How to Evaluate Parts Department Performance - A Consultant's View

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Workshop Info:


Presenter: Richard Owen
Original Air Date: March 15, 2012
Program Length: 100 minutes 


How GMs and Parts Managers alike can dissect the Parts Dept performance to find areas and strategies for improvement.

As dealership fixed operations expert Richard sees it, dealership general managers tend to know only two numbers about the parts department - the gross turn ratio and month’s supply. And those two numbers are misleading. What dealers and general managers don't know is the real efficiency of their parts operations. Both GMs and Parts Mgrs need to know things like the level of NS parts and the gross profit margin by sales type. Dealers especially need to focus on the concept of "true inventory turns." None of these figures will be found on the dealership operating report.

You will learn:


  • How to reconcile the general ledger parts inventory to the shelf count
  • What it means when NS or "watch" parts have an on-hand value
  • What your parts department's true selling margins are
  • The crucial difference between technical and calculated obsolescence
  • How to calculate and interpret inventory efficiency
  • The correlation of parts dept and service dept efficiency

How to Evaluate Parts Department Performance - A Consultant's View

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