Essential information for end of life vehicle dismantling, depollution and recycling



Cash after COVID Post
Michael Manners, Founder Director of Limelight Learning UK Ltd, looks at possible outcomes of the easing of lockdown and provides us with a 12 step plan on how to keep your vehicle recycling business afloat especially if a second wave occurs.


Cash after COVID Michael Manners post
Michael Manners

The full impact of COVID-19 has not yet been felt as good businesses will yet go under through lack of cash. The auto-recycling industry has a sound business model and a substantial track record, so banks will be supportive. However, that comes at a price even if it’s cheap by historical comparison and the bottom line will be eroded.

New car sales are down 54% partly because people are preserving cash. There has been a significant reduction in traffic with the consequent lessening of accident damaged vehicles. These two factors reduce the availability of ELV’s.

The easing of lockdown will have one of two outcomes. Either this pandemic will remain stable or will get worse with a double peak – it cannot get better. Some pundits are claiming that it will not be a V or U shaped recovery but a W one. Therefore retention of cash is even more critical in these strange times of global pandemic – so plan for the worst and act on that plan.

The full impact of COVID-19 has not yet been felt as good businesses will yet go under through lack of cash.

Shrewd businesses will have built up cash reserves in good times for that rainy day that always comes. You don’t know when, why or for how long, but you know it will happen. So what can you do if the first wave of coronavirus has already played havoc with cash and a second wave occurs?

Here is a twelve-step plan:

Step One: Review all capital expenditure. Ask the question ‘what is the consequence of not spending this money now but deferring it to an unknown date in the future?’ If you can muddle through without it then do. If you cannot, take a close look at all available means of funding Capex other than outright purchase, but remember this comes at a price. Also, review selling assets.

Step Two: Take advantage of every Government led support for wages and other benefits on offer.

Step Three: Ensure Credit Control chases cash with determination. Review reducing credit periods. With debtors, extend payment as much as is commercially viable without putting your reputation at risk – you do not want false rumours about your solvency to spread.

Step Four: Reduce headcount. Keep key personnel in place. Volumes are probably down and you cannot afford passengers. Of course act within the law.

Step Five: Examine every overhead and negotiate better terms for IT, telephone systems, rent, sales and marketing, eBay, auditors, lawyers. Scrutinise every item in detail.

Step Six: Talk to your bank and increase lines of credit. Talk to your auditors and seek advice from every quarter.

Step Seven: Defer dividend payments – better for shareholders to have a viable business in future than no business at all.

Step Eight: Make all personnel aware that waste costs money. Turn off the lights. Do not print emails. Ensure that every saleable component is not scrapped unnecessarily. Some of the points are petty but exist to reinforce the message that cash is the top priority.

Step Nine: Scrutinise processes and procedures. Are you using too much packaging material?  Are you using the right packaging materials? Are you scrapping tyres that have resale value?  Are your forklift drivers causing avoidable damage? Do all personnel understand that yours is not a scrapyard but a recycling plant as this mentality impacts on efficiency, waste reduction and cash management?

Step Ten: If you are the CEO, ensure your accounts department rings you at 9 am every morning with the previous night’s cash at bank figure to keep cash in sharp focus and you properly informed. Improve cash flow forecasts – you do not want nasty surprises.

Step Eleven: Run weekly meetings with heads of departments to reinforce the need to preserve cash and invite their input on how to do it. Instigate a Purchase Requisition system for expenditure over a limit of say £500 for sanction by higher authority.

Step Twelve: Heavily discount old stock to generate cash.

Those that survive COVID-19, especially if there is a second wave, should apply the lessons learnt. In summary, they are:

    1. Create a ‘war chest’ of cash ready for the next rainy day. Beware getting into so much debt that any cash generated is swallowed up by interest payments. When interest rates rise some heavily indebted companies will not survive.
    2. Ram home to all employees that cash is the lifeblood of business and not waste anything that has a realisable value. Do it by relentless ‘management nagging’, training and education. This industry wastes thousands every year through carelessness and neglect.
    3. Ensure you have greater than needed lines of credit with the bank – safety net.
    4. Review all expenditure, if not essential don’t buy it – luxuries are for when your ‘war chest’ is full – and even then is questionable.
    5. Stay ‘lean and mean’ in good times – resist the temptation when things are going well to pile on ‘fat’. Peaks are inevitably followed by troughs! Watch trends, stay vigilant and keep in control. Assume that disaster is imminent and plan accordingly.
    6. Refine your negotiating skills and use them to minimise costs.
    7. Improve Credit Control, take Cash Flow Forecasts seriously and review variances – make the head of finance fully accountable.
    8. Ensure your processes convert metal to money fast – piling up inventory reduces profit and adversely affects cash.
    9. Persist with a 9 am call giving the cash at bank figure. 
    10. Take advantage of those who succumb to acquire at bargain prices complete businesses or plant, machinery, equipment, land, key personnel – move quickly because your competitors will – our American colleagues have deep pockets.

If you would like to contact Michael to find out more please visit the website or email


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Owain Griffiths

Owain Griffiths

Head of Circular Economy at Volvo Cars

Owain joined Volvo Cars in June 2021 to lead Circular Economy in the Global Sustainability Team. The company has committed to being a circular business by 2040 and has financial, recycled content and CO2 based targets for 2025, all of which Owain is working across the company to make happen. Owain previously worked for circular economy consultancy Oakdene Hollins where he advised businesses on evidence led circular economy implementation. 

Turning into a circular business and the importance of vehicle reuse and recycling.

The presentation will cover the work Volvo Cars is doing to achieve 2025 but mainly focus on the transformational work towards 2040 and the business and value chain changes being considered. Attention will be paid to the way vehicles are being dealt with at the end of life and the complexities of closing material and component loops. Opportunities and challenges which Volvo Cars is facing will be presented including engagement with 3rd parties and increasing pressure from stakeholders.

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e2e Total Loss Vehicle Management [e2e] is the UK’s only salvage and automotive recycling network with nationwide, environmentally compliant sites delivering performance resilience and service reliability to the insurance and fleet markets.  The network’s online salvage auction drives strong salvage resale values and faster sales.  e2e’s salvage clients have access to the network’s stocks of over 5 million quality graded, warranty assured reclaimed parts. 

The power of the network model means e2e has the ability to influence industry standards and is committed to continually raising the bar whilst redefining the role and perceived value of the salvage operator.  Network members adhere to robust service level agreements, against which they are audited, in order to ensure performance consistency and a market leading customer experience.  

The salvage and recycling operating environment is evolving rapidly, and e2e is anticipating, listening and responding to changing market needs.  Regulatory compliance, ESG, reclaimed parts, customer experience, EVs, new vehicle technologies, data and reputation risk are just some of many considerations linked to the procurement of salvage services.  e2e will drive further added value to clients and members through the adoption and application of emerging technologies, continuing to differentiate its proposition and position salvage services as a professional partnership. 

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