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Making it in the Classic Car Junkyard Business | CTC Auto Ranch

by Pablo Fuentes | Last Updated May 3, 2017
Making it in Classic Car Junkyard Business

In 1985 David Williamson and his brother were struggling to make their used car sales business work.

After failing to sell a 1947 Dodge pickup truck multiple times, even going as far as to offer it for as little as $300, they got the bright idea of trying to sell just parts from the truck.

They listed an ad for truck parts in a motor news magazine, and what had been an impossible vehicle to sell, became a hot commodity. They ended up selling parts from that old truck for $3,000 and realized there was a lot of money in just selling parts.

Those were the modest beginnings of CTC Auto Ranch; now they are one of largest classic car junkyards in the country. Starting with just 80 cars, they now have over 4,000 classic cars and sell parts all over the world.

Today, on Small Business War Stories, we talked with David Williamson from CTC Auto Ranch about his start and success in the classic car junkyard business.

Check it out:

The Soul of America Tour

This episode is part of the Soul of America tour sponsored by Tecovas Boots, Badger Maps, and Impact Dog Crates. During April 2017, I drove with my six month-old puppy Muddy Waggers, my guitar, and my podcasting equipment with the goal of recording podcast episodes with small business owners throughout the heart of America.

Listen to the podcast:

Show Notes

A summary of our interview with Dave Williamson from CTC Auto Ranch is below.

You can use the links below to jump to your interests.


This is quite the facility you have here. Just so our readers can get an image, you drive up and there are hundreds and hundreds, maybe thousands of cars?

Dave Williamson: There are about 4,000 cars. Mostly '70s and older.

How did you guys get started? How do you go from whatever you did before to having a lot full of classic cars?

Dave Williamson: Well, we started about 1985, I think, and we were in a town called Lewisville, TX about 30 miles up the road. We did mostly restored cars, okay. If you don't remember, back in '85 the economy wasn't all that great, so we're selling maybe a car or two a week, something like that. We had leased that property, and our lease had came due, and we decided we wanted to own property, so we found this tract of land out here north of Denton, TX on Highway 35, and we bought a six-acre lot, and moved our stuff out here.

At the time, we had about 80 cars. So when we moved out here, we didn't start off in the salvage car business, we were still trying to sell cars and sell other things as well, trailers, trucks, whatever. Whatever it takes to make a buck. And at the time, we had a 1947 Dodge pickup truck that had been on my back line, it's just a piece of crap. Been there forever. Nobody wanted to buy it. Tried to sell it for 300 bucks, nobody wanted it. The back window had been cut out with a torch.

So my brother had come up with the bright idea. He said, "You know, why don't we just put an ad in Hemmings Motor News, and just sell some parts off of it, see if somebody wants some parts off this thing." So, we did that and then in the next 30 days, we sold about $3,000 worth of parts off that old truck.

So that light flashed up. We go, "Hey, maybe there's money in parts." So we started doing that and we started buying some old parts cars and things like that. Then a friend of ours up the road that had a late model salvage yard helped us get our salvage license though the state.

What does that mean? What is a salvage license?

Dave Williamson: That gives us the right through the state to sell parts. If you start selling without a license, the state will come down on you and you're doing a big no-no. From my understanding, as far as I know, the state doesn't put out any more salvage licenses. You'd have to buy an existing license, yeah. You'd have to buy out an existing yard. So I think we were the last one in Denton County, as far as I know. I would think the license is worth something. I've never heard of anyone selling one, without selling the yard with it, but I would think so because they are transferrable.

How do you go from 80 cars to over 4,000? How do you get a car? How do they ship here?

Dave Williamson: Well, at first, we were beating the bushes and we bought out some old yards here in Denton that old guys had been there forever and they wanted to get out. They were old and wanted to retire, so we bought all their good stuff and left them with the crap. We buy groups of cars here and single cars here. People come to us and buy their car or scrapers, we'd normally take them to the scrap yard and smash them. We pay more for them, so they'd bring them to us. Like that.

How much you usually pay for a car?

Dave Williamson: That just depends on the car. Everything's different. Unfortunately, there's no set price on cars like that. It just depends on what it is. Of course, I got to buy as cheap as I can because I'm not going to sell the whole car. Some of them, I may not ever sell anything off of. Others, I sell two fenders, maybe a hood. It's not like I can pay $1,000 or $2,000 for a car then I couldn't make any money on it. I've gotta buy it kind of down there at scrap price.

Do you go pick it up from wherever? How many of these cars actually run?

Dave Williamson: Not a lot. Most of them, we don't even know if they run. We don't care. We don't check them. If I show you a motor, I'm just going to guarantee it to be rebuild able. I'm not going to guarantee it to run unless I've heard it run. But as far as hauling, we've hauled a lot of the cars ourselves. A lot of people bring them to us. It just depends on who it is.

Do you get cars mostly from Texas or they come from far and wide?

Dave Williamson: No. Mostly Texas, this side of Oklahoma. I mean I don't travel more than an hour to get the car- it's just not worth my time. There’s getting to be fewer and fewer around; most of them are here now.

