Buying automotive scrap

**ggariepy** · 02-10-2020, 09:00 AM

I've been scrapping for many years now. At least 10 or 11, maybe more.

Long ago I learned that curb picking was a money losing operation. It's typical for me to travel 25 miles just covering one neighborhood in my urban area and then taking the material to the scrap yard. Sometimes I will invest 5-6 hours a night into an operation like that, and gross only $40. Take out the expense for mileage and I net around $15. Not a great rate of pay!

So I have dabbled here and there in buying scrap, primarily from auto repair shops. I've heard many guys talking about "paying a buck a rotor" and wondered how well that worked out for them. As for me, seeing that rotors vary quite widely in weight, I came up with a different idea: build a working relationship with the shop owner based on trust. Arrive to buy scrap with an empty truck, load everything he's got, and then split the proceeds with him 60/40, I keep the 60%. And yes, I show him the ticket.

The one guy I've done this with has come back to me semi-regularly over the years. I've tried to make it work with another, larger shop recently, and the guy acts like he doesn't want to talk to me anymore. "Other people pay better than you do" he says. WTF? How? I doubt too many are paying on a percentage basis, is there another strategy people are using?

The guy didn't want to talk about it. He openly admitted to me previously he didn't know how much he would have gotten for the first load I hauled for him. I don't know what his basis is for saying I pay less than the other guys.

I suspect something else is going on there, but I'm not sure what it is. I'd be willing to adjust the percentage slightly, but it's a lot of work even for 60%.

Anyone willing to share their purchasing strategy? What am I missing here?

**mikeinreco** · 02-10-2020, 09:59 AM

Most people dont want a split they just want it gone and not have to see the "scrap guy" again till next time they need him......get an average weight of rotors and pay accordingly.....if they don't wanna deal with you move onto next no need to waste time on futile efforts

**greytruck** · 02-10-2020, 11:12 AM

Sounds like he quit the middle man. Its not good to tell/show people how much $$$ you get. I understand the split thing, but I bet he got a commercial account with the yard. They drop off a dumpster or lugger. I know if you have a commercial account at one yard here, you get $30/ton more than driving it over the "public" scale.

**ggariepy** · 02-10-2020, 02:49 PM

Originally Posted by mikeinreco

Most people dont want a split they just want it gone and not have to see the "scrap guy" again till next time they need him......get an average weight of rotors and pay accordingly.

Interesting point. So the scrap material includes a lot more than just rotors; there's all manner of suspension components, engine parts, etc. If rotors is all the typical scrapper pays on and he gets the rest for free then he's making out like a bandit.

What I don't understand is how a guy can look at what's effectively a gaylord full of scrap and then come up with a price 'by guess or by golly' and consistently do well. The market fluctuates so much. I guess if you're doing it every day, perhaps. I can look at the back of my truck and ballpark what a load of curb picks is worth within about 10 bucks. But that's mostly shred with the occasional bit of aluminum thrown in. Maybe a rotor or two once in awhile. So it's easy. The stuff in an auto shop's scrap bin has all kinds of different values. How are guys doing it?

...if they don't wanna deal with you move onto next no need to waste time on futile efforts

Yeah, this guy acted like a real SOB. And I've been a good customer of his for 20 years. It kind of pisses me off.

**ggariepy** · 02-10-2020, 02:53 PM

Originally Posted by greytruck

Sounds like he quit the middle man. Its not good to tell/show people how much $$$ you get. I understand the split thing, but I bet he got a commercial account with the yard. They drop off a dumpster or lugger. I know if you have a commercial account at one yard here, you get $30/ton more than driving it over the "public" scale.

I highly doubt it. There is no sign of that going on, and it doesn't take a rocket scientist to figure out who buys scrap metal in the area and what it's worth. This is a large garage, not a mom and pop operation. In fact, the shop area is as large as any dealership's and probably bigger than quite a few. I don't think he's going direct, I think he's got somebody who wants his business bad enough to overpay for what he's got.

I talked with my other big customer this afternoon. He feels like I'm treating him fairly and he appreciates the transparency. At Christmastime I get him a bottle of something nice and he deals with me exclusively. He's a hard working dude and he doesn't have time to go to the scrap yard himself.

