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An integrated future

As integration between collision and mechanical shops increases, auto recyclers are recognizing the need to adapt in how they do business with these shops and also each other.

Integration is not without its challenges. Steve Fletcher, Managing Director of the Automotive Recyclers of Canada, says that the organization’s members have parts that collision and mechanical facilities require, but often, the challenge is making that sale because of uncertainty at the shop level as to whether the part will meet requirements and what kind of communication needs to happen across the different parties involved.

More pressure

Collision and mechanical facilities are under pressure to get repairs done in a timely manner, and recyclers need to ensure that expectations are managed so they’re considered a viable source of parts by these shops.

“They don’t have the time to play around and possibly mess up their cycle time,” he says. And, there’s going to be some turnaround time if one recycler needs to purchase a part from another.

“We all need to operate on the same level, otherwise we’re not going to be able to service the shops the way they want to be serviced,” says Andrew MacDonald, owner of Maritime Auto Parts in Nova Scotia.

A one-stop shop

MacDonald says that shops are getting busier and schedule their repairs accordingly. In some cases, they’re measured by the insurance company down to the hour—which means losing money if the right part isn’t landed at the right time.

“We need to continuously be improving to better service those collision shops or else we lose that business because we’re not upping our game,” says MacDonald.

A few recyclers are bigger, more consolidated players, but the majority are still smaller, family-owned businesses that buy and sell from each other to ensure they have the parts required when shops come knocking.

“A lot of large companies like to deal with one-stop shops—so for those smaller independent auto recyclers, it can be tough to compete with the consolidated players,” says MacDonald.

Integration and opportunity

While recyclers and collision repairers have always had to work closely together, Corey Earl, Operations Manager at Hoch’s Auto Parts in Ontario, says this is going to be even more important in the future—and as technology evolves, integration can create opportunities for both parties.

“Previously, a shop would call with a list of parts they were looking for and we would ask questions, do our pricing and get back to them,” he says. “With the advent of the digital age, a lot of the shops will just supply us with an estimate. We can usually find savings for the shop and sales opportunities for us as the recycler, quoting on parts the shop would not even think to ask about. We can put everything together into a better package for them, help the shop and increase sales as well.”

As vehicles become more complex and incorporate more technology, Earl says recyclers will need to continue to stay ahead of the curve so they can recognize, harvest and sell more advanced parts to shops that need them. It’s a process, one that first requires knowing this technology exists in vehicles and keeping an eye out for it, while secondly, using past knowledge to build on future endeavours.

Collision Management May 2019

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