How to Optimize Your Fleet’s Parts Inventory

By Mary Gerard, Content Marketing Manager

An organized fleet operation and parts management program starts with keeping the right types of parts in stock. Keeping the most used parts on your shelves allows technicians to complete jobs quickly and reduce downtime. Eliminating obsolete parts can clear much-needed space out of your parts room and your inventory. 

This will save you time and money. 

To optimize your fleet operation’s parts inventory, follow these steps:

Assess Your Parts Inventory and Parts Rooms

The first step you should take is to assess your current parts inventory. Once you determine what you have, then you can organize the parts. You can categorize them based on their criticality, frequency of use, and lead time for procurement. In doing this, you should identify obsolete or excess parts that can be removed from inventory to reduce costs. If you’re still stocking parts for vehicles you no longer have, you’re wasting time and money.

Use a Fleet Management System (FMIS)

Using an FMIS can help streamline inventory management by automating processes such as making parts inventory easier by integrating with barcoding tools, allowing you to set up automatic reordering, and giving you access to reports. This provides visibility into inventory levels and helps prevent stockouts or overstocking.

Set Up Accurate Forecasting

Pull data from your fleet management solution to determine how often each part is used. This will help you anticipate the parts you’ll need and avoid emergency purchases or stockouts. When forecasting, you should consider factors like seasonality, equipment lifecycle, and fleet utilization patterns to ensure you have the right parts in stock. This will save you money by only stocking the parts you need and will reduce vehicle downtime by ensuring the parts needed for repairs are in stock.

Case Study: Buckeye Valley Fire Department

Establish Minimum and Maximum Stock Levels

Determine optimal inventory levels for each part. Then, set minimum stock levels to trigger reordering and maximum stock levels to prevent excessive inventory buildup. You should regularly review and adjust these levels to align with changing demands.

Build Strong Supplier Relationships

Building strong relationships with reliable suppliers who offer competitive pricing, timely delivery, and quality parts can keep your parts management program running efficiently. To save money, you can negotiate volume discounts.

Implement Just-in-Time (JIT) Inventory Practices

JIT involves maintaining minimal inventory levels by ordering parts only when needed. This reduces carrying costs and storage requirements. However, you must ensure you have contingency plans or access to alternative sources in case of unexpected delays or disruptions. Not having the parts in stock when you need them can result in higher costs to obtain the parts – and shipping – and can increase the vehicle’s downtime.

Use Centralized Inventory Management

Consolidate your inventory into a centralized location or a system like a fleet management software solution, to improve visibility and reduce duplication. This allows for better control, reduces the risk of stockouts, and enables easier tracking and management.

Regularly Review and Optimize Stock

Conduct routine inventory audits to identify slow-moving or obsolete parts. Consider selling or returning these items to free up space and capital. Additionally, regularly review part usage data, repair trends, and industry updates to adjust your inventory strategy accordingly.

Train Your Staff

Ensure your staff (especially your parts room staff) understands the importance of keeping an accurate parts inventory. Provide training on inventory control processes and re-ordering procedures. 

Employ a Dedicated Parts Room Staff

Assigning a designated parts room staff can increase the efficiency of your parts management program, allowing these staff members to become familiar with where parts are located, when to reorder them, which suppliers to use, and more.  

Monitor and Analyze Performance

Continuously monitor and measure key inventory performance indicators such as stock turnover rate, fill rate, and carrying costs. Analyze this data to identify areas for improvement, cost-saving opportunities, and potential process bottlenecks.

By following these steps, you can improve your parts inventory processes, and make your parts management program more effective. This will reduce time and provide cost savings. 

RTA offers the industry’s best parts inventory module. Learn why it’s the best – and see it for yourself – when you schedule a demo!