Scrap Metal Collecting

I live in a pretty big city and I had a friend a few years back who made a small fortune (150-200k) over the course of a year or two just by collecting scrap metal and selling it.
When I was with him, we were only making a few bucks here and there by buying catalytic converters and selling the metal to scrap collectors for more money. But a few years before he had a big truck that he would use to pick up the metal and he had recruited some of his friends to help him.
He eventually fucked it all up by being arrested for attempted murder (which he somehow miraculously got out of) and he became an alcoholic. He got his girlfriend pregnant too and he was chronically depressed. He was looking to start it up again, but life kept getting in the way. We lost touch.
I can't really contact him because or friendship didn't end too well and he's a sneaky jew, but his story still fascinates me.
How can I make this into a lucrative business? Apparently there are quite a few people who have made it work, but I don't have many details.
How would I go about finding the scrap metal in the first place?
Are there territorial disputes that I need to be aware of?
Does anyone here know more about this than I do?

I see lots of ads on Kijiji (basically craigslist) about people collecting metal/scrap metal for free. Seems to work very well, especially if it's like stoves and fridges, since it's hard to get rid of them. They pick it up for free, so yeah. Otherwise no idea. Perhaps some scrapyards, auto or not?

You're going to get involved with a bunch of sketchy methheads OP, stay clear of that field.

You need to have a large storage space with walls and barbed wire, because your main competition will be heroin addicts (no joke).

You need to collect a bunch of scrap and then wait for the market to get better (let me guess, your friend made his fortune in 2012 when scrap metal sold at an all time high?) and then sell.

Mexicans do that shit all the time in Chicago. They roll up and down alleys in pickups loaded with obscene amounts of junk. I usually lean metal shit outside the dumpster so they can scoop it up.

No, I think it would have been 4-6 years earlier than 2012 because I was hanging out with him around 2013-2014. He was 30 at the time and when he was making money he was in his 20s. I remember that he was always checking the market prices though.
I guess I'm just confused because I wouldn't have any idea where to actually find the materials, appliances and catalytic converters aside.
Yeah, I think it's mostly Mexicans here as well.
I'd like to think I'm more efficient than the average heroin addict/meth head/mexican, so I'm not too concerned about competition it thats what I'm looking at.

No way he made 200k in 1-2 years by buying and selling scrap metal. The quantities of scrap needed to reach that number within a year is calculated in tons.

I agree with this.

My neighborhood has a lot of metal theft.

I think these guys then sell it to another guy like your friend, who sells it at a profit. It's called using a "fence" to avoid being busted with stolen goods. This kinda work has peril and doesn't seem like it would pay so good without getting your hands really dirty.

There are tons of videos on jewtoob of metal scrappers.
Watch a few to get an idea of what your life would be like and how much you would actually make.
TL;DR it's a waste of time. Way easier ways to make money

It's not the best time to get into the scrap metal business. I recently spoke with a guy in the Chicago scrap industry who business has tanked over the past few years on account of China's steel oversupply and who lost quite a bit of money holding certain stainless grades which lost ~30% of their value from 2014 --> late 2016.

That said, learn Chinese if you're still interested. Quite a bit of business is done between the western seaboard and Chinese mills/suppliers, but most of these have long time partnerships with their respective clients. I'm not sure of the exact companies involved as I don't usually trade in scrap, but I do know that steel mills in China are always looking for cheap scrap. Dealing with them is a rabbit hole though, so be careful.

If I were you I'd try to start working for one of these companies, work there until you have some decent contacts with suppliers and buyers (depending on which side you want to sit on) and you have a better idea of what you're doing and how the market behaves, then try striking out on your own afterwards.

also,
^this. Steel trading margins are generally slim because there's not much value added, i.e. steel is steel is steel, and if it's not the proper grade then you have a problem. I found it hard to believe that your friend made 200k within 1-2 years solely from scrap trading unless he was dealing in $2m worth of scrap/year or was dealing internationally where you can get nice tax arbitrages. And it wouldn't be measured in tonnes, it would be measured in hundreds or thousands of tons depending on what specific type of scrap he's dealing in (stainless vs. carbon etc.)

