A leading OEM in the automotive industry faced challenges with their oil program for the US and Canada. They were using an incumbent oil manufacturer that relied on third-party distributors for both bulk and packaged oils. The packaged oil, being 100% private label, caused inventory turnover issues for the distributors, leading to stockouts and extended lead times of up to 2+ weeks. The OEM needed a solution that could deliver packaged oil within 2 days on average to meet dealer expectations and improve service levels.

To address these challenges, a leading oil provider partnered with Kem Krest. Leveraging our existing strong partnership, the oil provider proposed a solution that guaranteed delivery within 2 days on average, based on our proven track record with other OEMs. We utilized the minimum order quantity (MOQ) required by the OEM and consolidated it with our existing chemical business for the OEM. This strategy helped reduce outbound freight costs and align the overall landed cost with the oil provider’s requirements. Our standard on-time shipping rate of over 98% and an average national order-to-delivery time of approximately 2 days ensured that the OEM’s stringent delivery requirements were met or exceeded.

This approach led to significant improvements in the OEM’s oil program. The average order-to-delivery time for packaged oil was reduced to within 2 days, meeting the OEM’s requirements and improving dealer satisfaction. By consolidating shipments and optimizing freight costs, we were able to offer a competitive price despite our higher cost structure compared to third-party distributors. Our high on-time shipping rate and efficient delivery processes resulted in a more reliable supply chain, reducing stockouts and ensuring consistent availability of packaged oil.