Is Salvage Management the Right Career for You?
In this fast paced world it only takes a minute for your supposedly safe career to crash and you to end up jobless. It wasn’t until the global financial meltdown last year that we fully realized this. Now we see how quickly those on top can fall to the bottom and this realization has put a whole new spotlight on the true recession-proof careers out there. Careers like those in the salvage industry.
But just because salvage and salvage management offer you stable career opportunities even in the midst of an economic downturn doesn’t mean they are the right career path for you. Here are just a few of the different choices within the salvage field for employment:
Salvor: As a salvor, you must be intimately familiar with the insurance industry, be creative, have a good eye for reusable materials and be well-versed in the basic workings of many industries. Salvors must be able to find salvage out of junk, affix a proper fair market value to it and coordinate its care.
Auction Coordinator: As an auction coordinator, you would be responsible for taking pictures of the salvage and posting them on an online auction site, writing a description of the salvage that creates the opportunity for transparency in the transaction and get the word out about the auction.
Salvage Specialist: As the salvage specialist, you are charged with the responsibility of transferring titles from the old owner to the new owner based on local laws and regulations. Salvage specialists handle all paperwork associated with the transfer and make sure it is done correctly.
Salvage Engineer: As a salvage engineer, you must test the stability and assess the extent of damage of the salvage. Your job is to ensure that it is safe to use in the future.
Selling Salvage Online
The internet has introduced many improvements into our lives. One of the most important is our increased ability to access the products and experiences of people living far outside our normal social and societal circles. The concept of the more accessible distance between you and the varied people, products and websites that you can find on the internet is called Reach , and it’s something that can help you when selling your salvage.
Consider the reach you have in your society. If you put your salvage outside your company’s door and added a price tag to it, your reach would be anyone who normally or occasionally passes through your area. Your actual reach in terms of selling the salvage is further reduced when you consider the number of those passers by who:
a. can see the value in the salvage and know how they can utilize it
b. can afford the price you affixed to it
As you can imagine, these limits severely reduce the likelihood that you will sell your salvage. If you put signs out on other streets or take an ad out in a local newspaper, you can extend your reach but it is still limited by the amount of people you reach who can use and afford the salvage. There is also one additional problem—do those people have the ability to walk, drive, or hire a ride to your salvage.
No matter how you look at it, these limit your ability to sell your salvage—and they definitely limit the likelihood that you will get a buyer at fair market value. The internet, however, does nothing but increase reach and further target the potential buyers who are reached out to.
Maximizing Recovery
It is universally agreed that waste is irresponsible. If you had a bag of perfectly good apples and you threw them in the nearest garbage bin you would face scorn, as well as a possible chastising, from those who witnessed your action. The same is true if you are not maximizing your claims recovery by selling the salvage you acquire. It is like throwing away perfectly good apples for no apparent reason.
Maximizing Recovery through Salvage Selling
Companies all over have a need for the salvaged goods that you have stored. While these items may no longer be usable for the purpose they were originally intended for, they may still be usable when repurposed or reduced to scrap. When you sell your salvage for fair market value to a buyer who can use the items and is happy to get a discount on them, you are creating a return where once there was a loss.
Maximizing Recovery through Timely Salvage Selling
Money works for you in many different ways. When you use the money you have today to reduce your debt, it not only increases your net worth but it also reduces the amount of money you spend on interest for your debt. When you use money you have today to buy stock or save, you gain earnings, profit or interest on it. Salvage sitting unused and unsold is becoming less and less valuable to you, since the dollars it represents are not being used to pay debt or earn interest. Selling your salvage today gives you a liquid asset to invest or pay debt with.
Not only does the sale of salvage bring in additional funds that go directly to your company’s bottom line, but the timely sale of salvage can create an impact in your budget, your debt and your interest immediately
Absence of analysis of salvage disposed by Insurers during the Financial Year.
Insurance companies do not keep track and records of salvage disposed of during the year, the percentage recoveries that they get out of salvage are not on record and no analysis is being done in this respect. Salvage disposal should be properly accounted for and should become a part of the Key Relevant Area (KRA) just like incoming premia and claims outgo are accounted for. Salvage is hard cash, so why not open up a salvage department just like other departments or may be outsource it to professional people who can become Insurers’ virtual salvage departments!
Can Insureds take benefit of online auction of salvage?
Where Insureds retain salvage, they can also go for Salvage Management to fetch better prices and make up the difference between loss assessed by insurers and actual replacement cost of the lost asset.
Insured individuals who find themselves saddled with salvage will often be stuck with storage and
other fees while their salvage sits, compounded and possibly deteriorating and losing potential market
value. These individuals can find salvors locally and ask that they value the salvage and sell it, but since they are unfamiliar with the world of salvage, they often don’t know to do this.
