Case

1. Plattsbourgh Motor Service
(case study)
Kenan Kasumagić

2. Contents:
• Case and relevant theory
Major issue:
• Evaluation of industry
Proposed Solutions
• Pros and Cons

3. Overview of Plattsbourgh Motor Service
• Distributor of automotive replacement parts.
• Automotive Aftermarket industry is mature and characterised by slow
growth.
• Whole industry experienced a downturn in 2008
• Traditional Distribution Channel that requires a complex pricing
strategy

4. STRENGTHS
(Internal, helpfull)
WEAKNESSES
(Internal, harmfull)
• Keep inventory costs down for others
• Can detect changes in demand
• Hold a larger variety of items then retailers
• Unnecessary supply chain step
• Adds cost to supply chain members
• More diverse parts added to inventory
OPPORTUNITIES
(External, helpfull)
THREATS
(External, harmfull)
• More older models, means a greater variety of parts is
necessary
• Retailers needing to save money of inventory cost
• Incerase of production of american and foreign cars,
mandatet safety equipment, warehouse dist store
assured sales from the jobber stores
• Manufacturers selling directly to retailers
• Dealers turning directly to manufacturers
• Technological improvements goverment mandatet
safety equipment, recessions an consumer spending
power
SWOT analysis

5. Manufacturer
Warehouse
distributor
Fleets Jobbers
High-volume
dealers
Dealers
Consumers

6. Major issues
Declining profits and Stagnating sales
• Reduced demand
• Increase in DIYs
• Low-cost competitors
• Technology

7. Evaluation of industry
• Low cost competitors
• Trend of disintermediation
• Focus on fast moving products

8. New channels
Manufacturer Manufacturer
Warehouse
Distributor
Dealers
Large Retail
Store chains
Consumers

9. Proposed solution 1
Match competitor strategy
• Focus on fast moving products
Pros
More profitable
Reduced inventory costs
Cons
No competitive advantage
Ignores certain markets
High barriers to entry

10. Proposed solution 2
Disintermediation
Consolidate with warehouse
Pros
 Meet competitor pressure
 Higher Profit margins
 Lower Overheads
 Niche market
 Secure high volume clients
Cons
 Increased inventory and Distributions costs
 Job loss

11. Recommendations
• Fokus on saving retailers and dealers money, by incurring the inventory costs, and
using a Just-In-Time inventory approach.
• Allowe manufacturers to focus on manufacturing, an let the werehouse
distributors fokus on sales and distribution to keep costs low for everyone.
• Despite the changing external enviorment, PMS need to avoid being
disintermediatet