The Recycling Entrepreneur Newsletter

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ISSN: 1539 - 6789   (c) Scott D. Andrews April/May, 2003
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In this issue:

1. Announcements & Commentary

2. Military Scrap – A Profitable Opportunity???

3. “Book” Report – Precious Metal Bearing Electronic Scrap – CD

4. Scrap Classification – What is High-Grade and Low-Grade?

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1. Announcements & Commentary

Welcome, if you’re a new subscriber to our publication. Welcome back, if you’ve
been a faithful reader for some time. If you’re a new reader, I just want to
let you know all the back issues are archived for your reading enjoyment at:
http://recyclebiz.com/the_recycling_entrepreneur_newsletter.html

Since it’s been a couple months since we last visited, how about we start off
with some freebies?

People frequently ask me where I come up with some of the material I write about
here. Here are a couple of “insider’s secrets”.

First, learn to use, I mean REALLY use, GOOGLE. In searching for specialized information, there is nothing better – especially if you learn some little-known capabilities. Download this GOOGLE interface and supercharge your searching capabilities!
Second, want to learn how to locate specialized, industry-specific products
and/or services? EVERY industry or trade has an organization to foster its
growth and profitability. And most have very targeted magazines called trade
magazines which go exclusively to members/participants of that trade or business
niche.

Want to learn, for example, who wholesales electronic precious metals testing
devices to pawn shops, scrap yards, jewelers, etc.? Beg, borrow, or subscribe to
trade pubs which service these industries. Many will provide a sample copy to
you as a participant in that business – usually if you are in the US. But it is
frequently easier to befriend a person who already subscribes, and simply ask if
you could borrow some old issues.

Are you shy, or not confident enough to ask? Then try some of these services
which arrange FREE subscriptions to a variety of trade magazines:
http://www.freetradepubs.com/ , http://industryclick.com/icmagazines.asp ,
http://www.primediabusiness.com/magazines/magweb.asp?page=Magazines , and
http://internet.tradepub.com/

You will find a large number of wholesalers, distributors, and suppliers who do not otherwise have any Internet presence – ones you couldn’t find online regardless of how proficient an online researcher you might be.

Onward . . .

I’ve had LOTS of interest in the cell phone recycling project. I am getting ready to do a couple of weekend fundraising drives to gather phones, and especially statistics, to present you. I’m also fine-tuning the techniques to maximize the return on phones which are not bought by our primary scrap cell phone buyers. I’ve seen reports of anywhere from 20 to 65% of the collected will qualify for top-dollar purchase.

Frankly, I could live with the 20% figure if I’m collecting +500 on a Saturday and averaging $10 each for the 100 “good” ones. Even if I’m splitting the profits 50-50 with a Scout troop I’m netting $500 for the day. The proceeds from the remaining 400 should come out to at least another $500 profit to each of us – and this is a very “lowball” estimate.

Are you beginning to see the profit potential here? I hope to be able to prove this to you in the coming months as this process becomes more familiar and streamlined – this is the service you’ll have access to should you decide to participate.

And, last, but not least, I wanted to share with you what a forum participant wrote recently. This from Clive:
"I started when I saw someone post an add for a box of jewelry in the newspaper. It was a shoe box almost full for $50. So I called and went over there to check it out. There were some that were just garbage, but most of it was at least 14k. I bought the whole box for the 50 bucks and ended up making about $500 total. About $350 for the gold and $150 for the various gems and non-gold stuff that I sold on ebay. I also got a nice navy aviator pin. I just post an add in the newspaper and i get a few calls and email."

Can it really be this simple? Yes, yes, and yes! This is not a complicated business, and the opportunities are endless and everywhere! You might not find these kinds of deals advertised in your local paper, but how about garage sales, flea markets, and swap meets?

 I’ve done exactly the same thing hundreds of times at local dentists offices – taking the scrap I’d just picked up and selling it hours later to a refiner across town.

The only difference between you taking the big profits and the person accepting a fraction of the value for their “scrap” is that YOU have the knowledge of value (IF you have the manuals) and how to maximize your return, and YOU have the drive and determination to ACT on it! Simple as that.

