More and more cars are being manufactured these days and an increasing number of people are keeping their cars for a shorter period of time. Because the cost of repairing cars is often prohibitive, even cars with relatively less damage are totaled by the insurance companies who prefer to chase customers buying new vehicles. A large number of salvaged cars are sold by the insurance companies to salvage yards that typically isolate the valuable spares and components and then crush the car for selling to recyclers of scrap metal. Even though it may seem that the work of crushing cars or operating a salvage yard is not very complex, it requires more than just a yard and some equipment. Some aspects that prospective salvage yard business operators should know:
Know What the Operations Entail
To successfully operate a salvage car business and ensure the maximum profits, you should be very familiar with the structure of the vehicles and the various components that are used in their manufacturing process. This is because you want to remove all the parts and components that are valuable and can be sold to buyers who would like to buy the used parts as they are cheaper than new spares. These parts are also in great demand by dealers of certified pre-owned cars due to the cost advantage. You will also need to be familiar with the process of crushing cars and the equipment required, like lifting equipment such as cranes and forklifts, and hydraulic crushers that reduce the car to a metal brick.
Know the Regulations
The licensing department of your local area is the best place to find out and learn about the regulations applicable to a car crushing business. Usually, you need to comply with zoning regulations as the recycling industry presents hazards to the groundwater and the environment. Additionally, there will be requirements for insurance and bonding. You need to identify a plot that meets the regulatory requirements applicable in your state. The office of the Environmental Protection Agency should be contacted for information on water and air pollution compliance.
Equipment and Licenses
Since junkyards require a lot of space for the vehicles to be stored before they can be taken apart or crushed, you will need to choose a plot that is at least 2-3 acres in size. If you are starting out for the first time in the salvage business, it may be better for you to consider taking the plot on a lease instead of buying it outright. If you have an opportunity of taking an operational crushing yard on lease, all the more better as you will not have to take the trouble of setting it up. Apart from the office infrastructure, you will also need to have forklifts, cranes, a tow truck, a car hauler, a crushing machine, and a crusher bed. Be sure to acquire a car wrecking license with the fees as applicable in your state.
The car crushing business involves a lot of hazards. It is essential that you have clear safety policies for both employees and customers. Ensure adequate insurance cover for both the employees and the assets. Make sure you have adequate security to guard your premises.