Overseeing Consolidated Parts Departments

Feb. 5, 2018
Consolidated parts-department setups can be quite cost effective, assuming managers are trained effectively.

Over time, Evan Nelson has developed a knack for numbers. In 2016, however, he was tasked with solving an equation that, initially, made his head hurt.

Consider: In 2010, Nelson was in charge of overseeing three parts department employees. Just six years later, that number multiplied more than 10 times over, after Nelson was promoted from a parts manager role to director of 12 consolidated parts departments for the Autosaver Group. The promotion meant an immense change in professional duties for Nelson.

“The transition was very overwhelming at the very beginning … when you jump up to that number of employees,” says Nelson, who now oversees 32 parts department staffers.

All of a sudden, when an Autosaver parts department needed a new employee, hiring duties were cast upon Nelson. He also had to keep tabs on financial documents for all of the Autosaver parts facilities, with locations that stretch from New York to New Hampshire. And, learning the programs and procedures for multiple manufacturers doesn’t just happen overnight.

Still, Nelson felt confident that his skills could eventually help him thrive in the role of parts director for Autosaver, and he could also see the merits of a dealership group having one point person tasked with cutting parts expenses and working to get the group volume discounts from distributors. He just didn’t know how long it would take to get all of his departments operating in unison.

The Problem

By 2010, Nelson had developed a reputation for producing stellar gross profits, thanks to the close attention he paid to meeting manufacturers’ criterias for kickbacks. Of course, that was when he was in charge of overseeing a small group of employees. Six years later, when he was promoted to parts director, Nelson was instantly saddled with a big increase in responsibilities.

For starters, the wide range of brand offerings among the Autosaver dealerships meant that the new parts director had to study up on the programs of OEMs, such as Subaru, Mitsubishi and Kia.

Additionally, his new role came with the requirement of spending nearly 12 hours per week on the road, driving from his office in Littleton, N.H., as far away as Comstock, N.Y. (which is a 35-hour trek, one way), because, while his company uses video conferencing, Nelson still finds value in observing stores in person when possible.  

Nelson’s initial answer to his expanded role was to work 14 hours per day. He often spent much of his evening printing out individual store reports, as he tried to stay on top of issues like obsolescence.

“The biggest challenge is learning every different manufacturer’s programs, and returns—you know, warranty procedures,” Nelson says, with regard to overseeing 10 stores. “Every franchise has their own procedures and programs that they offer. That’s one of the biggest challenges, staying on top of the dealer programs.”

The Solution

Nelson feels a key reason he was promoted to parts director was because upper management was impressed by his work ethic. So, while he didn’t continue working 14-hour days indefinitely, the parts director did make sure to exhaustively study up on multiple OEMs. The manufacturers’ online training served him especially well.

“I remember, with Subaru, I spent about a full week, from 8 a.m. to 5 p.m., learning and doing all the online training they offered,” Nelson says, adding that most OEMs’ online training is quite efficient and user friendly.

In an effort to learn everything necessary about unfamiliar OEMs, the parts director also met with several parts and service reps, asking countless questions of each about their programs, or policies for returns.

Nelson quickly learned that there was little reason to be intimidated by his workload, despite working with several different brands.

“Most manufacturers do everything similar ways, and it’s just learning the small differences,” Nelson explains. “Once you have a basis for it, it’s ‘Parts 101’ at that point; it’s just trying to figure out which computer screen you have to go to for each one. All in all, they’re very similar.”

Nelson’s focus on training extended to his new hires. Before long, Autosaver’s fledgling parts director had his new managers undergo mandatory training sessions in Littleton that typically lasted at least a week. Nelson led the training, so that each of the new hires could learn all of his preferred processes. These days, four of Autosaver’s parts managers are longtime co-workers of Nelson’s, who share their boss’s attentiveness toward issues like off-the-shelf fill rates.

“I have the utmost respect for every manager I have,” Nelson notes. “I trust that they’re all handling the business the way I would. … And I can see their numbers, and the numbers look great.”

The Results

Nelson’s 2016 promotion to parts director has added up to an improved outlook for the Autosaver Group. The group’s consolidated parts departments, which have a combined inventory of roughly $2.2 million, have seen their gross profits climb; Nelson says that most of his departments have seen a roughly 25 percent increase in the last year.

Nelson’s transition to his new role required a prolonged study session. Fortunately for him, all of the training he endured left him with several lessons learned.

Chief among those lessons: pass your knowledge on to others. Because, if you do, it’ll eventually leave you with managers in place that share your business philosophies.

“Don’t ever be afraid to hire somebody smarter than you,” Nelson says. “Because, ultimately, you need somebody that’s intelligent … to make the day-to-day operations go smoothly.”

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