News & Blog

Challenges in parts management for equipment dealers

If you, as an equipment dealer, have your spare parts management optimally organized, you have an important asset to differentiate yourself from the competition in terms of customer service. But then you will have to overcome some challenges.

How do you organize the ordering of parts?

Throughout the organization, the need for parts arises continuously. These may be ordered by customers, needed to keep inventory at the right level, or needed (sometimes urgently) for service and maintenance. Will you order these centrally for everyone? That makes the ordering process clear and manageable. Or do you opt for decentralized ordering? That makes the ordering process flexible. And where do you have the parts delivered? At the central warehouse? At multiple locations? Or even at mechanics' homes so they have them in the service van the next day? Think carefully about these questions and always balance flexibility and speed with manageability and cost.

How will you keep track of inventory?

Do you only keep track of the stock in your warehouse(s) or also the stock in the mechanics' service vans? Whatever choice you make, your business processes will have to be set up accordingly and this must be supported by automation. Does it make sense to invest in automated storage and order picking systems? Can you start working with barcode scanning in the warehouse? And do mechanics work with a mobile application to record their parts consumption? Maintaining inventory correctly requires an analysis of processes and possibly an investment in automation.

"Measuring is knowing. With good automation, you can perfectly track parts consumption."

How do you gain insight into component consumption?

Measuring is knowing. With the help of good automation, you can perfectly track parts consumption. The important thing is what you then do with that data. You want as low an inventory level as possible, but as little as possible to go wrong. In the analysis of your optimal inventory levels, you will also have to include the performance of suppliers; how fast can they deliver and at what cost? For some parts it is a must to always have them on the shelf, for other parts you want no stock because they are rarely needed or can be delivered at lightning speed. In consumption analysis, it is also interesting to discover trends; better predict future parts needs and respond accordingly. Sound ERP software and the right Business Intelligence tools will help you do this.

How do you value your stock?

The valuation method for your parts has a big impact on the financial numbers. There are numerous examples of companies that have no clue about the value of inventory or completely misjudge what inventory is worth due to years of poor inventory management. Are you looking at the purchase price? Or the current value? Or do you work with a fixed transfer price? Each method has advantages and disadvantages, and it's good to list them and determine the best choice for your organization.

Two important things to overcome these challenges in parts management:

  • Optimize processes: Ensure streamlined business processes based on best practices in your industry
  • Successful automation: Support the way you work with user-friendly, comprehensive and industry-specific business software.

For both of these things, you need the help of a software partner specializing in your industry. At Dysel, we've been helping equipment management organizations improve their business processes and deploy equipment management software for many years. Want to learn more about what Dysel can do for your organization? Get in touch with us!