A Conversation with Jim McKinney

May 1, 2024 | Interview

An Unusual Path to Ownership

By Caryn Smith

Everyone knows Jim McKinney as an auto recycling professional turned innovative owner of EZ-Suite, a software that provides real-time data in processing and tracking of deliveries for the auto recycling industry.

(c) Jeff Sprang Photography

Now, he has added full ownership of Milliron Auto Parts in Mansfield, OH, to his credentials. From his roots in auto recycling and knowledge of shipping, technology, trading groups, and full- and self-service operations, McKinney has his finger on the proverbial pulse of the industry and his outlook is a positive one.

Automotive Recycling: Jim, you have returned to your roots in automotive recycling, and still own and operate EZ-Suite. How did this all transpire to now own two companies?

JIM MCKINNEY: I grew up a mechanic by trade in my dad’s shop. That’s what I did. And you know, family businesses can be tough. Then, I ended up becoming a dismantler for Milliron Auto Parts 26 years ago, and I worked my way up and into management. Growing up with my dad a mechanic and my mom in technology and computers, I had that rare mix of knowing both of those sides of the world.

While working at Milliron, owner Karl Milliron wanted to update the systems to Pinnacle and when he found out that I knew about technology and computers, I got to come up front and help with that install. That experience got me into what I call the ‘front end’ of the business. I became a dispatcher at the time, and grew from there.

Eventually, I left Milliron to work for Greenleaf Auto Recyclers and got more of an education. Angus Harris took me under his wing, mentoring me, and I became a site manager for them. I realized that I really liked P&Ls and things like that. And then, Greenleaf was sold after working there for about four years.

AR: What brought you back to Milliron Auto Parts?

JM: I was trying to purchase a yard that was in trouble and I asked Karl and a few other yard owners to be my brain trust and help me figure that out. We quickly realized the purchase would need a huge injection of cash, which I didn’t have, and they were willing to put up the money at that time. This was around 2008, when the economy tanked. I told the investors that I did not want to risk it, so I backed out of the purchase.

Then, Karl suggested I come back to Milliron and run his place. With the recession, I ended up letting the dispatcher go and inadvertently created EZ-Route, which I built for us in Excel. It was operating pretty well, so I told Karl that I thought we could sell it for others to use. He and I became 50/50 partners and it took off.

Maybe six or seven years ago, I stepped down as a General Manager of Milliron to run the EZ company, as it had gotten so big that there was plenty to do and it needed more attention.

About three years ago, Karl asked if I wanted to buy Milliron as a part of his succession plan. He doesn’t have any children or family to continue to run it. I thought it was good for me to be in touch with the industry, to be an owner, and to know the industry’s struggles as I continue to develop software. We made a deal where I was part-owner, with a five-year transition plan to full ownership.

Then, Karl’s father, Grant Milliron unexpectedly passed away last year. Karl took on his father’s estate and the foundation that he had created, which is a very, very nice foundation, and it was going to be a lot of work. We accelerated our plan by a couple of years and I bought the remaining 50% on January 1 of this year.

AR: Milliron is a family business, with a long history in the industry as a leader, how did it start?

JM: In 1954, Grant Milliron (Karl’s father) and his dad decided to open a salvage yard business with a business plan written out on one piece of paper, $1,000 and just a few cars. After a couple of years, his dad decided he wanted to exit the business and Grant stayed on. He grew the business until the 1970s gas crunch, when part sales were in the tank. So he ventured into recycling and scrap, that led Grant to start a salvage company, that led into buying a shredder and becoming a whole shredding operation. Eventually, it led to Midwest Trucking, as well. All these businesses were spawned from a few cars and an idea.

I tell people this all the time; it’s not about it being fast, or getting it earlier than expected, it’s about what I expect is going to happen today.

AR: Describe the facilities and processing at Milliron.

JM: Milliron Auto Parts is sitting on about 18 acres. We’re a hybrid facility where we do full- and self-serve. I think we opened a self-serve in 2013 or 2014 and jumped into that game. And for us having a shredder across the street was kind of a no-brainer. In September of 2011, things got tough for a lot of recyclers, especially in Ohio. We noticed it and I don’t know how, but we found the courage to open the self-serve. We probably should have done it years before. We were already buying these cars off the street. I buy about between 250 and 300 cars a month. Some of those are full-serve, some are self-serve.

AR: You are primarily doing self-service at Milliron. How many cars are processed on the full-service side?

JM: Probably about 10 a month, which is very, very light. We should be doing about 100 a month. We’re going to get there. We do 250 to 280 cars a month in the self-serve. We hold about 1,200 cars there. When Karl and I were both kind of gone from the day-to-day operations running the spin-off businesses, it made the full-service side a little more difficult. Self-service is a much easier business.

AR: Do you have any EVs processed?

