The used/secondhand auto parts industry in the U.S. is also commonly referred to as the automotive recycling industry. It is a very legitimate and large market, which is worth about $30 to $40+ billion annually. The industry has around 8,000 plus businesses, and in total the employee strength is over 140,000.
These companies basically buy wrecked or totaled vehicles, and they fully dismantle them. The extracted parts that are in usable condition are sold to buyers that need them. Most common parts that are sold include engines, transmissions, doors, wheels, mirrors, and electronic components.
The most well-known players in this industry include LKQ Corporation, Copart, and Pull-A-Part. These used auto parts are sold through salvage yards and online platforms like eBay Motors and Car-Part.com. Many companies have their own online websites where they list the entire inventory, pricing offers, and condition of parts, and they use credit card payment gateways and echeck/ach merchant accounts to collect payments for such parts sales. Most such sales are generally nationwide; only some providers also ship auto parts internationally, but mostly such trades are in B2B mode.
Used parts are very popular because they are about 50% to 80% cheaper than new ones. These parts are widely used in insurance repairs and are sometimes the only option for older vehicles like the vintage ones. Typical transaction size ranges from $50 to $4,000, with an average value under $999. This transaction pattern makes e-checks and ACH suitable payment methods.
How eCheck Works for used auto parts companies.
Customer enters the bank account number and routing number on the checkout page. The merchant can also submit details on the virtual terminal.
Payment information is converted into an electronic check and is then sent through the ACH network.
The system verifies the bank account and sometimes also checks balance ability.
Provider may call the customer for verbal authorization.
Funds are generally held in the customer’s account the very same day and are settled in 1–3 business days.