Dealers: How to avoid those stressful year-end parts inventory counts

Updated Dec 22, 2019

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If you followed my suggested daily inventory count you should have completed two full inventory counts this year and perhaps are working on a third.

Wayne Brozek has been in product support at the dealer level for the past 30 years. In 2014 Wayne began doing consulting work with parts and service managers in North and South America. You can contact Wayne at Brozek has been in product support at the dealer level for the past 30 years.  In 2014 Wayne began doing consulting work with parts and service managers in North and South America.  You can contact Wayne at [email protected].

Unfortunately, I still hear horror stories of parts departments doing a full inventory count in December, working their employees on weekends and evenings trying to get that one count for the year done. I used to live those days, so I know how this happens. We advise our clients to complete a minimum of two inventory counts annually so none of their employees have to work extra during the holidays. They do this by following our daily commitment sheets.

A word about these sheets: As managers we don’t always manage to the commitment; we manage to the task. When we manage to the task and our departments get busy, we can justify why we didn’t accomplish a task. When we agree that the commitment is the priority, then no matter how busy we get the commitments are made.

Here is an example of the difference in a commitment vs. a task.  As the manager you ask your employees if they can commit to doing a certain function daily (such as bin counts). No matter what is going on around you or how busy you and your team get you commit and hold each other accountable to accomplish the commitment.  Once that happens, you begin to move the needle. If you and your team just agree that you should do it but never commit to ensure it is completed daily then any excuse will justify why it wasn’t done.

I have found that making commitments and writing them down makes them harder to avoid then just saying I “should do” something.

If you are one of those dealerships that is trying to cram another year-end inventory into the last 90 days of the year and you’re stressed along with your fellow employees, just contact me and I’ll be happy to show you how this can be avoided in 2020.

The end of the year is also the time to look at your obsolete, non-returnable and aged inventory. We all have those obsolete parts.  We also know that the majority of those parts are never worth more than their listed book value.

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Hopefully you had a plan this year to get a certain amount written off. To get this accomplished, you also need to get it counted and boxed up so you can remove it from your inventory.

The good news: it’s not too late if you haven’t yet dealt with this part of your inventory.  There are ways to dispose of these parts; here are a couple that I have used:

  • Donate certain parts to a local community college or high school technician program.
  • Sell it via eBay or a similar service. (Note: This is more time consuming since you’ll need pictures, descriptions, applications, etc. Someone will also need to keep track of bids and shipping.)
  • Scrap it. (Check with your accountant on this since there are certain restrictions and verifications required detailing that the parts have truly been scrapped.)

I hope 2019 has been a prosperous year and that you’re looking forward to 2020!