BOTTOM LINE BOOSTER

they in turn to the re-manufac- turer that would be a great result.

“Right now if the accu- racy of what we send to the core consol- idator is only 50% that means that the 50%-not-sold becomes scrap iron and the core consolida-

tor has to have it hauled away. Both the recycler and the consolidator lose because the recycler is giving it away and the consolidator has to pay to have it hauled for scrap.”

Changing the Process Currently, Cunningham notes, the way the process

works is that a remanufacturer (i.e. OE) goes to the core consolidator and puts in an order for 100 elec- tronic widgets. In turn, that core consolidator goes to 10 different auto recyclers to get the widgets and those 10 might farm the order out to smaller guys and so on.

“There are two main problems with that system,” said Cunningham. “First, there are inconsistencies in what is actually sent to the core consolidator, which means what the remanufacturer actually needs may be something different. Secondly, the value of what the auto recycler is sending keeps getting diluted the more people involved. “Every auto recycler finds the amount he or she feels is worth their time; mine might be $25 and yours might be $10. The key is to harvest a model that makes sense, brings in the most money and expands the markets servicing remanufacturers.” The commodities program aims to put the auto recycler who controls their commodity and knows what they have to be able to work directly with the core consolidator and in an ideal world stop the devaluing of their commodity by appointing a point person who manages and knows their commodities inventory. “The value to the buyer is getting the proper num- ber at the proper time and reducing the number of contacts needed for that to happen is essential,” said Kunkel. “That means having the ability to consolidate the material to be properly verified and tagged. Finding a consolidator that will push the revenues

56 Automotive Recycling | July-August 2015