Some things just don't make sense to me. Like why they don't make the whole airplane out of the indestructible black-box material? Or why don't all dealers use bar code technology for their parts department?
Some parts managers tell me that their dealer principals refuse to spend the money on bar code scanners. Not a whole lot of logic behind that. Parts department bar code scanning is one of the most important enhancements to the Dealer Management System (DMS).
If you're on the fence or skeptical as to how important bar code scanning is to a dealership, or if you have a problem justifying the cost, read on.
Here are four major reasons why there should be no hesitation:
Overall productivity gains can be in excess of 50%.
Parts managers who have actually tracked their productivity as a result of adding bar code scanning realized such productivity improvements. Small and medium size parts departments are likely to gain the most.
For a 3-person staff parts department to process a stock order, from receiving to the binning of the parts, requires at least one-third of the department workforce.
Depending on the size of the order, it can take hours just to check in. That's one less person helping technicians or retail and wholesale customers.
For almost every parts manager to whom I spoke, scanning capability literally cut the receiving process time in half, freeing up more personnel time, because the receiving and check-in function often can be combined into a one-person job.
A shorter receiving process means greater parts availability.
When an order arrives and the parts are scanned, receiving and receipting can occur within seconds, depending on the scan tool and software used.
Parts in general are available for sale faster. Parts can be served up to technicians faster, increasing shop productivity. Special orders are processed more efficiently, boosting customer satisfaction. Another important consideration is accuracy during parts check-in and the order receipting. Scanning parts reduces human error.
Perpetual inventories can be more frequent and less disruptive.
Especially in smaller departments, the task of conducting consistent and frequent perpetual inventories can be tough. It takes time and manpower.
But accuracy is at risk by not conducting regular inventories. The result can be lower customer satisfaction, excess inventory, insufficient inventory, higher acquisition costs, and ultimately lower profit and return on inventory investment.
Parts scanning avoids that.
Physical inventories are performed faster with less people.
The efficiency gain here is consistent with the productivity gain stated earlier. The taking of the physical inventory, for most, is cut in half as is the amount of people required. Moreover, there is no confusion nor errors among count teams as a result of calling out numbers and quantities.
You may be interested in which company offer bar code technology for the parts department. ADP, Reynolds & Reynolds, and UCS each have their own products. There are also excellent third-party companies such as Automotive Business Solutions and Gigabyte.
Whether it is the DMS provider's equipment or a third party's, ask the following:
- What features and capabilities are important to my dealership?
- How well do the features and capabilities of the system supplied by my DMS provider match my needs?
- How well do the features and capabilities of the third-party system match my needs?
- Which equipment best matches my needs and budget?
Investigate and talk to others using the product you're interested in. I've heard positive comments about the companies mentioned here. No doubt, there are others to consider.
A final word: If cost is your only reservation for not moving forward, look at the productivity gains and crunch the numbers again.
Gary Naples is a parts consultant to dealers and manufacturers. He's authored two books on parts management. He's at 570-824-1528/[email protected].