Business revs up for Ateco Automotive

Customer Story

Supply chain sophistication helped Ateco Automotive build its reputation and win the handling of some of the most prestigious and exciting cars in the world.

Ferrari and Maserati: few brands have greater eye-catching, head-turning power in the car business. Fast, expensive, sleek and sophisticated, they are designed to generate excitement. The feeling is abundant at Ateco Automotive, one of Australia and New Zealand’s major vehicle distributors. From 1 October, Ateco, via wholly owned subsidiary EAI, took over distribution of these icon cars.

“You’d have to say there is a buzz about the place,” says Rod Matthews, Ateco’s chief financial officer, from the company’s Sydney headquarters just weeks before Ateco took control of the distribution. “It doesn’t get much bigger.”

Not that these fine autos will fly out the door. Even though they are among the most desired cars in the world, with prices ranging to 700,000 Australian dollars (about 440,000 euros), Matthews expects to sell 10 of each brand per month. But what Ferrari and Maserati’s decision demonstrates is Ateco’s powerful reputation in the region.

This year, Ateco expects to import and distribute 32,000 cars via almost 190 dealers in Australia and New Zealand, including Citroën, Fiat, Alfa Romeo and Kia, as well as vehicle parts and accessories.

That is a jump from the 12,000 cars handled in 2000. That year, the company took on Kia, at the time selling about 6,000 cars a year, and have lifted sales to 25,000, among the fastest growth in the world.

Ateco’s influence has been considerable: in 1998, the company reintroduced Alfa Romeo to the market; in 2002 it brought Fiat back. Taking responsibility for Citroën in 1994, Ateco oversaw a tenfold sales lift.

By the end of the 2004-2005 financial year, Ateco was a aud 700 million (440 million euro) business. “Growth has been rapid and we run a demanding and complex business. Overseeing the delivery of a car from Korea to a dealer in outback Australia, as you would imagine, is quite a mission,” says Matthews.

Growing pains

When the business began to undergo rapid expansion in 2000, its supply chain management system at that time was “not up to it, clearly inadequate; it was an off-the-shelf job,” Matthews says.

Recognizing that it had to dramatically sharpen supply chain performance, Ateco turned to IDS Enterprise Systems (now IBS Automotive). IDS, which was acquired by IBS this year, is a specialist in automotive distribution and supply, developing enterprise systems, supply chain management and e-business solutions.

“IDS is No. 1 in the automotive business,” says Matthews. “It was the obvious choice. Because it specializes in it automotive solutions, it offers tailor-made features that its competitors can’t match.”

In 2001, after a six-month setup, the IDSe42 system was installed in Ateco’s Australian head office and went live across all brands. It has been, says Matthews, “a crucial factor in the company's expansion.”

Ateco adopted the full IDSe42 package, an importer/wholesaler distribution software system including modules for vehicle tracking, warranty, spare parts, financials, warehouse management, sales and business intelligence.

Matthews says the supply chain has become much more efficient under IDSe42. “Delivery is quicker, our inventory is down, vehicles, parts and warranty issues can be tracked anywhere in the chain.”

Effective system

The electronic interfaces and real-time information system make up a huge advantage, says Matthews. “We have information at our fingertips, meaning responsiveness, flexibility and better decision-making.”

Data keyed at a single point in the supply chain is available across the entire chain. All 188 dealers can access the system via the Internet to order and track vehicles and spare parts, and to enter warranty claims.

One of the strengths of the IDS system is its multi-functionality, which allows for instant communication across multicompanies, multi-time zones, multi-currencies, multi-languages and multi-warehouses.

This clearly works for Ateco, which has to operate across the Australian continent, which is geographically as big as the United States. Ateco went live with IDSe42 in New Zealand in 2004.

“The bottom line is that IDS helped us expand and develop as a respected distributor in our region,” says Matthews, adding, “We must be doing something right for Ferrari and Maserati to come on board.”

text: David Passey photo: Michael Coyne

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