Cat Logic

I’m sure that many of you have already heard this story - especially the yards that I have been consulting since I sold my yard back in 2019.  But, I’d like to share it as an article so others can gain some knowledge from my experiences related to selling catalytic converters.


When my brother and I bought our yard from our dad back in 2008, we ‘inherited’ a relationship with an older fella that would come by on the first of each month and buy our cats.  We had used him for roughly 10 years at that time, and we felt confident that he was paying us top dollar for our cats.  After all, he was a nice guy and seemed to be just scraping by.  In my mind that meant that he was not making much profit off of our cats.  


Somewhere around 2009, he showed up to pick up our cats in a brand-new Dodge Crewcab Dually 4WD that was nicer than anything I had ever owned. The presence of this new truck told me that he is making good money off of our cats, and it got me thinking about ‘testing the waters’ to see if we were leaving money on the table by selling to him.  I asked him not to come back next month and put effort into finding a competing cat buyer to give us an offer.  At the time, all I had to go on was the average price per cat - and I was looking for a higher average price.  


The next month, we had two buyers show up at the same time and gave competing bids for our cats.  We got a higher offer and sold them for more than we had ever sold them for in the past. After that, I learned that the two of them had worked together to get the price where they wanted it to be (enough to make me think I was getting a good deal).  However, money had changed hands between the two of them.  I, again, had been cheated.  


I decided we needed more competing companies to give an offer for my cats.  I decided to hold off on selling them for about 60 days so we could stockpile about 1,000 cats.  I then invited 7 competing cat companies to come in and give competing offers - all at the same time.  We laid out all 1,000 cats on the floor in one of the warehouses and allowed each buyer to look over the cats from 7AM to 12 Noon and turn sealed bids in at 12 Noon.  We opened the bids and planned to award the cats to the highest bidder.  However, two guys were still there - waiting to hear who won the lot.  The two of them started bidding against each other to get the cats.  It was like a live Copart auction used to be where each bid was $1,000 higher than the previous.  We ended up selling the cats for about $5,000 over the highest sealed bid.  I told myself that this was the way to go and I planned to start this method of selling them going forward.  However, when I called all 7 of the companies that had come out the first time - to tell them about the next cat auction date, most of them told me they would not be coming because it was a waste of time for them.  Now, I’m in a dilemma - I found a way to get more for my cats, but the buyers are not willing to compete to get them.


I remembered meeting Becky Berube with United Catalyst Corporation at a prior show, so I reached out to her to sell my load on assay.  During our first conversation, I learned more about cats that I had ever known.  I learned about PPMs (Part Per Million). I learned about moisture content. I learned about average weight per cat, etc.  I decided to ship my 1,000 cats to her.  I was nervous because I was going to have to trust her to pay me instead of taking payment at the time they were picked up, but I went ahead and shipped her a load of 8 boxes of cats. It took about 2 days for the shipment to arrive at her door and about 5 days for her to decan and analyze my load.  About a week after shipping the load to her, she paid me 80% of what the estimated value of the cats was.  And that 80% was MORE than I had ever gotten for my cats in the past - on average per cat.  About 30 days later, she transferred the remaining 20% to me.  I had found the answer to my dilemma - and had found a new method to sell my cats.  


However, I am never happy to just settle on one company.  I decided that I needed to ‘test the waters’ again.  This time it was going to be amongst companies that provided assay services for cats.  So, for the next 12-18 months, I shipped my cats to several companies that would process my cats on assay.  I tried many of them - and I tracked their performance.  Being the analytical type, I tracked lots of data points: PPMs, Moisture Content, Average Weight per cat (de-canned), ratios among elements (PT, PD, RH), Lease Rates, Days to Pay, Payment Terms, Metal Return Rates, current Spot Prices for each element, etc.  I tracked everything I could track - and compared each of the providers with each other in an attempt to find the best company to handle my cats.  I found many discrepancies:

  1. One said my moisture content was 9% when I knew it should be around 2% from all the others’ data

  2. One said my average weight per de-canned cat was 10% less than what all the others had reported

  3. One said my PPMs was about 10% lower than what the others has reported - when I knew the quality of the cats had remained about the same

  4. One used an estimate of the dust that was collected from the de-canning process because all the dust was consolidated during the de-canning process


After the 12-18 months of testing everyone that I could test, I called Becky back at UCC and explained to her what I had been doing.  I explained to her that I had determined that UCC had proven to be the most honest and provided the highest returns.  I had found the company that I trusted to handle my cats.  From that date until the day that I sold my yard, I shipped my cats to UCC - and still recommend them today.


The take-away: you need to trust who you send your cats to.  Are they providing assay results that are independently verified?  Are they capturing all of your dust and adding it to your load or are they simply using a formula for estimated dust? Are your samples being diluted to reduce your PPMs?  Is 100% of your load being accounted for? What is your true moisture content? Is your provider making points off your lease rate? 


Chad Counselman

Wise Counsel Group, LLC

Chad@WiseCounselGroup.com
Location: Knoxville, TN, USA

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