The automotive industry is facing a storm of challenges in 2024. Supply chains are strained, production delays persist, and consumer preferences are rapidly shifting. 

In your day-to-day, these automotive industry challenges can manifest in various ways. Maybe you are struggling to manage inventory across multiple channels or keep up with rapid stock replenishment for franchisees. Or perhaps your eCommerce operations have become sluggish and ineffective.

You can improve operations, increase sales, and streamline processes without investing more time by implementing a unified commerce solution. Below, we break down the top challenges for the automotive industry and how the right platform can help you avoid them.

Short on time? Here are the key takeaways

• The automotive industry faces many challenges in 2024, including supply chain complexity, the digital transformation of order management, and effective stock management.
  
  
• Complex automotive supply chains demand real-time updates and adaptable delivery options to keep production lines running smoothly.
  
  
• Digital transformation is rapidly changing how automotive companies handle online sales and parts replenishment.
  
  
• Effective inventory management of vehicle parts and components relies on instant updates and precise product identification.
  
  
• A unified commerce platform offers comprehensive solutions to many challenges facing the auto industry.

Let’s take a closer look at each of these issues below.

Challenge #1: Supply chain complexity in the automotive industry

Supply chains in the automotive industry are notoriously complex, and this complexity causes many challenges.

These intricate networks span the globe, encompassing everything from raw material extraction to the final assembly of vehicles. Disruptions at any point in this chain — such as we have seen on auto chips in recent years¹ — can have far-reaching consequences, delaying production, increasing costs, and ultimately impacting consumers. 

These problems often play out differently depending on the scale and reach of the platforms involved in sourcing and distributing automotive parts.

National platforms, which aggregate parts from suppliers across the entire country, offer a wide variety of products but often struggle with long delivery times because of their distance from warehouses. This can be a problem for urgent repairs or time-sensitive orders. When a mechanic needs a specific engine part urgently, for example, they might easily find it on a national platform but face a week-long wait for it to arrive.

On the other hand, regional platforms, which focus on sourcing parts from suppliers within a smaller geographical area, are known for their quick delivery times — often within a few hours. However, their product selection is usually more limited, which can force buyers to compromise on either the exact part they need or the quality they desire.

How to address the complexity of the automotive industry supply chain

Unified commerce platforms like DJUST offer various features to help address these automotive industry supply chain challenges. These features include:

• B2B eCommerce catalogs: Efficiently organize and display a wide range of products to your customers. For example, you easily categorize and showcase thousands of auto parts for different vehicle makes and models.
  
  
• Product restrictions: Tailor product availability based on regional or national needs. For instance, you can restrict certain high-performance parts to certified mechanics only.
  
  
• Related products: Enable your site to suggest alternative or complementary items, making purchases easier. When a customer views brake pads, suggest matching rotors or brake fluid, for example.
  
  
• Shipping software integration: Connect seamlessly with different shipping companies. You could integrate with multiple carriers to offer the best shipping rates and delivery times for each order.
  
  
• Split delivery: Let customers receive parts of their order at different times or locations. This can allow a car manufacturer to receive engine components at one plant and interior parts at another.

These features can help you create a more responsive supply chain. For example, a truck parts distributor can use DJUST to offer a huge selection of products nationwide, while also connecting with any delivery and logistics software to have all data in real-time in one place, helping facilitate the process for the end-user.

Expert tip: Consider a combined national and regional approach. Stock high-demand items regionally for fast delivery, and keep a full inventory nationally for specialized orders.

Challenge #2: The digital transformation of order management 

Online ordering helps boost efficiency, transparency, and customer satisfaction, which is why so many automotive companies are digitizing their ordering processes. But this shift throws hurdles into two key areas in automotive industry processes: eCommerce and replenishment.

In the eCommerce model, manufacturers sell to distributors who resell to garages and stores or directly to B2B clients, such as mechanics. This multi-tiered approach with many different systems can get messy, creating communication gaps and inefficiencies. For example, parts manufacturers commonly struggle to provide real-time inventory updates to distributors, leading to order errors and delays.

On the flip side, the replenishment process, where garages restock directly from manufacturers, often relies on outdated paper or Excel-based systems. This manual approach is a recipe for errors and lacks the speed required in today's automotive market. A garage owner might waste hours manually checking stock levels and placing orders each week — time that would be better spent serving customers. Time truly is money, and when it’s wasted on useless tasks, it’s revenue lost.

How to transform your automotive order management

With a platform like DJUST, you can make these digital transformation challenges a thing of the past. Here are the tools that can help:

• Front-end templates: A customizable B2B store interface that is easy for distributors and end-clients to use. For example, you can create a user-friendly parts catalog for mechanic shops.
  
  
• B2B shopping carts: Designed for bulk orders and complex pricing structures common in the automotive industry. With this, you could allow tire distributors to order multiple sizes and brands in a single transaction, for instance.
  
