Starting the new year with a clear strategy for parts inventory is one of the most effective ways to improve profitability, reduce waste, and keep your service department running smoothly. Use this 2026 Parts Inventory Optimization Checklist to review your processes, identify gaps, and implement best practices for the year ahead.

At Pro Count West, we specialize in helping dealerships track, manage, and optimize parts inventory to save time and money while improving service levels.

1. Review Last Year’s Inventory Performance

▢ Analyze turnover rates for all parts categories
▢ Identify slow-moving, obsolete, or discontinued items
▢ Flag items with frequent stockouts or overstock issues
▢ Calculate carrying costs and shrinkage losses

2. Conduct a Physical Count & Reconciliation

▢ Schedule a full year-end count (or cycle counts for high-value items)
▢ Reconcile on-hand stock with your inventory management system
▢ Investigate discrepancies immediately
▢ Implement a regular counting schedule for 2026

3. Update Stocking Levels & Reorder Points

▢ Review minimum and maximum stock levels for each part
▢ Adjust reorder points based on seasonal demand and usage trends
▢ Automate reorders for high-turn items where possible
▢ Factor supplier lead times into stocking strategy

4. Forecast Parts Demand for 2026

▢ Review historical parts usage by vehicle model, type, and season
▢ Collaborate with service advisors to anticipate service trends
▢ Account for new model releases, recalls, or promotions
▢ Identify potential gaps and plan inventory accordingly

5. Monitor Key Inventory KPIs

▢ Track inventory turnover rates regularly
▢ Monitor stock aging and highlight slow movers
▢ Calculate fill rates for service department requests
▢ Review carrying costs vs. profitability per part category

6. Optimize Storage & Organization

▢ Group parts logically (by vehicle model, frequency of use, or supplier)
▢ Implement barcodes or RFID for accurate tracking
▢ Use vertical or modular storage to maximize space
▢ Ensure proper handling and storage to prevent damage

7. Evaluate Supplier Performance

▢ Review lead times, reliability, and pricing for all vendors
▢ Consolidate suppliers where it improves efficiency or reduces cost
▢ Negotiate contracts or terms to optimize cash flow
▢ Keep an approved supplier list up to date

8. Review Software & Systems

▢ Ensure your DMS or parts management system is up to date
▢ Confirm integration between service, parts, and accounting systems
▢ Train staff on using the system efficiently
▢ Consider upgrades or automation tools to improve accuracy

9. Plan for Continuous Improvement

▢ Schedule quarterly inventory audits and process reviews
▢ Track improvements in turn rate, fill rate, and carrying costs
▢ Adjust stocking strategies based on KPI insights
▢ Foster a culture of accountability in the parts department

10. Partner with Inventory Experts

▢ Consider professional inventory services for audits and optimization
▢ Leverage external expertise to reduce errors and free up staff time
▢ Use expert insights to implement best practices and maximize profitability

Start 2026 Strong with Optimized Parts Inventory

A well-organized and accurately managed parts inventory is critical for the profitability and efficiency of any dealership’s service department. By following this checklist, you can reduce waste, improve service levels, and make smarter stocking decisions throughout 2026.

Pro Count West helps dealerships count, reconcile, and optimize parts inventory, giving you accurate data and actionable insights to run a more profitable service department.

Take the first step today: Schedule a consultation and let us help you start the year with the right parts in the right place at the right time.