Tradition vs. Technology  If a family-run small business survives long enough, the reality of generational transition must be faced and worked through. Since selling my facility in 2019, I have had the opportunity to work with hundreds of recyclers from all over the world - and I have seen a wide variety of effects of generational transition in almost every operation. I’ve seen patriarchs that have refused to ‘hand over the reins’.  I have also seen the incoming generation ‘drop the ball’ and cause the business to fail.  I could write for days about issues that exist in family-run businesses, but today’s article is going to be focussed on the adoption of technology during generational shifts.  The Automotive Recycling Industry has been a very lucrative segment of the overall automotive industry for well over a century.  It has not required a lot of education, ability, or technology in order to provide an acceptable income for many generations.  A strong wor...

Discouragement is the starvation of imagination. Does discouragement lead to a lack of imagination OR does the lack of imagination result in discouragement. Either way, we MUST remain imaginative during these times. Since its inception, the Automotive Recycling Industry has survived every economic downturn in the history of man. As a matter of fact, our industry actually grows during downturns in the economy. Once the Lockdown of 2020 ends, we will see an economy that will slowly return to normal - over a two year period. But, during that recovery period, people will be very hesitant to spend major amounts of money. We will see a prolonged dip in new car sales which will generate a major upswing in the utilization of Recycled Original Equipment (ROE) parts in the mechanical repair process. We are also hearing that insurance companies have concerns about the New OEM supply chain being affected for months and months following the Lockdown of 2020. They, the insurers, are now looking t...

With the global lock-down affecting everyone’s sales, we are all looking for ways to find sales dollars. We also all know that the Automotive Recycling Industry is counter-cyclical - when the economy is hurting, we do better. When the lock-downs are over and demand for ROE parts is increasing because of the recession, will you be ready to convert demand into sales? Many will truly excel in the coming months as demand rises and you are able to cash in on it. However, many facilities are not ‘connected’ correctly to capitalize on the opportunities that will exist. What do I mean by ‘connected’? Each customer type that we have uses a different method of finding our inventory. If you are not sharing your inventory so that it appears on the platform that potential customers are using, then you will not have the chance to sell your part. Many retail customers search online to find parts: eBay, Car-Part.com, Hollander Storefront, TradeMe, Etc. Body Shops using Estimate-Writing sof...

In 2020, we plan to do $17M in Gross Sales. In 2020, we plan to dismantle 2,000 vehicles. In 2020, we plan to turn a 14.7% Net Profit. Each of these are Outcome Goals. Outcome Goals are very hard to predict. You should be focusing on Input Goals, not Outcome Goals. What is the difference? We all know that in-stock sales are directly proportional to vehicle purchases. As a matter of fact, there is a known ratio between the two. For the average recycler, the Cost of Goods for In-Stock Sales is roughly 43%. This number could range from 40% to 50%, but we will use the average of 43% for this example. This is a facility that probably focuses on a 2012-2013 model year for its average year purchased. For this example, we will also assume that this facility is 50% In-Stock Sales, 40% Brokered Sales, and about 10% non-part revenue. So, if this site sets a goal of $17M in Gross Sales for 2020, that would mean that In-Stock sales would need to be $8.5M, which is 50% of the $17M Goal. Stay...

Service Creates Loyalty Is there a such thing as loyalty these days? Are the customers simply shopping for price? Does our level of service influence the chances that a customer will order another part from us? I believe it does! It takes years to build a reputation with a customer, yet it can be lost in a matter of a few interactions, if not sooner. We all know this statement is true, yet we don’t train our people to think this way. Let me explain how two interactions with a new car dealership service department caused us trade our car in for a car from a different manufacturer. In 2018, we bought a new Volvo XC60 for my wife to drive. We loved the car. It performed well, it had lots of cool technology. We actually decided that it was a better car than the 2017 Mercedes GLC300 that we traded in to buy it. After zero issues for the first 10,000 miles, it was time for a free oil change. My wife attempted to schedule the oil change only to learn that there were no technicians on du...

Frequency, Reach, & Yield How have you worked to increase your gross sales in the past? Have you sent out mailers? Hired an outside sales rep? Made cold calls? Shared your data through a third-party? I stumbled across a simple idea a few years ago that changed the way I focus on increasing gross sales. Before I get ahead of myself, let me backup and explain another truth I live by: You can’t improve what you don’t measure. By measuring anything, you focus on it and start working to influence it. An example of this would be weighing yourself every morning when you get out of bed. By making a simple, mental note of your weight, you modify what you eat and how much you exercise on that one day. If you weigh on a daily basis, you will probably be working to lose weight or, at least, maintain your existing weight. By measuring it and knowing where you stand, you empower yourself to make minor adjustments on a daily basis that allow you to eventually reach your goal. My goal is 175 l...