Buying carat scrap, what to pay for?

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archeonist

Well-known member
Joined
Jun 27, 2012
Messages
286
Hi there guys. I'm into this hobby for a few years now and I've refined almost all material you could think of like fingers, pins, flatpacks, cpu's, jewelers sweeps, dental and carat scrap and a lot more. This experience told me that computer scrap isn't that easy. First you have to have a lot, it has to be stripped, and the final gold extraction is a complex and waste producing process, wich leaves you with very little gold most of the time.
So I'm currently refining my last pc scrap I have laying around and I'll go for the carat scrap, I know that you can get a good profit from it and it is very easy to refine.
But here is also my problem I have really no idea what to ask for carat. I know a few guys who do beach metal detecting and sell their gold to a local goldshop. But how is this price made up? And how do I get these guys to sell the gold to me so I can have some profit and give them a better price?
 
I gather you want to know how to price scrap jewellery in euros, well let’s use €32 a gram as the fix.
Now you need to know the fineness of the items so I’ll give you a quick guide.
8 carat is fix 32 x 0.333 = 10.656 a gram at full spot.
9 carat is 32 x 0.375 = 12.00
14 carat is 32 x 0.583 = 18.656
18 carat is 32 x 0.750 = 24.00
22 carat is 32 x 0.916 = 29.312
Now you have to determine what is the most you want to pay per carat to make a reasonable profit and see if you can outbid the local buyers and still make a profit, hope this helps.
 
I find it very hard to find karat scrap at a price I can make a profit on. If I did I could probably just sell it straight to the bullion dealer for the simlar profit anyway (and save myself some time and chemicals..) Profit on Karat scrap seems to be made by conning people out of their gold for less than it's worth. I guess you could say that about all scrap, but I can't go the bullion dealer and sell 10kg of ceramic cpus at real time spot price like i can do with a 18k bangle, so the game is a little different.

Computer scrap on the otherhand I have had a bit of luck with. Bargains do come up as it's alot harder for the inexperianced to judge the value of a computer component compared to the value of jewellery that has the gold content stamped on the side.. It's simple maths and people trust the hallmarks over somones un-assayed button too.
 
speed said:
Profit on Karat scrap seems to be made by conning people out of their gold for less than it's worth. I guess you could say that about all scrap...
I've never had to "con" anyone when buying karat scrap, and I don't feel I'm buying the item(s) for less than they're "worth". I explain the value of the item(s), the costs I will have to refine and resell the gold, and I offer a fair price allowing myself a modest profit. As you said, if you expect to make a profit on anything, you have to buy it for less than what you'll be able to get when you sell it. That's true whether it's karat scrap, ewaste, used cars, etc.

Dave
 
The nice jeweler pays approximately 70% and mostly takes metal in on trade.

The former pawn shop owner I know pays 87% and I guess does ok because he moves greater volume.

I buy your gold prices vary from 30% and up.

But no matter what you pay as a gold buyer in any position expect to be labeled a con artist. It doesn't matter that these guys have to run a pawn shop and maintain the costs of having a store. They are con artists you see.

So, they spend their days dealing with people who expect them to con them...how do you think they approach their buyer who is paying high 90's, running a tight ship with a big bankroll. With disdain, distrust and a general expectation that YOU are the one making all the money.

I am happy to share what I know, but I have never understood how one thinks that karat scrap is where you make money.

Offer cash, operate outside the patriot act, pay well and take big risks and you very well may be able to make good money.

Know that every time someone asks what to pay for karat scrap, 500 people read it, and the competition to buy goes up. And know that those who give advice on how there are members who have carved out a niche in which they survive, are gainfully employed...not reliant upon what they can con someone's gold for, but their knowledge of the chemistry and techniques of refining.

The simple answer is that the answers you seek are not simple numbers you can find on this forum, but in the art of getting out there and failing until you find your niche and define your own success.


Sent from my iPhone using Tapatalk
 
In refining karat scrap the bonus can be the other values you don’t pay for such as silver in many lower karat alloys and palladium in some white gold alloys which if you simply sell on is lost, you can also collect stones which especially diamonds can have a value which weigh very little unlike cubic zirconium which have to allowed for when buying, sapphires and rubies are fairly heavy also so again make allowances for the weight of stones.
You can simply buy and sell and make a profit but for many the actual science is part of the driving force and if their hobby can make a little money so much the better but there is room for all in this business it’s a personal choice which route you take or perhaps a financial one once you do the maths.
How you run your hobby or business is up to you and only you know what exactly it is you want from it, what works for one may well not work for another.
 
