I’m curious to know how popular pre-nuptial agreements were in the 80s; we might want to consider drawing one up with our inventory. Between what I have seen with my eyes and what I have seen doing deep dives on customer inventory records, we are clearly sitting on some OLD STOCK, which is, in many cases, duplicates, triplicates, and beyond, taking up valuable space for decades!
“It’s gonna sell someday” is a refrain I often hear. One gentleman told me, “We sell those older parts all the time.” In this case, he was sitting on over 1,000 parts that had been in inventory for over ten years. He might sell a few of the older parts, but he isn’t selling the older parts like he thinks he is. What is the equivalent in years for parts in stock for 9,999 days? Answer 27 years. Keep this in mind, our days in inventory meter only has four digits, so the clock likely stopped meaning the parts have probably been on the shelf a lot longer than that.
Why am I making such a big deal of this situation? Because I visit many yards and when someone tells me they don’t have any space. . .I literally want to cry. Remember, my crew and I, cleaned out Bill’s Auto Parts, and there were parts in the building for 20, 30, and 40 years. I’m still hacking up dust from 1940. Been there, done that, and I barely got a t-shirt. Space is the ultimate commodity in our business. No one has an unlimited supply of it, but it should be lean and organized in such a way as to support your Part Evaluation Report, which lists your most valuable parts in priority order.
I am amazed at how many yards I visit where you have to climb over parts on the floor between the shelves to try and retrieve a part. The same holds true for your employees, which might explain all the MIAs you get when a part is sold, but it can’t be found.
Suppose motors and transmissions account for 40-50% of your sales. In that case, you should have the equivalent amount of space dedicated to those part types and keep a revolving audit on those shelves to divest yourself of the dead wood regularly. One habit that should be eliminated immediately is stocking shelves with parts that have been returned. I understand the temptation to shelve the part since the vehicle may be gone, but I would pay close attention to your sales history as I think you might be better off without that part.
I hate to mention the “H” word, but hoarding has been, and probably always will be, a part of this industry. It’s just so hard to ditch something we have so much invested in. “I love you darling and will never give you up . . .never, ever, never said the counterman to the front wiper motor from the 1960 Belair. We will be together for life”. All laughs aside; we need to purge!! We also need to stock parts that have quick and consistent turns, and we need to do this now.
For the parts hoarders out there, Happy Anniversary!
I am NOT a Core Expert, but a Recycler working at a Core Company. This has advantages because I have become the Recycler’s “Inside Guy”. Let’s put a laser focus on your inventory in 2023.
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Pauly D is not only the “Recall Guy” for Takata Airbags but has now morphed into the “Core Hunter” helping Recyclers maximize Core Profits by reducing deductions. Contact firstname.lastname@example.org or 401-458-9080.