ATF Professional spoke to Dave Horsnell, Director of DLH Auto Recyclers Ltd about how they took advantage of the situation relating to the pandemic last year by expanding the business, not in space but efficiency.
Dave, tell us what’s been happening at DLH Auto Recyclers Ltd
At the start of the pandemic, we were in the same position as everybody else. We just didn’t know what was going to happen. We decided to keep pushing forward during the first lockdown, and we used that time to do our expansion.
We bought some new depollution equipment, which has been up and running since the end of April last year; this work bay has completely transformed the way we work. Last year we also provisionally ordered a new vehicle transporter. We decided to keep the order, and although we didn’t know where we were going to be in six months with regards to the volume of vehicles coming in due to the pandemic, we had the feeling that things would keep going.
We decided to carry on with our plans for the expansion, and a year on, I’m feeling pleased with myself for making that decision.
So, can you give us an update on what you’ve been doing since COVID?
We’ve been investing in the future of the business. We had plans pre-COVID, which I have already mentioned. We never put anything on hold and decided to move forward. We invested in depollution equipment and depollution buildings, a new multi-car transporter, with another one on order for the end of this year. And we are continuing our investment into the storage warehouse of green parts, which is ongoing, and which we are hoping to have done by the end of 2021.
In terms of the volume of vehicles coming through, have you seen an increase?
Currently, we are at COVID levels of vehicles. Our expansion plans are for the future, and when things get back to normal, we will build on the normal to increase our volume of salvage.
Can you tell us more about your expansion plans?
Our plan isn’t just to keep adding more surface area to the operation and simply collect vehicles and sell the parts. No, the expansion plan is to process more vehicles more efficiently and faster.
With the new vehicle transporter capabilities, we will be able to go further within the UK to collect more vehicles. They will be brought in, follow the stripping process, the parts are then graded and stored for onward sales back into their supply chain, be it for private sales or green parts for the repair industry.
We also heavily invested in software. We are still with frontier, but in January this year, we switched to being cloud-based. It’s been working very well, and it’s given us a lot more functions to allow us to be more efficient within it.
When did you come to the decision that becoming more efficient was necessary? Was this during or pre-COVID?
We always knew this pre-COVID. The only thing that COVID did was slightly delay the plans. It was in 2019 that the decision came to streamline the process to be more efficient. And we already started this and were able to reduce one of our storage areas on our site in North Walsham because we were processing the vehicles faster.
Putting the vehicles through the new depollution building has made a big difference. We’re now able to treat more vehicles and dispose of more vehicles so that we can store less. And on the parts side of the business, we’ve invested in equipment and more staff to strip the vehicles faster and get them logged, graded and shelved.
What were the reasons for you to become more efficient?
Actually, after attending the ATF Professional conference in Warwick in 2019, I learned how insurers had become involved and wanted to buy our parts. This pushed me to move with what they potentially wanted. This made me go for the extra investment into selling into that industry. And the only way to achieve this was by being super organised; it is not ‘old-school’ dismantling anymore. The vehicles need to be stripped, the parts graded and put on the shelf ready to be sold, and all in the fastest and most efficient way possible. And this thought process has come from insurers.
We know what the insurers want because we’re heavily involved through the VRA certification scheme. We’re having meetings with the insurers through the VRA, and they tell us what they want. We deal with Green Parts Specialists, and they are very clear about what they want; they’re very focused on what quality of parts they want, so we’re able to supply into their chain. We’re also supplying into the eBay B2B platform. Again, they’re very clear. We’ve had many zoom meetings with eBay for business and major insurers who have been on board, and they’ve said what they want is quality and reliability. You can’t get quality and reliability if the parts are still on the car when you sell them. The parts need to be off the car – graded, certified and available for sale immediately.
We have confidence in our service. We’re not planning on being the biggest supplier, but what we do plan on is doing it right, and that quality and reliability will be part of our ethos.
What is your impression of both eBay B2B platform and the VRA certification scheme?
It’s very early days, and you’ve got to realise that we are still in the COVID era. Currently, requests for parts are down because repair shops are not as busy. Fewer vehicles on the roads mean fewer crashes, therefore fewer vehicle repairs.
B2B at the moment is a very slow burner. Insurers want to get involved, but there just isn’t the volume of parts on there at the moment, and as an industry, we need more dismantlers around the country, supplying parts to feed the repair industry.
Being VRA certified has been a big step to making it a level playing field for the people who want to buy certified, graded parts. In my mind, it’s got a lot of potential, and being super organised and efficient is key in making this scheme work.
What do you think the public perception is of green parts?
I think the vehicle recycling industry has a better reputation now. But when it comes to getting the public to consider green parts, I believe it is the insurance industry that needs to win the customers around to use them. For example, you have an accident, and an insurer rings you up and asks, ‘Do you want a second-hand door or do you want a new one?’ Nine times out of ten, the customer will ask for a new one. But the policyholder needs to be made aware of the benefits of using a green part when they take up the policy. On the other hand, I can understand why the insurers don’t want to ask if the customer wants a green part when that particular part is not available; it is a bit of a chicken and egg scenario. But I genuinely believe the sales will be there. Maybe not right now, but they will be there. If we pull through COVID and maybe into 2022, we will see an increase in the sale of green parts when things get back to normal, but the policies have to be sold to have the option of green parts if new parts aren’t available.
Insurers are now in a strong position because they can say to their customer, ‘would you like a certified green part? And this can be explained that it is a graded part; it’s gone through certain checks, and it comes from a certified recycler. This will give the customer confidence and may choose a certified green part over a new part.
What are your final thoughts about the industry?
For my business, I believe warehousing is the key to the operation. Now to have just surface area to park cars is not our priority anymore. Warehousing is our priority, and by the end of this year, we will have a new warehouse so that we can supply more green parts to the repair industry.
The 3 Peaks Challenge
After writing the above, Dave told us about an activity he was about to participate in for charity, the 3 peaks Challenge in May 2021:
“Myself and my son Tom are attempting to climb Ben Nevis, Scarfell Pike and finally Snowdon over three days from 21st May. Why you ask? Well, although I have enough challenges as a managing director of a vehicle recycling company and garage services, I am attempting it for three reasons:
- My Incredible sister-in-law, Ros Horsnell was diagnosed with metastatic cancer back in 2017. She has put up an amazing fight against this terrible disease and her courage and determination to keep fighting it has been for me, an inspiration.
- My brother Greg, who without his support and companionship, would have been a game-changer for Ros. He truly has kept Ros fighting and he is someone I look up to and admire. To add, both Greg and Ros’s children, Megan and Harry, my wonderful nephew and niece, are both their strengths.
- To be on the drugs which keep Ros alive costs money and the research is ongoing, so while we take on this challenge, every penny we raise will go direct to Breast Cancer Now, a charity carefully chosen by Greg and Ros, and a charity that is steered by life-changing care.
Every step will be in support of their courage and effort, and help them to live the best lives they can, please help us reach our target of £10K.”
If you can offer you support, please go to our giving page at https://www.justgiving.com/fundraising/ramblingforros1
DLH Auto Recyclers Ltd is a member of e2e, a group of the most progressive and forward-thinking salvage and vehicle dismantlers in the UK.
To find out more about DLH Auto Recyclers Ltd, visit www.dlhautorecyclers.co.uk