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ANALYSIS OF THE SUPPLIERS FOR MERCEDES BENZ COMPANY

 

 

 

Analysis of organization and its suppliers and particularly the supplier of urgent transportation services in car-manufacturing industry

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COURCE: SUPPLIER RELATIONSHIP MANAGEMENT

 

 

 

 

SUPERVISOR NAME: JOLANTA KUBICKA

 

PREPARED BY: ISA ISKANDAROV

FARID BALOGHLANOV

TABLE OF CONTENTS

Introduction……………………………………………………………………………………..3

Chapter 1

1. Suppliers of Mercedes Benz Company………..……………………………………………..4

1.1       Alpine Electronics……………………………………………………………………….4

1.2       Dräxlmaier Group…………………………………………………………………..……5

1.3       Brose Fahrzeugteile……………………………………………………………………..5

1.4       Valeo company …………………………………………………………………………5

Chapter 2: Strategy in Supplier Relationship Management……………………………………..6

2.1       Supplier Segmentation…………………………………………………………………..6

2.2       Supplier Identification ……………………………..…………………………………….7

2.3       Criteria of choice of suppliers…………………………………………………………….8

Conclusion……………………………………………………………………………………….8

References…………………………………………………………………………………….….9

 

 

 

Introduction

In this project, we will explain strategy in supplier relationship management, supplier segmentation, supplier identification and criteria of choice of suppliers of Mercedes Benz Company. In addition, we will give examples of Company’s main suppliers and analyze some of them according to the supplier segmentation 

Information about Mercedes Benz Company

Mercedes Benz Company is one of the biggest car manufacturing companies in the world. Mercedes-Benz did not grow over night. It took more than 4 decades before the automobile was patented, marketed, distributed and sold. Karl Benz patented a pedal free motor wagon in Germany in 1886. First automobile was introduced to the market in 1901. From 1926, Mercedes Benz automobiles were available for public. Since then, Company has become a brand known worldwide for quality performance, design and technologically innovative luxury vehicles. Mercedes Benz began operation through its parent company, Daimler Group Corporation of Stuttgart Germany. In 1930th, Company produced the 770 model, which was popular during German’s Nazi period. After gaining popularity in Europe Company leaders decided to expand market, then in 1965, Mercedes Benz USA (MBUSA) was created. Nowadays Mercedes Benz produce their automobiles in thirty countries. Products of Company can be found all over the world.   Mercedes Benz offers a full range of passenger, light commercial and heavy commercial equipment: cars, vans, trucks, buses.    The main products are luxury cars: S-Class, Mercedes-Maybach and Mercedes-AMG.

 

Chapter 1. Suppliers of Mercedes Benz Company

Mercedes Benz Company has more than 100 suppliers. We list some of them:

A H R Metals Inc., Alpine Electronics, A1 Bar Code Systems, AGC Automotive Americas, Ai3/DJD Investments Sequencing Center, Automotive Lighting Company, Alabama Bolt & Supply, Alabama Graphics & Engineering Supply, All Pro Inc., Allright Tool Company Inc, Altex Packaging Inc, Aluminum Technology Schmid North America, AmPro Molding LLC, Andress Engineering Associates Inc, Applied Industrial Technologies, ARD Logistics-Alabama LLC, Atchley Steel Company Inc,  Brose Fahrzeugteile, Bagby Elevator Company Inc, Bar Bender Steel Inc, Barloworld Handling LP, Bates Enterprises, Dräxlmaier Group, Benteler Automotive Corporation, BHS-HARREX Inc, Birmingham Control Systems, Davis Machine Works, Davison Oil Company Inc, Decatur Plastics Products Inc, DSW Converting Knives Inc, Dudley C Jackson Inc, Eberspaecher North America, Eissman Automotive North America Inc, Fravert – Business Image Graphics, G & B Global LLC, Federal-Mogul Corporation, Gestamp Alabama, Giant Resource Recovery-Attalla Inc, Global Industrial Components Inc, Great Lakes Metal Stamping Inc, Grede Escambia, MGM Machining Inc, Mid-South Industries Inc (HQ), MISA Metal Blanking Inc, Mitchell Plastics, Motion Industries Inc, MSCO Inc Colbert, Neocon USA Inc, New Southern Resistance Welding, Oerlikon Balzers Coating USA Inc, OMI (Opelika MetalFab Inc), Packaging Materials Supply, Hoerbiger Automotive Comfort Systems Inc.

