Night Riders
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Toyota dealers now have less money tied up in stock since the car manufacturer together with Redhill operator Hammonds Transport have reorganised component distribution using a nightly drawbar and demountable system on "quiet" vehicles.
• On 1 November, almost 250 car dealers within the Toyota GB network switched on to the financial and operating benefits made possible by a transport operator apparently content to remain unobtrusive.
Successful operation of Toyota's "lean distribution system" will mean that the activities of the £17 million turnover Hammonds Group will proceed relatively unnoticed, Night deliveries suggest the vehicles will be largely unseen and thanks to some environmental considerations when choosing the vehicles, relatively unheard by local residents on adjoining properties.
Perhaps a £7 million three-year contract is sufficient reward for anonymity.
Two fleets which Hammonds formerly operated on a weekly parts replenishment programme and a next-day VOR (vehicle off road) service have been combined by using a drawbar and demountable system. The result is nightly deliveries to every dealer and general stock and accounts delivered on the same vehicle. Toyota says significant improvements in parts availability will improve dealer margins. More frequent deliveries means fewer VOR surcharges and
more competitive prices offered to the • independent repair trade. Dealers
will also have less capital tied up in stock.
The car manufacturers were largely responsible for devising just-in-time supply at their vehicle assembly plants, so it could be argued that until recently, the dealer networks have been lagging in providing an appropriate system for the franchises.
However, 1994 has been a year for parts supply initiatives, as uncertain trends in new car sales have widened the attention on the aftersales business at the dealerships.
Volvo dealers saw an upgrade of the stock parts delivery service, operated through a parcel-based system run by Federal Express, in January. In October, Vauxhall cut a six-day stock replacement service down to five for its 550-plus dealers, courtesy of a three-year £20m contract with Exel Logistics BRS using drawbars and double-deck trailers.
Toyota says it has achieved its aim of improving the service to its dealers and increased benefits to itself without an increase in its costs. "Previously, we had a fleet of 16-tonners running to a number of outbases where the loads were transshipped to another fleet of vans for local delivery. Now we are using demountable bodies, no trans-shipping takes place and this reduces the possibility of error and the potential for damage," says Toyota distribution operations manager Roger Davis Under the new Toyota parts ordering and delivery procedure dealers place \TOR parts orders before 16:00hrs each day. Stock parts are delivered within 36 hours—orders before 21.00hrs on Monday are delivered in the early hours of Wednesday, while Tuesday orders arrive in the early hours of Thursday. In effect, a fifth of the weekly stock order arrives every night and the same vehicle can deliver VOR orders the next-day.
Trunking routes
The Hammond system covers all the dealers in the network using seven trunking routes which feed 27 local delivery rounds. Outwardly, the hub-and-spoke concept is similar to the way it ran the previous Toyota system, before it won the tender for the reorganisation. This was won ahead of competition from TNT, Federal Express, Seaking (a sister company to Toyota GB within the Inchcape group) and Swift Transport Services.
The new Toyota fleet is all MAN. Eight M90 12,192FLD drawbar units form the trunking backbone. These are supported by 17 L2000 7.5tonners. Six of these 8.153FIDs are used for deliveries in the Lutterworth hinter-land, while 11 others are out-based and fitted with Abel demounting systems -The prime mover and the two pods on the trailer are loaded at
Lutterworth and trunked back to outbases which are either operating sites within the Hammond network or other sites where we have parking-up facilities," says Hammonds' deputy managing director John Cutler.
While the basic huband-spoke trunking system to outbases was part of the original two-fleet system, there are fewer vehicles than before. But the number of delivery drivers has increased by 11 to 35 as a result of doubleshifting the M90s which also make local deliveries.
A vital element in the improvement in the distribution chain is a large investment in electro-magnetic sorting technology at Lutterworth. Distribution manager Bill Jackson heads the team delegated to making the system work. He explains: "Instead of picking orders two at a time, we are picking them 40 at a time. The machine then breaks this down into individual orders, which are packed and passed on to Hammonds."
Reorganisation has been such that Hammonds drivers are more involved at the warehouse than ever before. For example, the trunkers spend more of their time as loaders and checkers at the warehouse than actually driving," says Cutler.
The move to night deliveries posed environmental problems because many dealerships adjoin residential areas. Quiet running technology was provided by MAN with additional engine shrouds and air suspension. Low noise tail-lifts also helped.
Administrative problems had to be overcome as well: "We have switched from a system where the vast majority of our parts was delivered in the day, requiring a dealer to be present to sign an advice note, to a situation where the parts were to be delivered overnight, unattended. To do that, we wanted to have an audit trail which would prevent a part inadvertently arriving at an incorrect destination. We specified that the tendering hauliers would have to provide a precise tracking system which could also help us to avoid possible arguments with our dealers about whether or not a part had been received," says Davis. Hammonds managing director Ivan Couchman explains that existing technology already employed by the company has been up-graded to solve this: "We already had an automatic proof of delivery system which used a hand-held computer to read bar-codes on the side of consignments. Information could be downloaded at the depot. Now we have a modem in the cab," he says.
Bar-code panel
Each bar-code panel has a check digit and the driver at the delivery point scans the panel. If it proves to be an incorrect consignment for that location, the computer will not recognise it.
"The information is transmitted immediately giving proof of delivery or otherwise, recording the time and providing a record of our performance," says Couchman.
Targets set for the system are exacting: 98% of the deliveries to be made on time with zero errors.
"The system gives us important information and allows us to control a proportion of the supply of core stock through automatic re-ordering. I am sure we are not the only franchise operating such a system and I don't anticipate that it will put us a long way ahead of the others, but it will place us at the forefront," says Davis.
So Toyota lays claims not only to be the car in front, but also to have the dealers in the forefront.
Li by Steve McQueen