Swiss Automotive Group accelerates efficiency and growth with Dynamics 365

Swiss Automotive Group (SAG) sought an ERP that would improve operational reliability, efficiency, and transparency in its finance and warehouse activities and replace fragmented, outdated solutions as a standardized, single source of truth.

SAG is moving to the cloud with Dynamics 365 Finance and Supply Chain Management and their robust out-of-the-box capabilities deliver unprecedented insights, optimizing SAG’s fast-moving business.

Reduced lead times and costs, increased customer satisfaction, smooth scalability, and better inventory management ensures SAG remains an industry leader.

Swiss Automotive Group (SAG) is the leading distributor in the European automotive aftermarket. With more than a million active customers and steady growth, SAG needed the power of an agile, flexible, cloud-based enterprise resource planning (ERP) solution to drive its progress forward. The family-owned company replaced its legacy ERP system with Microsoft Dynamics 365 to improve operational reliability, efficiency, and transparency in its finance and warehouse activities.

Driving change

With the proliferation of electric vehicles, e-commerce giants entering the B2B automotive market, and changing consumer expectations, the automotive industry is experiencing a revolution. Suppliers need to keep pace to stay in the race or be left in their competitors’ dust. SAG is a high-volume business known for its reliability and speed, but in this rapidly evolving world, its ERP platform was underpowered; it needed a race car.

SAG’s legacy ERP system—a mix of home-grown ERP solutions—bore the weight of delivering more than 20 million products from hundreds of warehouses to customers across Europe. Doing business at such volumes requires optimal system performance, yet the system restricted visibility between finance and warehousing activities and still relied heavily on paper-based processes. Perhaps worse, maintaining it required the institutional knowledge of long-tenured employees. As people retired, they took with them their subject matter expertise.

Moving to a standardized, user-friendly solution became imperative. Modernizing with Dynamics 365 Finance and Supply Chain Management promised to improve operational reliability and efficiency, increase transparency and control of warehouse management, and provide comprehensive financial insights across SAG’s sales, delivery, and warehouse operations.

The journey to the cloud

SAG’s goal was to have an ERP in which standard, out-of-the-box capabilities met nearly all the business's needs while future-proofing operations and fortifying the company against specialized, siloed knowledge. That requirement—plus the potential to seize opportunities that had yet to be defined—made Dynamics 365 the right choice. “We knew that Microsoft had a superior cloud strategy, and we saw the possibilities that come with a Microsoft ecosystem,” says Martin Sager, CIO at Swiss Automotive Group.

With the support of strategic partners, SAG designed a core solution template that’s easy to stand up and meets most country-and region-specific regulations with minimal customization. After the project kick-off in 2016, the new ERP solution went live in Austria in 2018, in Switzerland in 2020, and in Czech Republic in 2022. Today, more than 2,000 users are enjoying the benefits of a modern ERP system, including unprecedented insights into SAG’s operations and financials and comparisons and benchmarking of processes and data across locations.

“We knew that Microsoft had a superior cloud strategy, and we saw the possibilities that come with a Microsoft ecosystem.”

Martin Sager, CIO, Swiss Automotive Group

Built for speed

SAG’s customers, which are mainly garages and independent repair shops, serve their customers’ needs by returning their vehicles to prime condition ASAP. Typically, parts are ordered after service has already begun, so every minute counts. SAG ensures its products are delivered as quickly as possible. With 10,000 to 100,000 sales order lines per day, a streamlined warehouse management process is the engine that keeps it all on track.

Finding the right part among millions is quick and easy with Dynamics 365 Supply Chain Management. When an order is placed, either online or by phone, SAG quickly identifies where the parts should ship from—the central warehouse or one of its local branches—and makes the delivery. The customer usually has the part within two hours of placing the order and might receive up to four deliveries per day.

Accelerating growth, pulling out of the pack

SAG’s legacy ERP system couldn’t keep up with the fast pace of acquisitional growth and prevented management from achieving a cohesive company-wide view. When it implemented Dynamics 365, the company designed a “blueprint solution” that was easily extended to new acquisitions, allowing them to merge quickly with SAG—crucial, given the company’s rate of growth.

The impact of such swift inclusion on customer experience and revenue is enormous. 80% of SAG’s orders come in through its web shop, Connect, which fields product and price inquiries via a middleware component to help manage the high data load. Connect is a vital component of SAG’s e-commerce strategy, and the visibility unlocked with Dynamics 365 means newly acquired brands aren’t operating as satellites but rather strengthening company unity. The fact that SAG is working in the Microsoft ecosystem with Azure, Power Platform, and Microsoft 365 further supports company cohesion.

SAG’s uniform product catalog, which integrates its product information management application with Dynamics 365, ensures that all SKUs are in the same format regardless of country of origin, facilitating product management and comparison. Consistent product identification across countries also makes possible seamless intercompany transactions and improved inventory availability, ensuring that parts are delivered quickly. It also means that SAG can run consolidated reports and perform data analysis on crucial business insights like purchase volumes, sales, and inventory levels across its branches more effectively.

“As a company that sees up to 100,000 sales order lines per day, a few seconds saved on every pick makes a big difference to our customers.”

Stephan Simeoni, Senior Project Manager, Swiss Automotive Group

Revving up inventory management

SAG’s business is all about availability of inventory. Warehouse Management in Dynamics 365 Supply Chain Management allows real-time visibility into inventory thanks to its integration with Connect. Visible inventory helps ensure high availability of items across locations and considerably reduces lead times and costs, all of which increases customer satisfaction and sets SAG further apart from the pack.

But locating parts quickly is only valuable when warehouse logistics make a speedy delivery possible. Dynamics 365 unlocks an unprecedented level of operational efficiency by streamlining warehouse processes. Once customer orders are received, they’re quickly processed and released to the warehouse, where Warehouse Management automates inbound, outbound, and cross-docking logistics, inventory management, and stock counting, largely paperless, speeding processes while improving accuracy. When warehouse processes were paper-based and the picking process was manual, inefficiencies and mistakes were difficult to monitor and correct. With the Warehouse Management mobile app, barcode scanners, automated picking, and optimized route planning, orders are processed accurately and delivered within two hours for most shipments. Stephan Simeoni, Senior Project Manager, Swiss Automotive Group, explains, “As a company that sees up to 100,000 sales order lines per day, a few seconds saved on every pick makes a big difference to our customers.”

Dynamics 365 interfaces with AutoStore have also been instrumental in improving operational efficiency by increasing warehouse automation, transparency, and control. SAG’s largest centralized warehouse in Switzerland covers an area of 32.000 square meters (345 square feet) and includes over one million articles ranging in size from small filters and tires to lubricants and car diagnostic tools. This integration allows for better management of inventory and streamlines the entire process from order entry to delivery supporting the company's strategy of rapid delivery, which is crucial for their customers. This setup ensures that the company can meet the high demands and expectations of their customers effectively.

Features like Dynamics 365 cross-docking automations reduce handling times and speed SAG’s order fulfilment timeline by optimizing the use of its warehouses to direct deliveries to different markets. The flexibility and scalability of Dynamics 365 extends SAG’s warehousing capacity through seamless integrations with external partners into its supply chain. Simply establishing connectivity and using SAG’s mobile handhelds and printers allows any partner to engage in warehouse operations.

The road ahead

SAG’s migration to the cloud continues, with planned implementations in Hungary and Romania that will add 1,500 users. The company is excited about the momentum it has with Dynamics 365 because it opens a new world of innovation opportunities, “especially the AI function,” says Sager, adding, “We get this type of innovation directly out of our platform; all we have to do is adopt it.”