Word-Of-Mouth and Bootstrapping are Keys to Success
Recently a fellow emailed me asking how I could afford to bid on electronic and telecommunication scrap. The short answer is that I did some creative bootstrapping. Here are more details.
This fellow was referring to a discussion in my eBook,
How to Make Money in the Home Based Salvage and Recycling Business. In the eBook I describe my adventures in electronic salvage, scrap metal and deconstruction.
First off, there's bidding and then there's auctions. Starting off I had no cash at all so auctions were out of the question. Even now I stay away from auctions because things usually get bid up way too high and the lots are often too large. In my experience the ones who bid and win have seemingly unlimited cash and they "flip" things almost immediately. Even if they only gain 10% in a couple of days, 10% of say, $10,000, is $1000 profit - not bad pay. Problem is most of us, including me, don't have that sort of cash laying around.
So, I bid on things. Through word-of-mouth I hear about things that are available. Often they are free. If not, I'm usually asked how much I pay, I "bid" and if acceptable, I get the material. Unless my bid is a small amount I explain to the seller that I need X number of days to pay after I pickup the goods. If this is unacceptable, I go on my merry way looking for the right deal that fits my circumstances and finances.
I've found over the years that word-of-mouth referrals is gold. I don't spin my wheels attending auctions, watching craigslist and freecycle listings and the like. Just too time consuming for the meager return. One of my best deals ever came directly from sitting in a rural coffee shop each morning and getting to know the folks who come in. One thing led to another and I ended up with a year's worth of very profitable electronic salvage work.
Recent examples include a word of mouth referral to a person wanting a 100 year old house torn down. I got the call and ended up with 1000s of board feet of beautiful old growth lumber for free. I'm using some and selling the rest.
Another example is a call I got about an old farm. I could have whatever I wanted for free. Note that I said, "have whatever I wanted." In this case, if I had to take all of it, I would have passed or offered a small amount for the stuff I wanted - just too much junk I didn't want so this worked out well. In a couple of hours I collected about 300 pounds of used aluminum roofing, some corrugated steel roofing in very good shape, about 200 pounds of copper wire, a working wood lathe, riding lawnmower, all sorts of miscellaneous tools, hardware, plumbing and electrical supplies, fencing material... Enough to load my Nissan pickup and 8 foot trailer to the brim.
My contact is going to get in touch with the absentee owner of the farm to see if I can have other items as well that he was unsure of at the time. Things I have my eye on are a canoe, a small Kubota diesel tractor (needs work), several 100 feet of irrigation pipe, doors in casings, and the old barn itself. He's pretty sure these are unwanted items as well. I'll keep my fingers crossed :)
A word about Craigslist - I said above that I don't spin my wheels searching craigslist all the time. I've found it to be mostly too unprofitable, but once in awhile it pays off. I check maybe once every couple of weeks. This morning I saw a listing for a very nice woodstove fireplace insert with variable speed blower. I called and found it was just a couple of years old. The folks bought the house with it in it and decided to heat with propane. Woodstoves are too heavy for most people to move around and they just want them out of there - thus free! If you run into these, ask too if they have any firewood. Most people seem to forget this. This morning if I hadn't asked, I would have missed out on a cord of nicely seasoned oak firewood.
A tip - Woodstoves typically way between 250 and 350 pounds. I can load and unload these woodstoves myself (and I'm 65 years old) using the following method. I have a small 8 foot utility trailer I bought as a kit from Harbor Freight. It's the heavy duty 5 lug model with a tilting bed. I can easily tilt the stove up on end and flip it back down on a 4 wheel dolly. Then I roll it to the edge of tilted down bed of the trailer and roll it on. You'll need a small piece of heavy plywood to fill the gap between the edge of the trailer and the ground - a steel plate works even better. Once on the trailer it's relatively easy to roll it in place and take it off the dolly.
In my pessimistic view of the economy, I think woodstoves and firewood are going to be gold (among other things). I may keep this one and use it. Whichever extra one I end up with, I'll probably trade it for a wood splitter or something else useful.
