Tracking and Managing Cores
Over his 35 years in the auto industry, Aris Aponte has never once been called into his boss’s office and scolded about a financial oversight. Aponte, currently the parts director at World Toyota in Atlanta, knows his job security and his employer’s bottom line aren’t completely unrelated.
He never loses sight of that. That’s why, when it comes to tracking and managing cores in his parts department, Aponte is vigilant, returning remanufactured parts, like starters or alternators, to suppliers as fast as possible.
“When you have a dirty core, what are you holding it for? There’s not one benefit,” he says. “That’s big money … and money that’s not recuperable if you don’t stay on top of it."
“It’s my dealer’s money,” Aponte adds. “I don’t want to tie up their money, because we can use it for something else.”
Of course, not every dealership employee readily understands how costly unreturned cores can become. That was certainly the case when Aponte first arrived at World Toyota and Scion a decade ago.
Turning a Blind Eye
Over the years, Aponte has developed a reputation for being hired by dealerships to fix their parts department’s financial slip-ups. Often, the parts director has found that poor management of cores was holding a facility back.
“For the many years that I’ve been in the business,” Aponte notes, “what I’ve seen is, when I go take over a store, the managers don’t manage the cores properly.”
More often than not, back counter employees get lackadaisical, letting cores pile up. Sometimes, there’s poor communication between the parts department and technicians. Or—as was the case at World Toyota and Scion in 2008—virtually every employee seemingly turned a blind eye toward tracking and managing cores.
A decade ago, “nobody was keeping a watch out” with regard to returning cores, Aponte explains. Employees in the parts department were certainly holding onto cores too long, and were holding up the owner’s money as a result.
A few employees had “a story” for Aponte to explain the slow return of cores. But, he found those justifications to be little more than excuses. And, he views such excuses as inexcusable.
Aponte discovered long ago that simply returning cores once per month—or even once per week—becomes problematic over time, because the remanufactured parts start to pile up quickly. Fortunately, his industry experience helped him diagnose World Toyota and Scion’s issue with cores rather quickly.
Seeing the Light
Upon arrival in Atlanta, Aponte quickly implemented his preferred process for returning cores by holding several meetings and clearly explaining procedures to staffers. The results, he says, were virtually immediate.
“The way I manage cores, it’s very simple,” he explains. “If you sell it over the counter, you’re charging a core. If you sell it (to) a wholesale customer, you’re gonna charge them a core—you will pay a core, no exceptions.”
Aponte’s preferred process for managing cores works as follows:
- Parts department employees deliver parts that have core values to internal sales, and make sure to take the box for the part with them.
- After giving said part to, say, a technician, parts department staffers set the parts box on the floor, and write down the RO number. That way, if a part isn’t returned to the parts department by the end of a workday, it’s fairly easy to find which employee or department has it.
- The parts manager or director submits any necessary request and prints a packing label, and makes sure the box leaves the facility within at least one day.
- The parts manager/director holds on to all packing slips, keeping them in a folder.
“There’s not a core that stays here more than overnight. … I usually ship them the same day they come in,” Aponte notes. “I just write the part number, go back to my terminal, and print the label—that simple.
“Once I print that UPS packing label, I just email them and say, ‘Where’s my credit?”
The Present Outlook
Aponte estimates that, in the past, World Toyota and Scion got credit for roughly 30 percent of its cores. Now, they return 100 percent of such parts. Inventory in Aponte’s parts department has increased from around $600,000 to $820,000 during his time in Atlanta.
“The inventory before was like a two-month supply and now we’ve got it to 18 days,” Aponte explains. “We’re turning it faster.”
Nowadays, the parts department at World Toyota and Scion does $1.5 million in revenue per month. Aponte’s reputation for turning around dealership parts facilities remains intact.
Dealership owners “trust me and empower me with somebody else’s money; I’ve got to treat that with respect,” Aponte says. “One hand washes the other. If you trust me with something, I’d better keep that trust, deserve that trust, and gain that trust. So I’d better give it all I’ve got.”