My friend, 'all' it takes is a burning desire and determination to succeed. This is what you need to work on BEFORE you start your business. To paraphrase Abraham Lincoln, if I were given two days to chop down a tree, I'd spend the first day and a half sharpening my axe. To start "sharpening your axe" go here: http://success.scottrecommends.com
Once you've conquered your inner emotions and motivations, you will find that it
really isn't difficult to be better than the competition. My 25 years experience
has shown me over and over that simply showing up is 90% of this game. As Wayne
Gretzky has stated, "100% of the shots you DON'T take DON'T go in". Being there,
being persistent, and being better than your fellow recycler will serve you
infinitely better than rationalizing why you're not succeeding.
The other reason I’m telling you this is to establish the value of participation
in the discussion forum: ( http://www.recyclebiz.com/discuss , or go to the home
page and click on “FORUM”). It’s FREE, at least until July 1, after that date
you’ll have to own High-Profit Recycling to profit from it. If you haven’t
visited yet, do it TODAY.
By the way, here are some links you might want to follow to familiarize yourself
with the site:

http://recyclebiz.com/discuss -discussion forum - open to all until 1 July,
after that time to owners of the "High-Profit Recycling" manuals only

http://recyclebiz.com/the_recycling_entrepreneur_newsletter.html - the past
issues of this newsletter - goods reading for real recyclers

http://recyclebiz.com/frequently_asked_questions.html - Our FAQ - if your
question isn't answered, ASK US!

http://recyclebiz.com/metals_and_alloys.html - a number of rare BoM reports,
articles on recyling, and stuff you're not likely to find anywhere else

And, of course, PLEASE visit here:
http://recyclebiz.com/online%20order%20form.htm

2. Military Scrap – A Profitable Opportunity???

Many folks believe that Uncle Sam, those infamous purchasers of $600 toilet
seats, $200 hammers, and $10 rivets, must naturally be a great source of scrap
electronics and other precious metal-bearing material. You might feel that my
interest in obtaining the “Precious Metals Master File” indicates that I must
believe that our own federal government, and particularly the military services,
must not be too efficient a recycler, since they obviously waste so much money.
Let me lay that notion to rest. The simple reason that the “PMMF” exists is
because the government has undertaken the task of maximizing the return on
essentially any type of precious metal-bearing scrap that is generated by the
military. As a matter of fact, they are probably one of the most efficient
recyclers of gold, silver, and the platinum group metals. Why? A couple of
reasons.

First of all, Congress has mandated that they do so. Since our so-called
strategic stockpile of most important metals has been sold and depleted, it is
now required that maximum effort be expended by the military to recycle as many
precious metals as possible, and they go back into this strategic stockpile.

An example of this depletion is the success of the “Silver Users Association”,
which is basically a silver cartel (of dubious legal validity) in getting the
federal government to sell off the country’s multi-billion ounce of silver at
giveaway prices over the past couple decades. As a result of this, the
government will, in the next year or so, have to go out into the silver market
and purchase (at the then-current prices) to buy any silver needed to build
weapons systems, coin Silver Eagles, and anything else silver is needed for.

Nonetheless, the military has access to the research and funding to establish
and maintain what is probably the most efficient scrap identification, sorting,
and recycling processes possible. That, along with the size to obtain very
favorable refining contracts from the largest precious metals refiners, gives
them the ability to maximize returns on scrap generated by various government
departments.

Add to this the captive, cheap labor they command to do the actual physical work
involved. The “PMMF” is just an indication of how thoroughly researched and
organized this effort is, as it is the government reference manual as to what
items can be efficiently and profitably reclaimed and recycled. It basically
tells the recoverable metal content of EVERY item the feds buy and utilize,
which is just about everything that you and I buy, in addition to weapons
systems and other materiel not used by the public.

Because of the efficiency of this governmental recycling “industry”, you’ll not
find anything of any real precious metal value being discarded by the government
– those days of opportunity are long gone. As a matter of fact, the rules for
surplus sales specifically indicate that no scrap materials with recoverable
precious metals are to be sold to the public, except by competitive bid and
under specific circumstances.

Hence, the value of the “PMMF” is more as a reference for us (IF we can ever get
access to it) because of the information it provides us on non-military products
which a recycler might come across in everyday business, e.g. PC’s, consumer
electronics, films, etc., etc..

