Taking Stock: Holding the Right Parts, the Most Effective Way

“What should I hold in stock?”

I’ve lost count of how many times I’ve been asked this question over the last 20 years. It’s a simple query that opens the door to a much larger conversation about strategy, customer needs, and the commercial realities of the automotive aftermarket. And yet, it remains one of the most important decisions any motor factor or distributor will face.

Most factors and distributors strive to hold a wide enough variety of stock to cover the vast array of vehicles on the road today. This means covering essential emissions products such as Exhausts (EXH), Catalytic Converters (CATs), and Diesel Particulate Filters (DPFs). These products are critical to completing a comprehensive offering to customers. However, they come with their own unique set of challenges.  Emissions products are often large, heavy, awkward to handle, and not exactly the most attractive items on the shelf. Let’s face it—no one is going to put a DPF on display for its good looks. Despite their higher price point, emissions products tend to account for a smaller percentage of overall turnover when compared to faster-moving parts like filters, brake pads, or spark plugs. That makes them a bit of a conundrum: important to have, yet not always the easiest to justify in bulk.

On the other hand, service items and braking components are typically easier to store, quicker to sell, and come in stackable, uniform boxes. They fly off the shelves in higher volumes and contribute significantly to a factor’s cash flow. From a purely logistical standpoint, it’s much more convenient to fill a warehouse with boxes of oil filters than it is to dedicate racks of shelving to variously shaped exhausts.

 The Space-Time-Cost Triangle

Warehouse space is finite, and the more emissions stock you hold, the less room you have for high-turnover items. This balancing act is the foundation of good stock management. Get it right, and you’ll have what your customers need when they need it. Get it wrong, and you risk tying up capital in slow-moving stock while missing out on faster sales elsewhere.

So, how do you decide what to hold?

At EEC, we’ve spent years fine-tuning this process. We use a combination of car parc data, historical sales patterns, and national Pareto performance to make informed recommendations to our customers. This data-led approach ensures that the parts chosen are not just popular nationwide, but also relevant to the specific area and customer base a factor serves.  One rule of thumb that remains consistent in the UK is the traditional 3:1 ratio of EXH to CAT and DPF sales. This serves as a good starting point for building an emissions inventory. But what’s more important is understanding how customer demand has changed over time. In recent years, we’ve seen the Pareto curve—the 80/20 rule—become even more pronounced in the emissions sector. A handful of part numbers are now responsible for a much larger portion of total sales.

Whereas in the past some factors would carry 3,000+ exhaust SKUs to cover over 90% of the car parc, today that same level of coverage can often be achieved with just a few hundred part numbers. In some highly targeted setups, customers are successfully operating with only a few dozen core SKUs and still achieving consistent turnover. In addition, the advent of same day suppliers also made this easier as they offer a distress purchase, often across the country. Although a premium is paid for this service it allows factors to reduce their stock holding, however, they can sometimes be relied on too much, affecting margin.

 Stocking Is Only the Beginning

Getting the right stock in the right place is step one. But having it sit on a shelf collecting dust defeats the point. At EEC, we believe that active stock management is just as important as initial profiling. We work closely with our customers to monitor stock performance and ensure that what goes in also goes out.

After a reasonable settling period—usually a few months—we’ll review the customer’s sales data alongside updated car parc insights and national Pareto shifts. If something hasn’t moved, we ask why. Has demand shifted? Is the part still relevant? If not, we pull out non-movers and replace them with newer high-demand parts. This reprofiling process keeps the stock lean, relevant, and profitable.

Here are some practical ways that stockists can enhance their inventory control:

Invest in Stock Analysis Tools

Use software that provides real-time data on:

• Stock turns (how often each item is sold)
• Demand forecasting
• Identification of dead stock

Regular analysis helps spot trends early, avoid over-ordering, and keep working capital optimised.

 Just-In-Time (JIT) for Low-Turn Items

For parts that rarely move but still have value, consider a JIT approach:

• Only bring them in when there’s a confirmed need
• Use local or national suppliers who can provide fast turnaround

This frees up cash and warehouse space for more profitable lines.

 Bundle Kits to Increase Value

Instead of selling parts individually, bundle them:

• Fit kits including sensors, gaskets, clamps, and link pipes
• All-in-one solutions that save garages time and improve the first-time fix rate

These kits offer upsell opportunities and improve customer satisfaction.

 Establish Clear Return Processes

Returns are a fact of life in the parts world, especially with emissions products. Make sure:

• Staff are trained on what can be returned and how
• Paperwork is streamlined
• Credits are issued quickly to keep customer goodwill

Efficient returns management reduces write-offs and improves cash flow.

 Understand Seasonal Trends

Certain parts may peak in demand based on:

• MOT seasonality
• Winter and summer driving patterns
• New legislation affecting older vehicle emissions

Stay ahead of these shifts and stock accordingly.

Looking Ahead: EVs and the Future of Emissions

With the industry talking more and more about electrification, you might be tempted to hold less emissions products. But while EVs are growing, petrol and diesel cars still dominate the road. According to recent data, the majority of UK vehicles remain internal combustion engine-based, meaning the demand for CATs, DPFs, and exhausts is going nowhere—at least for the foreseeable future.  In fact, as these vehicles age, the demand for replacement emissions products could even increase in the short to medium term. Well-managed stock in this area will continue to deliver strong returns.

In Conclusion Stocking emissions parts doesn’t have to be difficult or overwhelming. With the right strategy, data, and support, it can be a reliable source of both turnover and profit. The key lies in understanding your customer base, tracking what’s working, and being willing to adapt when it isn’t.

At EEC, we’re committed to helping our customers hold the right parts, in the right quantities, at the right time. When done well, emissions stock can become a key component of a successful, modern factor offering—even in an industry evolving towards electric.

Written by Ben Kendrick – EEC’s UK Sales Manager