There are over 60,000 auto scrap yard businesses in the United States and that number is growing, meaning that owning and operating an auto scrap yard business can be a very profitable undertaking.
In this article, we will give you the basics, paint a picture using broad strokes, of what you need to open one. We are All Import Auto Parts, serving the Greater Fort Worth area with affordable and reliable used auto parts. Call us today, tell us what you need for that DIY car repair project, and we will find it for you.
What is an auto scrap yard business?
Auto salvage yards deal in decommissioned vehicles from individuals, insurance companies, businesses, and government entities. The salvage yard is kind of like a temporary storage facility that holds the vehicle before it is scrapped. The general idea is that a vehicle has it’s parts stripped and sold and once it is extracted of all its value, what remains gets sold for scrap metal.
First step you need to take for an auto scrap yard.
Finding the right location is crucial. Not only does it need to be easily accessible, but it also needs to have the proper zoning which allows salvage yard operations.
After the property is acquired.
When your land is established in a commercially zoned area, there are certain expenses you will need. Some states will actual require some of these items below:
- Fencing – This establishes your perimeter and will help prevent people from stealing parts from you.
- Security – Motion detectors and cameras to prevent theft in off hours. Some yards still use a dog.
- Shop, Garage or Warehouse – You need a place for dismantling vehicles. When vehicles come into your business you can’t just put them out. You need to drain fluids and strip parts the corrode quickly so that you can sell them at their best quality. Your building should have enough ventilation and be able to have enough room to store parts and separate recycling. Ideally you want enough space for an administrative office as well.
- Equipment – Some of the equipment you will need is tools, a car lift, an engine lift, forklift, and a car crusher. Might as be worth is to have a good yard truck as well for hauling parts around.
- Equipment for customers – A few wheel barrels, some spare tools, straps, etc…to help remove and haul the used car parts.
- Business Office Equipment – A computer preferably with an inventory management, customer management, and finance software installed.
And, when all of that is done, consider these last items:
- Obtain the necessary permits and licenses, including environmental permits, zoning approvals, and business licenses.
- Comply with local, state, and federal regulations for wrecking yards.
- Secure general liability insurance and workers’ compensation policies.
We have not mentioned writing a mission statement or creating a business plan. Those two items on your to-do list are game changers. If you do not know how to create either of them, find a good business consultant and get it done.
A final word about All Import Auto Parts.
All Import Auto Parts is locally owned and operated, a family tradition in the Fort Worth area for over thirty years. Call us today, tell us what you need, and we will make it happen, just as we have for two generations of Fort Worth residents.