Responding to customers' needs in a more connected world

Following its Strategy Number One>Next, BMW Group completed its logistics network layout on the Chinese mainland with its fifth regional distribution center in Shenyang, northeastern Liaoning province, with synergy effects to be generated together with its Tiexi plant.

BMW's RDC celebrated its grand opening on Oct 18 in Shenyang, further boosting the company's operational excellence in its largest single market in Asia through fresh thinking.

The German premium brand expects to consolidate its benchmark position in the after-sales service business field now that it has brought together its world-leading technologies and methods in logistics management. With the help of these measures, urgent orders can be fulfilled within 24 hours.

"Our after-sales business development in China has been very successful, with solid growth in recent years," said Wolfgang Baumann, vice-president of Parts Logistics Management at BMW Group.

"The focus of our action will always be on our customers. Our aim is to ensure the highest customer service satisfaction.

Baumann said: "Shenyang Regional Distribution Center offers the best premises, it has favorable infrastructure close to the production plant, as well as the option of expanding our logistics area."

"Since we expect the success of BMW Group to grow quickly in this market in the years to come, the after-sales business will likely continue its growth also," he continued.

The German brand has become a leader in after-sales service as the first carmaker to specify an after-sales service brand in China. The 2015 International After-sales Customer Survey showed that BMW cars incur the lowest maintenance costs among German premium brands.

Excellent RDCs

BMW is now the only premium brand that has an established parts distribution center in Northeast China.

In August, the BMW Brilliance Automotive joint venture started distributing parts, accessories, merchandizing and Lifestyle for BMW, Mini, and BMW Motorrad in the new location in Shenyang, which has a total area of 15,000 square meters for the first phase, and after the second phase, it will be extended to 25,000 square meters. The infrastructure constructions for the second phase was completed, and the entire RDC is expected to be filled in the next one to two years.

Claus Eberhart, vice-president of After-sales Services at BMW Brilliance Automotive, told China Daily: "Shenyang RDC serves as a great benchmark that has shortened delivery duration and has elevated efficiency. As a result, it has helped squeeze costs, boosted profitability and benefited both dealers and customers."

BMW's five RDCs, located in Beijing, Shanghai, Chengdu, Foshan and Shenyang, cover the brand's most condensed sales regions with a total storage area of about 152,000 sq m for more than 80,000 types of parts.

The just-completed logistics network achieved a parts availability rate of 97 percent, and the system and its efficiency are still being developed, as the carmaker does not tolerate delays before parts reach customers.

Eberhart added: "We expect to realize operational excellence and fresh thinking in the after-sales business. These are part of our end-to-end plan and will complete the Strategy Number One>Next in China once the measures are put in together."

Fresh approach

BMW's mobile app for after-sales services is set to launch in 2017. The app, in its beta phase, will notify the user of maintenance requirements and the user can make an appointment within the platform. It is able to diagnose issues with the car, also displaying the car's status during repairs or maintenance.

Eberhart said: "Digitalized service can provide a unique experience, amusing a customer with seamless and convenient service. So we are going to offer more through mobile apps."

"We are taking new approaches to provide after-sales services. We are digitalizing our channels and services to deliver excellence to customers."

Looking forward, he hopes digitalization and connectivity technologies will play an increasingly important role in after-sales services.

The company believes that more and more customers are seeking a seamless experience in after-sales service, because the younger generations, especially those born in 1990s, are going to be mainstream customers in the near future.

The younger generations in China were born in a connected time and they rely heavily on mobile devices. Their demands are constantly evolving, at a pace matching the country's leading development in digitalization.

BMW highly respects its customers' needs and hopes to further develop its after-sales service accordingly.

Eberhart gave an example of how the carmaker listens to the customers. From this August, if the vehicle was recalled due to quality issues and the maintenance duration was longer than one hour, BMW's service outlet will provide a courtesy car or traffic fare reimbursement for those affected car owners.

haoyan@chinadaily.com.cn

Timeline

2006

BMW established its first Chinese regional distribution center in Beijing to supply tens of thousands of authenticated parts.

2007

BMW built its second Chinese RDC in Shanghai to shorten the urgent order delivery cycle from five days to one for dealerships in the eastern region.

2008

Foshan RDC in Guangdong province replaced the spare parts storage in Hong Kong and shortened the delivery cycle to one day for dealerships in the southern region.

2012

BMW connected its service logistics network after another RDC commenced operations in Chengdu, Sichuan province to better serve customers, in western China.

2014

BMW upgraded its Beijing RDC with a boost in storage area, throughput capacity and order process efficiency.

2015

The new Shanghai RDC became BMW's largest in Asia, with operation efficiency elevated by 20 percent.

2016

The Shenyang RDC was put into operation and its synergy with the Tiexi plant started benefiting both the northeastern region and the overall Chinese market together with the four other RDCs.

(China Daily 10/25/2016 page24)