Dave Putits, a Cornwell dealer, was surprised when he got into the business when occasionally a customer who failed to pay him.
Minimizing "skips" is the hardest part of the business, Putits notes. He has used collection agencies and gone to small claims court to fight delinquent payers, but there is no effective corrective action to "skips." The best strategy is to prevent them from happening.
When a customer skips on him, Putits lets the other techs at the shop know about it. He uses this for leverage in negotiating with the other techs in the shop on price.
While only a minority of customers are problem payers, Putits says these problems can destroy a dealer's profitability. He keeps his losses below 1 percent of his total sales.
Problem pays, however, are rarely with large purchases, Putits has found.
Putits services a variety of automotive stops: repair shops, body shops, dealerships, recreational vehicle stores, etc. He has found body shops to be among the best customers, especially if he can manage to visit them shortly after the scrap dealers come by. If he happens to arrive at the right time, the techs are flush with cash from scrap sales and often in a buying mood. In some shops, techs pool their proceeds from scrap sales to buy tools from him.
"A body shop has more finesse," he says. "I tend to have better luck with those customers."
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