The Fallacy of Seeking the “Lowest Bidder”

We all know that is it the duty of procurement and purchasing people to be good stewards of their company funds. When it comes to precious metal catalyst reclaim, the obvious and typical metrics (processing fees, shipping costs, speed of turnaround and metals accountability) represent a small fraction of the precious metals value, and yet nearly all companies base their decisions on PM refining contract awards on these outward appearances.

Some vendors win contracts on basis of being a few pennies cheaper than their competitors, and some client companies have even made taking the lowest bidder their corporate policy. They’re simply trying to save money, but do we buy the cheapest shoes we can find? Do we visit the cheapest dentists we can find? Why not? Simple: because we all seek a balance between the performance and quality of what is being bought and the fairness of the price.

As clients seek deeper and deeper discounts, a vendor will do everything they can to reduce costs of labor, cheaper raw materials might be found, production speed might be increased, etc.; but only to a point. As the saying goes, “nine women cannot make a baby in one month”. Cross the line in some way and you will suffer the consequences: you’ll get a lower quality product or service. In the precious metals business these consequences would include poor or insufficient processing, inaccurate sampling, incorrect assays, illegal disposal of wastes, or other improper behavior… all of which represent a huge risk to you as the precious metals owner.

The critical nature of precision and accuracy in evaluating high-value materials grossly outweighs any perceived discount on processing fees. It is the proper weighing of the catalyst shipment, the drawing of an accurate sample and conducting the highest industry standard of precious metals analysis that are the absolute essentials. It obviously takes trained people, calibrated equipment, time and experience to accomplish this. It may sound trite, but quality cannot and does not come cheap. Degrees of accuracy are in direct correlation to the investment made in creating them. In precious metals recovery, there is a substantial amount of false-economy in a “lowest bidder” mentality.

Sabin’s custom-designed processing and continuous catalyst sampling system generate consistent, reproducible, statistically valid samples – the most important step in the recovery and refining process. This system generates samples that represent – as accurately as possible – multi-ton lots of spent catalysts. For more details on Sabin’s laboratory, please review our ‘PM 101 – Sampling and Analysis’ section.

For over 75 years our technical innovations, conservation policies, and responsive service have helped maximize returns for PGM catalyst and other precious metals users around the world. We invite you to visit us and see for yourself what the “Sabin Difference” is all about.

The Take-Away

Make sure your precious metals end up with a responsible recycler, root out and eliminate the unethical and the wasteful, and forge global partnerships; allow for fair margins, invest in research and development; discard perceived limitations and challenge what is ‘normal’.

At Sabin, we believe that long-term wisdom and meaningful innovation is best for business, and as a result, it is what is best for the society of Mankind. If you’d like to learn more about this topic, or any of the other Sabin Metal Precious Metal bulletins, please visit us at www.sabinmetal.com.