How to Start a Used Auto Parts Business


Selling used auto parts can be a financially rewarding business opportunity. Salvage yards sell used auto parts by accumulating vehicles for storage and removing the working parts. You will most likely need a tow truck to start your business, along with secured storage for the used cars.

Things You'll Need

  • Tow truck
  • Acquire a property either by lease or purchase. For a used auto parts business, the property must have sufficient land for you to store vehicles. Ideal locations will have a small office with a large land area behind or beside it. The location will need a security fence; if you are unable to find one with a security fence, you may have to have one constructed on the property.

  • Apply to the local department of motor vehicles to get a dealer license. Used auto parts dealers must have a special license in most states, similar to the license a car dealer would have. At this time, you should also apply for a general business license and tax identification number at your local revenue office.

  • Acquire a tow truck. Most used auto parts dealers have their own tow trucks; if you are unable to acquire one, this business model may be difficult. Most of your inventory will come purchasing broken down vehicles and having them towed to your location.

  • Set up your business office. You will need general retail and office supplies such as computers, fax machines and a cash register. It is also recommended to purchase inventory software to help keep track of the parts you have coming and going. At this time, you should set up a sign on the exterior of your business that highlights basic information, including your business name and telephone number.

  • Set up contract database with other used auto parts dealers. This is the network that allows used auto parts dealers the ability to get used parts they do not have in inventory. You can also list your available parts through the service. Having this service is crucial; you risk losing business if you cannot secure a part for a customer (see Resources).

  • Begin collecting vehicles for storage. The vehicles you collect will supply your business with the majority of your used auto parts. It is recommended to run advertisements that offer to buy "junk" vehicles or others that people may want to get ride of. Offer a small cash payment for the vehicles and free haul-off.

Tips & Warnings

  • The larger the land area of the location, the more vehicles you are able to store. The recommended size will depend on the amount of vehicles you want to keep. It is important to not choose a location too small.
  • When collecting vehicles, it is of utmost importance to acquire the title to them. Make sure the person you are buying the vehicle from is the owner and has a clear title.


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