Rant on buying prices:

Well, a couple points to make here:

1: If you don't know what you are doing you have less chance of being successful
2: If people who don't know what they are doing are adversely affecting your business, then you are doing something wrong too
3: Like any business, you have to seize opportunities as they present themselves. That may mean being in position to capitalize on the mistakes of those that wont learn/listen
4: If you are good at what you do, then your services will always be in demand...AND...you can typically set your own price.
5: SMF is one of the best tools available to help scrappers succeed, whatever you define as success

I forgot who has this tag line but it is very appropriate when considering how successful you want to be (paraphrase): "Do what others cant do and/or do what other wont do"

Originally Posted by shendog

Well, a couple points to make here:

4: If you are good at what you do, then your services will always be in demand...AND...you can typically set your own price.

Not really true. People can set their own prices in areas where the demand is greater then the supply and their unique skills are in demand. Exactly where does this apply in commodity scrapping in general? This is an industry where you have to have built up connections over years to get your material coming in at a rate you can make a profit. You need to juggle the different materials to know what you can and cannot make a profit on (this changes all the time and varies area to area). Knowledge and connections or being the only game in town are what makes or breaks you, same as in every other business. For somebody starting out now in a highly competitive area it is hard to make money even with skills.

Originally Posted by unknownk

Not really true. People can set their own prices in areas where the demand is greater then the supply and their unique skills are in demand. Exactly where does this apply in commodity scrapping in general? This is an industry where you have to have built up connections over years to get your material coming in at a rate you can make a profit. You need to juggle the different materials to know what you can and cannot make a profit on (this changes all the time and varies area to area). Knowledge and connections or being the only game in town are what makes or breaks you, same as in every other business. For somebody starting out now in a highly competitive area it is hard to make money even with skills.

I've seen my item #4 manifest itself in many different types of industries, so I know its a sound principle. I don't advocate it as an absolute in every circumstance, but its true more often than not. I know of 4-5 guys on this thread regularly that could walk into (almost) any location in the US and set up shop without connections and within a year have a successful business. It takes motivation and knowledge, period. The contacts will come. Competition is everywhere, so if you are fortunate to be "the only game in town" you are indeed lucky....for now. But having competition isn't what breaks you, it actually allows you to have a measuring stick on how good you are and what areas you can improve on. There are ALWAYS areas where you can separate yourself from others and provide a service that others don't/won't.

Unlike the original poster, I don't worry about the guys that are not "true scrappers". They don't pose a threat to my business and them overpaying for material will just hasten their departure from the industry. I set my own rules for what I pay, who I do business with, what I'm willing to do (or not do), etc. I am confident in my abilities and painfully aware of my deficiencies. I focus on what I do best, represent myself honestly to my clients, and try to meet or exceed their expectations. While I do most of the things the OP described as necessary for a "real" scrapper, I really haven't kicked off my business as one might for a new startup. Given the great success I've experienced in just the first year, I'm almost afraid of what will happen if I actually did a marketing campaign. I thank God regularly for the blessings and I count this Forum as one of the best tools for my success.

[QUOTE=shendog;163915]I've seen my item #4 manifest itself in many different types of industries, so I know its a sound principle. I don't advocate it as an absolute in every circumstance, but its true more often than not. I know of 4-5 guys on this thread regularly that could walk into (almost) any location in the US and set up shop without connections and within a year have a successful business. It takes motivation and knowledge, period. The contacts will come. Competition is everywhere, so if you are fortunate to be "the only game in town" you are indeed lucky....for now. But having competition isn't what breaks you, it actually allows you to have a measuring stick on how good you are and what areas you can improve on. There are ALWAYS areas where you can separate yourself from others and provide a service that others don't/won't.
QUOTE]

In our area there was 2 main scrap buyers. Everyone either went to one or the other, for their own reasons ("Because we do" was the reason)

The 3rd buyer was a big dealer, they delt directly with the railways & industry & didn't pick up metal, it all got dropped off to them by the kiloton. We never went there.

Then, something happened with the big dealer, they wanted to get bigger, so they cleaned up their act & area, put adds in the paper with prices for the first 2 months & we noticed.

Then as we talked about it, we started to relise that virtually everytime we went to the other main 2 buyers we were getting ripped off.
A Kg here or a Kg there, their scales didn't read right depending on where you put the metal (?!) They were down grading our metal & not showing us what they wanted.

Then I relised that the other guys scales were taking weigh (sic) too much time to get to a total. Ie, chuck 12 Kg on, watch as it goes 11- 12 - 13 -11-10-9-9-9.
So, its 9Kg.... & WTF was the guy doing signalling something to someone at about the same time the values changed..
& WTF! 9Kg, thats 3/4 what we weighd it at beforehand.

Then we find out of someone that did get ripped off. By the old "Yeah, we will drop off a metal skip so you can fill it & we will pick it up & pay you." 3 tons + gets a return of 1 ton after expenses...

So, we now go somewhere else, the 'Big guy' who isn't interested in ripping us off. Even a rumour is going to affect their returns.

Their paperwork is going to have to match every step of the way. If its out a little they know something dodgy is happening & the workers have no intrest in wrecking their job for a few $$. So they do everything by the book &

well you know. Thats where we sell all of our metal now. 100% of it.

Thats how you get a good name in the scrap business, stay clean & honest & let the others ruin it for themselves.

I wonder how much the other dealers would pay us as a lump sum to get 100% of our metal for ever?
It'd have to be way more then they ever ripped us off for.