JM: Very little; a couple of Prius’s here and there. We’re gearing up and I’ve got people trained for it. But, you know, we’re in a small town of about 50,000 people. We have more hybrids than pure EVs. It’s not very popular here yet. It seems like there’s a little stall on the EV side right now with manufacturers having issues and sales not where they thought they would be, so we’re kind of waiting the game out, but I’m sure we’re going to have to jump in at some point.

AR: Is your facility ARA CAR Certified?

JM: Yes, we did accomplished that in mid-2000s.

AR: What was the purpose of Midwest Trucking?

JM: There was a group of about eight yards that formed Midwest Trucking, and they hired someone to do the trucking. Remember, this was back when I was a production manager at Milliron, and I was part of some of that. It finally grew to where the trucking wasn’t working so well. Karl offered to start a trucking company to meet their needs in 2003. This was all born to compete with consolidators, which were located about an hour from us.

A group of us in Ohio, Michigan, Kentucky, and Illinois, banded together to form Midwest Trucking, with Karl taking on the logistics to help the group. It was getting it was quite expensive and getting tough and Karl wanted to expand on the group. The group eventually dissipated, but the trucking and the trade remain. So over time, Karl grew it into about 150 or 160 yards on the transportation side, before it was merged with PRP.

AR: You’ve got a bunch of smart people that you’ve been learning from.

JM: Absolutely.

AR: What’s happening with EZ? Are you still going to be part of it?

JM: I’m still CEO and I split my time between the EZ and Milliron offices. EZ just went through a very large transition. Before, all of our development was outsourced and contracted, and so we brought it in-house now. We’ve hired a Chief Technology Officer and several developers with plans to add to that team. We are back to what I would call ‘building mode,’ where we are creating new products and also stabilizing our base. We are actively building a couple of new products as we speak; so it’s grown quite a bit for sure.

AR: How many employees do you have right now?

JM: Nine employees at EZ and 24 at Milliron.

AR: How many facilities do you work with the EZ products?

JM: Unique recyclers, right around 550 recyclers. I’m also on the PRP Board of Directors, as treasurer, and we do a lot with PRP. It is a good group of recyclers, and PRP has really come a long way. We partner with other groups like Recyclers Cross Dock, the Canadian Auto Recyclers and we’re starting to work with some folks in the UK. So we’re kind of kind of all over the place.

AR: What is your primary EZ-Suite product?

JM: The biggest product is probably EZ-Route. EZ-QC (Quality Control) is growing the fastest right now because it’s our latest product. This is where data and pictures of parts are displayed as they are processed through our platform. It’s beginning to gain adoption now and really coming on nicely. And we still sell many EZ-Route software systems, as well. We are still a growing company.

AR: How did the relationship with PRP come about?

JM: This is an interesting story. At Milliron, we were a heavy broker when EZ was just taking off. I was trying to get a deal with PRP. We built EZ-Runner software for groups and I was trying to get PRP to buy into it. It came down to EZ and UPS and UPS beat me out of the deal.

But what PRP realized at the time was that we also had Midwest Trucking. And Midwest Trucking is in Ohio and they were having problems in Michigan, connecting to the PRP northeast group. Being in Ohio, we were perfectly positioned to help solve that issue. So we lost the software deal with UPS, but we got a trucking deal for Midwest that helped foster relationship with PRP where they got to know us.

A year later, we beat UPS out of the software contract, with EZ, and here we are.

When all this happened, I stepped down as Milliron General Manager and went to run EZ primarily, while Karl focused on trucking, and the yard kind of just did its thing. Fast forward, now we’re reinvigorating Milliron. We were more self-serve then full-service, other than brokering parts. But now we’re focused on growing our inventory as a full-service business.

AR: Being a part of Team PRP, I’m sure helps with connections. How do you view that now?

JM: The PRP Trucking Network Hub in Mansfield, Ohio is the largest in the entire network. It’s positioned really well, logistically, and the group has merged into one from Midwest and PRP members. It’s the busiest hub on the network and Milliron is four miles from it, so it’s very easy for us to take advantage of brokering on the network and get parts out quickly.

AR: How do you keep two busy businesses going?

JM: I just love it or I wouldn’t do it. I wouldn’t be in this far if I didn’t love coming to work. My friends and family have often said, ‘You keep saying you’re going to slow down.’ I realize that I’m telling them that to appease them, not me. I’m not ready yet. And as long as I enjoy it, I’ll keep doing it.

I have really good people all the way around me, so I’m working toward a plan for some to take over and lead. I might slow down at some point and become a Board Member for EZ.

My wife Tammy and I have been married 31 years with three kids, two of which are working in the business. My one son, JD McKinney, has his own company. But, all of my kids are entrepreneurial. The other cool thing is that all of these things that I do intermingle, they’re all tied at the hip. I am jumping from business to business every day but it’s not a far leap. They’re all in the same world. That makes it really nice.

