New to the scrap business

**Mixedtraffic** · 02-13-2022, 08:04 PM

I want to open a company and need some advice.

I have a friend of mine who owns a manufacturing facility that generates 300,000 pounds of clean 6063 aluminum scrap every year.
he was dealing with some recycling company they provide dumpster and charge him fees then give him 5% return on his weight. They pay 5% dirty aluminum and it’s definitely not dirty.
- long story short…
I want to start a business and handle his aluminum scrap for him. I will split the scrap value with him.
and I will make sure we get paid the correct value for his scrap and not dirty aluminum.
My question is:
What type of business do I open? What license do I need?
can I sell 20,000 pounds a month to a recycle center or mill and how do I get account set up with them.
will they pay me in cash for that amount of scrap
I am a Michigan resident and his company is in Indiana and Am I allowed to pick his scrap up in Indiana and transport across state line and am I allowed to scrap material that doesn’t belong to me and then pay him half of what I get for it

any advice on how the easiest way to set up my business and what type of business would this be??

**JJinLV** · 02-14-2022, 01:51 AM

Hi and welcome to the forum from Las Vegas! Your questions in order:

1. A scrap business!
2. Check with your city and county zoning and permitting firms. If all you're doing is hauling from the facility to a scrap processor and not storing material my guess is you'll need, at most, a waste hauling permit but not a general solid waste permit. If you will be storing it you'll need a solid waste permit.
3. There is no upward limit to what you can sell to a scrapyard. Call around for pricing and ask to speak to a commercial buyer. Don't give them too much information about the source until you're sure they won't try to poach your client.
4. It would be unusual for them to pay you cash for that amount of scrap. I do it for some of my clients (paid a client over $31k in cash last week!) but not every yard will do that and - depending on state laws - some might not be able to. Check or ACH is more common for that much money.
5. Yes you can haul scrap metal across state lines. You'll be a commercial hauler so you'll have to make sure your vehicle is rated for the weights you'll be carrying and will have to stop at weigh stations and pay any associated fees or day permits.
6. Whether you're allowed to pay half the value to your friend depends on what you arrange with your friend. I would buy bare 6063 at that quantity at around $1.45/lb. If you can sell at that price locally and make just .20/lb on it and sell 300k lbs per year you're making over $85k a year (before expenses) to work one day a week hauling their scrap. At half and half it would be over $200k per year.
7. Easiest way is to hire a lawyer who specializes to file all your paperwork.
8. See #1

**Mixedtraffic** · 02-14-2022, 06:54 AM

Can I call you?
Seriously need some advice

**APA** · 02-14-2022, 07:58 AM

878-207-6242 is my cell, call or text anytime. I have an easy idea for you and the aluminum. I have close business relationships with many people in the state of Indiana.

Thank you,
Tom

**ChildhoodDream** · 02-14-2022, 03:01 PM

Does the material have any cutting oil mixed in with it?

Just a question that came up about if it's clean or not.

**greytruck** · 02-14-2022, 06:09 PM

Are they turnings or shavings? Cause I sold alum turnings from a machine shop b4 and they pay .10/lb less for it even thow its "clean"

**JJinLV** · 02-14-2022, 11:05 PM

It sounds from the description like they are 6063 lengths either bare or painted and it's currently being bought as 6063 95%. 6063 turnings are almost never bought as 6063 of any grade.

**oztech** · 02-17-2022, 03:49 PM

Hello, We are located in MD and own a AL smelting factory overseas. We can buy all of them on regular basis and pay before picking them up. Please let me know your price as of today so we can work on a deal.
regards