Unless you own a scrapyard it is a huge waste of time.
I'm guessing you don't own a scrapyard.

catalytic converters have platinum, which is worth a ton. was he dealing with random metal crap or only with precious metals? I make ok side money buying gold and silver jewelry from garage sales/thrift stores/ and estate sales. and reselling it for spot or small premiums. A lot of people know the value of gold but you can make good money buying flatware from the right places

>reselling small amounts(

what are you talking about? i sell it on ebay and to a LCS. its pretty easy to get spot or 95%

I can see how you get spot for it on ebay, but then again if you account for sellers fees you're not getting spot anyway. No coin store would buy jewelry for spot. 95% sounds somewhat believable, but there is a huge difference between selling for 95% and selling for spot.

lol no theres not. lets do some math here. if spot is $100 and the LCS gives me 95% then i get $95. really not a huge difference. thats where my junk and broken scrap goes. if its wearable i sell it as "vintage" on ebay and normally with a good markup from spot. you are right tho. i lose about 13% selling on ebay from fees and paypal, which sucks but its still very profitable

It depends on the quantity, if you're trying to run an actual business the 5$ difference starts adding up. If you just do it casually it doesn't matter that much I guess. What % of spot do you usually buy your jewelry at? Doesn't visiting thrift store and garage sales take up a lot of time? Right now I buy scrap gold from people directly, I might look into what you're doing if you say it's profitable.

Scrap really isnt doing that well. My 2004 sonatas timing chain went and I called around to scrap places and they all offered me $10 for a 2.5 ton car

Not even going to lie to you man the only reason its profitable is because i rip people off. i normally pay about 50% of spot less if i can, and i really only buy 10 & 14kt gold.

it does take up a lot of time but i buy and sell other things i find as well, and i enjoy going to those places to begin with.

Ripping people off is the name of the gold buying game. If you're on the lookout for other stuff and actually enjoy the experience I guess it's worth it. Just giving you a heads up tho: if you do it too often cops will come knocking as you need a license for that kind of business.

A few family friends have done extensive scrapping. its seems simple, but it is a full time job. and I call bullshit on the 200k figure.

Know that you are going to be stripping a lot of wiring and dismantling of potentially dangerous items, and that local trash collection will either charge you or refuse you service if your operation starts breaking down lots of tv's and plastic encased appliances. Which you will because copper. Its the precious, non-ferrous metals that make money. Normal steel is cheap as fuck. stainless, copper, aluminum, etc...thats where the money is at.

>200k
>in a year
the scrap metal your friend was selling came in white powdery form.

>current copper price is like 6000$ for a fucking ton
>it's the metal that makes money

You would make much more money buying cars at the end of their life, breaking them down and selling the parts. Scrap metal ain't worth shit these days.

It's not the best time to get started, but here's my 2 cents ...

Find the local companies that clean out foreclosures. They are always taking out the appliances and throwing out the metal. If they were smart they would sell the metal themselves, but the labor cost of removing from the house and then sorting/organizing and that shit might make it unprofitable. Call some local realtors and find out which realtors are selling for FNMA, FreddieMac, BAC, Chase, or whoever the big banks are in your area. The realtors should give you the names of the trash out companies that they work for. Fuck if you remove appliances for free, they might just have you go and take a bunch. FNMA replaces nearly all of the appliances in their foreclosures.

If you're smart, you'll piece out the appliances and sell the working parts on eBay and Amazon. They are worth much more resale parted out than they are scrap. Then disassemble and sort out the rest.

Put an ad on Craigslist to pick up old appliances for free.

Also, computer parts go for a good price. If you find and old 386 that processor has a good amount of gold in it. You can sell them to local yards or sell on eBay. Each part will have it's own price ... motherboards, drives, RAM ...

Good Luck.

I'm sitting on tons of scrap metal right now-- almost a ton of scrap copper from pipe and wiring. Where the fuck do I sell it?

I can tell you that your friend was lying to you.