Hi all,



I am in the first stages of looking at scrapping businesses to buy and came upon SMF, which looks like it will be a great resource.

I have a good understanding of business from other past experiences. However, I am wondering as I look at existing businesses, what I should be looking for and what questions I should ask a seller.

I am looking at a couple small yards which seem to take in ferrous/non-ferrous metals, and I assume, sort and sell them. My main questions at this point are:


  1. how do they source inventory from metal sellers -- is it normal to have contracts with demolition companies or municipalities?
  2. who do they sell to?
  3. what is the time from buying to selling, i.e. how long will I hold inventory/how much cash do I need on hand?


One of the places I have looked at lists equipment including two 5,000 lb scales and 1 truck scale. What is the expected life span for this equipment before I will need to replace it?

What are the other questions you would ask? What are the pitfalls or seller tricks I should be looking out for?

Thanks in advance for any advice.