Years of experience in the same role leads us to use our intuition when making important decisions. A senior Parts Manager can make a purchase based on what they think customers will buy, and they may succeed. But if intuition fails, the dealership will suffer financial losses that are often irrecoverable.
Making decisions based on intuition can be replaced by effective and organized processes based on statistics, reports, and best practices. This article poses practices that help the dealer manage the Parts and Service Departments through precise reports and detailed information.
Parts
Unsold parts and those that are not used for service jobs have the same fate: obsolescence. Obsolete parts involve:
- Monetary investment in storage
- Monetary investment in insurance
- Physical space
- Immobilized investments
Parts Order Suggestions is a feature provided by Autologica DMS for dealers to establish a parts purchase policy based on statistical sales reports. The system uses the dealer’s daily operation data to achieve optimal stock levels and availability.
Other important reports that your DMS can provide are Parts Activity Based Costing, which allow the dealer to understand, for example:
- Which parts have high inventory but low sales?
- Which low cost, high inventory, and low demand parts can be used for special offers?
- Which customers have bought parts with low demand?
- Which parts should we avoid purchasing because there is already enough inventory?
Which parts should be labelled as obsolete?
Service
What are the consequences of leaving service appointments management to chance?
- Last minute cancellations
- Overlapping appointments
- Delays in starting the jobs
- Dead time and monetary loss
Having an organized and centralized appointment schedule can help avoid these issues and assure the dealer that the appointments booked (on the website, by phone or at the dealership) will count with an available Advisor and will not overlap. In addition, automatic reminders make it difficult for customers to forget their appointments, and if they decide to cancel the dealer will have enough time to reschedule the appointment.
With a tool like Appoint365 the dealer has an online schedule that centralizes all service appointments, sends automatic reminders to customers via SMS or email, and provides reports on popular jobs, occupancy percentage of the workshops, and more.
Successful dealers replace counter-productive decisions left to chance with decisions based on strategic data that have a higher success rate.
In the second part of this article we will analyze how to avoid making decisions based on intuition in the Sales Department.
