MONETIZING SMALL PARTS
We study the parts before we decide if we are going to offer the small part at our full service facility or not. It’s a combination of small parts sales that give us the added revenue.
“We figure the total cost of our expenses related to the sale such as removal-staff, sales, shipping staff for a month period of time and divide it by the number of parts we are selling to find out just how much our minimum cost should be to touch a part based on your current sales. You can use those numbers to find a minimum to gauge by to determine your bottom prices. The actual values of the parts new, when no other alternatives are available, is also considered, and the availability of the vehicle. Don’t just throw a num- ber out, put some math to it. Your staff will support the pricing better that way also. “We wanted to encourage small parts sales at our self-service business because the customer does the work in removing the parts so we have the ‘Feed Bag,’ which is a small plastic bag the customer can fill up with screws, widgets, miscellaneous small plastic knobs, etc., for $2.50 per bag. For us, we study the parts before we decide if we are going to offer the small part at our full service facility or not. It’s a combination of small parts sales that give us the added revenue.” “In this day and age we have to think smarter about how we stay competitive and there are still many parts that we don’t have an Interchange for yet – the top 20 parts that Dorman sells still have no Interchange,” said Swift. “The more Interchange we develop the more parts we can sell and this will become crucial as competition gets tougher.”
Thinking Outside the Box
One associate ARA member capitalized on a “light bulb” moment that came to him while at work one day. That idea has grown into an expanding worldwide business, and can help auto recyclers profit too. J.J. Feregrino, founder and president of We Buy Key Fobs, says that being an entrepreneur, he always is keeping an eye out for a way to fill a gap. “I noticed when people were purchasing a used car it usually only came with one key fob,” said Feregrino. “Customers would always ask me if there was a second key fob, and I had to refer them to a franchise dealer. One day I noticed a box of old key fobs to previous vehicles that had been sold that the customers never picked up. That is when it dawned on me that I could use my background in technology and reprogram the fobs for the customer at a better price.”
54 Automotive Recycling | March-April 2015
Feregrino immediately started researching how to make this a viable service for people and founded We Buy Key Fobs in 2011.
It quickly grew into a worldwide business with 14 employees and counting to meet business demands. We Buy Key Fobs aims to make it easy for auto recy- clers to use their services to increase their profit. “Our process makes it easy for salvage yards,” says Feregrino. “They don’t have to worry about separating the good from the bad remotes or testing them. We take all remotes. Whether they are dirty, cracked or missing a button, we will buy it! They don’t have to guess what they will be paid or even if the remote will be accepted. We pay a flat rate for aftermarket remotes. We even pay for the shipping. Currently our rates are two dollars for OEM and fifty cents for after- market.”
According to Feregrino, some of the other benefits to using We Buy Key Fobs include; consistent pricing, fast payment turnaround, multiple payment options for salvage yards, including instant payments or one day turn around service. It also promises prompt cus- tomer service and actual people to answer your calls. Feregrino says they are aware that for some recyclers, it might not seem like a worthwhile investment but encourages them to try them anyway.
“I think some auto recyclers feel that selling fobs is not worth the time – I mean two dollars for an OEM remote?” said Feregrino. “They may think that, how- ever, if you add that to the number of vehicles per year, you are talking about a decent amount of money that is just getting thrown away.
“Who likes throwing away money? Any increase is more than they are profiting now. All you have to do is throw the fob in a bucket and when it is filled give us a call. I don’t think we have a recycler that has not sent us a second batch after the first!” “Today, every dollar counts, that’s why we recycle key fobs,” said Eric Piper, Sales Manager, Spilman Auto. “I’ve been using We Buy Key Fobs for two years now and they are very reliable and trustworthy. I receive the check immediately. I sell them every fob we get and don’t have to worry about returns and/or excuses. Shipping it to them is like money in the bank for us.” “We collected over 100 key fobs as a fundraiser for
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