How to Sell Metal Scrap Material in Best Prices

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How to Sell Metal Scrap Material in Best Prices
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Your system generates scrap material every day
after the manufacturing or consumption process.
And for years, you mightve been following this
procedure to scrap metal calling a scrap
company, deciding the price, sending the filled
containers, and then getting paid for your metal.
For you, this might be the best way to handle
the scrap metal. But, only some manufacturers
know selling scrap metal the right way could be
another source of profit for them. Everyone
selects a particular scrap company for various
reasons including lower prices, better services,
or just transparency. But most of the scrap
companies would buy very low and sell high.
Hence, as a seller, it is important to
understand the value of your scrap material and
how to get the right value for it.
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• So, weve gathered the steps to help you make the
  most out of your scrap metal.
• Fix the Settled Price
• In the fabrication industry, selling scrap metal
  isnt a one-time event. Therefore, it is
  important to make sure that you dont end up
  working with a company that tempts you with an
  above-market price, and after that gradually
  lowers your per-ton rate to a below-market
  price.
• You need to make sure that you tie the pricing to
  a defined commodity-market index. This way, you
  can protect yourself when the market falls and
  benefit when there the market rises. The decided
  upon index prices are generally not similar to
  the negotiated price for the scrap. So, when you
  negotiate, you are basically negotiating the
  differential price. This means there will be a
  difference between the market index price and the
  amount that the scrap company would give you.
  And when your prices are tied with the
  market-index, the scrap company wont be able to
  freewill their way around the prices. So, make
  sure that when the index goes up to 20, the
  scrap price should also go up by the same amount.

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• Be Aware of the Downgrades
• It is a common industry practice to pay for the
  least valuable scrap material in a load. If the
  load contains 90 stainless and 10 some other
  material, the less expensive material would be
  graded. Looking from an ideal point of view, the
  payment should be based on the percentage of the
  material in a load. For dirty loads, downgrading
  the scrap amount is certainly fair, especially
  if a dirty load increases the amount of
  segregation work. Hence, if a scrap company
  downgrade a load, ask for proper documentation.
  Make sure that there is an agreement to send
  documentation and pictures for any downgraded
  load. If you communicate with the scrap company
  about how it handles dirty loads, you will
  understand how it operates.
• Separate the Scrap Pieces
• This technique is all about maintaining
  transparency. This process includes everything
  that happens to the scrap before its sent to
  the mill. It includes shipping, processing costs,
  and other value-adding process costs. For
  instance, you get a pallet of metal pieces after
  a laser cutting process from a machine
  containing Amada parts or Bystronic parts. Before
  you put them for buying, they must undergo a
  number of value-adding steps. You need to
  segregate them by type and cut down to a
  mill-acceptable size.

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• Just like that, steps may vary depending on your
  exact material mix and requirements. It depends
  on your own processes and the price increase
  that a scrap company is willing to give you.
• It might sound like a complex process, but
  remember that just like the production, scrap is
  also a revenue center, so its worth organizing
  it with a process.
• Keep Track of the Load and Tracking Reports
• Usually, the truck arrives at your workplace,
  retrieves your scrap, and leave a pickup receipt
  and scale ticket at your dock. After a certain
  period of time, the concerned person would
  deliver them back to the front office. But it is
  not necessary that all those pickup receipts
  make it into the main office. You need to verify
  the number of loads that left the facility and
  for how many of them you received the payment.
  Keep one responsible person to take care of this
  process. Especially, when you scrap aluminum,
  stainless, or other high-value materials.
  Because each load can account for thousands of
  dollars.
• Summing it up
• Handling scrap material isnt rocket science. But
  it is important to understand the process,
  market, and of course, having a basic knowledge
  of the industry prices wont harm.

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If done right, just like you produce products
using Bystronic parts or Amada parts, you can
turn scrap into a valuable profit-making product.
This Article Post is Originally Posted here
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