How has supply changed over the years? Have you seen the supply of cars go down?

Dave Williamson: Well, not necessarily. I mean, yeah, they've come down some, but, we still get- for instance- we just bought a group of cars from that guy over in Decatur, TX. We bought like 38 cars from him. He was 35 miles down the road. But we had to haul them all in and that takes time, it takes money. I have a car hauler, then a pull trailer behind that. I can move two at a time, so it takes a while.

You have people from all over the world who buy from you, right? So what are some of your wackiest stories? I mean you have people asking for parts from like Europe, Asia, etc?

Dave Williamson: Yeah, yeah. We ship internationally, for sure. I just sent some parts to Turkey. They were buying 69' Impala parts, I think in think in this case it was AC parts.

Let's talk a little bit about the perception of having a junkyard. What are maybe some of the things that people think about a junkyard, that may or may not be true? What are some of the myths and tales?

Dave Williamson: Oh yeah, well, in this kind of business- in this particular kind of junkyard- everybody thinks, "Aw, man, I want to work there. That'll be great." "All those classic cars - being around that all day long. That'll be so cool." They don't see the hard work on the other end of it. I mean, those parts don't fall off those cars. People aren't patient. I mean, everybody wants it now. We're a small operation. We only have one or two parts pullers, one or two people packing parts.

How do you keep track of what you actually have? Do you have a file for what parts are no longer on a car?

Dave Williamson: We log them as we bring them in, and then we put them on our website. I don't directly keep track of what’s left on a car. But what we do is, if we pull a lot of parts off a car, then we'll bring it back up, we'll re-shoot the pictures, and repost it. We try to keep up with it that way, but we really can't keep up with it. I mean, it's one of them deals where everybody complains: “I see it on your website, so I know you got it.” And my response is: “Well, you know, I took that picture a couple of years ago, so maybe it's not still there.

You don't continually update all the pictures with 4,000 cars. I just can't keep up with it, no. But that's why, like I said, what we've tried to do in the last couple of years is, when we bring a car up and pull its parts off, we were trying to re-shoot it, and refresh the pictures.

What's the process where somebody wants a part? Let's say somebody comes to your website and saw a part they needed…then what do you do?

Dave Williamson: You send somebody out, or you go out yourself to the yard and look at the car and see if the part is still there. Fortunately for us, our phone rings constantly all day. So what I'm doing is when I answer that phone and they tell me what they need, I'm writing it down, writing their phone number down. Then I go out, you know, every hour or two, I'll go out and I'll look at all this stuff and I'll call everybody back, tell them what I have. I'll shoot pictures of it that way.

Now there's nobody who can buy anything without seeing a picture of it, you know? I mean, no one takes your word for anything. They want you to send an email, picture thingy whatever, then if they want it we'll write the order, pack them up, ship them out.

How do you price parts? Do you look up the market price of every part or do you just know by this point? Do you have an encyclopedia in your head of what everything's worth?

Dave Williamson: Well ... Yeah, at this point, I know what's hard to find. What's hard to find stuff costs more money because I have to pay more money for those cars. And of course, people think that in an old car that it should a part should hardly cost anything. They need to see the business and see the other end of this thing to see what it takes to run. You know, between insurance, regulations, taxes. You know, all the stuff that it takes to get into business these days. Insurance, I mean, health insurance for your employees, everything. It's very expensive to do this business.

Tell me more about the insurance part. What do you have to have insurance for?

Dave Williamson: I have to have liability, you know, product liability. I mean, you send something out and if it fails, I mean, you're kind of behind the gun on it, within reason. The government comes up with new regulations all the time, you know. Before we didn't have to have a license to stand behind a counter and sell you a part. Well now, every person has to be licensed, and they charge you every year for that.

What are some myths about junkyards that are not true, that most people believe?

Dave Williamson: Some people think you're out to get them you're out to rip them off, or something like that; they've always had bad experiences in the past. Everybody wants you to send the parts so they know what you're sending them. I mean, I want to send them a good part. I don't want to send them something they're gonna send back. I gotta pay a man to pull it, pay a man to pack it ... waste my time selling it.

Pulling parts is not always easy, sometimes they're rusted in, and if it's like a quarter panel, we gotta cut it off the car, it's all time consuming. We use a Sawzall, a chop saw. We don't use a torch cause that warps the metal. We'll cut it at the factory seams, so we can sell all parts. It takes time, it's not something that happens in five minutes. Sometimes we'll spend a half a day pulling a part off for somebody. It's not like all that money they pay is a profit. It's all overhead.

What's the rarest car that you've seen come through here?

Dave Williamson: You know, I have seen a lot of interesting stuff come through. I've got a 1940 Packard 160, which is a real rare car. When I first got it, I mean, it needs a total restoration but, when you get a car like that the first thing you think is, "Well, does it work?" “What is it worth?” So the first thing you do is you go to Google and you Google the car, see what's out there on the market. I can only find one car like it and it was already restored and it was $160,000.

Do you ever think, "I should restore myself instead of selling the parts?"

Dave Williamson: Well you think that but no, I won't do that because I'm not in the restoration business. I don't have the people that can do that. My guys are good at pulling things apart, they're not good at putting them back together. I'm gonna sell them to someone else and let them restore it.

