Buying out an auto salvage yard?

I've noticed a lot of older auto salvage yards that seem to be operating on their last leg...usually its an older family member that owns/operates it, the rest of the family isn't interested or is just living off what little easy money they're making from walk-ins. Or they're semi-abandoned and overgrown with weeds and trash.

If you look up the property values, most seem to be in arrears with taxes, some for almost a decade. And given years of accumulation of oil and other chemicals, the property can't be used for much else unless the EPA signs off on it.



But they're sitting on a small fortune in scrap metal alone, not to mention the value of individual components - vintage parts, cores, aluminum, etc. And as time goes on its less and less valuable as rust and weather set in.

Why isn't someone buying up these places and liquidating them? Or consolidating several yards into a modern facility? Of course it would take a large investment, but the numbers would seem to add up when you factor # of cars, $ per ton, etc.


Seems like with the 'green' movement there should be some incentives to improve 'blighted' properties as well.

Anyone ever try this or seen it done?

For the sake of numbers, lets say you're looking at a yard that has at least several hundred cars.

Our company just completed the second salvage yard 4- weeks ago (We started it on Sept. 15th) It was a fully operational State licensed Salvage yard and the wonderful twist to this one was that it was also a major Industrial salvage/ junk yard, thats why it took us so long to completely liquidate, well that and the fact that we were way under-staffed. Obviously much of the site was a massive learning curve for us. Perhaps the number ONE thing I learned was the fact that there is nothing in the scrapping world that can possibly beat having or aquirering a salvage yard to scrap out. Please dont misunderstand me, I dont mean that in a arrogant way, not at all.... truth be told it was a very humbling experience.

IronPirate, As I read your posting it reminded me of about two years ago when I came up with the very same thoughts. It was then that I began taking small little trips all around looking for those old run down junk yards / salvage yards. I made contact with several owners and opened up dialogs with a handful of them.

I wish I had more time tonight, I have to get going for now. I will try to elaborate a bit later.

GreenTruckR, please do - I'd love to hear some first hand experience.

My main concerns are pricing and acquisition, and then reselling. How do you talk someone into selling out when they're probably very used to a certain way of life and have been doing the same thing for years?

Who did you sell to as you broke everything up - a broker, another yard/processor?

This is exciting stuff

How big was the yard? 3-1/2 months seems pretty quick actually. We were estimating at least 8-10 months for our yard, but that's working with minimal equipment and staff to keep costs down.