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Obsolescence in Auto Parts Inventory

What Is Obsolescence in Auto Parts Inventory?

Inventory obsolescence is when products in your stock are essentially no longer sought after for multiple reasons. This results in the product staying on your shelf with minimal hopes of being sold in the near future. When your auto parts reach the status of obsolescence due to their decline in value or market demand, you can be stuck with this stock taking up valuable space in your warehouse. Auto parts that have remained in stock between 7-12 months (or longer) are typically categorized as obsolete parts.

What Causes Obsolescence?

High parts obsolescence can be caused by:

  • High return rates due to order errors
  • Inventory errors
  • Special order parts that are never picked up
  • Stock auto parts for rare or less common vehicles
  • Over ordering and reaction management
  • Lack of knowledge of existing inventory

Strategies to Prevent Obsolescence in Your Auto Parts Inventory

Preventing an accumulation of obsolete parts starts with developing and improving processes. There are four main strategies that parts departments can use to their advantage.

  • Developing Better Processes for Special Order Parts: Put processes in place to secure payments and limit returns on special order parts. Build out reports and follow-up with customers.
  • Improving Consumer Communication: Define your return policies clearly and communicate them with customers. Follow-up with customers to ensure the right parts are ordered.
  • Improving Inventory Management: Know the age of your inventory. Determine what you need, what you don’t need, what you can send back to the manufacturer, and reduce reactive ordering.
  • Forecasting Obsolescence and Knowing When to Discount: Determine the lifecycle of parts and identify larger obsolete parts volumes to be set at lower, discounted prices when necessary.

Auto Parts 4 Less is a multi-vendor marketplace that hosts a number of sellers that provide a large selection of premium grade auto parts at discount prices from engine parts, exhaust systems, performance upgrades, brake parts, and so much more. We draw a large number of consumers with a larger number of interests. This is important when it comes to rare, uncommon, and aging parts because you are more likely to find the people who need your potentially "obsolete auto parts." 

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