AR: What roles does your family play in the business?

JM: My wife now works at Milliron, handling the books. She came out of retirement after leaving her nursing career in 2020. My daughter Tiffany Nuhfer, eldest of the three, is doing all of my HR and payroll for both companies. And my youngest son, Mitchell McKinney, is in sales at Milliron.

AR: Auto recycling is changing with a new diverse generation of owners. Where will it be in five to 10 years?

JM: Our industry is adopting technology more than ever; I’m seeing younger generations buying in more from the software side. They say, ‘We need all of your products. And we want more.’ I think technology is going to keep evolving heavily in this industry more and more. It has to be. Those that get in the game sooner are usually better off.

From a PRP and auto recycling perspective, trading groups are improving. We’re actually starting to see some change. People are actually adopting and listening and getting more engaged. The industry is thriving pretty well right now. Everybody’s trying to do the best they can and improve the business. Then, add to it this younger generation who want to be different than dad and mom, and they want to really get it done, so it’s changing.

I don’t know what’s going to happen with EVs and self-driving cars. It’s like everything else; there comes a big peak and a dip, and then we have more little peaks and dips. We’re a long way off. I don’t know if I’m going to see that transition in my tenure in this industry. The next generation will. I don’t think it’s going to happen as fast as the world thinks it will.

We’re going to have to do what we’ve always done in this industry – somebody has to handle end-of-life vehicles. And that’s us. Back in the day, you didn’t sell body parts, you sold mechanical parts. Now that’s evolved and we’re selling body parts. We do a better job of recycling now. I don’t know what it will be, but there will be something there for a long time.

AR: So do you think the number of recyclers will drop?

JM: We are going to see some attrition in this business. If you don’t adopt to technology, you’re going to lose business; the phone calls are going away. It’s more and more electronic, whether we like it or not. We have to change how we think and how we do business. We’re going to see more consolidations.

On the positive side, I’ve met facility owners that are small, that weren’t aware of ARA, URG, RCD or PRP. Becoming part of a group is huge. Getting in these groups alone brings you a higher level of education. One of the best things – you can pick up the phone and call another facility for help. What other industry does that? It’s not often that competing businesses call one another and they will tell you how to fix your problem. That is huge and we’re seeing the groups are growing.

I’ve seen new small recyclers that maybe don’t know what they’re doing, and then get in a group, listen, and ask questions, and then they thrive. I’ve seen it over and over again. If you’re engaged, you’ll survive. But you have got to be engaged in a peer group. You’ve got to be an active member.

AR: Shifting back over to shipping. What’s going on in the shipping world in an Amazon society?

JM: I often tell our team that at EZ we’re in an Amazon world and we need to think that way, as we create what we create. It is more and more demanding, it’s more and more electronic, and the expectations have changed. The truth is, we all expect to get on Amazon and have whatever it is in a couple of days. It’s such a different ballgame. We’re trying to write software in those terms and within the expectations of the world today. We’re constantly trying to make ourselves a more efficient and delivering machine.

I’m very proud to say that our software helps with a lot of that. It used to be all on paper and I didn’t know if your part was getting to me today or tomorrow or Friday, or if it was lost. Now you can track it through a process that makes sense. In the EZ-QC product, I can see the work you’re doing to the part. I literally can tell what your progress is when I’m buying the part and so can the shop.

It is an Amazon expectation that we all experience. I tell people this all the time; it’s not about it being fast, or getting it earlier than expected, it’s about what I expect is going to happen today. If I know that it’s going to be a day late, it’s not the end of my world. If I get to the day that I’m expecting it, and it doesn’t show up and then I’m unhappy, right? So it’s a matter of being transparent and managing the expectations and making sure they know what they’re getting. This includes communication, pictures, things of this nature.

AR: On Amazon, if I don’t like it, I can drop it off at UPS for free, and they take it back with a QR code, and I get an instant refund. Is this going to affect all e-commerce purchases?

JM: Amazon is tightening up their return policy now. But for us, it’s the returns we can control that we’ve done a very bad job of as an industry. EZ-QC helps that.

I buy a fender from a recycler in Texas. The instant they pull it from inventory, I can see a picture of it. I can see right away, it’s a left not a right whatever it is, and can fix that before it goes any further. Before, I waited three days for a part to get to me, take it to the shop, they’re upset that it’s a left not a right. We have the ability to catch mistakes now, and it gives us control over things we can control.

AR: Is there anything else you’d like to tell us?

JM: Yes. I didn’t graduate high school. I quit high school about two months before I was supposed to graduate. So I’m living proof that if somebody works hard and puts their head down and really gets after it, you can be successful.

 I’m really excited for the future. I’ve been in this industry a long while, and I see a lot of good things happening. I feel like there’s such significant change and momentum, and I am very, very happy about that.

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