Dealer Parts Trader

If you are like most dealers, you have some idle parts inventory. Parts are typcially considered idle when they have not been sold in the last 12 months. Industry statistics suggest that if a part has been sitting on your shelf for 12 months, you only have a 15 % chance of ever selling it.

Parts Inventory can become idle in many ways.

Perhaps, you inherited the mess that you have now. Employee turnover and poor management are leading contributors to idle parts inventory.
The manufacturers have done their part as well. They are constantly changing part numbers and are lowering return reserves or excluding parts that can be returned.
Your DMS can even contribute to the problem if it is not configured correctly or you have not been properly trained on how to use it. Do you use your suggested order report ? Is it helping you or is it part of the problem ?
Maybe you have done a decent job of managing your parts department, but the changing market conditions have you guessing about which parts to keep in stock.

Regardless of what caused your problem, using the Dealer Parts Trader Power Brokering Tool can help get you back on track and recover some cash flow at the same time.

Let's say that you have $ 10,000.00 of money to invest and you take it to a broker. At the end of a year, you go back to the broker and ask for the good news about how much return you made on your investment. The broker tells you that you made nothing. You would probably immediately take that money and move it someplace else and let someone else manage it.

How about an example a little closer to home. Lets say that you had 3 or 4 used cars that had been on your lot for the last 12 months. If you needed some cash flow, you would take them to the auction and get rid of them even if you had to take a loss.

Most parts departments can turn their inventory four or more times per year while making a gross profit of at least 25 % or more. Why would you want to tie up your cash flow on assets or parts that are not making you any money ?

Dealer Parts Trader has a network of buyers that are interested in puchasing your idle parts inventory. The process begins with a DPT staff member helping you extract your list of idle parts out of your computer system in an electronic format. The list of your parts is then imported into our Power Brokering Tool to determine how much opportunity you have for selling parts. It is typical for DPT to be able to sell 35 - 50 % of the parts that you have available. There is no charge to you for the evaluation process. If you choose to sell your parts, it begins a 4 stage process that we call an offer. You will be issued a user name and a password to login to our website.

In stage 1, you will be presented, on screen, with the list of parts that the first buyer would consider purchasing. At this stage, you can print a report out and do a quick bin check to make sure that the parts are available and in wholesale condition. ( A typical offer has 25 -100 parts ). If the part is not in an OEM box or the box is damaged or has writing on it, you can make a note to the buyer to let them know. You can make a note for each part line item. Once you have reviewed the list of parts, you can update the quantities to only include the parts that you really want to sell. This process should take you no more than 30 minutes. When you have finished updating the parts, you click on the accept button and an e-mail is sent to the buyer letting him know an offer is avaible for them to review. This step should be completed in 2-3 business days from the time the offer is created.

In stage 2, the buyer logs in to the DPT website and reviews the list of parts. Buyers are making a purchase decision on each line item based on their current quantity on hand. Most buyers will purchase between 50 % - 80 % of the offer. When the buyer has selected the parts that they will purchase, they will update the qty's on the screen and hit the accept button. An e-mail is sent to the seller to inform them that the buyer has accepted the offer. Buyers usually will approve an offer in 1-2 days after being notified by e-mail.

In stage 3, the seller can now see the name and location of the buyer. The seller can call the buyer and get a purchase order if necessary. The seller boxes the parts up and sends them to the buyer. If parts on the list are not shipped for some reason, the seller can update the qty on the screen. Once the seller boxes the parts up, the seller makes an invoice out to the buyer and accepts the offer in the DPT system. When the offer is accepted, it moves into stage 4 waiting for the buyer to receive and acknowlege the parts are in good condition. An e-mail is sent to the buyer when the offer moves into stage 4. Sellers should plan to ship parts to the buyer in 3-5 business days after the offer is accepted in stage 2.

In stage 4, the buyer receives the parts in and inspects them. Using the invoice provided by the seller, the buyer notes discrepancies and contacts the seller to resolve these. Once the final amount is determined, the seller is mailed a check from the buyer.

The process starts all over again with the next buyer until the seller has either sold all of the parts that they want to sell or when DPT can no longer provide any other opportunity.

The going rate for selling idle parts inventory is 50 cents on the dollar with the average commission amount ranging from 5 - 7 %. The effective net amount is 43 - 45 cents on the dollar.

We try to make it easy on you and us. Rather than us having to send you an invoice, we ask you to just sell your parts at 45 cents on the dollar. You are essentially paying us a 5 % commission, but we are collecting it directly from the buyer in the form of a discount. It is far easier for us to only have to invoice 50 buyers every month than it is to invoice 500 sellers.

As a seller you are also responsible for paying the freight to get the parts to the buyer. On your first and second opportunities, we typically will create offers for you that are in your same region of the country to minimize shipping costs.

All of this information is summarized in our simple one page service summary agreement.