We’ve talked before about the reasons for delays in repairs being completed. According to a survey we did on hours produced, the number one delay was waiting for customer authorizations (23%). The second most common reason for repair delays was due to parts availability (21%). When techs are held up from working because they are waiting for parts to arrive, customers get frustrated and the auto shop loses money. What can auto shop managers do to prevent repair delays due to problems with parts acquisition?
When car parts are not available, it costs everyone time, and it costs the shop money. It can be tricky figuring out how best to acquire parts, though, and balance that out with differences in prices. For instance, if the shop loses $30 for every ten minutes a tech is idle, does it make more sense to send out for parts at a nearby auto parts store even if their prices are higher?
Another issue is getting the correct part or parts for specific repairs. If the tech finds out that he has the wrong part for the job in the middle of the repair, the whole waiting process starts over again with more time and money lost because of the mistake. Obviously, determining the best way to ensure consistent parts acquisition is complex.
Building and Maintaining a Good Inventory of Parts
When an auto repair shop has the parts necessary for repairs already on site, this eliminates the time spent finding and acquiring the right parts. Inventory management, when done correctly, can dramatically increase a shop’s profits by drastically reducing downtime. Of course, the challenge lies in understanding what parts to stock and how many of them. A good parts manager understands how to put new parts number in stock, when to phase parts out, and when not to put new parts into inventory.
There are a number of issues that a parts acquisition specialist has to be on top of in order to build and maintain inventory and prevent problems. They include:
Buying parts in useful numbers – There are some parts that are used so often that it’s worth it to buy them in bulk or to stock one of every variant there is for cars the shop services. This is true especially when these parts are inexpensive. Making room for them on your shelves is good. It will save time and money.
Buying related parts – There are some parts that, when replaced, require other parts to be replaced as well. Those should be kept in stock in the same numbers because if your shop doesn’t have the related parts, it means running out to get them and holding up the repair. As one of our forum members stated it, “If you don’t carry every single part related to the sale of one part, there’s no reason to stock any of it. You’re still waiting for something.”
Avoiding acquiring obsolete parts – Car parts change all of the time, and a parts manager must know which ones are getting phased out so they don’t get ordered. He also should know when to cut his losses and toss old parts because they are taking up space and will, unfortunately, never be used.
Knowing which parts are better supplied by someone else – If the repair requires that the tech remove other parts to get to the problem, it may be in the shops best interest to not stock the part. If the shop can get the part before the tech needs it, it’s better off sitting on the parts store’s shelves and not in the auto shop’s inventory.
Parts Acquisition Is Something of an Art
For many auto shops, adding an experienced parts person who knows how to manage inventory and get the right part for the repair every time would be a worthwhile investment. In larger operations, it’s more or less mandatory in order for the shop to remain competitive. If a shop mishandles parts acquisitions it loses money and customers. As with everything else, technology is changing how auto shops get their hands on the parts they need, but it’s not seamless yet. A knowledgeable and capable parts manager will still be a great part of the team for years to come.
How does your shop handle parts acquisition? Do you have a parts manager on staff. We would love to hear your experience. Weigh in here or in our forums.