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3 common parts hoarder symptoms that you can rebound from with a killer comeback

3 common parts hoarder symptoms that you can rebound from with a killer comeback

Are you – or someone you know – a parts hoarder?

Just to be clear, I’m not talking about the “hoarder” who can’t move around their house. I’m talking about parts managers who quietly hang on to slow-moving parts for unknown reasons. Some say it’s OCD with every part in its place; or an odd attachment to certain SKUs; or even an obsession for unmarketable inventories.

Regardless of the cause, it can become a silent profit killer. Three common symptoms include:

  • Parts staff wonder aloud as they try to find a spot to put new incoming parts
  • General Managers raise an eyebrow as it costs money to insure parts
  • Customers question the lack of availability of fast-moving parts

Another indicator is in the numbers. Run a few DMS reports and calculate the idle percentage. If the percentage is higher than 10% of your inventory that hasn’t moved in over 12 months, there is a problem.

Does any of this sound familiar? If so, there’s plenty you can do to change things around. If you can say you have a problem with letting go of slow-moving parts, then the hardest part is compete.

Solutions Exist

Truth be known, problems with parts hoarding – or idle reduction – is far more common than you would think. While few parts managers like to openly talk about it, the problems are extensive.

If you haven’t sold a part in 12 months, you pretty much have no chance of selling that part. So essentially, you are paying insurance on a part that takes up valuable space and it will never go anywhere.

The hard truth is, you MUST part ways with these idle parts in order to maintain a healthy inventory. These parts must be identified, re-priced, and marketed to potential buyers in order for your inventory to become a well-oiled machine again.

Start completely fresh

Depending on how deep you’re buried in idle, many parts managers recommend going “cold turkey’ and using parts brokers to sell in bulk. But a word of caution: only go this route with trusted professionals who have your best interests at heart. You will sacrifice margin for a quicker sale, but you’ll be much healthier to reinvest in more marketable parts.

Or, if the sentimental attachment is too strong, you can handle the marketing yourself by advertising on parts marketplaces with less severe discounts. While potentially a slower process, both methods help you regain inventory control.

Planning your idle future

As you continue with your inventory improvements, recognize that idle will always lurk below the surface of a profitable inventory. Now, more than ever, you must be self-aware and not slip back into old habits.

How do you keep up with it? Easy:

  • Regularly check your inventory for slow movers
  • Re-price and market before they become a problem
  • If need be, seek help from parts marketing professionals who are trained in dealing with these kinds of inventory issues. There’s no shame in asking for help!

Looking for more help from trusted experts who know a thing or two about this? OEC’s PartsBrokerDirect is a click away.