The secret to beating your
the odds are in your favor!
I’ve just returned from speaking at the Saskatchewan
Recycler Conference, where it was cold! It was four degrees below
zero. (Ok, it was Centigrade!) They were gracious hosts, and most
of the Canadian recyclers who attended the conference are doing
After my remarks, usually one or more attendees will come up and
want to talk with me about how to cope with the brutal downward
spiral in selling prices for used parts and the increased expenses
of running a recycling operation.
When asked about some of the fundamentals that I’ve just spoken
about—offering extended warranties, taking steps to reduce dismantling
costs, or putting salespersons on commission—none has been done.
My response is generally the same: You just need to be a little
better to beat your competition.
Even more encouraging: Once you make the decision to focus on beating
the competition, the odds of achieving a measurable difference
are way in your favor.
Let me share with you why I feel that way.
Imagine that your business has 100 competitors. Consider where
most of them are in relation to these four key thresholds that
lead to competitive advantage:
1. Recognize that there is an issue. Most owners and managers know
that they are facing pressure on earnings. Something isn’t quite
right, but they don’t want to devote the energy to defining the
issue precisely. I would estimate that only about one in four has
the willingness to face issues directly. So, out of 100 competitors,
simply recognizing the issue puts you in better shape than 75 of
2. Zero in on the issue and create a workable solution. Now, how
many of the 25 competitors left will act upon the insight? How
many will invest the time to design a workable solution? Let’s
be generous and say that half of the remaining competitors recognize
the issue and can remain focused long enough to design a solution.
Now, of your hypothetical 100 competitors, only 12 remain.
3. Quantify the solution with goals, metrics, and milestones. As
business owners, we know that implementing a major initiative (such
as shifting sales people and delivery drivers to pay for performance)
doesn’t happen overnight. It takes careful planning and good leadership.
It requires sound management and agreed upon measures of progress.
How many of your competitors will do this step effectively? Let’s
be kind and say half of the remaining twelve get this far.
4. Execute the plan. Among the six of your competitors that have
a plan with measurable milestones to deal with the issue(s) that
have been identified, only half, or three, will have the gumption
to carry it out. It takes a lot of energy and involves changing
key processes. Before you become discouraged about competition,
consider that only three of your hypothetical 100 competitors might
be doing the right things to make meaningful improvements to their
The very good news - If you can carry out these four steps, you
only have to be a little better than these final three to win.
You must delegate effectively to make sure that you cross all four
of the key thresholds to lasting competitive advantage. If you
find you’re stuck, get help. It’s available, and the cost is small
relative to the IMMINENT decline in earnings you will see if you
don’t constantly innovate, cannibalize your old paradigms in favor
of new ones, and change.
My friend used to say I threw 100 changes against the wall every
year, and only a few really stuck, but they were real humdingers.
Visit our website and review the articles from earlier this year
about strategic planning. Most recyclers simply don’t do it. Consider
joining one of our non-competitive groups of six recyclers for
a one-day strategic planning session designed to assess and prioritize
your proposed initiatives. You’ll head home with new energy and
a strategic plan that will put you miles ahead of the vast majority
of your competition.
Don’t forget to subscribe to Ron's free
monthly auto recycling e-newsletter, with news and tips, register
Remember, only you can make BUSINESS
Ron Sturgeon is past owner of AAA Small Car
World. In 1999, he sold his six Texas locations, with 140 employees,
to Greenleaf. In 2001, he founded North Texas Insurance Auction,
which he sold to Copart in 2002. In 2002, his book “Salvaging
Millions” was published to help small business owners
achieve significant success, and was recently reprinted. In
June 2003, he joined the new ownership and management team
of GreenLeaf. He also manages his real estate holdings and
investments. You can learn more about him at WWW.autosalvageconsultant.com
He can be reached at 5940 Eden, Haltom City, TX 76117, email@example.com or
817-834-3625 ext 6#.