I'm sorry but I don't really agree. 'Conned' may be a strong word but that's essentially what most gold dealers do. Gold has a 'fixed' price and hallmarks are a pretty solid indication of what you have in your hand even if you dont have the skills to test it. If you buy drastically lower than the price of the gold you're making your money because the seller either doesn't know what they have or isn't bothered about getting what it's worth (I'd say the latter is a very rare occurrence!).

Refining gold is actually adding value to earn money, not simply just paying somone less than an item is worth. The question is what do you effectively charge for your refining service and my experiance is, to make a profit I simply can't buy karat scrap at the going rate, refine it then sell it as 24k (plus silver etc.). The only way i make money is when i can pick up an item at a car boot (flea market) or similar that is priced drastically lower than it's gold content.

With electronic scrap the situation is different. There's no hallmark telling me how much gold is actually present and it's virtually impossible to test conclusively unless you have a massive batch to assay so there is a genuine reason to buy at much lower prices than what you 'suspect' the gold value to actually be. It's much more speculative and you're effectivly charging to take on that risk, not simply buying lower that what you know the value is.

Maybe that clarifys my point. It's not so much about the morals of it. It's that there's good reason to buy escrap for alot less than gold value but karat It's very hard without simply fleecing people. I have the same issue with silver scrap too!
 
It really depends on what your local buyers are paying as to whether you can make a good profit or simply a profit, if you are willing to pay more than everyone else and can still make a profit then that to me seems a fair deal for all, the cost to refine and the ease of the actual refining of carat scrap makes it an easy option to turn a profit but as with other forms of scrap volume is the key.
 
speed said:
I'm sorry but I don't really agree. 'Conned' may be a strong word but that's essentially what most gold dealers do. Gold has a 'fixed' price and hallmarks are a pretty solid indication of what you have in your hand even if you dont have the skills to test it. If you buy drastically lower than the price of the gold you're making your money because the seller either doesn't know what they have or isn't bothered about getting what it's worth (I'd say the latter is a very rare occurrence!).

I've worked in the melt house, where you buy at 98% of melt value...mostly from those that as you say, "con" their victims out of their gold. At any given point the melt house has to have at least a quarter million dollars tied up in their inventory, to maximize profits for different categories that they are buying. They also have to have the analytics to determine exactly what they are buying within 1/4 of a percent. On karat scrap, their paycheck comes out of 1/2% of melt value.

I've seen the checks of the gold buyers, that sold to the melt house. Every sale put them at a greater risk of buying high quality fakes. Every sale put them at greater risk of getting killed by a down on their luck irate customer, or worse yet, someone fencing stolen goods looking for their next fix. Their checks weren't that much different than the 1/2% check the melt house takes. If they are able to pay 30%, nobody is going in to that neighborhood.

It's not that anybody is getting conned, as you say, the hallmark defines it's value...there is no ambiguity, only a question of whether it is genuine. In order for someone to be conned, you have to manipulate the seller in to working against their best interest due to the falsehoods you present. These aren't cons, they are a reality of risks, overhead and market. The market in Miami is considerably different than the market in backwoods Arkansas.

In my previous town, I could buy junk silver coins all day long. In this town, they bring a pretty good premium. In my previous town, I could be on the doorstep of any number of buyers paying 98% on karat scrap within a 30 minute drive. In this town, it's more like an hour and a half. Locale opens some markets and closes others.
 
snoman701 said:
I've worked in the melt house, where you buy at 98% of melt value...mostly from those that as you say, "con" their victims out of their gold. At any given point the melt house has to have at least a quarter million dollars tied up in their inventory, to maximize profits for different categories that they are buying. They also have to have the analytics to determine exactly what they are buying within 1/4 of a percent. On karat scrap, their paycheck comes out of 1/2% of melt value.

I've seen the checks of the gold buyers, that sold to the melt house. Every sale put them at a greater risk of buying high quality fakes. Every sale put them at greater risk of getting killed by a down on their luck irate customer, or worse yet, someone fencing stolen goods looking for their next fix. Their checks weren't that much different than the 1/2% check the melt house takes. If they are able to pay 30%, nobody is going in to that neighborhood.

