How to Start a Salvage Yard

Business Overview:

Learn how to start a salvage yard and enjoy running a business that turns one person’s trash into another’s treasure. Salvage yards or junkyards are places where old cars and car parts go to die. However these cars and parts get a second life when purchased by collectors and auto refurbishing enthusiasts. If you are interested in how to start a junkyard, all you really need is some land on which to put the cars. Then it will be important that you comply with all local environmental regulations. Depending on how many cars you plan to house, you may only need a few acres. Fence off this area and put an office at the entrance and you’re all set. An office could just be a small trailer; somewhere that keeps you out of the elements and where you would keep a dedicated phone line and a computer. When you start collecting cars, it’s a good idea to keep an accurate inventory so when you get calls asking for a specific car part, you’ll know immediately if you have it or not. You don’t want to have to search your whole yard for a certain make and model of car hood. Individuals will bring you their old broken-down cars and you will pay them for their addition to your collection. Also consider contracting with local junk car removal businesses so they always bring their cars to your yard. They will charge you a fee but this is a great way to keep building your inventory. Another way to get cars onto your lot is to tow them there yourself. You will likely need to hire a driver to handle pick-up and delivery of cars so you can stay on site to assist customers. If you already own a tow truck, this would be the perfect option. To start this type of business it’s helpful to have experience with cars but it’s not required. Consider bringing on a mechanic or auto expert (or hobbyist) to work for you. You won’t need him to be on site full time but he should be reachable by phone during business hours and available to come to the yard for consulting purposes and to help pull parts off cars. Operating a salvage yard is one of those business ideas that allows you the freedom to be your own boss and, since you are the boss, you can close your yard if you need to go vacation or have a sick child at home. This type of business is not glamorous but it is very necessary both for people who need to get rid of their cars and for people looking for parts they need so they can fix their old cars. It is very rewarding to help a collector find just the right part to finish a refurbish job.

A Day in the Life of a Salvage Yard Business Owner:

Your day will begin by opening your yard for business and contacting the junk car removal businesses you work with to see if you can expect any deliveries that day. If you operate a removal service yourself, you will send your driver out for any scheduled or called-in pickups. You will spend the majority of your day assisting customers, either on the phone or in person, in finding specific parts.

About Your Customers:

Your customers will be people looking for auto parts.

What You Need to Start:

• Land
• Fencing/locks
• Tools
• Office (trailer or shed)
• Tow truck and/or relationship with towing companies
• Computer with inventory and finance software

The Good:

• Salvage yards are very useful for people rebuilding old cars.
• You get to work with interesting people.
• It’s rewarding to help people find the parts they are looking for.
• Your business helps get old junk cars off the streets.

The Bad:

• The start-up costs can be high.
• It can take some time to build up your inventory.

Resources:

• Automotive Recyclers Association
• Automotive Aftermarket Industry Association
• Bureau of Labor Statistics on Automotive Service Technicians and Mechanics
• Wikipedia on Wrecking Yards

About The Author

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