I dunno what the other dude's problem is. Thanks for your response.

**mikeinreco** · 02-10-2020, 03:21 PM

Originally Posted by ggariepy

Interesting point. So the scrap material includes a lot more than just rotors; there's all manner of suspension components, engine parts, etc. If rotors is all the typical scrapper pays on and he gets the rest for free then he's making out like a bandit.

What I don't understand is how a guy can look at what's effectively a gaylord full of scrap and then come up with a price 'by guess or by golly' and consistently do well. The market fluctuates so much. I guess if you're doing it every day, perhaps. I can look at the back of my truck and ballpark what a load of curb picks is worth within about 10 bucks. But that's mostly shred with the occasional bit of aluminum thrown in. Maybe a rotor or two once in awhile. So it's easy. The stuff in an auto shop's scrap bin has all kinds of different values. How are guys doing it?

Yeah, this guy acted like a real SOB. And I've been a good customer of his for 20 years. It kind of pisses me off.

I don't buy automotive scrap but I do buy computer scrap..........I carry a portable digital scale that can weigh up to 400LBS.........I can stack towers on it until they will topple over and it won't max it out.........Have almost quit paying for scrap due to market conditions unless customer requests it..........You will have to come up with some sort of process that works for you........I find sometimes sitting around the house can be more profitable than out losing money chasing scrap........I know what my bills are and I can lose a minimal amount of money everyday by just doing nothing or I can get out and try to hustle and lose alot (I rarely do lose but have a few times)..........I take alot of stuff no one wants to fool with and try to turn that into $$$$.....find your niche (I think automotive scrap is desired so more potential people interested in this material)

**kss** · 02-10-2020, 04:59 PM

Originally Posted by ggariepy

What I don't understand is how a guy can look at what's effectively a gaylord full of scrap and then come up with a price 'by guess or by golly' and consistently do well.

I imagine at some point, and what I have seen a lot of the time, is it isnt worth their time to worry about. A lot of times scrap people dont pay at all and just pick everything up to get rid of it for the business without having to PAY.

If youre an owner of a pretty sucessful business, where you are potentially making $10,000s of thousands a month, it may not be worth your time to worry about if scrap is $0.03/lb or $0.05/lb.... you got a pile of crap you need gone consistently, and the $50 or $100 bucks isnt enough to worry about.

I would never think this way, money is money, and every bit helps the bottom line, but a lot of owners will pay a premium to not have to deal with certain things. Dealing with scrap, pricing, and keeping track of variable deposits, may be one of those things for this guy, he may not want the hassle. If youd just say "Ill give ya $100/month, and Ill take all your stuff every friday" he may be interest but if he has to watch over the recipts, and track anything, or put in any effort, it may not be worth it to him....

Just my thoughts from what I am hearing you describe.

**t00nces2** · 02-10-2020, 06:27 PM

I have said it before and I will say it again. Most of the scrap I get I buy from yard sales. The rest is just opportunity. I don't really deal in steel, it just isn't worth it. It may pile up some if the opportunity presents itself, but most of the scrap I take is brass I picked up from sales. Keep in mind, this is just a hobby for me, but if I were you, I would search for a wider variety of items and figure out where your search yields the best result.... and pile on the other things that are just the gravy on the entrée.

**ggariepy** · 02-10-2020, 10:55 PM

The $100/month idea is interesting. If the stuff wasn't sitting outside in many cases that would be an interesting angle to work. Thank you for your reply.

**ggariepy** · 02-10-2020, 11:00 PM

Originally Posted by t00nces2

I have said it before and I will say it again. Most of the scrap I get I buy from yard sales. The rest is just opportunity. I don't really deal in steel, it just isn't worth it. It may pile up some if the opportunity presents itself, but most of the scrap I take is brass I picked up from sales. Keep in mind, this is just a hobby for me, but if I were you, I would search for a wider variety of items and figure out where your search yields the best result.... and pile on the other things that are just the gravy on the entrée.

Thank you for your reply.

