Buying in bulk, looking for possible pitfalls.

This is my first post, but I know to do my research, which I have.

I am buying in bulk from estates. I will reuse, resale and recycle everything possible and part of it will obviously be scrapping non working items. Here is the big question.

What would be a loss if I purchase at $.10 per pound?

I can make huge mark up on clothing and working items, and I believe i can make a small profit on most non working appliances. The only thing I believe would be a total loss would be old, non working televisions. Can you think of anything else that would not be worth the trouble when thinking of regular homes and scrapping at $.10 per pound? thanks in advance.

Vic from Jersey

If I were going to do this, I wouldn't buy by the pound. These people don't usually deal with that type of selling anyway. You'd have to be good at estimating what you can get out of the lot, and just make an offer based on that.

Like Ryan sez ^.

You sound like you are prepared to get everything from the piggy but the squeak, and that's a h*lluva good start.

Even old TV's (and monitors) have some residual value, if you want to take the time to salvage copper and circuit boards out of them. Have a look at some of the old threads here for how to gut them. Just make sure you have a home for the left over TV tube and housing' cause its an potentially costly albatross around your neck if you cant get rid of them. But you are not likely to get many in each estate...maybe 2 or 3 from a household?

Speaking of environemental issues, you need a plan on what you can do with old stuff you may find in the back shed. For example, I found a very old bag of orchard pesticide once...."arsinate of lead". Hully crap!! Thank god for hazardous waste dropoffs!!

I've heard from some guys who tried auctioning estates is that you need to be VERY tactful saying to the relatives what old spinster aunt Fred's stuff is worth to you. Don't downgrade it. Don't tell them its all shzt. So a single number--how much cash you would offer them, has the least chance of pzzoff value to them. Some may be insulted that granny's stuff is only worth a dime a pound.

In this down market, you're doing the right thing...sell everything for better than scrap if you can!!!

Keep us posted on how it goes!! Photos are nice!!

Jon.

Thanks so much for the responses. I am stuck on the per pound model for a few reasons, and I know I will push some customers away, but so do the overpriced companies. I have a market that I will go after, and taking everything at a flat price per pound is my angle. I was just wondering if there was an item that would be a major money loser at that price.

Perhaps I am reading this wrong........You are buying estates at .10/lb.......So for broken down old particle wood tv entertainment center you would weigh it (SAY 100LBS) and pay $10 for this...........If true I will begin to pick them up on side of the road throw them in an old house and call it an "ESTATE".........Please correct me if I'm wrong in reading this I am not well today nor have I been in a while

Beds. Tvs. Junk. Wood. Non reusable/sellable furnature. Etc.

And at the current steel prices, you could loose a lot if there is a lot.

But, at that price, if you sell a few good items i cant imaging you going in the red.

Currently @ .10/lb you would be losing money on any Iron/steel/ferrous scrap materials also.

Your saying your willing to take the good with the bad. I like your angle. I would make sure you do the math. If a estate if garment heavy, and the cloths are old, then you may need to re-think the pricing. If the house is full of "broken down old particle wood tv entertainment center", then simple, don't bid on it. But this will take a lot of thinking, you will need to have a very good outlet for the "crap". Also don't be stuck on the .10 Lbs. If your going to work this way you will need to do ALOT of planning, my 2 cents. Good Luck

You might be wanting to sell some of these things by the pound after buying them by the pound, but you would just have to buy some of the stuff. There is a lot of trash and junk that estates want gone as well as Parker said. Also as Jon said, people don't want to be lowballed so selling that antique table set for $20 might not be attractive. People hoard, it just happens. Tons of attic, garage, and shed stuff that is just trash. You could be paying hundreds of dollars for stuff that you have to pay again to dump. If you pick and choose, then the deal doesn't sound so attractive to them. I stick by my advise on offering a set price.

Also how long would it take for you to weigh up an entire estate?

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Originally Posted by vicpell

This is my first post, but I know to do my research, which I have.

I am buying in bulk from estates. I will reuse, resale and recycle everything possible and part of it will obviously be scrapping non working items. Here is the big question.

What would be a loss if I purchase at $.10 per pound?

I can make huge mark up on clothing and working items, and I believe i can make a small profit on most non working appliances. The only thing I believe would be a total loss would be old, non working televisions. Can you think of anything else that would not be worth the trouble when thinking of regular homes and scrapping at $.10 per pound? thanks in advance.

Vic from Jersey

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I can think of a whole lot that could be a loss. Do you have a textile buyer for all of grannies old clothing? Have you ever considered the junk that may be in a rodent infested basement or attic? What about a basement with water and or humidity issues? Are you prepared to pay 10 cents a pound and have to get a 40 yard dumpster? Do you have a paper buyer?

I speak from experience here. Had a guy call last year to remove metal from his fathers house. House had 3 feet of water during T.S. Irene and had never been properly dried out. Look up the term "Collyer's mansion". That will give you an idea of the inside of the house. I did make some money taking out metal, tearing apart two campers and hauling junk. As of last fall, the house was even close to being empty. Had I paid a penny, I would have lost thousands. I took over 5 tons to the dump (at $95 a ton), He rented a 10 yard dumpster and a 30 yard dumpster (about $900). Again, he is not even close to being done.

