According to his plan, Isenberg would lease the facility, perhaps with an option to buy. Training would come from two sources: His partners, the local yard owners who helped target the sites, would handle the day-to-day training, especially the intricacies of bidding on wrecked cars at insurance auctions. As he has done for years, Isenberg would conduct compreInensive seminars and provide complete, computerized inventory and accounting systems.
"I'm turned on to this. I need it as a challenge," Isenberg says of his plan to franchise auto salvage yards much like fast-food outlets. "I think it will provide a much higher level of management sophistication."
But will it work? Is the timing right, he is asked in light of several clouds currently hanging over the industry (see box, below). "I know it's a cliche, but I don't think there's any such thing as problems, only opportunities," Isenberg responds. "If you consider that probably 99% of the current operators manage by the seat of their pants, the more dark clouds that appear, the more advantages the good managers will have. Now may be precisely the time for the more sophisticated managers to come in."
But will top-flight business school graduates and worldly venture capitalists want to sully themselves in what Isenberg himself refers to as "the last frontier?" Isenberg concedes there are a few unsavory characters and "chop shops" to steer clear of, but in the next breath he emphasizes that a well-run operation need no longer be dirty. His trump card: The bottom line will be too good to ignore. A number of yard owners agree. "I think you'll see it more and more as the years go on. Our field is already starting to attract a more educated crowd," says Bill Ellis, the Nevada yard owner. "Two of my 22 employees have college degrees." Stuart Willen, owner of Triplett Auto Recyclers Inc., in Akron, Ohio, concurs. Willen belongs to a local country club, where he has been known to refer io his occupation as automotive reclamation engineer. He does this, he says, more in the line of jest than camouflage, adding, "Money speaks for itself."
Isenberg has another vision of the future, one he shares with his seminar group on the final afternoon. "What if some large company decided to go into recycling?" he asks. "What if it set up a disassembly plant similar to an auto assembly plant, one with extreme econoinies of scale thnt could handle 1,000 cars a day? There would be a central computer to keep track of the inventory at the facility and the 50 to 100 storefront sales outlets this facility supplied. Now, let's say all the parts had bar codes on them, and, like at the supermarket, the cash registers at the storefront outlets could read those codes. Based on the VIN (vehicle identification numbers), the computer knows every part on that car. It knows the new selling price, the average used selling price. It knows the overhead attached to labor. It knows the core value. The computer decides whether or not to take that part off."
Isenberg pauses to let that thought sink in, and, true to his expectations, a bit of seat-squirming begins. "Inside the huge facility," he continues, "it would be like an assembly line in reverse: Dismantled parts would go onto conveyors, some to the rebuilding department, others to be cleaned and tested and packaged and labeled. At the other end of the building, the hulks would go straight to the shredder as scrap. Huge trucks would deliver these prepackaged, prepriced parts to the storefronts. It would all be vertically integrated. Any dummy could run one of these places. For a customer coming in it would be like going to a supermarket in search of pimento-stuffed olives. And you know what? Every component of this scenario is already available somewhere in the world."
The room is quiet. Then a bit of nervous chatter erupts. "Maybe we could get jobs there," says Ed, a Brooklyn salvage operator. "This could put everybody out of business," says Bob, his voice strangely faltering. "Would something like that be legal?" asks somebody else.
"I hope I didn't ruin your day," Isenberg says. "Point is, there are going to be some radical changes coming. It's going to happen. I'll tell you when: as soon as the general economy picks up and interest rates drop and companies are looking more boldly to new ventures."
In part, no douht, to pick up everybody's spirits, Isenberg restarts his slide show, which unexpectedly mixes in a dash of cheesecake with a disassembled door frame. There are also more inspiring photos of well-run, progressive operations and some catchy slogans -- "You Get the Piece without the Grease" -- possibly for the yard owners to emulate.
Shutting off the projector light, Isenberg distributes a stack of evaluation forms and then takes up his final order of business. A theatrical sweep of his hands -- from Volume 1 to Volume 30 -- restates his objective. He turns and looks Bob right in the eye. Bob has won $150 at the casino blackjack tables only the night before; he promptly spent most of it on a sweater for his wife -- perhaps, in case word got out, as a defense against just this confrontation.
"I tell you what, Bob," begins Isenberg. "I'll make you an offer you can't refuse. I'll let you take all of the cassettes home with you. Listen to them all. And then buy any you want at a 25% discount. Just send the rest back to me."
"That sounds fair enough," Bob says, as a sly smile sweeps boyishly across Isenberg'sface.
Barry Isenberg, self made-consultant on auto turns his back on the old ways.
