Keeping an Accurate Converter Inventory Can Help You Level Up
To understand your converter profits, it’s important to understand your inventory first. But most automotive and scrap metal recyclers don’t have an in-house expert to help them count by material type and evaluate their material before it leaves their facility. So, how can you ensure you’re keeping an accurate inventory? And how can it help you maximize your profits?
For recyclers looking to optimize their businesses on a long-term basis, the key is to maintain a thorough converter inventory.
Keep a Specific Count of Your Converters
Most dismantlers will remove converters and place them in a central bin, which eventually gets moved to a secure location. This is usually when the converters are counted and placed into gaylord boxes. But how can recyclers know what type of material is going into each box? How can they be sure of the exact count? The answer is that they can’t be 100% sure.
For those of you still using tick marks on the side of a gaylord box as inventory control, let’s leave this method in the past. There are too many variables to consider—and too much at stake—to rely on such informal methods. So what should you keep in mind when counting your converters?. Let’s dive into it.
What to Consider When Keeping an Accurate Count
There are several different types of converters, and some are two units that just look like one. It’s also important to remember that each converter has a different size and weight. So, using an accountable counting method can ensure that there are no miscalculations.
Here are questions you should ask yourself when counting your material:
- Is the converter an original equipment manufacturer (OEM) gasoline, DPF, aftermarket, foil, or bead?
- Is the unit an OEM ceramic/foil combo (meaning it’s two units)?
- Is this a branch with multiple converters?
- What are the percentages of each type of material?
- Are your material percentages different from the yard history?
Once you’ve answered these questions, it’s time to separate your converters by material type and count them. This also means identifying any combination or branch units. Next, you’ll want to validate the fullness of each converter, which means verifying if the ceramic is intact and how much is left.
This is the only way to ensure a proper count is made for your converter inventory.
Why Is It Important to Know Your Converter Inventory?
Keeping an accurate inventory helps you track your shipments and monitor theft easily. But it also ensures you’re getting a fair price when selling your converters. For example, you’ll know when a buyer is trying to overpay on well-known units and underpay for lesser-known units because you know exactly what material you hold.
It also means observing patterns in your material type averages and understanding your profits. With proper counts and history, you can project potential inventory value. You can also understand which buyer and location is more profitable.
For those who don’t have the time and resources to manage this type of in-depth tracking, this is when a processing partner comes into play.
Why Having a Processing Partner Can Help You Manage Your Inventory
Working with a toll refiner will give you even more information because they will count and grade your material, offering material weights, counts, and averages. Processors will also assay your material to determine the exact amount of platinum, palladium, and rhodium in your converters. That means that you’ll get a detailed report of your precious metal loadings with PPM’s, gross/net weights, percentages, and more.
This information helps you visualize your operations more easily. It also makes it easier to understand where and how you’re making profits and how you can optimize your business.
To assist our suppliers with their inventory, PMR designed a Supplier Services Platform (SSP). Recyclers can track every converter that comes into their inventory visually and assign a value for managers and owners to view, with the ability to keep these values hidden from frontline employees. We also provide extensive catalogs on converter values according to serial number and give instant evaluations with our photo grading and VIN/TRIM tools.
It’s always easier when you have an ally in your corner helping you manage, track, and secure your hard-earned catalyst material. So if you’re tired of never being sure what happens with your converters every month, partner with a processor who helps you to take control of your converter inventory and start making better purchasing and selling decisions.
For more information on evaluation, visit PMR’s Resource Center.