Parts Department Growth
Wholesale vs. Online: Which Will Make Your Parts Department More Money?
You want more parts sales. Great. Who doesn't?
But where, exactly, are those extra sales supposed to come from?
There are a few ways to grow your parts business. But each comes with different costs, challenges, and opportunities.
The real question is which one is going to make you the most money? Let's look at your options and what it actually takes to make them profitable.
Wholesale
Local and regional · Net 30/60/90
Online
Nationwide · Paid at checkout
Your options
First, there are really only three ways to grow parts sales.
Service Drive · More repair orders
The Service Drive: Good Business, Limited Control.
Your service department keeps parts moving. Customer-pay, warranty, internal repairs. It's the foundation of your business.
But you can't magically create another hundred repair orders just because your sales goal went up. Your growth depends on how much work comes through the service drive.
Wholesale · More local accounts
Wholesale: More Control, More Moving Parts.
Wholesale lets you grow beyond the service lane by selling to repair shops and collision centers. And it can generate serious volume.
The catch? Growing wholesale often means more trucks, drivers, delivery routes, receivables, and returns. More sales, but more costs and risk, too.
eCommerce · More buyers beyond your market
Online Parts Sales: A Much Bigger Customer Pool.
Selling online opens your parts department to buyers nationwide, not just customers within driving distance.
Someone three states away needs an OEM part. You've got it. They order, you ship, and you've got a sale you probably wouldn't have earned otherwise.
The question isn't which channel is better. It's which one can generate more profitable growth for your department.
Recommended episode
[Episode title — Nick Burch]
The real cost of wholesale
Let's talk about what it really costs to grow wholesale.
Wholesale can be a great business. But anybody who's run it knows the sales number is only part of the story.
The Cost of Adding Another Wholesale Route
Truck
$600–$1,200/mo
Lease or financed purchase
Driver
$3,500–$5,000/mo
Wages and employer labor costs
Insurance
$150–$400/mo
Commercial vehicle coverage
Operating Costs
$400–$900/mo
Fuel, maintenance, repairs
Estimated monthly cost
$4,650–$7,500
That's approximately $55,800–$90,000 per year, before account acquisition, returns, receivables, and additional overhead.
That delivery truck doesn't pay for itself.
Expanding into another wholesale territory? You'll likely need a truck, driver, insurance, fuel, and maintenance.
And those costs don't disappear when orders slow down.
If your existing routes have room, great. But adding a new route means generating enough gross profit to cover the added expense.
Buying the truck is the easy part. Keeping it profitable is the challenge.
“I spent $1,400 per van to have it vinyl wrapped. Plus my driver's all wanted UV protected window tint. That was another $200 per van depending on how many windows.”
Anthony Blubello
Former BMW Parts Manager
Then there's the money you haven't collected yet.
Wholesale accounts often run on Net 30, 60, or even 90-day terms.
That's business as usual. But it also means you're paying to stock and deliver parts long before the money hits your account.
“I had a repair shop owner once get up to $50k and over 120 days. He was my biggest mechanic account, but he never paid on time. We ended up cutting him off.”
Anthony Blubello
Former BMW Parts Manager
Illustrative wholesale order
Parts sold to a repair shop
$4,000
Net 60Example only. Actual payment terms and collection timing vary.
You've already paid to stock or source the parts. You've paid to deliver them. Your team has done the work.
But the cash may not arrive for another two months. And if the customer pays late, you're waiting even longer.
More wholesale sales can mean more accounts receivable. That's not necessarily bad. But it needs to be part of the growth calculation.
And collision returns? Those can be a real treat.
A body shop orders $6,000 worth of parts for a collision repair.
You fill the order. You deliver the parts. Everything looks good. Then months go by… And here come the returns.
The $6,000 collision return scenario
Order fulfilled
The body shop receives $6,000 in parts.
Business as usual
The original sale is long out of mind.
Surprise
$6,000 in returned parts may be coming back onto your shelves.
Now what?
You're processing the return, dealing with credits, and figuring out whether those parts will sell again. Depending on return eligibility, some may be difficult to send back to the manufacturer.
Oh, and you still have to win the accounts.
Let's say there's already a big wholesale dealer in your market. They've got the trucks, the relationships, and repair shops that know their drivers by name.
Winning those accounts takes competitive pricing, reliable delivery, and time.
Wholesale can be great business. Just make sure you're accounting for the full cost of winning and keeping those customers.
Adding another truck doesn't automatically mean another truckload of orders.
Selling online
Now, what changes when you sell parts online?
Quite a bit, actually.
Your market gets a whole lot bigger.
Instead of competing for the same local repair shops, you can reach parts buyers nationwide. More potential customers, without expanding your delivery territory. Think volume sales on steroids.
You don't need another delivery truck.
No new routes, drivers, or commercial vehicle insurance. You ship orders through parcel carriers instead. Shipping still costs money, but you're not taking on the same fixed expenses.
You get paid upfront.
Online customers pay at checkout. No waiting 30, 60, or 90 days to collect. That's a nice change if you've ever chased wholesale receivables.
You can make money on shipping, too.
With competitive carrier rates and smart shipping prices, you can earn additional profit on shipping instead of treating it as just another expense.
You still have to earn the sale.
A webstore alone won't bring in orders. You need competitive pricing, reliable fulfillment, marketing and good customer service. Sound familiar? You already know how to do most of that.
Side by side
Wholesale vs. Online: Put the economics side by side.
| Factor | Wholesale | Online |
|---|---|---|
| Customer reach | Local and regional | Nationwide |
| Growth investment | $4,650–7,500/month for an additional truck, driver, insurance, fuel, and maintenance | $1,000–3,000/month for platform, marketing, and basic operating expenses, plus variable fulfillment costs |
| Delivery | Local drivers and vehicles | Parcel carriers (with preferred rates) |
| Payment | 30/60/90-day terms | Paid at checkout |
| Competition | Established local wholesale dealers | Online retailers and aftermarket brands |
| Returns | Unexpected collision returns, sometimes months after the sale | Typically shorter return windows, with more control over return policies |
| Delivery damage | Dealership is responsible for damage during local delivery | Carrier coverage or shipping protection helps cover damage during shipping |
| Key growth challenge | Winning local accounts and expanding delivery coverage | Reaching nationwide buyers and converting demand into sales |
| Profit model | 10–20%Volume-driven gross profit | 10–20%Volume-driven gross profit |
"But online margins are lower."
Yep. They often are.
You know what else can have lower margins than retail counter sales? Wholesale.
And yet plenty of dealerships work hard to grow their wholesale business. Why?
Because gross profit dollars pay the bills. Margin percentage alone doesn't.
Run the numbers
Wholesale or online: Which Puts More Money in Your Pocket?
Before you invest in another truck or delivery route, run the numbers. See how much gross profit you could keep selling the same volume of parts through wholesale versus online.