How To Start Scrap Metal Business in IndiaIn India Cost, Profit, Business Plan, Requirements | SkillsAndTech

How To Start Scrap Metal Business in IndiaIn India Cost, Profit, Business Plan, Requirements | SkillsAndTech

If you want to start a scrap metal business first you need to know about Scrap metal, it can be described as the material that has been produced in the form of metals. Metals are used extensively in many different things. The traces of metals after use are referred to as scraps of metal.

If one considers India the country, then 26.9 million tonnes of scrap metal was produced during 2013-14. It is predicted that the industry will expand to many times its size over the next five years, at 12.48 percent. The scrap industry in the world is massive and located in a $500 billion industry that employs more than 1.5 million individuals.

The use of scrap metal is huge considering the requirements it meets. Recycling of scrap metal is huge across the globe. India is also a major market of this industry, which employs 7 lakh people.

This growing industry holds huge opportunities for the future. About 40% of the steel used in the world comes from scrap metal, which is the size of this market. In this article, you’ll learn about the scrap metal recycling opportunities and a lucrative business plan for starting the first metal recycling business.

Scrap Metal Business Opportunity

What are the Scrap Metal Business Opportunities Scrap metals include a variety of metals, including copper, iron, steel brass, aluminum alloy nickel, bronze, and many more, except precious metals? They are used as waste after various uses such as in industries of manufacturing that produce frames, utensils, and various other items using the metals.

Metal scrap is found in an enormous amount and is extremely valuable. What makes the metal recycling business so popular is the value it offers when compared to other recycling companies.

Before you begin your enterprise, it is essential to know what you are planning to recycle. It is also essential for you to run a feasibility test to determine exactly what needs to be done in this field.

There are numerous positives and negatives to this particular business, as well as some issues and issues between, and one should know the basics. Here’s a concise and detailed recycle business strategy.

Scrap Metal Business Plan

While starting a scrap business you need to draw Scrap Metal Business Plan There are many aspects to this recycling industry that should be taken into consideration before launching the business. Here are some questions that may pop to thoughts.

How do I begin the Scrap business?

Every time you start something, you have to create an outline of what you will need to accomplish to get the desired result.

  • The first step is to think about which kind of metal you will recycle. There are many kinds of recycled metals and they are easy to recycle, which is why one must choose the kind of metals to recycle. This is because to recycle different metals, there are different techniques as well as resources and methods and each one requires an investment of a different amount.

Determine the kind of recycling you’ll be doing

There are various types of recycling carried out on scrap metals. Select the exact kind of recycling you wish to undertake. For instance, you could segregate the metal according to its nature, quality, etc., or simply melt it into a certain shape.

There are several levels of recycling for metals such as

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  1. separation of metals
  2. Cleaning
  3. refining
  4. melting
  5. Forming
  6. cooling
  7. Refinement, polishing, and refining.

You can decide how much you can do. It’s important since the amount of recycling you can do will determine the rate that you’ll be able to offer your recycled product.

What are the prerequisites to start your Scrap Metal Business?

Recycling Plant

Once you have decided on what type of metal you’ll recycle and in what amount, then you will need the facility to set up your recycling plant. Since you’re recycling a metal, it is necessary to have an area sufficient to accommodate the recycling plant, as well as store materials, machinery, and the finished product. Recycling metal is regarded as a heavy industrial task, therefore you must be in a factory-like space.


You must have an infrastructure that is strong enough for your business. A place that is secure in which your machines can operate. A place where you can store your recyclable items, a place in which you can separate metals and clean them, and other such things.

Additionally, you will require an air-conditioned space that meets the requirements of a standard factory. Build the structure according to the standards of a facility for security concerns.