3. “Book” Report – Precious Metal Bearing Electronic Scrap – CD

This is a bit of a departure from our usual book report, as I wanted to inform
you of a product brought to my attention through our discussion forum. This is
a new product on CD only at a price of $40.00. I ordered it and received it
within a few days. The author does not give his name, but does state that this
is the First Edition, and future updates will follow, either free or for a $3
charge for the newest CD version, which is very reasonable.

This CD, for the most part, is very well done, and the author gives the specific
breakdown of a wide variety of commonly-found electronics scrap materials. I
found his mention of the Precious Metals Master File a bit misleading, as he
gives the impression that it is readily available from the Department of
Defense, but those outside the government having access to it are unwilling to
share it due to not wanting the public to have the insiders knowledge it
contains.

It is pretty obvious that the author has not been able to obtain a copy through
the source he provides for you to get it. Other than this one portion of the CD,
I found the material to be both stimulating and valuable if you are interested
in electronics recycling.

I especially enjoyed the part detailing a few weeks’ accumulation of different
types of electronics what they contained in aggregate, and the profit potential
– this is the type of information most of us find particularly motivating and
worthwhile. Some of the topics covered are Hard Drives, CPU’s, connectors and
fingers, and mother boards. He discusses items which are not worth your time,
and gives some good info on a variety of components.

He claims that future editions will go into even greater detail and specifics of
accumulating and processing more types of electronics scrap. I’m looking
forward to future editions, as this is an area which I’ve never spent a lot of
time on.

So if you’ve ANY interest in scrap electronics, I recommend this CD as an
addition to your knowledge base. You can order by sending check or money order
to:
CTH
P.O. Box 55
Fairfield, KY 40020
Or send $40.00 by PayPal to: walden93@bellsouth.net Tell them you were referred
by scott@recyclebiz.com.

4. Scrap Classification – What is High-Grade and Low-Grade?

This is an area which is only really relevant if you’re actively recycling scrap
which requires refining or processing to realize a return. Refiners generally
regard high-grade materials which are karat-quality gold or scrap materials
which have only one or two other metals, and which comprise a small portion of
the overall value of the scrap.

Materials such as 14k jewelry, dental alloys, platinum crucibles and wires, or
even some electronics scrap which has a high proportion of precious metals in
relation to its overall weight are considered high-grade.

On the other hand, CPU’s, mother boards, switches, films, auto catalyst, and
most other types of scrap are low-grade materials. The important distinction
for you, the recycler trying to make a buck (or lots of bucks, hopefully) is the
cost and time involved in transporting and refining your material.

Obviously, the lower-grade your material is, the more it will cost to get it
processed and take your profits. This is why I recommend you concentrate on the
higher grade types of scrap – it is almost always easier to make big profits if
you aren’t spending your time transporting and processing your scrap. If you
can buy karat gold, sell it that day to a local buyer/refiner, and get your
profits immediately, you can immediately put your money back to work for you by
buying more of the same.

Likewise, if you’re opening catalytic converters to sell the catalyst or
shipping it to a refiner, you’re probably giving up more in lost opportunity by
having your money tied up for months at a time than if you were selling the
whole ‘cat’ to a consolidator or broker on a more regular basis.

Is this to say that you should not seek lower-grade scrap? You must make a
decision as to what your cash-flow needs are and whether you have access to
large enough quantities of scrap to justify dealing with low-grade.

Personally, if I can buy it and sell it immediately, even for a small profit, I won’t turn
any type of scrap down. The key here is to have your resources lined up so that
you know how and where you’re going to take your profits – and take them as soon
as possible. This is the key to recycling for profit, rather than as a hobby.

Well, I think we’ll wind it up for this version of “The Recycling Entrepreneur”.
Let me know if you have questions, concerns, or would simply like to see a topic
covered or an interest addressed in next month’s issue. And please visit the
forum and take advantage of the variety of experience and knowledge exhibited
there – this is YOUR resource.

‘Til next month, happy (and profitable) recycling!

With Warm Regards - Scott Andrews

P.S. - Want to get a guaranteed $3,000 return for a $97 investment? Go here and
GET this information: http://tax.scottrecommends.com Frankly, without this
package, you’re not REALLY in business – you’re simply pretending. This is VITAL
to your success.

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