anachronism said:
I had a guy visit my premises yesterday having been recommended by a client. He wanted to get into refining gold and said his plan was to buy fingers from eBay and make profit on them.
You can imagine his face when I told him that he would lose money, especially when he had written a business plan. This guy was no idiot, he was genuine, intelligent and forthright.
I have had the same conversation with 5 UK people referred from this forum over the last year.
Although I accept that in a very few cases people will buy these things to learn a process, the vast majority of people buy them thinking they will make a profit. Dress it up any way you like but as such I do not accept that selling fingers for more than their worth is a straight deal.
That's not a dig. It's not aimed at anyone in particular it's just an expression of my opinion and ethical position on this so please don't anyone get hot under the collar. 8) 8)
You guys do what you like but a pig in a frock is still a pig.
You were kind to educate him, and it goes to show your integrity.
It is really darn hard to make money...as in a reliable business income, on the refining side of e-scrap...from a startup. The material is inconsistent, difficult to refine from strictly a chemistry point of view, and further, it's really hard to compete with massive scale pyrometallurgy. Your value is in your analytics, of the odd, concentrated values, that don't lend themselves to consistent sampling on the large scale.
It's one thing to be a recycler, or a packager...but the amount of e-scrap that is actually refineable on a small scale is small. Then, if you want reliable data, you have to accumulate enough like material to run a reasonable size load, realistically, many of them. OR, you have to invest in analytics. OR, you have to have a lot of seed money to fail quite a few times before you start to get it right. Either way, you have to be persistent, willing to fail, and plan to work your butt off. Because, even after you know your numbers, you have to maintain a constant stream of material that you can buy at a low enough price to afford to eat.
What I can say solidly is this, if you personally entered in to e-scrap refining, with that level of integrity and without multiple business failures in your resume that taught you to look at all of the angles, you are one heck of a talented businessman. I think a lot of it is that you seem to be pretty stubborn, but the failure rates are high, the technical difficulty is up there, and the financial difficulty as well.
In the examples you gave of the 5 people, they are at hopefully the beginning...if they thought it was as simple as watching a youtube video, then raking in the gold using AP or any other home brew procedure, clearly they have another thing coming...but hopefully it arms them with the knowledge to look at problems in a more analytical fashion for their next business plan.
As for selling fingers for 2x intrinsic, I really don't know...maybe it's gambling, maybe it's ignorance, maybe it's speculation. I want the people around me to be successful and make good decisions, and like you, I couldn't knowingly mislead them or enable them...but at the same time, I've made some of those mistakes, and they have value in and of themselves. I've got a bag of "contacts" that turned out to be incineration scraps. Spending $10 for an ounce of fingers may very well be a bad business decision, but a good overall lesson in reality. Whether they buy it for the education, or the education comes as a side effect to their greed and ignorance of reality, it's still more inexpensive by the ounce than by the pound.