Wednesday, October 24, 2012

Where to Find Scrap Metal

Where do I find scrap metal?

This is probably the hardest obstacle for anyone trying to break into the scrap metal industry. After all, no matter how much knowledge you have in your head, you don't get paid until there is metal on your truck. Well, today you're in luck because I'm going to disclose some of the methods I personally use.

It's Not Who You Are, It's Who You Know

What's true in most of life is true in the scrap metal business. The more people who know your name, the more metal you will get, period. One of the best ways to do this is to get some business cards made up. If you have a business name, great, but if not, you can still just make some cards with your name and a brief description of what you do and what you pick up. You can get them made up at a local store like FedEx/Kinko's or another local printing business, or you can also order them online from a site like uprinting.com. Once those are made, start handing them out to everyone you can. Give one to anyone you talk to about metal, leave some at your local businesses like laundromats, just get them out there.

Metal Is EVERYWHERE

I mean this in the most literal sense. Every industry, and every person on the earth uses metal in one way or another. A few years ago, the hunt for metal was a bit easier. The scrap metal prices at the time were much lower, and as a result many automotive garages had trouble giving away their bulkier items like exhaust pipes or hoods and fenders. Today, however, prices on those metals are about 5x higher than they were, so while people may have not bothered to spend a couple hours cashing in $20 worth of metal, you can be certain those same people will gladly spend the time today and make a quick $100. I know I will.

Stop #1 - Your local automotive shops

So, garages can be a great place to begin searching for scrap metal since they generate scrap every week. Of course, this isn't a secret, so be prepared for some competition. In this business, money talks, and if you can offer to pay for some of the metal, you will have much more success. When I go to a garage, I usually pay for the more valuable items like rotors, non-ferrous metals like aluminum (radiators, transmissions, etc... ) and catalytic converters. One quick warning about converters, if you aren't familiar with the markets and grading of converters, do not buy them. There is good money to be made on converters, but It is very easy to lose money on them, and there is no way to easily tell the value of one. Weight and size are not indicators of a converter value. Even guys that have been doing this for years occasionally end up eating a $30 or $40 loss on a cat because they made a bad call.

When you get to a garage, go around back and mention to the first person (mechanic) you see that you're interested in buying metal, and they should be able to direct you to their supervisor or whoever is in charge. You will need to speak professionally and concisely. When the supervisor (or whoever you were directed to) hears the words, "scrap metal" you will most likely be immediately turned down. (If not, then great, you just landed your first client!) If this happens, just casually mention one item you wanted to buy and how much you're paying. For example, I might say something to the effect of, "Oh, okay, I was just asking because I'm paying a dollar a piece for rotors." I've seen this statement change a lot of minds, and most of my accounts were landed after someone told me no. However, if they are still not interested in your services, politely thank them for their time and take your leave. If they are on the fence just ask to leave a card with them. They may not ever call you, but then again they may, so it's worth dropping a card.

Rinse, Repeat

These are the general tactics you want to use anywhere. Watch for businesses that are closing down or ones that are just moving into a building. Be sure to check estate and yard sales for unwanted items, and be sure to ask if there's anything they're getting rid of that isn't up front for sale. This can lead to broken items like extension cords, lawnmowers, etc... Many people don't realize these items still have value and are glad just to be rid of them. Post an ad in the local paper and on Craigslist. Like I said before, the people who know your name, the better your business will be.

Really, you should just be checking everywhere. I've bought car batteries from my local dump, picked up chairs, desks, and computers from schools, removed stainless from an old Pizza Hut that was converted into a car dealer. I've removed water heaters from apartment complexes, home heating oil tanks (Make sure they're empty!), broken down equipment from farms, batteries from marine/rv repair shops, a variety of metal from my local private trash service, and the list goes on. When I say metal is everywhere, I mean literally everywhere. All you have to do is ask.

For those who scrap cars, one of the best ways to pick up unwanted cars is to drive around and keep an eye out for cars with expired/no license plates, flat tires, or are covered in snow or leaves. Many times, owners will just leave a car like that in their driveway because it's broken and they haven't taken the time to do anything with it or are unsure of exactly what they should do. If you show up at their door offering a solution and cash, you've got a good chance of getting the car. I'd say, about half of my cars come this way. Be sure to use the same tactics that I mentioned above. If you get the car, be sure to leave a couple cards with the owners so they can tell their friends.

Some people are nervous about answering the door for strangers, or you may just happen by while the owner is away. If this happens, just leave a card on the vehicle in question and write an offer on the back. As always use common sense and don't enter yards that are posted with No Trespassing signs or other deterrents.

The Bottom Line

The scrap metal business is all about networking. You won't succeed by sitting at home and wishing. Get some cards made, take some time to go out and find it. The best thing is that once you're known in your community, you won't have to search nearly as hard. I had a good 30 mile radius set up of contacts, and was at the point where metal would find me. I've actually given stuff away to friends in the business because I just didn't have enough time to go and pick it up. Start advertising today and you'll have a richer tomorrow.


55 comments:

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