1.1 Alpine Electronics

Alpine Electronics is the consumer electronics subsidiary of the Japanese electronics component manufacturer Alps Electric, specializing in car audio and navigation systems. Alpine’s engineering headquarters are in Iwaki, Fukushima Prefecture, Japan. Alpine also has manufacturing facilities in Brazil, Hungary, Mexico, China, and Thailand.

 In 2006, 76% of Alpine’s revenues came from OEM sales. BMW and Honda have offered unbranded audio systems manufactured by Alpine, and companies such as Dodge and Jaguar Cars have offered co-branded Alpine audio systems in their vehicles. Established in 1967 as Alps-Motorola — a joint venture between Alps Electric and U.S.-based Motorola — it became Alpine Electronics, Inc. in 1978 when Alps bought out Motorola’s share of the company. Alpine offers a wide range of items, including in-car multimedia, amplifiers, speakers, subwoofers and signal processing equipment. In 2008, Alpine introduced a full line of marine sound system products.

1.2 Dräxlmaier Group

Dräxlmaier Group is a German automotive component supplier active in vehicle electric systems, electrical and electronic parts, interiors, storage systems, plastics, tool making and logistics. Founded in 1958, the family run enterprise is nowadays one of the top100 automotive suppliers, running 58 sites in 22 countries on four continents and is the market leader in the premium segment for both wiring systems and interior system. The Headquarters of the Dräxlmaier Group is based in Vilsbiburg, Lower Bavaria, Germany. The Dräxlmaier Group has such renowned customers as Audi, BMW, Bugatti, Cadillac, Jaguar, Land Rover, Lamborghini, Maserati, Mercedes-Benz, MINI, Porsche, Tesla Motors, and Volkswagen.

1.3 Brose Fahrzeugteile

Brose Fahrzeugteile is an automotive supplier. The family-owned company has its headquarters in Cobourg, Germany. In 2016, the Brose Group developed and produced mechatronic components and systems for vehicle doors, seats and body at 60 locations in 23 countries worldwide. Brose’s customers include more than 80 car manufacturers and other automotive suppliers. More than 25,000 employees worldwide working for the family-owned company. The Brose Group generated sales of € 6.1 billion in fiscal 2016. The company is also the primary sponsor of the Brose Bamberg Basketball.

1.4 Valeo company

Valeo is an automotive supplier and partner to automakers worldwide. As a technology company, they design innovative solutions for smart mobility, with a particular focus on intuitive driving and reducing CO? emissions. The Group also provides and distributes spare parts for automakers and independent aftermarket operators. Valeo Company produce radiators for Mercedes Benz automobiles. As a global automotive supplier, Valeo operates in 32 countries to design innovative technologies and systems that will make the car of tomorrow more intuitive, autonomous, connected and environmentally friendly.

 

Chapter 2. Strategy in Supplier Relationship Management

Strategy of Mercedes Benz Company in Supplier Relationship Management is creating closer, more collaborative relationship with key suppliers in order to uncover and realize new value and reduce risk of failure. Strategy is the selective partnership.

“In the best year of our company’s history to date, we also initiated the biggest change. We are in the process of reinventing our entire company.” (Dieter Zetsche Chairman of the Board of Management of Daimler AG and Head of Mercedes-Benz Cars).

The main goal of Mercedes Benz Company is to be the best, the slogan of company “The best or nothing”. They try to be successful in field of high technology, safety, comfort and ecology safety. For achieving these goals, they need key suppliers, which will provide sustainability.

Company honor their best suppliers every year for their outstanding performances in the past business year with the Daimler Supplier Award. All key suppliers and strategic partners are invited to this ceremony. For top performance in the categories of Quality, Partnership and Innovation. In addition, a Special Award is handed over exceptionally innovative performance.

2.1 Supplier Segmentation

The Mercedes Benz Supplier Network philosophy has been providing the basis for the collaboration between Mercedes Benz Company and the suppliers.

Performance and partnership are the basis of successful collaboration. Performance measured based on the criteria of quality, technology, costs and supply. Partnership based on trust and open communication.

Mercedes Benz Company categorizes their supply base in four segments: Strategic Partners, Key Suppliers, Suppliers and Potential Suppliers.

