Inventory can include items like oil, tools, and large equipment. It also includes stock items, or parts which are sold to the customer during the course of repairs, such as gaskets and timing belts.
Inventory management and parts management go hand in hand, but outside of labor profits, the profit a shop brings in ultimately comes from parts markup at the point of sale. Consequently, there’s very little room for error in managing parts.
Simply put, mismanaged parts means money left on the table and unhappy customers—a combination no shop owner or automotive team wants to experience.
A good auto parts inventory management system should let you:
• Know what parts you have in stock and how many you have
• Track what sells and what sits on the shelf longer than it should
• Help you plan for growth.
With the right auto parts inventory management system, your shop can go from disorganized to a well-oiled machine generating more and more profit.
How to know when it’s time to update your auto parts inventory management system
What are some indicators that your auto parts inventory management could use a tune up? And when should you start looking into shop management systems like Tekmetric? Here are some indicators to look for:
1. Overstocking Parts
It is easy to overestimate the demand for a specific part, especially if you are ordering parts between seasons, ordering specialty parts, or still using pen and paper or a spreadsheet to calculate your inventory.
Whatever the cause, it is important to remember that every part has a carrying cost. You can think of “carrying cost” as the storage cost for a part. Every part that sits on a shelf and occupies space that better selling products could take up costs your business money.
2. Parts Shortage
If you’re constantly running out of supplies, your auto parts inventory management system is failing. Good parts management requires staying ahead of the curve to anticipate the needs of your shop.
If you are always running out of parts and having to order them before you can complete a job, jobs will take longer, you’ll wind up paying more for parts, and you may lose your customers’ trust.
3. You're wasting time finding parts!
Whether the problem is a shortage or overstocking, either way your shop is spending too much time managing inventory ineffectively! If inventory management has become a dreaded task at your shop simply because it takes so long to complete, it is time to upgrade your system.
Inventory management must be a smooth process if you want the rest of your shop to operate efficiently. If regular check ups on your auto parts inventory are taking too long, it is probably a sign of a larger underlying problem—disorganization.
Own Your Parts Inventory With a Cloud-Based Shop Management System
You can’t run a shop without the right parts and tools, and in today’s automotive industry. Cloud-based shop management systems not only simplify your shop's operations, they even make it easier to make more money!
1. Direct Integrations with Parts Vendors
With immediate access to your favorite vendors directly inside Tekmetric, service writers can instantly find what they need.
Even better, because you an integrate multiple vendors, your shop can compare prices to get the best deal, and place an order in a matter of seconds.
2. Complete Inventory Management - From Anywhere
Track the flow of parts in your shop with Tekmetric's Inventory that connects to repair orders, estimates, and more. If you don't have a part in stock while working on a car, quickly swap the part for a similar one in inventory.
And because your shop management system is in the cloud, you can access your shop's parts inventory and do everything you could in your shop right from your phone or tablet. Literally, you can log in from anywhere in the world you have an internet connection to gain complete access to your shop remotely.
3. Create parts matrices to apply the right mark-up every time
By building streamlined process for marking up parts, shops can ensure grow your shop’s profit margin while staying fair to customers.
Fine Tune Inventory Management with Tekmetric
Whether you need to track down a stray steering column or make a decision about how much to invest in A/C repair parts for the summer, Tekmetric is your go-to system for gaining a better understanding of how parts move through your shop.
Please note: This blog post does not constitute legal or financial advice. This blog post is merely a guide on how shop management software works with accounting software. Additionally, there is a difference between bookkeeping services and accounting services. If you’re seeking professional accounting services, contact Paar, Melis, & Associates.
For many shop owners, the accounting side of business can be overwhelming. After all, there’s probably a good reason why you decided to start an auto repair business and not an accounting firm—you enjoy fixing cars and helping people, not staring at numbers all day. That's where reporting features from Tekmetric come in, making it easier to see all your finances in one place.
But when you’re in the shop owner’s seat, it’s vital for you to have a firm grasp on your books. If you want your business to succeed over the long haul, your financial statements need to be complete, consistent, and comparable.
With Digital Vehicle Inspections shops can go the extra mile and introduce a new level of transparency through a frictionless experience for the customer.
They can get clear pictures or videos to show them what's wrong, have the inspection results sent to their email, and approve or decline work with just the click of a button.
However, while this is super simple for the customer, for Service Advisors, finding the right inspection can be time-consuming. Especially when your shop is training new service advisors and introducing them to your standard operations.
To save your Service Advisor's time and effort, we are excited to announce our newest feature: Default Inspections.
This feature streamlines the inspection process and makes it easier for you to provide great service to your customers.
Service advisors serve as the major touchpoint between customers and your shop. While they ultimately need to build repair orders for technicians, they need to get that information from the customer.
And vice versa, when technicians provide inspection findings, service advisors explain those findings to the customer to figure out the best path forward.
That's why service advisors need to make customer service a focal point of their role, to build that trusting relationship between the customer and your shop.
Because when customers feel like they can trust that your shop is giving them the right recommendations, they'll feel more comfortable approving repair orders for the work their vehicles need to keep running safely and reliably.
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