RETURNS! How to Prevent Them

During the pandemic I’m sure that we all have had the unsettling thoughts of what am I going to do, will I have shops to sell to, can I buy cars for parts, will I be able to keep my employees. What I have noticed is that we got busier during the pandemic. It was somewhat of a challenge, shops cut their hours and when we did deliver the parts, they were looked at and accepted outside of the shop’s doors. Drivers were not allowed inside the shops.

The shortfall of manufactures producing parts helped immensely. Some shops that had never bought a recycled used part because they thought they were junk, started calling us and realized the parts we sell are the same parts that the dealers sell except ours are used. Now that we have gained these shops during the non-manufacturing of OEM new parts, we need to keep them as customers after production starts back up. To do this, recyclers must sell quality, clean parts, delivered within a reasonable time.

Now that these shops are buying recycled, some of them double order the same part from multiple recyclers. This is problematic, your driver gets to the shop to deliver the part and they say they already have the part. It is, first come, first keep. Here comes the return. Did the shop think of the time, effort and money invested by the recycler getting the part to the shop? Sometimes, sometimes not. These are the customers that have to be managed. Do you charge a delivery fee? Well, if you delivered the part second, you are not getting paid for the delivery because they are not accepting your part. How many times do you want to go to this customer and get the same result? Time to manage customers returns.

Business’ stay viable by having customers and we strive to make all customers happy. Unfortunately, you cannot make everyone happy all the time. This is when you get returns. A good return percentage is 10% or lower. You might think this is unattainable but if you continue reading, I can help you achieve this goal.

What processes lead up to a return sale:

  1. Improperly inventoried.
  2. Lack of Communication.
  3. Bad quality or missing parts.

Inventory descriptions
This topic has been covered in so many articles they could be made into a book. Each different, each with good points. Inventory is the job of your inventory specialist. They must have a good sense of damage and what parts sell and what does not. Other than the vehicle buyer, the inventory person is the most valuable person you have employed. Since sales are the direct result of inventory, they must know how to accurately describe the parts or parts damage. Accurate wording with clear descriptions and options: 2D5 does not make sense to the internet buyer, where 2.0 dent center does on a door. Descriptions are all that the sales people have to work with when talking with their customers.

The second return reason is a lack of communication between your sales person and the customer. The sales person must have an accurate description of the part. One that they understand and can convey to the customer. They should get the VIN Number to decode and get the correct year, make, model and motor size of the vehicle. The sales person should ask which side, drivers or passengers, not right or left. Front or rear, halogen or HID, or any other pertinent information needed to find the right part that the customer needs. After finding the part requested the sales person should repeat the order with all specifics to the customer with the description of the part you are selling them. Don’t assume the answers, Ask the question to get the correct answer. Communication prevents aggravation. Verify the shop name, address and who you are speaking with. You are the sales person, you control the conversation, you need to ask the right question to get the right answers, if not you will get returns. This is another reason that the inventory person is so important. Accurate descriptions make sales.

Parts Quality
After inventory is parts quality or damaged parts. Did the inventory person miss something when inventoried, we all make mistakes or miss something but if they are good at their job, odds are they did not miss damage. Did it get damaged in dismantling? Is it possible that the dismantler broke it when harvesting it or it dropped and broke? At this point the dismantler should let the person who maintains the inventory know, so the part description can be changed, part goes to repair or the part deleted. It should never be put away as if nothing was wrong and the original description remains the same as undamaged. If not told immediately, you will find out about the damage when your salesperson has sold the part to their customer. Now the salesperson must call the customer to describe the damage on the nice part he worked hard to sell in the first place.

Another issue is missing parts. Do you use a scanner to put parts away? Do you write down locations and enter them manually in your YMS? Either way it must be done correctly.
If a part is missing at the time of the sale, you may have to scramble to get another part ready or worse have to call the customer and tell them you cannot supply the part. Periodically do random rack location audits. Check to make sure the parts are where they say they are and in the best location for that part, not the easiest location. From shoulders to knees, these are the locations that fill up the most in racks.

Quality Control
You would think that after all the hands and eyes that have been on those parts there will be no more surprises. Surprise! You still may have some. The last person to inspect the part is your quality control person. They must double check that the correct side is pulled, that bumper tabs are not torn or missing, that headlamp mounts are all intact. All parts, I repeat all parts, must be cleaned before leaving your facility. Soap and water do not cost much and leaves a lasting impression on the customer. A clean part sells better than a dirty one and will cut down on the customers requesting clean up time.

There will always be returns. You can do everything right and the customer will just not want it. Some customers have unrealistic expectations or perhaps they never intended on keeping the part in the first place. It was ordered because the insurance company said to buy it from you but they wanted a new part, so they will find any reason to refuse it. You did all you could do to deliver a quality part. However, if you follow these simple procedures your return rate should come down and your trucks will leave full and return empty.

Debbie Hussey has worked at Northlake Auto Recyclers in Hammond, IN since 1996. She starting by doing inventory for 3 years then moved into the sales department. She is the manager of the sales staff, deals with inventory management, sales, computer IT, website and marketing, EBAY She can handle all aspects of the business but her focus is primarily on inventory and environmental compliance. With her work Northlake Auto was the first in Indiana to be awarded clean yard GOLD level status by the Indiana Department of Environmental Management (IDEM), and Platinum Medal level with INCARES (Indiana Certified Automotive Recycling Exemplary Standards). Debbie also serves on the ARI (Indiana Auto Recyclers Association) board.

Northlake Auto Recyclers  |  (219) 937-3960  |