Most individuals will not exercise their right to retain their salvage simply because they do not know
what to do with it or how to get any value from it. This is helpful to businesses that pay claims on
damaged goods because it gives them the ability to offset some of those claims they are forced to pay.
Educated consumers who do exercise their salvage retention rights will soon find that selling their salvage,
especially in an online auction format, helps them make up the difference between the assessed
value paid by their insurance company and the cost of replacing the damaged goods.
Absence of analysis of salvage disposed by Insurers during the Financial Year
Insurance companies do not keep track and records of salvage disposed of during the year, the percentage recoveries that they get out of salvage are not on record and no analysis is being done in this respect. Salvage disposal should be properly accounted for and should become a part of the Key Relevant Area (KRA) just like incoming premia and claims outgo are accounted for. Salvage is hard cash, so why not open up a salvage department just like other departments or may be outsource it to professional people who can become Insurers’ virtual salvage departments!
From a pin to airplane, to a single salvage intermediary?
This is what happens when an adjuster uses the same old guy for salvage disposal whatever may be the commodity. When at home, even when we need to sell something like an old T.V., we try to find out a T.V. dealer so that we can fetch a reasonable amount, but when it comes to insurance salvage, anyone works?? For a heart ache, go to a dentist?? People are earning upto 300% margin from the salvages bought from insurance companies as intermediaries just due to lack of proper salvage management. We need to religiously follow salvage management right from the lowest level to the topmost. Leaders of the industry need to be a part of this change.
Salvage Management—A Recession-Proof Career
Whether we are in the midst of a global economic shakedown or not, working folks are always looking for new careers. Often, they search for something that offers them an increase in their work related value and opportunities, while remaining lucrative, recession-proof and innovative. For new college graduates and experienced business people looking for a change, the answer to their quest may very well be Salvage Management.
Few businesses allow for such complete satisfaction from both the buy side and the sell side as Salvage Management. When dealing with sellers, salvage managers are like heroes protecting the bottom lines of banks, insurers and other businesses. Since the salvage manager is taking something that is normally viewed as worthless, there is no opportunity for the seller to feel as though he or she is not getting enough for their salvage. Instead, any amount (especially the large selling amounts seen at auctions) is considered a gift to their income statement and directly offsets and reduces their losses.
When working with buyers, salvage managers are fulfilling the buyer’s need to find quality products that don’t cost an arm and a leg, that help their business grow and progress to the next level, and that offer sustainable solutions they might not otherwise have access to. Even in an auction setting, where some buyers will most certainly lose an auction at one point or another, the ability to participate and see what types of salvage you offer are very rewarding and keep them coming back for more.
While it’s unfortunate that insurable events will always continue to happen, for salvage managers it is the single most important aspect to the recession-proof side of the business. No matter how bad the economy or jobless rate is, people will always experience loss, will always have salvage to sell, and will always need inexpensive salvage items to buy.
Uses of Salvage
Many people underestimate the value of salvage. They may consider it trash or useless wreckage, but no matter which description they use, they consider it worthless. For others salvage is as valuable as the cash in their pocket—as a matter of fact, the cash in their pocket may be a direct result of their ability to see the value in salvage.
These forward thinking and imaginative individuals understand that salvage is not trash—trash is useless. It has lived out its destiny and has no further application either because its damage is too extensive to allow for any repurposing or because it was not built to withstand damages well enough to be useful. Salvage, on the other hand is given an entirely new lease on life and a brand new purpose once it is found and valued by a salvor.
One of the most common uses of salvage is for parts. Whether you are thinking about automobiles or heavy equipment, much of the salvage you find can be purchased inexpensively and used to repair or replace parts on many of the different vehicles, tools, and mechanisms you use every day. It can even be used to make structural repairs on buildings—which can save the salvage buyer a substantial amount of money.
But salvage use is not limited to parts. In fact, some salvage doesn’t involve parts but instead, formerly edible substances like grain. While this type of salvage may no longer be fit for human consumption, livestock can be fed for weeks from the supply. And what about cartons damaged in shipment? Some salvage is in such good shape that it can still be used for its original purpose, but can’t be resold in its current condition. So the salvage buyer benefits from something as simple as ugly or damaged packaging.
No matter what use you can find for the salvage you buy, chances are you will be surprised by the flexibility and quality of the salvage you have access to.
Salvage as a Claims Management tool
By adopting salvage management, following benefits would accrue to the Insurers to start with:
a. Maximizing realization from sale of salvage over a period of time leads to much needed ‘lower claim ratio’ for the Insurers;
b. Shorter Claims Turn Around Time (TAT);
c. Complete salvage management solution saves time and manpower of Insurers, which can be invested in developing some more innovative ideas for claims handling and management;
d. Insurers are able to have complete control over the salvage settlement/disposal activity with our transparent salvage management system.