My main job is as a software developer. The scrap metal business started out as a hobby, but I'm looking for a steady source of secondary income. Traveling from place to place in the hope of finding scrap metal to purchase is expensive both in terms of mileage and opportunity cost; it's why curb shopping is a low or no-profit activity. There is money to be made in steel, you just have to move enough of it. I'm willing to pay for it, but I need the winning strategy for dealing with one of the single biggest sources of metal around.

I suspect that the people who have this figured out are keeping their cards close to their vest. Competition tends to make people behave that way.

**ggariepy** · 02-10-2020, 11:04 PM

Originally Posted by mikeinreco

I don't buy automotive scrap but I do buy computer scrap..........I carry a portable digital scale that can weigh up to 400LBS........

What kind of scale do you use? I'm interested in investing where it makes sense.

**mikeinreco** · 02-11-2020, 05:05 AM

https://www.ebay.com/sch/i.html?_nkw....TRS1&_sacat=0

**mikeinreco** · 02-11-2020, 05:06 AM

And sorry i was wrong bout weight goes to 330lb

**mikeinreco** · 02-11-2020, 05:07 AM

This one looks good but seems awfully cheap to be this nice

https://www.ebay.com/itm/660lbs-Digi...f45c%7Ciid%3A1

**kss** · 02-11-2020, 08:12 AM

Originally Posted by ggariepy

Thank you for your reply.

My main job is as a software developer. The scrap metal business started out as a hobby, but I'm looking for a steady source of secondary income. Traveling from place to place in the hope of finding scrap metal to purchase is expensive both in terms of mileage and opportunity cost; it's why curb shopping is a low or no-profit activity. There is money to be made in steel, you just have to move enough of it. I'm willing to pay for it, but I need the winning strategy for dealing with one of the single biggest sources of metal around.

I suspect that the people who have this figured out are keeping their cards close to their vest. Competition tends to make people behave that way.

I am also a software engineer, also doing this as a hobby. If you are looking for STEADY source of secondary income, this is probably not the best way to get that. I made a post recently about how I came to the conclusion that curb shopping is not very profitable, then the very next day probably found about $500 worth of computer parts on the curb. The curb is a crapshoot, and I do the curb stuff just for fun/hobby, not expecting to make much on it, but I enjoy the treasure hunt and thrill of finding good stuff. The only stuff I actually pay for is computer stuff because I am relatively familiar with it and its value. I am trying to find more steady streams of electronics waste but as of now its just daily looks at letgo and craigslist for people selling bulk/box lots of computer stuff. This has gotten me a few pickup truck loads, but is not a steady stream like I am looking for, but all I have access to for now. So far this has not been profitable enough to be an actual source of any income yet for me. I am mostly still building/growing, trying to find sources, with the hope the profits may come later. If they dont, no big deal its all still fun for me.

It just takes time to make connection and get rolling. I am starting to reach the point now where maybe 2-3 times a month someone I have bought from/picked up from before, is contacting me to do it again, as long as I can keep growing that number, it should eventually have enough people to get stuff from that i have a constant stream of electronics waste. That is my goal.

And yes, in this, competition is the biggest obstacle. In yours and mines day job, there is way way too many jobs and not enough people, because not everyone is or can be a programmer/software engineer. However with scrapping, anyone with a truck or trailer can potentially do this so competition is stiff, and connection/networking is key.

My strategy is (even though I havent implemented this to any businesses yet, just one-time pickups from random people via craigslist/letgo), I will come take any and all metal for free. I could never PAY for steel/shred from one-time pickups. But if it was a regular client that produces a know amount on a known interval, I would first offer to come take it all for free on an schedule, and if they wanted to be paid for it, I would offer an amount I know is significantly less that the scrap value of everything. If they really cared about making money from it, they would call a yard and get a roll-off dumpster for their scrap. But since they arent doing that and are calling a random guy like you or me, they likley just want it gone easily/quickly/reliably and are just glad they dont have to pay to get rid of it.

**hills** · 02-11-2020, 08:50 AM

( quote) I came up with a different idea: build a working relationship with the shop owner based on trust.