  
• Order Management Systems (OMS): Streamline the entire order process from placement to fulfillment. This enables the tracking of an order for custom car parts from quote to delivery.
  
  
• Multi-storefront capabilities: Enables businesses to manage multiple brands or regions from a single backend. You could, for example, manage separate storefronts for luxury and economy car parts from one platform.
  
  
• Advanced search functionalities: Makes it easy to find the right product quickly. You can enable searching by vehicle make, model, year, and part compatibility, for instance.

Expert tip: You can integrate your order management system with your inventory and customer relationship management (CRM) systems. This integration provides a fantastic overview of your business, enabling more accurate forecasting and personalized customer service.

Challenge #3: Addressing effective stock management in the automotive sector

Lastly, stock management in the automotive industry presents serious challenges surrounding real-time stock updates and quickly finding the right product references.

Garages and repair shops often need replacement parts within hours or a few days at most. Without real-time stock information, businesses risk overselling or underselling, leading to unhappy customers and lost revenue. For example, a brake pad manufacturer might show available stock on its website, only for a garage to find out after ordering that the item is on backorder.

The complexity of automotive parts also makes finding the correct item challenging. A garage needing to replace a transmission must consider multiple criteria: make, model, manufacturing year, size, and more. Getting even one of these factors wrong can result in ordering the incorrect part, causing delays and extra costs.

How to improve automotive stock management

At DJUST, we offer several features to address these stock management challenges:

• Related products: Suggests alternative or compatible parts when exact matches are out of stock.If a specific brake caliper is unavailable, it can suggest a compatible alternative, for example.
  
  
• Product restrictions for customers: Ensures customers see only products relevant to their needs or authorization level. You could show commercial-grade parts only to fleet managers, not individual consumers.
  
  
• Warehouse management: Efficiently tracks and manages inventory across multiple locations.As an example, you could monitor stock levels of spark plugs across regional distribution centers.
  
  
• B2B shopping cart: Allows for complex orders with multiple line items and quantities.This could enable ordering of various engine components in different quantities for a production run.
  
  
• Real-time updates via API integrations: Keeps stock-level information current across all sales channels.For example, the system would instantly update inventory levels when a large order of oil filters is placed..

Expert tip: You can set up a system of tagging and categorizing products based on multiple attributes (e.g., vehicle make, model, year, part type). This detailed organization makes it easier for customers to find what they need and reduces the likelihood of incorrect orders.

From showrooms to screens: The new frontier of automotive sales

The automotive industry continues to rapidly evolve, driven by advances in technology and changes in customer expectations. To stay competitive, businesses are increasingly using advanced platforms with B2B eCommerce features designed for the industry. 

Here are some of the key drivers shaping the future of automotive commerce:

1. Headless eCommerce platforms, where the front-end and back-end of your eCommerce are decoupled, offer increased flexibility. They allow your business to customize the customer experience and integrate with various systems more easily.
   
   
2. Composable commerce for B2B, a modular approach to building eCommerce solutions from smaller pieces, can provide the flexibility and scalability needed to keep up with the volatility of the automotive market. Composable accelerators speed up the deployment of new eCommerce solutions.
   
   
3. Price list software that supports volume-based pricing (discounts for bulk purchases) makes managing complex pricing scenarios in B2B automotive sales easier. This incentivizes larger purchases and keeps customers happy.
   
   
4. A robust B2B PIM (product information management system) and catalog management software streamlines the organization and presentation of vast product arrays, ensuring accurate and up-to-date information across all automotive sales channels.
   
   
5. Creating intuitive product detail pages and implementing a B2B customer portal can mean a personalized experience for each client, with custom catalogs and easy reordering.
   
   
6. Workflow validation (automated checks for accuracy and compliance in business processes) helps automate approval processes, reducing errors and speeding up order processing of parts and vehicles.
   
   
7. Enterprise headless commerce solutions provide the scalability and flexibility needed for large automotive businesses with complex operations.
   
   

Unified B2B commerce platforms often include all of these features, so you do not need to run several applications in tandem.

Expert tip: While focusing on automotive-specific solutions makes sense, it is also beneficial to learn from other sectors. For instance, understanding fashion industry challenges can provide insights into managing seasonal inventory and rapid trend changes.

The bottom line

The automotive industry faces its share of challenges, from managing supply chains and going digital to controlling stock, pricing complexity, and integrating new technology. 

The good news is that B2B commerce suites like DJUST offer a powerful solution. They come packed with features that meet the unique needs of the automotive sector. Our advice? Choose a headless, unified eCommerce platform that can help you tackle current automotive industry challenges and adapt to your future needs.

Sources

International Union of Marine Insurance - Auto chip shortage ending in 2024 could lead to overloading car carriers https://iumi.com/news/iumi-eye-newsletter-march-2024/auto-chip-shortage-ending-in-2024-could-lead-to-overloading-car-carriers

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