Aug. 11 2006 12:47 PM

More than 700,000 Kia automobiles travel US roads. Since Kia prides itself on customer satisfaction, getting replacement parts to the dealer as quickly as possible becomes Kia Motors America's most important job. About five years ago, Kia decided to automate shipping at its parts distribution centers in Atlanta, Allentown, Chino and Chicago to get cars serviced as soon as possible.


In the past, Kia's parts distribution centers used many different shipping systems, and its shipping operators had to learn how to operate all of them. Not only was shipping information scattered across different systems, but it also had to be manually re-keyed by the billing department. For each order shipped, the accompanying paperwork would go to the front office where a staff member would manually post the order and bill the customer for the parts. The company wanted to eliminate this double handling of paperwork by standardizing on one system.


Kia was faced with the challenge of streamlining its shipping operation down to one system that could manage shipping for all of its carriers as well as provide integration with its central Dealer Communication System for automatic invoicing and parts tracking. At the same time, Kia hoped to reduce its freight charges by adding the ability to shop for the best rate and service for each package across all of its parcel and LTL carriers.


"As car sales grew, the company needed to streamline its shipping systems to keep up with the demand for parts," says Derald McDonald, national manager of parts distribution center operations for Kia Motors America. This was a tall order considering the high order volume at Kia's four distribution centers. Kia's Atlanta parts distribution center, with the largest volume of the four, ships as many as 700 orders a day and works with 205 dealers in its region. The other centers average 300 to 500 shipments a day, with about 65 to 100 of those being truck shipments.


Kia selected Kewill's Clippership application to standardize its shipping operation. Clippership automatically selects carriers that can deliver the product as Kia has committed, compares shipping rates and automates the shipping process. It now takes two people about five hours per day to run the shipping operations at each center. The Kewill system's ability to interface with the company's central operating system allows Kia to post and invoice orders automatically. The system's ability to rate shop and find the most economical way to ship each order saves $1,000 to $2,000 a day, according to McDonald. Kia's initial return on investment study done on the shipping systems installed at all four parts centers indicated Clippership paid for itself within six months.


Clippership is a Windows-based shipping application that allows companies to create an integrated system that is easy-to-use, efficient and flexible. Kia uses Clippership to automate its small parcel shipping through FedEx and its larger shipments through freight carriers. These LTL carriers often have a minimum charge for a shipment, depending on its destination. This can complicate comparing FedEx and LTL rates. Clippership automatically compares the rates for a specific shipment between FedEx and the trucking carriers and gives the operator the least expensive rate in seconds.


Now, when Kia ships an order through Clippership, the order's information goes into a holding bucket. Several times a day, Kia's AS400 system sweeps the system and automatically posts and invoices each order. Because the shipping information is relayed almost immediately to Kia's central Dealer Communication System, any of Kia's 615 US dealers can immediately access information about the timing of their orders. Service personnel at dealerships can see an order's shipping information and get its carrier and tracking number, greatly reducing the number of calls to the parts distribution centers.


Since implementing Kewill, Kia has come to appreciate the vast amount of shipping information the system contains. "We can run various reports daily and monthly and can track costs to the penny," notes McDonald. "The system is so easy to use; training is not a serious issue. We don't ship any other way."


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