For the average metal service center, buyout business represents about 10 % of your annual revenue yet, if you are like most, you have no formal policy around how to handle it.

How crazy is that? 10% might not sound like much but for many companies we're talking about millions of dollars in business and yet you have no set policy and provide no training.

Metal Suppliers Online is a website containing the searchable inventory of every known distributor, mill, extrusion and forge shop in North America. Using it, our clients average over 20% buyout business.

If the time is taken to create, train, implement and measure financial results year on year, many benefits can be achieved. Among them:

1.) Increased revenue....and not just in buyout sales. Properly handling buyout sales results in saved time, which in turn result in improved inventory turns. Your inside sales staff will begin to be seen as the "go to guy" for your clients...."these guys really know their business".

2.) Improved client relationships. If your staff is educated in the broader availability of metals in the US market, they will become perceived as the first one to call on any metal requirement. And, with a consistent policy on markups, they will be providing a fair price every time.

We advocate the development of formal policies for handling buyouts. The topics should include:

1.) Pre-qualification. Specifically, what sort of company and what sort of metals do we go after?

2.) Sourcing. How do we locate the metals and which vendors are qualified. Metal Suppliers Online can certainly help here.

3.) Markup. What is the markup percentage? There should be clear direction here with qualifiers...latitude for special situations.

4.) Order Entry. How is the paperwork handled on the items?

5.) Warehouse. When buyout Metal is received, how is the warehouse supposed to sanitize the metal....removing all supplier tags and markings to prepare for shipment.

These are the basics that must be addressed in order to create a sense of order, consistency and direction to your buyout policy.

If properly addressed, a policy such as this will have a solid impact on your bottom line. Give me a call if you have an interest.

Alan Gamble....603.329.0101 ....metals@gmail.com