Parts Management in an Equipment Dealership

The parts counter is where most customers deal with the dealership. A contractor may buy one machine every five years and call for parts every week. Each of those calls is a test: is the part on the shelf, is the price right, and does it ship today?Parts also pays a large share of the dealership’s fixed costs. Parts and service gross profit is what covers overhead when equipment sales slow down, and service can’t bill an hour while a technician waits on a back order.Many dealers still run the department by habit. The stocking list is the one the last manager built. The pricing matrix hasn’t been reviewed in years. The obsolescence reserve grows every quarter. The cost shows up as lost sales nobody recorded, cash sitting in bins that haven’t moved, and service jobs stalled on parts.Parts Management in an Equipment Dealership gives parts managers, service managers, and dealer principals a working system for running parts as a profit center. The chapters cover stocking policy and demand-based ordering; fill rate, first-time fill, and lost sales tracking; inventory turns and obsolescence control; pricing and margin management; warehouse layout, bin control, and cycle counting; counter, outside, and online parts sales; returns and the OEM relationship; staffing, productivity, and compensation; and the reports a parts manager should read every week.The book also covers how parts works with service, rental, and sales. Planned maintenance kits, parts support for the rental fleet, and parts written into service contracts all depend on departments sharing data and agreeing on who owns the customer.The method is the same one used in the other books in this series. Measure the department against benchmarks, put the gap in dollars, and close it with a short list of actions. Where a fix needs no new spending, headcount, or software, the book says so.It is written by someone with decades in equipment dealerships, for dealers in construction, agriculture, materials handling, and golf car markets. If you tolerate your parts department as a cost, this book shows you how to run it as one of the most dependable profit centers in the business. 6