comline Group to move to new headquarters

Move hailed as “inspiring new chapter” for UK-based parts firm

Read More

Go to comments

Your email address will not be published. Required fields are marked *