Understanding the elements of effective parts management opens opportunities for improved workflowParts procurement. What is it, and how should it be handled? Every shop claims to have a parts process. If yours only relates to ordering parts, you may want to consider finding another career. That may sound harsh, but think about what can be affected by parts: quality, customer service, cycle time, productivity and, ultimately, profitability.Parts management consists of several core elements that are necessary to ensure that workflow is not disrupted and that quality is not sacrificed. The core elements of parts management include the following: vendor selection and management; initial parts order; supplemental parts order; communication/documentation; parts receiving/check-in; storage; parts distribution; and inventory control.Vendor selection and management are necessary to ensure that the vendors used are able to meet the needs and expectations of the collision repair center. Open communication and continuous review with your vendors will help keep production flow moving smoothly, and alert you to any potential situations that may affect the production flow. The parts process starts with the initial parts order, and the quality of the initial parts order is determined by a thorough inspection of the vehicle and an accurate estimate. The process continues with a parts check-in, inspection and distribution to the technician. Each element is equally important.

Vendor Selection and Management
When putting the process of parts management in place, the first step is selecting the vendors and meeting with them. This initial meeting will lay the foundation for your future relationship. That’s why it’s important to make sure that not only is the vendor aware of your expectations, but that you are also aware of their expectations. Have the vendor identify your primary and secondary contacts, and, if possible, include them in the meeting. Start by discussing ordering and delivery procedures.How will the vendor receive the parts order—by fax, e-mail, through an electronic parts ordering system, or phone call? What will the order include? The parts order should include the following: repair order number, customer name, vehicle year, make and model, production date, VIN, any applicable codes based on the parts ordered, parts list with numbers if available, scheduled appointment date, target delivery date and facility contact information. Delivery of the parts is based on the scheduled appointment date. Parts should be delivered to the facility 24 to 48 hours prior to the repair appointment. There is no need for the collision repair center to store parts earlier than this. At a minimum, all parts delivered should be labeled with the repair order number, customer name and vehicle name. A communication process must also be established between the shop and the vendor. Communication should include notification of receipt of parts order and status of the parts availability and delivery. Notification of backordered parts must be a priority with scheduled updates. The vendor must alert the collision center if the backordered part will arrive in time to accommodate the scheduled appointment date. Clarify with the vendor how incorrect parts or damaged parts will be handled and in what time frame. It is important to have the financial agreement in writing outlining the payment procedure and method, discounts if applicable, and the policy for credits/returns.The final discussion during your first meeting with a vendor is to plan for quarterly performance review meetings. This is necessary to ensure that all expectations are being met. Following the initial vendor meeting, notify all parts personnel of the agreed upon arrangements. Initiate the use of a vendor tracking log to record any discrepancy that affects the service you are receiving. These data will be useful at the quarterly review meetings.

Making That Initial Parts Order
The facility must have a process in place—either manual or automated—to alert the parts person of any pending parts orders. Each part order must include the following: repair order number, customer name, vehicle year, make and model, production date, VIN, any applicable codes based on the parts ordered, parts list with numbers if available, scheduled appointment date and target delivery date. The shop parts department, or person responsible for parts flow, will then order the parts from the agreed upon vendors based on the ordering procedures you set up. After receiving the parts order and verifying availability of the parts, the vendor should then communicate with the parts department the date the parts are to be delivered. If all parts are available when needed, the parts department should file the paperwork by the date parts are due in. If there is a part that is on back order, the parts department must then notify the estimator so the customer may be advised if the repair appointment date will be affected.Now that the initial parts order has been placed, each repair order must be managed to ensure the parts are received when promised, the parts are correct and received without damage. To manage the process once the parts are ordered requires a system to follow up on the date the parts are due. Once again, this process can be done manually (files labeled 1-31) or automated.To ensure vehicles are completed in a timely manner, parts for driveable vehicles should be ordered once a repair appointment is scheduled, with the delivery planned for 24 to 48 hours prior to the repair appointment. This will ensure that parts are available at the time the vehicle is dropped off. If they are not available, the shop will be advised and can communicate with the customer to change the repair appointment if applicable.If the vehicle is onsite, parts personnel should inspect the vehicle prior to placing the order. This is one more step to help ensure that there is no miscommunication and the correct parts are ordered the first time.Supplemental Parts Order
When ordering supplemental parts, the process is similar to the initial parts order, but with a higher priority on monitoring and management. The goal is to still try to meet the customer’s expectations by having the repairs completed by the target delivery date. Of course, if the supplemental parts will not be received in time to meet the target delivery date, the customer must be advised as to the earliest possible time.The parts department should not order parts without a supplemental estimate/parts order and approval from the estimator. A technician should not have the authority to place a parts order. When a supplemental parts order is received in the parts department, the vehicle is to be inspected by parts personnel prior to placing the order. Once again, follow the same process as for the initial order for tracking the parts. Do not forget communication and documentation.

