Day: November 15, 2019

How to Enter the Scrap Metal Market

Starting a scrap metal business can be very profitable after the first couple of years. Depending on which level of business you want to go in to, the initial investment can be very small or very large. First, it’s essential to know your metals, and which types of metals you’ll be collecting.

 

Collecting Scrap Metal

 

Collecting metal is by far the simplest way to enter the business. Many people and companies have old equipment and machinery lying around that they would love for you to haul off. Before you begin, connect with the nearest metal recyclers to understand how they do business. For this aspect of a scrap metal business, all you’ll need is a pick-up truck, sturdy clothes, boots and gloves, a magnet, metal snips, saw, wire-strippers, a scale, and some tie-downs. You’ll need to strip the metals of any other materials such as plastic, paint, or rubber coatings and sort the metals into ferrous (iron-based) and non-ferrous metals. While all alloys have value, ferrous metals are the most profitable.

 

Melting, Refining, and Finishing

 

If you decide you want to enter this sector, you’ll need land and a structure to house the materials and machinery. Each type of metal will need a different furnace because metals have different melting points, and you’ll only make more work for yourself if you try to mix them. Once they’re in liquid form, you can run a current through them to extract any other metals from the alloy. At this stage, the metal is ready to be poured into ingots, rods, or sheets and you’ll need metal casting services to get the molds.

 

There is a high profit to earn for the vast amounts of scrap metals that people no longer want. The time and investment it takes to go from junk to a marketable product may be well worth your efforts.

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Buying Equipment for a Startup

New businesses face unique challenges when it comes to equipment procurement and financing, because financial institutions have a bias against lending to businesses that don’t have an operating history but operations can’t start without equipment. That’s why so many entrepreneurs wind up raising money through equity sponsorship and debt investment. There are other ways to get the equipment you need, though. When you are purchasing heavy infrastructure pieces that will form the backbone of your company’s production, the SBA offers a path to financing specifically designed for small businesses. The only real catch is that the administration requires you to prove you will create jobs or otherwise improve the local economy, on top of being financially healthy.

What To Buy and What To Lease

Purchasing equipment isn’t always the best idea. If you’re getting galvanizing tanks, cranes, or other pieces that can have decades of operating life when properly maintained, it’s a great idea. If planned obsolescence comes into the picture, though, you might be better off contacting a financing company about a short-term lease with upgrade options at renewal. Leases can be less expensive than purchases if you’re planning to replace the item quickly and you figure in cost savings on things like equipment disposal and maintenance, because many lease options include help with equipment maintenance, at least up to a point. Weighing the options is vital, because you probably won’t be able to buy everything, so you’ll need to purchase the pieces of equipment that offer you the best investment.

Planning To Grow

As you weigh your options for equipment purchases, think about which pieces you will need to replace with higher capacity options if you grow. If you can’t afford to purchase the higher capacity option now, then consider leasing instead of making a purchase until you get to the long-term upgrade. Otherwise, look at what you can do to save money by planning for a shorter life expectancy and going for a budget solution on your initial purchase. The goal isn’t to invest in the most expensive and largest machines, but to plan for their lifespans and have a path to replacement or maintenance over the years.

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3 Trending Franchise Businesses

Many people dream of owning their own business but are intimidated by the start-up costs and high learning curve. Opening a franchise business can be an ideal alternative to starting your own business from scratch. There are many franchise opportunities to choose from. These are three of the most popular.

 

Optical Franchises

 

Optical franchise opportunities can be ideal for people who want to make a difference in the health of their communities. 64% of Americans wear prescription eyewear and 3 out of 4 adults use some type of vision correction. Additionally, 1 out of every 4 children requires vision correction. Eye health is an essential service that you can help provide your community, while also running a business in an industry that has generated $40 billion in revenue. Modern technology has made this a flexible option with online sales and mobile locations being an option alongside traditional brick and mortar stores.

 

Fast Food Franchises

 

The world of fast food has evolved far beyond the realm of burgers and fries, though those are still plenty popular. Franchises exist for just about any type of cuisine you can think of and new trends are emerging all the time. With fast food, you have the option to pick a well-known established chain or venture out into emerging markets.

 

Fitness Center Franchises

 

With obesity rates soaring, Americans are becoming increasingly health-conscious. This trend has led to a 26% growth rate in the industry since 2009 and 1 in every 5 Americans currently belong to some type of fitness center. Whether you’re interested in a specific type of sport or exercise or would like to open a traditional gym, there’s a franchise out there for you.

 

Whatever your interests and goals are, there is probably a franchise opportunity that aligns with them. Opening a franchise could be the right path to business ownership for you.

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