In the past few years, we’ve witnessed an important shift in thinking amongst dealers to appreciating just how much parts and service produces profit and overall dealership health. After all, parts and service departments are responsible for producing 49.6% of a dealership’s gross profits, according to NADA. Not only that, the parts inventory is the second largest capital investment a dealer makes, after new car inventory. Now, with online sales, dealers can expand their reach nationwide and experience infinite growth in parts sales- with the right tools and systems. Here’s how.
Creating the foundation
Regardless of whether you’re already selling parts online or not, it’s important to audit your operation to ensure that new customers gained through online sales will return to you in the future. If say for instance your dealership does well attracting new business, but struggles to retain customers, you’ll want to take a close look at customer service and follow-up to ensure you won’t lose future online sales customers to the same breakdowns. The most crucial aspect of successful online sales is good inventory control; accurate physical and digital inventory, good sourcing setups, and clear reporting which result in having the parts you need when you need them and accurately predicting future needs.
Making a plan
Many dealerships get into online sales to offload excess inventory and discarding obsolete inventory is a great starting place, but it’s important to have a sense of bigger goals and direction in order to unlock the most potential. It’s important to consider shipping infrastructure, scaling ability, maintenance of online listings, and long-term goals.
In our nearly 30 years of experience working with parts departments, we’ve witnessed the majority of parts and service operations struggling to get out of a reactive zone. In many cases, Parts Managers are juggling too many duties and inventory health suffers as a result. Without a responsive, clean, lean, adaptive, and accurate inventory, it’s nearly impossible to increase revenue streams. If you’re hoping to tap into the expanded market of online sales, it’s essential to give your Parts Managers and their teams the tools, time, and support they need to operate at a higher level.
PartsEdge saves Parts Managers hundreds of hours each year by taking all the guesswork out of DMS management, sourcing setup, and inventory optimization allowing them to focus on expanding a successful operation. Our expert team is available on-demand to guide your operation to record success. As a result, our clients see an average 20% drop in total inventory, 15%+ less idle inventory, a 50% increase in ROI, and a 20% increase in parts sales. If you’re ready to put our parts power tool to work, send us a message! Our testimonials speak for themselves.