Why Time is Your Enemy in the Parts Department: Part 2

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Read Part 1 of “Why Time is Your Enemy in the Parts Department". In Part 2, Bob Clements provides more strategies for saving time and boosting profits and efficiencies.

Software is an important part of running an effective parts department, so I encourage every dealer when possible to move toward business management software as soon as possible. I know many dealers struggle with making the investment, but, in most cases, the software available today will pay for itself within the first couple of years. It will give you better reporting capabilities along helping you do a better job of pricing parts and increase profits.

Using software, you can set the minimum and maximum level of inventory for various parts, so that you don’t have more than you need and don’t run out at season. You can also run reports that show you which parts sell the fastest, which is important as you begin to think about reducing your transaction time.

To sell more parts, you need to know which parts are selling. Every dealer should be running a report from their business management system that shows parts sales by volume, or your fastest moving parts. I advise dealers to run this type of report at least every 60 days.

A good approach is to come up with a “Top 50” list of parts. Then, arrange your parts department so that your 50 fastest moving parts are closest to your front parts counter. For example, you don’t want your fast moving belts hanging on the wall in the back of your parts area. You want them on the wall next to or behind your front counter. This also applies to air filters. Get a good supply of your four or five fast-movers under the front counter.

This sounds simple, but is hard for some parts managers to do. They have their dozens and dozens of parts, stored in a seemingly orderly fashion — all of the spark plugs in this section and all of the filters in that section. It looks pretty, but it kills transaction times. Get those fast movers as close to the front counter as possible.

Keep in mind that everything we are trying to do is designed to help your customers have a positive experience with your dealership. This way, they will walk out and tell their friends and family members about how good a job you do and the value they get from doing business with your store.

Happy, excited customers share their experiences with others they know and are more than willing to help you grow your business. So, let’s work on reducing that transaction time to give them an experience they won’t get from other dealerships.

Adding Storage

Once you have a good grasp on your fast moving parts, you might want to consider looking at investing in high-density parts cabinets like the ones from Lista or Stanley Vidmar. I’m a big fan of storage cabinets. They are great because they can hold a good volume of parts and often fit nicely right behind the front counter. Sometimes dealers say, “Yeah, these sound great, but, boy, are they expensive.” They are going to cost you a little bit, but wouldn’t you rather buy six of these cabinets than hire another parts person? The cabinets never get sick, don’t require you to pay them overtime and last forever.

Cabinets also make it a lot easier to do inventory. Everything is more compact and easier to go through. This is big when it comes to making your parts department more profitable. You have to be doing inventory checks efficiently and accurately if you want to improve inventory turns.

Create a High Performance Dealership with Bob Clements is a new series brought to you by Yanmar.

Harnessing Technology

Every major retailer has a bar code scanner at its point of sale. More dealers are getting on board with this as they see the potential to reduce transaction times and increase inventory turns. The equipment isn’t even that expensive.

Most business management system providers offer software that has the capacity to use a bar code reading system. Furthermore, most parts are now shipped to dealers with bar codes on them that you can normalize into your software with a couple of button clicks.

Getting converted over to a bar code reading system is going to save you a lot of time in the long run because you won’t have to type in the parts numbers. Plus, inventory counts are going to be more accurate because the possibility of making a typo is eliminated.

Converting over to a bar coding system will take you a little time, so it’s not something you want to tackle during the busy season. However, it makes for a great off-season project for your parts manager or other dealership personnel you’d like to keep employed.

Reduce Wasted Motion

The goal in your parts department is to search for ways you can reduce wasted motion. Every step you or one of your people take costs money. Every motion that is unnecessary costs you time and can potentially reduce the experience your customers have with both your dealership and the brands you carry.

Make today the day you decide to turn your parts department into a “lean, mean, and money making machine” and watch both your profits and your customers grow.

Create a High Performance Dealership with Bob Clements is a new series brought to you by Yanmar.