I don't mean to rain on your parade, but you need to seriously rethink your strategy.

Don't buy sight unseen. Last thing you want is 5 dumpster fee"s for a horders paper. Also I'd just do an estimate instead of by the lb. good luck and don't forget to consider the time they give you to clear out the junk.

I think you have a generally valid concept buying estates. What I would do is clearly communicate that every house is somebodies home as such I have to come take a look and discuss your needs. Service is key. I would buy estates, remove and clean up unwanted items, and deliver any items they wish to keep. In many instances you could very well end up with multiple streams of income from the same job.

*Buy the good stuff

*Clean up the garbage for a fee

*Deliver any items to specified location for a fee

*Clean interiors for a fee (SUBCONTRACTED)

*Exterior Maintenance for a fee (SUBCONTRACTED)

*If it is an estate with property I would network with real estate investors and see if I could get a referral for good lead for purchases. (I get $500 min. each)

IMO it is important to extract every dollar possible from each opportunity when the money earned is worth the stress. The more services I can provide the better. I don't clean but can bid it out and send a couple girls out for a day rate and leave a sparkling interior. Just some ideas. Good luck

OK. I may have given the wrong idea here. I wont be buying anything site unseen. I have a textile buyer that I can unload at coast for anything that doesn't sell at my rummage sales. Furniture is hard to lose money on, as long as it is in decent condition. If the customer wants "junk removed" then they may have to call a junk or actually pay someone to take it. My angle is to offer a solution to offset costs for an actual junk removal and to unload their extra stuff. In my area people will pick up scrap for free or charge an arm and a leg to remove junk. When you donate items, you still have to collect them and drive them out and even they wont take some things. Im going after a market that will let me in the house and possible purchase a lot of sellable items at a low price for the convenience of coming in and doing all the work.

I am able to unload decent furniture for good margins to college kids and lower income in the area. I did not think of a paper buyer though. I will also be paying closer attention to my scrap prices near by and see if over the long run I would lose a lot for just scrap, but to get into someones house for items that I can market up a lot, I may take a small hit on some metal.

Thanks so much. I definitely will try and work on relationships because I can see this as big money down the line

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Originally Posted by vicpell

Thanks so much. I definitely will try and work on relationships because I can see this as big money down the line

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What area are you in ? Is it heavily populated with a lot of estates turning up ? I have dealt with 2 in the last year neither one was I the first one in there. The first I was paid to remove a bunch of the leftovers and the second I brokered the remaining items thru a auction house . they were night and day in comparison . How many have you handled in the past ?

A dumpster delivered on site and then removed filled would run about $500 in my area . So if your clearing the place out and removing it at the same price your saving them a lot of foot work just matching that price . It might help to have your client call and get a dumpster quote just to use as a bargaining chip when it comes to your rate . I learned that trick doing masonry side jobs .

Say someone needed a staircase or retaining wall repaired or built . I would have them get a estimate from a few companies usually 3 . Then I would equate Material and manpower . And could usually get the job done for a fraction of the their lowest estimate . It opens yourself up to some competition but can bring a reality check to people who think you should be honored to do their work .

Unless it a high end estate, I charge to remove.
You end up warehousing a lot of stuff hoping to recoup your investment.
There's a lot information to consider. Your only one that knows what your specific situation is. If you got storage space and a ready market than you may make it work.
If your into flea markets and have I good understanding of how they work you do OK.
Its a lot of planning involved in a successful flea market business.
Good luck

I have been self employed nearly my entire life. There was a time when I sold on price primarily.

Until I learned to build relationships. Anyone that decides to use you based solely on price will shop you to death then shop more and ask you to meet somebodies price. The number one advantage we can have as scrappers is a professional attitude, appearance, and work ethic.

Dealing with a company that is reliable and does what it says when it says is what will make the most money. It will also get the most referrals. Networking is the key. A happy customer will tell 5 friends. An unhappy customer will tell 50. I am a solution provider first.

As far as get three estimates goes I tell them I'll be right in the top. My level of service demands it. You will not be sorry you used me. Then I tell them only the Govt uses the lowest bidder and you see what that gets.

Commercial vehicle insurance is a good selling point. It is not really much more expensive than regular coverage. HOWEVER, when you mention that regular coverage does not cover loading the truck and it doesn't I ask how they feel about paying for hurt backs, broken bones, ER visits. How's that lowest bid taste now?

The thing is even a hustle can elevated to something more. I always look for the more.

I've mulled it over and I can't really see a way that paying by the pound would work. Besides the logistical issues of weighing everything, you're just going to end up with a lot of crap. With this said, I do think there is merit to the idea of 'bulk estate sales' as you've described. Simply put, people don't want to waste their time; it's much easier to sell everything at once for a lump sum. I'd recommend you do something like offer a basic rate for household items (For example 'I'll buy all the silverware and plates for $400'). This way you avoid offending over price like sawmilleng mentioned, while also saving yourself the time of haggling and your customer the time of selling things individually.

Is this sort of the market you were going for, or am I missing the allure of purchasing family heirlooms by the pound?