# Toll refine



## Galaxy419 (Aug 21, 2016)

So the guy I sell my gold to wants me to refine his gold filled and wants to pay me 10% of return. He stated that what refinery pays him. I think 10% is a little low was wondering what other members think? 


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## anachronism (Aug 21, 2016)

For all the work involved, the time, the chemicals, and the skills you have learned 10% isn't worth it. Many people who claim to take 10% don't really take 10%. Personally I don't toll refine for less than 20% on a large batch. For smaller batches it's 25% at least. An honest 20% is far better for the client than a dishonest 10%

Remember if a refinery does it, it's "on the books" with taxes taken from his return so getting 20% should be a breeze if explained to him in a wayt he understands.


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## Galaxy419 (Aug 21, 2016)

Thank you for your advice 


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## Palladium (Aug 21, 2016)

anachronism said:


> For all the work involved, the time, the chemicals, and the skills you have learned 10% isn't worth it. Many people who claim to take 10% don't really take 10%. Personally I don't toll refine for less than 20% on a large batch. For smaller batches it's 25% at least. An honest 20% is far better for the client than a dishonest 10%
> 
> Remember if a refinery does it, it's "on the books" with taxes taken from his return so getting 20% should be a breeze if explained to him in a wayt he understands.



Honesty
Customer service
Education

My complete business model is based on the 10% scale which by the way is very profitable!


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## 4metals (Aug 21, 2016)

Toll refining can prove to be profitable with gold filled if it runs around 2% and you process about 50 pounds you make just shy of $2000 for your efforts less expenses. But what if the guy thinks it is gold filled and it's plated costume jewelry? Then you make considerably less. I know a refiner that owned stores and all of the plated and gold filled which he didn't pay for was either tossed into a scrap bucket or the customer kept it. The scrap bucket (full of goods received for free) could have been good gold filled, plated, or costume so the yields were all over the place. If your customer is like the guy I just described, you need to quote higher and be honest with the return. But if he does really cull the stuff and give you decent gold filled, then 10% is fair. 

Same is true with e-waste, well separated material can produce both higher yield goods as well as real low grade. But your acids are eaten up just the same and your time is expended whether the yield is high or low. 

It all comes down to a relationship. If your customer learns to trust you that you are being honest with his yields you can develop a long relationship. But you also have to trust that the customer is not filling the pail with gold plated material and passing it off as gold filled. it is funny how once you've digested the evidence the material that might have been mixed plated/gold filled scrap is sworn to have been hand screened gold filled. A refiner processing any kind of quantity would melt and assay, then with an idea in his head what he needs to make, he can let the customer either take his bar and just pay a melt fee, or pay a rate based on yield. 

By the way, if he is asking you to do this for him, he isn't happy with the payout he is getting from his refiner so he is shopping. Could be a good way to get the work and give an honest yield, if it beats his refiners return, you have started on that relationship and are off to a good start.


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## Galaxy419 (Aug 21, 2016)

Thank you that is very sound advice! 


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## Palladium (Aug 21, 2016)

Volume! In the beginning i nearly starved to death, but my rates and customer service soon guaranteed success. It all averages out on volume.


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## nickvc (Aug 22, 2016)

My advice for what it is worth is to ask if you can run a sample batch, ask to see the material and then randomly pick out around a kilo of it and then process that, this should tell you what you will be working on for the whole amount, if it turns out it's mainly plated then no 10% is not enough if it's decent gold filled then yes that's a fair price
With new customers honesty as palladium has said is the key, tell the customer the sample may be worse or better than the whole amount and give him a timescale to do the work that you can stick to, delays cause distrust, who knows he may find e scrapers who don't want to refine but are happy to collect and strip the product and sell on.


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## 4metals (Aug 22, 2016)

Another option is to pick through everything and run the gold filled at your quoted rate and return any non gold filled, like costume or plated goods. This can work for a smaller refiner but manual sorting can eat up lots of time. Plus you really don't want to give back the very low stuff because that will make your customer keep looking for someone to run that stuff and that someone will try to undercut you. But by separating and just showing the customer if there is a lot of low yield goods helps your credibility.


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## Galaxy419 (Aug 22, 2016)

He is going to give me a sample batch 454 grams an see how I do all my karat gold has assayed 99.92 or higher last time he paid me on the spot with out getting it assayed. I also stated to him the downfalls of gold fill worn items etc. and I also stated no magnetic items. I will be going through his sample batch myself and like you stated before he must not be happy with refinery payout. And I am small time refiner. No where the experience of the great refiners on this forum that I learned so much from. Did I make mistakes? Yes but I would research the forum an find the solution. At 10% my first batch might not even pay for chemicals. But it could build a great relationship. He owns 3 stores that buy gold. 


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## MGH (Aug 22, 2016)

Another thought: Charge for the service based on incoming weight

I am pretty small time, but I do a little bit of customer work here and there. My customers also tend to be relatively small time so they only have 1 – 3 pounds of gold filled material at a time. I charge a flat rate per pound of incoming material, and collect a small premium for each 0.25% yield above 2%. This usually works out to between 14% and 20% fee.

I like this arrangement because it gets around the concern about having plated material in the lot. Still, you don’t want to waste a bunch of acid on plated items, but it directs most of the sting to your customer who was responsible for screening them in the first place.

All that said, two things:
1)	You still MUST earn and maintain the trust of your customer, as well-said above.
2)	Volume does matter, as has also been said above. If I could routinely work on multi-pound batches or more, I think I’d be quite happy with a 10% fee.

Hope that helps. Good luck!

-	Matt


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## Palladium (Aug 22, 2016)

It's not only the 10% fee that makes money. Theirs a good bit of silver that comes with doing gold filled on volume. Also the residuals from karat that always makes it through add up at years end. My 10% is a sliding scale. Plated items, stainless items, irony items, and low yielding lots earn a 5-10% penalty according to what it is.


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