JANUARY 2011
                                        

A Closer Look E-mail the author

Foss Auto Recycling
Jim Ashmus • 866-534-5865

Thirty years ago, Jimmie Foss made a pragmatic decision that launched his career in the recycling business. He had worked on a farm, which was a seven-day-a-week effort. Auto recycling was six days a week and “I got holidays off,” Foss said. Even better, “Snow days on a farm, you have to work harder. You can close the car business.”

Back then, Foss was dealing in used auto parts, and it wasn’t long before he added four more locations. The auto parts businesses spawned a need for car crushers, and those came online about 20 years ago. Finally, Foss moved into the scrap business in 2005, and now has five scrap yards in North Carolina in addition to three small you-pull-it auto parts yards.

Foss sold two of his wholesale parts yards to focus more on scrap. “There’s a lot more opportunity in the scrap business than in used auto parts,” he explained. Although he handles auto scrap, that’s no longer his primary concern. His scrap yards accept ferrous and nonferrous scrap from peddlers, which accounts for about 65 percent of his material.

“People are happy,” Foss said. “They’re tickled to death that you’re paying them money.” In the auto parts business, customers had to pay for parts they needed to make repairs, so while they were glad to have them, they weren’t as happy as current customers who walk out the door with a payment for something that’s essentially useless to them.

Industrial scrap accounts for the other 35 percent of the scrap. Besides placing roll-off containers for industrial accounts, he is starting to look into the demolition business as a new opportunity.

Foss runs the business with his brother, Stephan, who focuses on nonferrous scrap and the accounting end of the business. Foss focuses more on ferrous scrap and the equipment. The company has one outside industrial account rep, and both brothers work with him.

Foss said that his favorite part of the job is “buying and selling of material. You’re dealing with a lot of different people.” When it comes to the sales of the material, Foss enjoys that interaction, particularly that “it’s all done by word of mouth.” He said that while there are formal contracts, the deals are made person-to-person and the written contracts are just a formality. “It’s an honor-based system – that’s what I like about this industry.”

While Foss’s business with his customers is honor-based, state and local regulations aren’t as trusting when it comes to buying material. Foss said that about two years ago, he was required to “fingerprint” certain items that come into his yard, like cars and copper, This entails photos of the material, photos of the person selling it, and signed documentation.

Regular customers have become used to this procedure. Foss said, “Most don’t have any problem. A few leave.” The documentation is saved on the company’s computers and is available for law enforcement purposes. It doesn’t happen often, but “if there is an issue, we burn a CD and give it to the police.”

On the sales end, Foss ships out about 350 truckloads a month, with about 8-10 truckloads a week destined for China and the rest of it sold domestically to refiners and steel mills.

Over the past five years, Foss has seen scrap prices skyrocket. “Prices have double to tripled,” he said. But at the same time, the cost of doing business is higher as well, particularly fuel prices. “We have to work harder to make the same amount of money,” he said.

As far as the future – that’s already here. A new facility is in the works, with more state-of-the-art technology for scrap processing, and, of course, “new offices,” Foss said.

While his original goal in moving from farm work to the auto salvage business was to work six days a week, he’s now looking at a future where he might work 3-4 days a week. “In two more years, my son should be here,” Foss explained. His son, Jimmie III, is in college. “He’s trying to learn – to grow the business,” so foreign business is part of his curriculum.

Jimmie III isn’t going to show up as the privileged boss’s son, though. Foss said that he “started at the bottom” and worked as a laborer in the yard to get to know it from the ground up. Meanwhile, Stephan’s son is a little younger, but Foss expects that he will also join the company when he’s ready. And then, maybe Foss will have a few more days off.