Why Scrap and Recycling Buyers Need Gazeloft: Know Your Margin Per Kilo Before You Quote

Two men buy scrap on the same street. Both know the going rates. Both have a scale, a yard and a lorry. One of them consistently makes more money, and it is not because he is tougher at the gate.

It is because he knows something the other one does not: exactly what each material earned him last month, per kilogram, after everything. When a load arrives, he is not estimating. He is comparing an offer against a number he can prove.

That number is the whole trade, and almost nobody in it has one.

Why scrap breaks ordinary record keeping

Most business apps assume you buy stock from a supplier and sell it to a customer. Scrap runs the other way round. The person who walks in with a bag of cans is a customer, and you pay them. The dealer you eventually sell the collected material to is a buyer, and they pay you. Call the wrong side a supplier and every report you read afterwards is misleading.

The second difference is timing. When you pay ₦18,000 for 60kg of aluminium, you have not spent ₦18,000 in the sense of an expense. You have converted cash into material. Nothing has been earned yet and nothing has been lost.

Gazeloft's recycling space is built on exactly that rule: buying moves cash into stock, and profit appears only when the material is sold. It is stricter than most yards are with themselves, and it is the only version that does not lie to you during a slow month.

The number that changes your buying

Once buying and selling are both recorded, margin per material falls out on its own. And it is usually a surprise.

A yard might find that its heaviest, most tiring line, the one that fills the lorry and takes all the labour, returns a thin margin per kilogram, while a lighter material nobody chases returns far more. That is not something you can feel. Volume feels like profit. Effort feels like profit. Neither of them is profit.

What you do with the number is simple and immediate:

• Raise your gate price on the material that pays, and take more of it than the yard down the road.
• Hold or drop your price on the material that does not, and stop competing for work that costs you money.
• Notice when a dealer's price slips below the level that makes a line worth handling at all.

This is what makes an experienced buyer look almost unfair at the gate. He is not guessing better than you. He is not guessing.

Set the price once, let everyone quote it

The moment more than one person buys on your behalf, consistency becomes the problem. One agent pays generously to fill his day, another pays too little and the sellers stop coming to you.

Default buy prices and stock targets turn your judgement into something the whole yard can follow. The price you decided from real margin becomes the price at the gate, and the target tells everyone how much of each material you actually want before the next collection. Nobody has to phone you to ask.

Cash is the other half of this business

Scrap runs on cash, and cash without records goes missing in the most ordinary way. You release ₦120,000 to an agent in the morning. By evening some of it is material in the yard, some is still in his pocket, and some paid for the lorry's fuel. Which is which?

Gazeloft tracks cash at hand and cash in bank as separate running balances, records movement between them as a swap rather than as fake income, and lets you tag cash to the specific agent holding it. At any hour you can say what the yard is holding in material and what it is holding in money.

Agents generally welcome this. The honest ones have been carrying suspicion they did not earn, and a ledger is the only thing that ever removes it.

The month-end that finally makes sense

The old month-end in a scrap yard goes like this: money came in, money went out, there is a pile in the corner, and the owner declares the month "not bad" based on how tired he feels.

The new one takes five minutes. What did we buy, by material and weight. What did we sell, and to whom. What is still sitting in the yard, at what it cost. What each material actually earned. Where the cash is.

You will notice something the first time you do it: the pile in the corner is worth either much more or much less than you assumed, and both answers change what you do next week.

Start at the gate tomorrow

Record what is in the yard right now at what you paid for it, and your cash. Then record every purchase and every sale for one collection cycle, from empty yard to loaded lorry.

At the end of that cycle you will hold a number that most people in this trade will never have. Use it before you quote your next price.

Open a free recycling space and find your true margin per kilo.