Mercedes Retools its Fulfillment Operations

Specific Problems Identified

Rizzo, who headed the search for a new fulfillment house, cites two factors that contributed to the fulfillment problems.

First, the consumer catalog and the automobile dealers had separate ordering systems, but a single fulfillment location and a single catalog from which to shop. The fragmentation was further complicated by an inventory system that didn’t provide current information to dealers placing orders or customer service representatives taking orders. As a result, purchases for out-of-stock products were placed even though there was an existing backlog of orders. Because Mercedes’ merchandise is branded, usually with logos, and many of the products are manufactured overseas, replenishing products is not an instantaneous process, and substitute items are not available.