Communication and Documentation
Parts management takes consistent communication and documentation. This is a very important step in the parts process, as it is in any process. Yet this is the one area that is overlooked the majority of the time. The process for communication and documentation will be based on the environment in which the facility is run. It can be verbal communication within the business, notes made to files, or internal e-mails and documentation within a management system. The way it is done is not as important as having a procedure in place and holding everyone accountable.

What To Do When the Parts Arrive
When a vendor arrives at the facility, the designated parts personnel are to pull the original parts order sheet for parts check-in. There needs to be a designated area in which parts are received. This receiving area must be in a place that will not affect production workflow. If parts are unloaded in the production work area, there is an increased chance that parts could receive damage. If left in the open, they can interfere with productivity and can cause a safety hazard.As the parts are unloaded, they should be inspected for quality and accuracy. Each part that is checked should then be noted on the parts list as they arrive. If any parts arrive damaged or wrong, this also should be noted. Check also that all parts listed have arrived. If they haven’t, note which part was not included in the parts order. Once all parts are unloaded, you should now have a parts list documenting the parts received, wrong or damaged parts and missing parts. You may receive an additional part that was not ordered. This may be the case if there are needed parts such as fasteners, brackets, etc. that the vendor knows are needed for a delivered part. These, too, must be noted on the parts list. Once all parts are checked and the list is documented, have the driver sign the copy. Both the facility and the driver should keep a copy. If any discrepancies, such as wrong, damaged, missing, or additional parts are found, there must be immediate communication with the vendor. This communication must take place prior to the driver leaving the facility. Any communication with the vendor must then be documented. If these discrepancies will affect the repair date or production process, the appropriate person within the collision facility must be advised. Don’t forget to also document this communication. These discrepancies should then be documented on a vendor performance log so they are discussed at the quarterly meeting with the vendor.

Where Do You Store the Parts?
Space is always an issue in a collision repair center because a repair stall costs money. Having a designated parts storage area is a necessity. Otherwise, parts are placed in undesignated areas. This leads to lost, damaged or missing parts, which results in reduced productivity. We all know where that leads. Make sure to designate an area and equip it to enable parts storage.
Once you have a place to store the parts, you need to know how to store them. There are several options, including bins, shelves, racks and carts. What you use will somewhat depend on your available space. Rolling cages/carts is one possible method. This way, the parts can then be easily taken out to the technician. This method may have a fairly high price tag and require more space. But the parts can be stored on the same cart throughout the repair, and these same carts are beneficial for storing removed parts and helping to ensure they will not be lost or damaged. This also helps keep technicians from using the vehicle’s interior as storage. One caution with carts: if not managed, technicians tend to store old parts that should be discarded. With proper production management, this can be controlled. How the parts are stored is another consideration. There are different ways to do this such as by last name or RO number. Whichever way is used, it must be communicated to all and be done consistently each time. The size of the designated storage area will have an impact on the method used. In a perfect world, the facility would have a large designated area and an abundance of rolling carts. As each parts order is received and checked in, it is placed on a cart and the cart is tagged with the RO number. The carts are then placed along the wall numerically. OK so it is nice to dream. I found that one fairly easy way is to have the storage area set up with bins and shelves, each labeled from 0 to 9. Based on the last number of the RO, the parts are then put in the corresponding bin or shelf. A file rack is located in the same area, also labeled 0 to 9. A copy of each parts order is placed in the corresponding file based on the last number of the RO. When a job is assigned, production will notify the parts department for parts delivery, retrieve the parts list from the parts room file, which will show which parts have been received. These parts will be pulled and delivered to the appropriate technician.
Any parts and supplies that are hazardous must be stored in a designated cabinet. All consumable supplies should also be kept in a cabinet and managed by parts personnel.

Parts Distribution
At the time the vehicle goes into production, the parts are to be distributed to the assigned technician. All parts should be inspected and reviewed at that time. Too often ,technicians will say they do not have time to check in parts, but really they do not have time to not check in parts. When checking in the parts, have the technician verify that they are correct and received without any damage. At this point, if wrong parts are identified or additional parts are needed, the production manager should be notified and a supplement inspection should take place. Each technician is responsible for the parts received and therefore should sign off on the parts list for those parts received. A copy of the signed parts list should be kept in the file as a permanent record.Inventory Control
There are consumables that are necessary to stock at the facility in order to ensure productivity. These parts should be under the control of the parts department. The amount stocked is determined by products used, volume and production processes. These products should not be overstocked. Determine stocking requirements, then maintain them at the needed level. The parts department should be responsible for the distribution of this inventory and keep track of what is distributed to whom and when. All consumable supplies for repair orders should be debited against a repair order or department. This will ensure profitability.Effective and consistent parts management is one of the most important improvements you can make in your facility. The facility’s parts process must be clearly documented and reviewed with all personnel that will affect it and are affected by the process. Each element of parts management is necessary for the overall flow of production. Having the correct parts at the correct time is necessary to ensure productivity and earn you greater parts gross profit. Parts management is a series of steps. Make sure that all employees are aware of the process and understand the benefit of each step. As with all processes, you must continuously monitor it and make the necessary changes to achieve your goal.