I want to expand, approaching a bank for a loan.

For the guys far more advanced in this industry than me (larger). I wanted to create a fallback while expanding at the same time. E waste is my primary business. So let me explain a few things I am considering.

Wire granulator: Why? Well in my entire county the best yard is only doing 80 cents on power supply wire which I know is coming out at a 60-65% copper by weight. Solid Core Romex is also doing 80 or at best 85 cents a lb. And the yards offering this price are going gangbusters right now from my personal observation. I'm asked by many of my smaller customers if I buy wire as well as e scrap and computers. Top this off with a daily 70-100lb of wire output in my escrap business. I'm interested in a small granulator for something at or around 100-125lbs an hour. I feel I'd be better positioned overall to take out a loan for a machine and spend what I have on hand advertising locally to buy enough wire to run the machine. Expected costs starting at 20 grand, I would be buying new and making sure the company who sells it comes out to help me set it up and shows me the ins and outs of running and daily maintenance.

X-Ray Gun: This sort of costs just as much as a granulator...and it explains itself what it does. Being able to positively identify alloys for purchasing on site would save me a massive amount of time spent sampling and confirming a load before I turn around to buy it. Expected costs from 12-25 grand.

Property: I need to move up to a dedicated facility probably in the next year or so. My intake stream can fill every space I have in a week. The plan would be pretty simple, buy a warehouse property with 3 phase 408 volt power. This would also force me to include material handling, such as a forklift. Also need to consider retail space, after all, it's better than a third of my business.


Overall I feel like the granulator has the most potential but also comes with the most risk. IF I size it right for the cost I believe this would lower my risk. I'd like hear what the older and or wiser has to say on the subject and if you need more information from me I can answer additional questions.

This is my thoughts on a loan for the equipment, most traditional banks will want a form of collateral, mainly property you own or have equity in. There are other nontraditional company's that do loans for machinery exclusively at a higher interest rate than you would get at a bank. Business loans and lines of credit through banks are not an easy thing to acquire. My $0.02

Well Army I would advise you to dig a little deeper as far as the wire granulator goes, I know a few guys that have bought these machines and it was supposed to be the next new get rich thing, it hasn't worked out so well for them, there main problem was and still is they are always searching for wire, one other thing they all agree that all they strip is number one wire only,they lower grades just don't work out to be profitable, is there consensus. there are also a lot of these machines for sale all around the country with low hours the dealers will finance you with decent credit. Another hurdle to over come right now is the price of copper keeps slipping and realy shows no sign in the near furture of rebounding. As far as the X- Ray gun I bought one in 2001 when I was a yard owner, payed 22,000.00 for it then it is still working my ex partner lets me use it on samples of lots I am trying to buy or bid on, any dealer will let you shoot a sample of something to see realy what you have if they are doing business with you. They are nice to have but for the amount of times you will need it if not having a high volume yard I think it would be a very high priced dust collector. And the investment required in my opinion would be better spent on something else. I don't want to discourage you in any way, good luck to you you asked for advise and that's what I am giving you. P.S. the guys that have the granulators are well seasoned in the scrap business and all have deep pockets for purchases, money is not there problem getting enough material on a steady basis is.

Hi, Army,

I've looked into granulators as well...my take on it is to question just how well they actually separate the copper from the insulation. It seems to me that the process will be very sensitive to just how fine the wire is chopped up to how much copper remains attached or stuck to insulation.

Imagine a chunk of #8 wire--it is mostly copper because it is so large compared to the insulation that may be on it. So the copper should fall out of a chopped piece of #8 pretty readily. Now compare that to a chopped piece of #23 solid copper wire--one of the wires in a common piece of 8 conductor LAN cable. That piece of copper is about 0.025" in diameter and small compared to the insulation it is surrounded by. That piece of copper may not be as readily separated from its insulation.

Apparently the shredders in granulating systems are pretty important. Some setups use two or three shredders in a row to get the stuff down to the sizes they need.

Bottom line: try before you buy. Send a seller a gaylord of your common wire you deal with and witness them processing it. Take the separated copper and insulation away and investigate just how well they did yourself. Have them write a separation guarantee into the sales contract. Find out how finicky the machines are to keep in adjustment. Know how much copper you are willing to throw out with the waste insulation.

I believe this is the real problem with granulators...they don't work (read separate the copper) very well, NOT that the feedstock for them is hard to find...

As an alternative to the granulation route, you could consider just using the process of how insulated wire is sold in bulk today without being granulated: It is separated into grades, as you are well aware of, baled, and sold as a certain recovery %. Usually by the truckload or shipping container load. Your challenge then becomes finding a baler and locating the big end user customers, bypassing all the middlemen. Ive seen wire baled with a 500 ton press, making a 3000 lb bale about 3'x3'x4' but there might be smaller presses making smaller bales that could be stacked together and banded.

That press could be put to good use baling other things like aluminum and light steel.

Lots of scrap stuff is sold without baling, in gaylords. The real reason stuff is baled is to make the shipping economical. You need to be able to get to weight limit in a truck van or sea can or take a hit on the shipping cost. An idea here is to ship wire in gaylords, but chop it into short pieces so that a gaylord can hold a shztload of wire. I'm blue-skying it here, but I do know that stuff like scrap steel banding is just horrible to deal with--in quantity its hard to handle, bulky, dangerous to work with, etc. But it becomes a puppy once it is run thru a banding chopper that cuts it into 2" lengths and fills barrels with it. The barrels are 500 lbs, easy to handle and truck, etc. Betcha chopped wire would work similiarly. And those banding choppers are pretty cheap--couple of thousand bucks.

It all boils down to if the end user--your potential customer-- would (or could) accept wire chopped rather than baled.

So maybe your problem becomes finding those potential volume customers and talking to them about how they would or could accept your product.

Not a lot of definitive answers but some food for thought.

Jon.

Sounds like your are trying to run before you walk.
My advice? Slow down a bit, learn the market some more and slowly get into it.

I would man, but at this point I'm growing too fast to keep up with my current methods. Every time I turn around I have to haul off something that I don't have time for. My shred trailer needs to be house sized to keep me from it every day or two. What I'm talking about is something to plan and implement starting this winter and have in operation by april or may. So while it appears I'm moving fast, I have aggressive strategies in place too, thus far, gangbusters.

Well I'm not trying to make it appear anything other than what it is... a trailer full of shred is barely worth the two hours and 35 miles to the yard to get rid of it. Especially since steel seems to be taking an unending dive.