How do people make money from scrap metals

I'd guess experience plays a big roll in the decision. As well, they may have seen something that tipped them off that it was a valuable lot (perhaps some metal that is worth more than mixed metal?)

Estimating weight is an artform. I bet the buyer went thru that room with a key chain magnet, i would. There may have been a lot of cooper, brass, silver in the controls. If the stuff was covered with paint or dust you might not notice unless you check. Maybe buss bars you didn't notice. Hard to say since i was not there. It's a slow learning curve and there are no books on the subject of scrap businesses.
The only thing i can suggest is get your self a book that lists the wieghts of materials. If your good at estimating sizes that would give you a good idea of how much a pile of steel beams is worth. There is no scientific apporach that i know of.
Best Regards Tom.

Also remember they may not always estimate correctly. And sometimes they may think it is worthwhile to break even or even lose money just so a competitor does not win the auction and decide the scrap business is worthwhile.
=20 Dan

Iggy, you have lots of great answers from a lot of smart people. However, they are all working at the wrong end of the material stream. I have scrapped lots of my own equipment in the past 10 years and have taken it to the scrap dealer in Bend, OR.
I learned many things about the business by asking them questions. If not really busy, the manager and/or other employees were more than happy to explain how they sorted metals and priced each type. Cast iron and steel are clear at the bottom of their price scale. copper of any kind is at the top. Aluminum casting, extrusion and sheet are all priced differently.
I strongly recommend you determine the scrap dealer you want to sell to and make an appointment for a plant tour. Be sure to tell them exactly what you plan and ask how they would like the metal. Clean ALWAYS brings a higher price. Ask how they unload it, if they do. I have had them pick up steel out of a pickup bed with a big magnet. Stainless and other stuff I got to unload. If the crane with the magnet was busy, I could either wait of unload it by hand.
I had to bring separate loads of steel, stainless, and other metals. Mixed loads, other than copper/brass/small quantities of aluminum are handled by hand and take lots of time.
If you have some mystery metal, take it with you when you visit and ask them what it is. They will happily show you how to tell. Anything that makes their business easier is a win for both of you.
Finally, understand you will always be dealing with a Hebrew! If you suspect they are jerking you around, walk away and find someone else.
Here in the West, we really only deal with the Schnitzer family. There are many scrap dealers. Two in central Oregon. But it all goes to Schnitzer. They started with scrap ships during WWII and are still going. Third generation, I think.
Good luck. Paul

It's an art. Some people can bid low and rake in the good auctions. You've done a healthy lot of that yourself, sir. Keep doing that. It's an additive sense you get for it, whether you get the best auctions or not, and you can learn from every mistake.
It's all good!
That is truly sad, isn't it?
Absolutely. You need to have time for tinkering, for hobbies, and for deposit runs to the bank, and some hours of family time.
-- Life is an escalator: You can move forward or backward; you can not remain still. -- Patricia Russell-McCloud

The best way to get educated is to buy a couple of lots. I been in and out of the scrap business since I was a kid. you just do it a little at a time until you get familiar with it. Way back when I would fly out to ca. and bid on 40000 lbs of electronic scrap at a couple cents a pound. The trick was to see a couple of expensive items that needed minor repairs and base the bid on what you could sell them for with the rest being the potential profit. I did have an edge in that I knew how to repair almost all the test equipment I would come across and had a place to sell it after it was repaired. Those big old motors are loaded with copper windings more than any new motor. Beams are easy to estimate you bid about 10 cents a pound if the beams are in good shape and sell them for 50 or whatever the market will bear. There is always someone looking for a beam for a project. I had a friend that was heavy into the used steel business and I would fly him around to look at buildings he was bidding on to tear down. There are no instructions in the scrap business but the whole thing is to buy low and sell hi.
John

The whole thing in any of these type of business dealings is to know more than the next person and do your homework, Today it is very easy to research parts. thirty years ago it was a good set of reference books and Thomas register. Also a complete copy of mil spec. data helped too. I make parts for multistage pumps like that. They are not a hard pump to rebuild. As you can see the price is up there. big valves are the same.
John

Where you live makes an enormous difference. Around here, the only scrap dealer waaay underpays.
It can be more profitable to travel a long distance to a larger city where prices are more competitive.
But I've found it best to stay out of the game completely.
If you can't hold it at arm's length and if it won't fit in a USPS priority box, don't mess with it.
BUT -- contents of room can be enormously profitable. If you can simply abandon or give away the grunge.

This is a six stage boiler feed pump that will supply about1400 gal a minute at a pressure of 1500 lbs. You need to find a facility that lost its main boiler feed pump and is dead in the water. The trick is to buy that pump for scrap price and hold it to sell it as a pump or rebuild it and sell it to an in user as a spare standby system. You can't really get hurt for much if you buy it at scrap price.
John

I never heard of this. I have been doing business since 1998
i

I knew nothing about this, but I also suspected that to be the case.
i

Also remember they may not always estimate correctly. And sometimes they may think it is worthwhile to break even or even lose money just so a competitor does not win the auction and decide the scrap business is worthwhile.
Dan
The scappers can be a valuable resource, being friendley with them is a good idea. You have to remember that they also aquire things from thier sources other than auctions. When i had my business in chicago i had some scrappers that would bring certian items i told them i buy to my place before the went to the scale. Got a lot of good merchandise for much less than auction prices. Also scrap yards themselves are a good source, i bought a lot of stuff from scrap yards. Some of the yards i dealt with would call me when they got a load of tooling, machines, and motors. My thinking at that time was to let them do the grunt work and i would cherry pick for items i could sell quickley. When you deal with these guys remember cash is king, always pay them in cash and will love you forever.
Best Regards Tom.

In illinois you also have to pay "use tax" on equiptment that you buy for use in your business, it's the same as sales tax most of the time. Some things are exempt, ask your accountant. Tricky stuff.
Those fork lifts you bought are subject to "use tax", as is any other equiptment you did not pay sales tax on. The compresser your installing is subject to use tax if you did not pay sales tax on it when you bought it.
Best Regards Tom.

I will start looking at that stuff and perhaps bidding on smaller lots, being careful to only outbid people who seem to know what they are doing.
i

Hear about the grave yard that was stripped of copper and bronze the old old families had buildings with bronze doors.
The rats also broke out the stained glass in side - hundred years old - for the lead.
This kind of stuff has to stop. Stripping hospitals that are mothballed for disasters of the heavy wire. Stripping wire along railroads, phone lines and the like.
Martin

Hasn't this douchebag killed himself yet? It would do the world an IMMENSE favor.

I had a scrap dealer pull the opposite on me.
He apparently knew I was a knowledgeable bidder based on previous auctions and lots ( a mistake on my not being invisible enough ).
So he simply outbid me on lots of interest. He did not have the faintest clue what he was bidding on.
Betting solely on my strictly holding to a msx. He thus got the item for its value plus a negligible increment.

Good point. What I thuoght of doing, is outbidding a knowledgeable bidder, but not by a lot, getting late into the game.
i

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Any chance you could explore the idea of *snipping* redundant information? Sure as hell is aggravating having to scroll through a hundred lines to find a paragraph or two.
Harold