I don't operate a yard, but there are two things that he can do; buy it for more, or buy it better. One of the biggest complaints I have about my current yard is that it's a PITA to drive into (only one scale, and it's quite busy so it can be hard to drive out of the yard once you're in). I mean, as long as he's offering competitive prices (IE at least on par with similar yards) then he should theoretically attract scrappers in the immediate area. But if I've been going to a yard for years that is paying the exact same as a new yard, and the new yard isn't any nicer, I don't really see any reason I'd take my business there.
Try to get a good web presence going. Maybe offer a donut or a coffee with every load of scrap, food is a great motivator.
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