Bingo ! You hit the nail on the head. Build long term relationships with your customers based on the values of mutual respect and trust. That's how you develop a loyal customer base.

( quote) I've tried to make it work with another, larger shop recently, and the guy acts like he doesn't want to talk to me anymore. "Other people pay better than you do" he says. WTF? How? I doubt too many are paying on a percentage basis, is there another strategy people are using?

People are funny creatures. You could drive yourself crazy trying to riddle them out. Maybe mark that that one as a " No sale" and move along to greener pastures ?

( quote) The guy didn't want to talk about it. He openly admitted to me previously he didn't know how much he would have gotten for the first load I hauled for him. I don't know what his basis is for saying I pay less than the other guys.

Is it possible that you might be a bit pushy ? You wouldn't take no for an answer and tried to argue your point ? That's a big turnoff for some people. You are the service provider. You need to let them come to you on their own terms.

( quote) I suspect something else is going on there, but I'm not sure what it is.

Human relations are tricky because people vary so much. For whatever it's worth .... i've found that the mind is often closed when the mouth is open. It might be more helpful to learn to listen attentively. ( Men generally don't listen well anyway.... at least that's what the gals have told me. )

Different customers have different needs. The trick is to listen carefully and identify what those needs are.

Best question to ask a potential customer ?

What can i do for you today sir ?

**406Refining** · 02-11-2020, 10:56 AM

Originally Posted by mikeinreco

This one looks good but seems awfully cheap to be this nice

https://www.ebay.com/itm/660lbs-Digi...f45c%7Ciid%3A1

I bought 2 of those blue ones (slightly different, but pretty much the same) about 6 months ago. They work great for smaller scrap like circuit boards and computers! I know they look cheap, but they are durable. I did on one occasion use this little bugger to weigh a 580 pound transformer, but wouldn’t recommend doing that very often. If you’re looking for a nice portable scale I would recommend this one.

**Breakage** · 02-11-2020, 11:08 AM

Have you considered buying cores? That might open things up for you. Even non-working units can do well to a bulk buyer, one of whom may still be active on the forums.

**auminer** · 02-11-2020, 06:06 PM

Originally Posted by kss

I imagine at some point, and what I have seen a lot of the time, is it isnt worth their time to worry about. A lot of times scrap people dont pay at all and just pick everything up to get rid of it for the business without having to PAY.

If youre an owner of a pretty sucessful business, where you are potentially making $10,000s of thousands a month, it may not be worth your time to worry about if scrap is $0.03/lb or $0.05/lb.... you got a pile of crap you need gone consistently, and the $50 or $100 bucks isnt enough to worry about.

^^^This^^^

Just today, one of my neighbors, (there are two professional one-man-band plumbers in my neighborhood, I don't know which it was) dropped off a water heater and the aluminum pan, and the scrap copper he cut away from the job he did today.

Between the two, I average about 5 water heaters & assorted peripherals a week.

Neither of them consider it worth their time to haul the stuff to the scrapyard, and they both appreciate the fact that they don't have to haul it to the city transfer station & pay 40 or 50 bucks to get rid of their 'trash' when they can drop it on my back driveway for free.

Plumber 1 also appreciates the occasional 12 pack of Miller Lite I bring him, while plumber 2 prefers the occasional bottle of Old Forester.

**greytruck** · 02-11-2020, 07:13 PM

Originally Posted by kss

I imagine at some point, and what I have seen a lot of the time, is it isnt worth their time to worry about. A lot of times scrap people dont pay at all and just pick everything up to get rid of it for the business without having to PAY.

If youre an owner of a pretty sucessful business, where you are potentially making $10,000s of thousands a month, it may not be worth your time to worry about if scrap is $0.03/lb or $0.05/lb.... you got a pile of crap you need gone consistently, and the $50 or $100 bucks isnt enough to worry about.

I 2nd this....

Along with what Auminer said..... My plumbing company i pick up from is the same. They charge a $40 haul away fee. Owner said to me..... "we charge a $40 fee to haul them away. They are worth what, $4 in scrap. Not worth having the guys driving to the scrapyard in the work trucks. we'll haul them back to the shop and you can have the tanks."

Buying automotive scrap

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