 

 

 

 

Classification of suppliers based on three criterias: Innovation, Performance and Purchasing Volume. 

The higher a supplier ranks on the pyramid, the more opportunities and trust the supplier is met with. The goal of all partners of Mercedes Benz Company should be to move to the top of pyramid: from suppliers to key suppliers, from key suppliers to strategic partners. Therefore as higher the segment as higher mutual expectations and commitments.

In this part we also will analyze our four chosen suppliers according supplier segmentation methods.

Our four suppliers are not only Mercedes Benz Company’s strategic suppliers, but also for the other car manufactures. Therefore, we can divide all of them into strategic partners group, because of their properties: Strong brand, Exclusivity, High market control and High profitability.

According to nine supplier interaction models, we think that, as our supplier has the high level of performance in the market and they are strategic partners for Mercedes Benz Company they should be on Integrate position.

Based on Customer- Supplier matrix we can say that our suppliers should defined as Leverage. They have all requirements for this group: Low risk, high spend services, Customer approach: ” Play the market”. Customer-Supplier relationship is Tactical, Cost leadership and supplier approach: increase the footprint.

2.2 Supplier Identification

Today the average company spends about half of their revenue to purchase goods and services. This makes company’s success dependent on their interactions with suppliers. The role of procurement managers has become very important. It is important not only develop existing suppliers but also find new suppliers.

Several factors make new suppliers important. For example, a new supplier has more modernized production system and their products cheaper than exist supplier’s products. Second, exist suppliers may go out of business. The main point is that new suppliers can be more beneficial than exist supplier.

To avoid any problems according to the supplier non-performance, buyers take proactive steps to verify s supplier’s qualifications. For checking supplier qualification buyers ask them about some verifications: reference checks, financial status checks, surge capacity availability, indication of supplier quality, ability to meet specifications. Suppliers who have passed the qualification requirements and are eligible for contract award are commonly referred to as “pre-qualified” suppliers.

2.3 Criteria of choice of suppliers

Mercedes Benz Company choose their suppliers not only based on stability and quality of production. Suppliers’ sustainability standards should define their requirements for working conditions, human rights, environmental protection and safety, and business ethics and compliance. They are obligatory components of the contract conditions. This components form the basis of all their business relations with manufacturing suppliers and service providers worldwide. By signing the contract supplier, commit to observing company’s sustainability standards. Company also support their suppliers to achieve these requirements, by providing information and training measures. The Daimler Supplier Portal serves as the central information platform.

 

Conclusion

As the inventor of the automobile, Company believe it is their mission and duty to shape future mobility in a safe and sustainable manner, with outstanding products and services and trend-setting technologies. Mercedes Benz Company’s goals are to be the leader in technology and innovation, to inspire customer and to continue to grow profitably. Company plan to achieve their goals by focusing on four strategic areas: Technology leadership and innovation, Delighted customers, Best teams, Profitable growth. For achieving these goals Mercedes Benz Company need beneficially and strong supplier relationship. Company built these relationships based on opportunities and trust.

 

References

1)      https://www.mercedes-benz.com/en/ official website of Mercedes company

2)      http://www.alpine.com/e/corporate/museum/78.html official website of Alpine company

3)      https://www.draexlmaier.com/ official website of Dräxlmaier Group

4)      https://www.brose.com/de-en/ official website Brose Fahrzeugteile company

5)      https://www.valeo.com/en/valeo-around-the-world/ official website of Valeo company

6)      Appelfeller, W. & Buchholz, W. (2005). Supplier Relationship Management. Strategie, Organisation and IT des modernenBeschaffungs managements, 12(2); 156-170

7)      Johnston, D. A., McCutcheon, D. M., Stuart, F. I., &Kerwood, H. (2004). Effects of supplier trust on performance of cooperative supplier relationships. Journal of Operations Management, 22, 23-38.

8)      Lambert, D.M., Emmelhainz, M.A., and Gardner, J.T. (1996), .Developing and Implementing Supply Chain Partnerships., The International Journal of Logistics Management, 7(2), 1-17.

9)      Mettler, T., &Rohner, P. (2009). Supplier relationship management: a case study in the context of health care. Journal of theoretical and applied electronic commerce research, 4(3), 58-71.

 

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