It's not that anybody is getting conned, as you say, the hallmark defines it's value...there is no ambiguity, only a question of whether it is genuine. In order for someone to be conned, you have to manipulate the seller in to working against their best interest due to the falsehoods you present. These aren't cons, they are a reality of risks, overhead and market. The market in Miami is considerably different than the market in backwoods Arkansas.

In my previous town, I could buy junk silver coins all day long. In this town, they bring a pretty good premium. In my previous town, I could be on the doorstep of any number of buyers paying 98% on karat scrap within a 30 minute drive. In this town, it's more like an hour and a half. Locale opens some markets and closes others.

I agree completely with this post.
 
I've never had to "con" anyone when buying karat scrap, and I don't feel I'm buying the item(s) for less than they're "worth". I explain the value of the item(s), the costs I will have to refine and resell the gold, and I offer a fair price allowing myself a modest profit. As you said, if you expect to make a profit on anything, you have to buy it for less than what you'll be able to get when you sell it. That's true whether it's karat scrap, ewaste, used cars, etc.

Dave
One thing I have noticed is that people like to sell karat scrap like non-scrap repairable pieces which is insane to my thinking. If it cannot be repaired, why do people buy it for more than spot?
 
All this talk of conning someone because you pay them less than what something is worth, what? Are you kidding? We are talking about adults here, correct? not the disabled, not children but adults. it is not the buyers job to educate the seller on what they should recieve for their property. If I go out to buy a car and and find one listed $3000 bellow blue book and after testing I haggle the price down an additional $1000 what's the concensus here that I should bite the bullet inform the seller of the items true worth, cutting mine and my family's throat in the process. Whether we're talking about precious metals, gemstones, vehicles or groceries all these items have a market value but when your buying off the street, Second tier market, the current worth of any item is determined by whatever buyers are willing to pay. As the seller you determine how much you believe your item is worth and depending on whats offered you decide ultimately whether or not to sell. Therefore, barring a case of overt fraud or subterfuge, the only person capable of conning you, is you. If you make a bad decision and believe after the fact that you should have recieved more money or whatever that's what's called a mistake and if your smart a learning incident. Sorry for the rant but all this talk of conning because someone offers 30%-50% the worth of something is ridiculous in that for the person to buy at such a great deal the other has to decide to sell it, which for good or ill is totally 100 percent their decision to do so. If I offer you half of what your stuff is worth I would hope you'd laugh at absurdity and walk away.

On a side note I don't go around offering 30%-50% the value of jewelry as I like to actually make deals more than once a week. That said when I see a great deal or am offered one I don't muck it up, i pass the cash and say thank you.
 
All this talk of conning someone because you pay them less than what something is worth, what? Are you kidding? We are talking about adults here, correct? not the disabled, not children but adults. it is not the buyers job to educate the seller on what they should recieve for their property. If I go out to buy a car and and find one listed $3000 bellow blue book and after testing I haggle the price down an additional $1000 what's the concensus here that I should bite the bullet inform the seller of the items true worth, cutting mine and my family's throat in the process. Whether we're talking about precious metals, gemstones, vehicles or groceries all these items have a market value but when your buying off the street, Second tier market, the current worth of any item is determined by whatever buyers are willing to pay. As the seller you determine how much you believe your item is worth and depending on whats offered you decide ultimately whether or not to sell. Therefore, barring a case of overt fraud or subterfuge, the only person capable of conning you, is you. If you make a bad decision and believe after the fact that you should have recieved more money or whatever that's what's called a mistake and if your smart a learning incident. Sorry for the rant but all this talk of conning because someone offers 30%-50% the worth of something is ridiculous in that for the person to buy at such a great deal the other has to decide to sell it, which for good or ill is totally 100 percent their decision to do so. If I offer you half of what your stuff is worth I would hope you'd laugh at absurdity and walk away.

On a side note I don't go around offering 30%-50% the value of jewelry as I like to actually make deals more than once a week. That said when I see a great deal or am offered one I don't muck it up, i pass the cash and say thank you.
I tend to agree with you. The way I do business is if someone who offers me a ridiculously low price for something we are never going to do business, ever. I have now learned a lesson and won't be in the position to be made another offer by that person or business. I don't haggle over prices, I ask and they make a price or I am done. I offer a price and they pay or we are done. I figure the time wasted haggling is time I could have used finding better deals other places. On the other hand I have friend that will haggle over anything, anywhere. And he walks away with some great deals, that just isn't me though.
 
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