![]() You can get a more accurate picture of how your parts sales are moving through your on-hand inventory by looking at your “true” inventory turns. With a turn of less than four, you may be carrying too much inventory, and with more than six you are probably ordering too often and missing volume purchase discounts. Your goal is to have a “gross” turn 4-6 times per year. To determine “gross” turns, you need to take the annualized cost of your parts sales and divide that number by your total dollars of parts inventory. Most parts managers understand the importance of measuring their parts inventory turns which, theoretically, helps them determine if they are doing a good or bad job controlling their department, but they also need to understand the difference between “gross” inventory turns, and “true” inventory turns. While you can’t do that with every part, it is still easy to reduce your item count on each part, and still meet the daily demands placed upon your parts department. You can easily meet that demand today by keeping only four in stock. Twenty years ago, you may have had to carry eight different carburetors in order to meet the needs of your customers and service department. Think how that changes your approach to deciding on the number of any particular part item you should keep on hand. ![]() Twenty years ago, it took almost 30 days to get a part, and now you can get a part delivered to you in one to four days. Today, it makes no sense for a dealership to maintain a large parts inventory, or stock ten of the same item, because manufacturers have greatly improved their ability to get you the parts you need when you need them. ![]()
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