Auto Scrap News 1.5

Cash 4 Cars Cleveland is back with our 5th installment of our Auto Scrap News interview series. Before beginning we will outline what our business does.  Do you want to know how to sell a junk car? Are you trying to determine what is a junk car worth? Are you seeking a provider who buys crashed cars? We pay cash for cars throughout Cuyahoga, Lake and Geauga counties. Our junk car buyer is standing by to tell you what is a junk car worth (yours).  We are who buys damaged vehicles and who buys crashed cars.

Our topic today centers on Kent Rothwell of Weaver Automotive. Mr. Rothwell runs this operation, which is based in Carnesville, GA. We encourage you to visit their website at: http://www.weaverparts.com

What are some of the primary functions you handle in managing Weaver Auto?

• Key relationships-all relationships that are extremely important to running the company, for example important customers, top salesmen, and vendors.
• Vision- where are we going and how are we going to get there
• Culture/Values- unspoken and both communicated values of Weaver Automotive- keeping an eye on the culture and behaviors within the company when “No one is looking”.
• Systems of Accountability- what financial metrics are we using insure the performance of the company

What are some of the changes in the auto recycling industry recently that you have noticed

• There has been a huge increase in damaged bent credits from the body shop industry. This goes hand in hand with the fact that the insurance industry is requiring shops to use more and more used items in the repair process. Shops typically make less money on used components. So this is there way of improving their used component margins.

Is there any marketing initiative(s) that you have used lately that has been successful?

• We have flooded our North Carolina market with flyers and postcards, we have also implemented a plan for our sales managers to visit customers in their markets.

The trend of the “U-Pull-It” and “self-service” business model has become popular in the industry. Do you (or have you) used this model? Any positives or negatives that you see with it?

• Yes, we have used this model. One of the biggest positives of this model is the cash turn is much faster than the wholesale side. The negatives are that pretty much everything you know about the wholesale side won’t work on the self-service side. The Self-service industry is more about the metal than the inventory. The biggest key is understanding the difference in the models and managing accordingly.

The scrap prices have continued to fall in the US. What do you typically pay for older junk vehicles these days in your area of GA?

• On average, we pay approximately $250.00 for the older junk vehicles.

What do you anticipate happening with the steep drop in per ton steel scrap pricing?

• I expect it to go up slightly but no dramatic increase anytime soon. I don’t expect a dramatic increase until China’s economy is back on track. Historically speaking, scrap prices go hand in hand with oil prices and I don’t expect the oil prices to stay as low as they have been.

Obviously, the demand for late-model (2005+) vehicles is always strong. What ways do you obtain late model vehicles for component inventory?

• The majority of our vehicles we purchase for inventory come from the auctions, we do however try to buy vehicles from body shops that have good working items, these vehicles are typically a total loss and only have liability coverage.

How does Weaver Auto manage its large inventory of vehicles & components?

• We run total inventory shakedowns at least every 6 months. We walk the warehouses and verify all components.

I saw that you use eBay as sales channel. Has this worked out well?

• It has helped us sell “deeper” into vehicles. Our yards are mostly in rural areas so the retail traffic is minimal. By selling on EBAY it has enabled us to recoup some of those sales. We have been working on the EBAY business for approximately 10 years, there are high fees involved in selling on EBAY and the learning curve is steep. If we had wholesale yards located in more populated areas we probably would not have ventured into EBAY sales.

Your website stated you offered new aftermarket components. Are these items that you stock? If so, are there inventory challenges? Are there any quality or compatibility concerns with them

• We have gotten out of stocking the aftermarket components, we do sell them put primarily purchase them from Keystone if there is a need. There are however, quality issues with aftermarket components. I know that may be surprising considering that they are new components, but the credit rate on aftermarket components is very similar in numbers to used components.

I noticed that you are a member of Team PRP (Premium Recycled). What are the benefits that have resulted from this?

• Being a member of PRP has enabled us to be a part of a wonderful network of other automotive component recyclers. There is a high standard of quality that is mandated by PRP and that gives us the confidence to send these components to our customers. It also, makes our available inventory much deeper. With our trailering service we can typically order from our partners and receive the items within 2 days.

It looks like the business hours are Monday through Friday. Have you tried or considered having Saturday hours? Is there demand on Saturdays?

• We have tried working salespeople on Saturdays but we have found that there is not a big enough demand and it doesn’t justify the added costs.

We certainly appreciate the insight on the industry and specifically the opportunity to learn about how Weaver Automotive navigates within the industry!

Those attempting to determine how to sell a junk car should call us ASAP!  What is a junk car worth in Cleveland? Are you pondering who buys crashed cars in Cleveland. Look no further than Cash 4 Cars Cleveland, the area’s premier buyer of junk vehicles.