August 2005

Over the past decade, the salvage industry has worked hard to overcome some perception issues.  In addition, customer service, delivery times, quality, and accountability needed to be addressed.  The summation of these things showed an industry that was working against itself in our efforts to increase sales and part usage rates.  We found that if we did not make ourselves easier to deal with, used parts would not be part of the repair process.

While these problems were universal in the industry, there were many schools of thought as to how to fix the situation.  Quality platforms were defined, standards for performance written, audit trails and accountability were introduced.  Most of the ideas for these things came from recyclers and the programs became compilations of these ideas.  A number of these ideas were generated by networking at various industry events. 

This line of thinking, along with some other reasons, brought pier groups in vogue.  A pier group is made up of fellow recyclers of the same size and general business philosophy.  The group gives feedback to the host facility that helps pinpoint areas that need improvement.  At the same time, each attendee is learning by looking at a business similar to theirs and the various ways they go about accomplishing the same tasks.  These meetings also presented the chance to train people on customer service, quality, and performance. 

Cont......

With better performance beginning to show, the next step was to bring in an outside auditor to inspect for compliance on the above mentioned items.  The auditor is familiar with the salvage industry but does not have a vested interest in the passing or failing of the annual audit.   The auditor checks for procedural adherence, proper tracking, problem solving, and problem prevention.  Interviews are conducted with employees to make sure they have a complete understanding of the expectations and details of the various procedures required in performing their duties.
 
All of these programs are designed to allow the recycler to deliver a quality product in a timely fashion.  The uniformity of these programs allows recyclers to trade with one another, knowing that the customer will still be receiving that same high quality part.  The repair facility benefits by receiving high quality used parts in a timely fashion.  The insurance industry benefits by increasing the used part usage rate which minimizes claim severity.
 
The next few years will continue to bring change.  The salvage industry is going to have to start spending more time on non-traditional ideas and processes.  The smaller repairs are becoming more time sensitive and many shops are looking for same day delivery to expedite the repair.  Many recyclers are contracting deliveries out in order to speed the service.  Courier services are being used to deliver hot shot orders and part discounts are being given if the repair facility wants to pick up their parts.
 
Other challenges such as inventory availability, part cleanliness, proper part descriptions, and electronic part search accuracy will all be areas that are going to continue to be improved upon.  We will be inviting more people involved in the repair process to visit our facilities and offer their views on the recycling process.  Bringing these people in to serve as advisors will offer more non-traditional thoughts that will help evolve the salvage and recycling process into a larger piece of the repair process without hindering that same process.