Phase I of BMW's new regional distribution center started operations on April 9 in Shanghai, aiming to reduce the delivery time for parts by 20 percent.

As BMW Group's largest RDC in Asia, the new Shanghai center addresses the continuously augmented after-sales service market in China. Powered by the company's innovative technologies, the optimized working flow is capable of fulfilling urgent orders in 24 hours through overnight air freight.

Claus Eberhart, vice-president of after-sales service, BMW Brilliance Automotive Ltd, said the Shanghai RDC enjoys the advantage of being close to a seaport and having convenient inbound access to the city.

The center will serve not only dealers in eastern China, but also cover nationwide requests.

"The new RDC will enhance after-sales efficiency by saving dealers' ordering and receiving time. As a result, this will save customers' time costs and help our brand in popularity," Eberhart said.

The German carmaker's data shows that 40 percent of the total 5 million after-sales orders last year were completed in the previous Shanghai RDC.

BMW's current four RDCs, located in Beijing, Shanghai, Chengdu and Foshan, deliver automobile and motorcycle parts, accessories and lifestyle products to authorized dealers and part shops.

To meet the rapidly increasing demands of customers in Northeast China, BMW is building a new RDC in Shenyang, which will be BMW's fifth in China. The new center is scheduled to begin operation in the first quarter of 2016.

Satisfying customers

Eberhart said the key to BMW's long-term success in China is to continuously improve customer satisfaction.

"About 15,000 customers visit our authorized dealer shops every day, and our after-sales service gives us several chances to meet each customer every year," he said.

"Customers may choose our company again in cases of high satisfaction with our after-sales service. So we have to offer our best for high customer loyalty and retention."

International research and consultancy company Frost & Sullivan's analysis released in February found that China will have the world's largest number of vehicles in operation by 2021.

The report said there would be nearly 150 million more vehicles requiring parts and service, making the automotive aftermarket a high-growth industry. It predicted aftermarket revenue would reach $82.04 billion by 2021.

Many local after-service providers have already joined the competition for the future market, as new car sales growth enters a stable stage.

Increasing competition and changing consumer behavior will steadily boost the sales volume of vehicle parts and services. Intense competition will also create a wider range of product and service options for end users to choose from, requiring participants to deliver more than just basic services to consumers and installers, according to the analysis.

"I like competition. Competition makes us better, and creates a better customer experience," Eberhart said.

This year, BMW will continue to strengthen its brand positioning in after-sales service, and focus on offering higher quality premium service for customers, according to a company news release.

Staying close

In recent years, BMW has sharpened its competitiveness in after-sales with an expanded dealer network and innovative business.

BMW Brilliance recently launched its online store on Tmall, one of China's largest online shopping platforms, to provide a taste of the online-to-offline service model. A customer can purchase authorized parts, accessories and arrange services over the Internet, and then visit the after service networks at a convenient time.

By the end of this year, 100 dealers will participate in this O2O practice.

Very soon, BMW customers may be able to enjoy a personalized pick-up service in which service people will handle everything for the customer. The pilot for this service is already running in Beijing and will expand to more cities.

Eberhart's vision is that connectivity technologies will be applied in the future to inform customers and drivers of the need for timely maintenance and parts replacement. With permission from the customers, they will receive such notifications on their mobile devices, and may then select dealers or service stations on their phones, tablets or in-car screens.

haoyan@chinadaily.com.cn

(China Daily 04/20/2015 page3)