for clunkers: Good or bad for you?
Recyclers have been talking about Cash for Clunkers,
and whether it was good or bad for our industry.
I won’t opine much, other than to say the answer
probably depends upon how prepared you were to
take advantage of the opportunities the initiative
Ever noticed that some folks seem to do well no
matter what happens? A fire in their warehouse?
Not a problem. They’re prepared with backup systems.
Insurance buys a new building, and they keep growing.
Big hail storm destroys most of the inventory in
the yard? This one happened to me. I was the only
recycler in the area to get help. I got $500,000
in SBA disaster relief because I had adequate inventory
records and valuation methods in accordance with
Everyone gets some good and bad luck. Some do better
at enduring the bad and leveraging the good. Within
days, we sent postcards to everyone in the zip
codes that had hail and sold thousands of pieces
of glass. Mostly 100 percent gross margin stuff
we wouldn’t have sold otherwise.
Many recyclers only change when events force them
to. By then, it’s often too late to make the most
of opportunities that appear.
What have you done recently to anticipate what
might change in the next few years? What have you
done to change your business in a meaningful way
or made specific plans to grow? That mailing you
did a few months ago was great, but it isn’t the
answer, it’s a temporary tactic.
You need to anticipate how business is changing.
How are your customers’ needs changing? What steps
have you taken to plan? That talk with your operations
manager about improving quality doesn’t qualify.
Again, it was a response triggered by too many
returns. It’s good, but it’s not strategic.
Some recyclers are thriving because they are thinking
on a strategic level. They make time to meet, think,
share, and create written strategic plans and measurable
goals. They appear luckier, but they’re really
better prepared. They are the ones who invest in
a better computer system. Many of you have been
considering that for years, but haven’t made a
move. You don’t know what you don’t know.
Many of the best prepared recyclers are also in
study groups, where they benchmark their operations,
exchange information about what works, and discuss
current issues, problems, solutions, and plan for
the future. My good friend Jim Counts facilitates
such groups, and so do I. I don’t know how Jim’s
meetings work. I haven’t attended one, but I hear
only good things.
My groups focus on business metrics, financials,
and strategic planning. We review the key initiatives
of each participant. We look at the strengths,
weaknesses, opportunities and threats of each initiative
(SWOT analysis). Participants come away with an
actionable list of ways to improve their operation
and several vetted new initiatives focused on growing
sales or reducing expenses. We have meetings planned
in the coming months, and I know Jim also has similar
opportunities to move a business to the strategic
If you can’t write down exactly what you are planning
to do to improve your bottom line, then you haven’t
done the strategic planning needed to really grow.
These groups work. You should make certain you
are part of one.
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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#.