So you would probably sell that car as one piece?

Dave Williamson: Yes. Yeah, because if you go to my website, I have a Cars for Sale page and a Parts Car page. The cars on the Cars for Sale page are for sale as a whole car. The ones that's on my Parts Car page are not for sale, just the parts off the cars for sale.

So much is a Packard?

Dave Williamson: You walked right by it coming in but it's, $6,995, I believe what it's on our website for. I mean, there's plenty of room but it needs a lot. It needs a total restoration so it's gonna cost you, depending on who does it, you know $50,000-80,000 to restore it.

Tell me about a time when things didn't go well. When did you have a challenge and what did you do about it?

Dave Williamson: Well, I mean, as you know if you're self-employed, there's good times and there's bad times. Fortunately for us, in this business it's been a pretty steady ride. I mean, early on it was tough because we didn't have the inventory. It was paycheck to paycheck. We've been pretty fortunate as we got a good base of customers, we've taken care of our business too, and have a lot of repeat business. So even when things were slow, our business was steady. For the last 20 years ago or so, I haven't had any real bad, bad years.

Have you ever had like an issue where an employee was difficult?

Dave Williamson: Well, yeah. We've had plenty of that, I mean, anytime that you have people- labor that's out there- when it's hot, it's hot, when it's cold, it's cold and you still gotta work. People still want their parts, they still gotta pull them.

What's the profile of somebody who's successful working for you? So you were talking about there's this romanticism of, 'I want to work there. It's awesome.' But then there's the hard work behind the scenes. So who have been your most successful employees and what's made them successful here?

Dave Williamson: We've been pretty fortunate that most of the employees we have, we've had for quite awhile. Unfortunately, this business doesn't make enough money that you're going to come in here and make a career out it and retire. Probably me and my brother that own this place are the only two who's going to retire out of it because it doesn't make enough money to keep paying the bills. And we don't have kids that are coming up that are going to take it over and keep it running.

Do you see that classic car restoration as a dying art? Or do you see a younger generation of people taking an interest in this?

Dave Williamson: I can tell you right now that the younger generation has definitely taken an interest in this. We have kids coming here everyday that want to walk around and look at old cars and just love them. They might be driving a Nissan but they want to look at the Chevelle.

What do you drive?

Dave Williamson: My everyday drivearound is a '71 Chevrolet pickup truck and then I have a 72' Corvette. And all the way down there and I have an 85' Corvette that I bought brand new, that I still have.

What would you say is the number one lesson or piece of advice that you've learned in your time running this company, that you'd put out to other small business people out there?

Dave Williamson: Treat your customers fairly. Don't put them down and don't judge a book by its cover. If someone comes into your office and they look like they can't afford a pot to piss in, but they may be a paying customer, you don't know that. People are people. Don't read them by just walking into the door. Take your time to talk to them. Treat them with respect, and listen to them.

Where do you see CTC going? What do you want to do with this?

Dave Williamson: I'm 59 years old and my brother Allen is 63. 10 years from now, I'm hoping we'll be able to retire and someone else who bought this place can carry it on. You want somebody who has the same passion for it-

What's your cut off, 1970? As time goes on and all a sudden we're about three years from 2020, and at that point an 1980 car a 40 year old car, right? Do you move the line?

Dave Williamson: Well, we have some 80 stuff I mean, but, you know, there's still some of those on the road but mostly what we look for is 70s and older. That 80s car is made out of plastic and they're not making new plastic. Also, for those newer cars, there's no style to them, they're all alike. It's not like they were in the 70s and older.

Do you do European cars at all? Do you have old Alpha Romeos, MGs, or Spiders?

Dave Williamson: We don't really do a lot of European cars. Every now and then I'll get a few Mercedeses laying around, things like that. I've had a few of the cars you mentioned, but I don't have any right now, I don't look for that kind of stuff. But if we buy a group of cars, inevitably we wind up with one.

Is there anything you want to share about your business. Where can people find you if they want to find a part for their vintage car?

Dave Williamson: Well, they can go on our website at CTCautoranch.com, of course they can call us over the phone at 940-482-3007. We do mostly 70s and older cars. Our strong points from 1940 to 1970. And not just any one brand. We deal in everything. Chevrolet, Ford, Chrysler, etc.

Final Thoughts

David Williamson and his brother followed a hunch and started listing parts as an alternative to selling entire vehicles. It led to a 30+ year career in the auto salvage business.

This is a great lesson for anyone looking to start a business. Sometimes your original idea might not work out. You need to be adaptable and try new things, pivot until you find something that works.

David also talked about always putting your customer first. You can't judge someone by their appearance. You need to take time to talk to them and treat them with respect.

If you have any question or comments about today's episode, please leave a comment below.

Topics: small business war stories, podcast

Pablo Fuentes

Written by Pablo Fuentes

Pablo Fuentes is the CEO of Proven. He is a graduate of the Stanford Graduate School of Business and UCLA. He is a Brazilian Jiu-Jitsu practitioner and a blues guitar player and builder.

 

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