Parts Warehouse Inventory of 180,000+ SKUs for Tier 1 Automotive Supplier
Comprehensive physical inventory and reconciliation project for a major automotive parts supplier, achieving 99.7% accuracy across multiple distribution centers.
Client Overview
A leading Tier 1 automotive supplier specializing in powertrain components and systems for major OEMs worldwide. The company operates five regional distribution centers across North America, managing an extensive inventory of precision-engineered parts.
With annual revenues exceeding $2.8 billion and serving over 40 automotive manufacturers, maintaining inventory accuracy is critical for just-in-time delivery commitments and financial reporting compliance.
Industry Sector
Automotive Parts Manufacturing & Distribution
Company Size
$2.8B+ Annual Revenue, 8,500+ Employees
The Challenge
The client faced significant inventory discrepancies across their distribution network, with variances exceeding $4.2 million in their previous fiscal year. These discrepancies were impacting:
- Financial Reporting Accuracy: Material weaknesses identified during external audits requiring immediate remediation
- Customer Service Levels: Stock-outs and delayed shipments affecting OEM production schedules
- Operational Efficiency: Excessive safety stock levels masking underlying inventory control issues
- System Reliability: Lack of confidence in ERP data preventing effective demand planning
The complexity was compounded by the high SKU count, multiple storage locations per item, and the need to maintain operations during the inventory process to avoid disrupting customer deliveries.
Our Solution
Phased Approach
Deployed teams sequentially across five distribution centers over 14 days, allowing each facility to maintain 80% operational capacity during counting activities.
RFID Technology
Utilized handheld RFID readers for high-value components and mobile barcode scanners for standard parts, achieving 400+ items per hour per counter.
Experienced Team
Mobilized 45 certified inventory specialists with automotive parts expertise, including dedicated quality control auditors performing blind recounts on 15% of locations.
Real-Time Integration
Integrated directly with client's SAP system for real-time variance reporting, enabling immediate investigation of significant discrepancies during the count process.
Methodology Highlights
- • Location mapping validation
- • Slow-moving item identification
- • Cut-off procedure establishment
- • Team training and certification
- • Zone-based counting strategy
- • Blind count methodology
- • Exception handling protocols
- • Quality control audits
- • Variance investigation
- • Root cause analysis
- • Process improvement recommendations
- • Final reconciliation reporting
Results & Impact
Achieved industry-leading accuracy rate across all five distribution centers
Discovered and documented discrepancies for proper financial adjustment
Maintained customer service levels throughout the entire project
Key Outcomes
Eliminated material weakness findings and received clean audit opinion
Delivered 23 actionable recommendations for ongoing inventory control
Identified $12M in excess and obsolete inventory for disposition
Restored trust in ERP data enabling better demand planning and forecasting
"The team's automotive parts expertise and systematic approach gave us complete confidence in the results. They not only delivered exceptional accuracy but also provided insights that are helping us transform our inventory management practices. This was a true partnership."
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