You will need various kinds of resources needed in a recycling company. It is important to arrange them for your recycling facility. The most important resource is:

  • Metal Scrap: Join forces with scrap collectors and scrap sellers, dump ground owners, and other similar groups to ensure you obtain the needed amount of scrap metal. Consider using scrap pickers who will supply you with scrap for a lower price as compared to a typical scrap dealer. If you require a large amount of scrap then contact wholesalers selling scrap metal.
  • Equipment: You must be equipped with all the equipment needed to recycle, such as containers, compressors, grinders, refiner, heating equipment, and more. It is recommended that you are using the most recent equipment instead of the traditional one because the most modern equipment is very efficient.
  • Machine: You must have the recycling machine you require. There isn’t a specific machine for recycling scrap metal because it takes different stages. For instance, you’ll need segregation machines cleaner, melting machine refining machines as well as a shaping container, cooling zone, and many more.

Where to Find Scrap Metal

Find out where the best chances are to find scrap and create ways to collect it. These could include small-scale firms such as auto repair shops, demolishers, plumbers companies, and even residential collections.

If you discover companies that generate a lot of scraps it is possible to develop a plan that will include regular pick-up. It could be worthwhile to schedule a drop-off bin in front of a company to store scrap.

You could also post a request locally to collect scraps from sites such as Facebook Marketplace and Craiglist or via apps such as OfferUp or LetGo. Also, be looking for posts by other users of those platforms seeking to remove inoperable vehicles or inoperable washing machines, dryers, dishwashers, as well as other appliances.

Garage sales auctions, thrift shops auctions as well as flea market sales are excellent places to search for old brass lamps or other items made of metal.

The Man Power: Despite being surrounded by a myriad of machines, it still requires human power to run your business. First, you must hire an expert who will manage your recycling business since they are well-informed regarding the recycling process. Additionally, you’ll need some workers based on your needs. You might need to provide them with training before the recycling plants.

Other Utilities

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Like every other plant, you require essential amenities such as power supply and water supply, a transport system for recycling along with better roads, the plant in a desirable or preferred location, and others.

If you are in the business of recycling metals and depending on the area in which you plan to begin your venture, there might be additional requirements that are worth looking into.

Documents and Permissions Required to Start Scrap Metal Business

Here are the documents required to start a scrap metal business The reason you want to establish an enterprise for recycling metals that is later used by other companies.

So you must have approvals from various authorities. First, you must have an official document for your metal recycling plant which will specify the type of metal you plan to recycle.

In addition, you must get approval from environmental authorities for pollution control. In the future, you might require permission to install the plant in a certain location or permission to utilize ground and power sources.

If you’ve received all forms of approval, you will need to sign up as an entity and join the Goods and Services Tax to pay tax as usual on the sales and services you provide.

Documentation is essential since, without it, you could get into problems. Be sure to have everything you need to run a smooth and profitable business.

Investment Required For Scrap Metal Business

If you are wondering what is the Investment Required For Scrap Metal Business; It is safe to assume that recycling metals aren’t an entry-level business, so it is likely to require a large amount of capital required for the start of your business.

It is possible to calculate this by calculating the expense for various kinds of materials, utilities, machinery, and manpower. In the case of the manufacturing facility, you could choose to own or lease it. It’s dependent on your preference and your budget.

If you’re in a position with a little money, you should rent it out, and then later depending on the type of investment you can own it.

The next important area for investing in is the infrastructure that you’ll have to put some money into. Estimate a cost of 1-5 lakhs depending on the requirements.

The third element is the resources. There are a variety of resources, such as machines, equipment computers, etc. that will easily be purchased for Rs 5 lakhs. It is possible to think about hiring them, which could be a smart option to cut costs.

You could rent all the machines or lease one or two and have a few similar to major machines, which might not be available to lease. They cost a decent sum of cash.

They range in price from between 1 and 20 million and even more depending on the requirements. Select the right machine for your requirements, which means the type of machine you choose should be based on the type of recycling you’re doing and at what rate you recycle, the quality of the recycled product, and the number of recyclables you’re able to recycle.

Other Expense

Other expenses For Scrap Metal Business include paying experts technicians, technicians transportation, drivers office boy, and many other employees.

It is also important to include the costs associated with transport and packing. Monthly bills for water supply, power supply, various kinds of taxes, taxes, etc. should also be considered as an essential cost.

Scrap Metal Recycling Process

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There are a variety of methods of recycling metal scraps that you can use as Scrap Metal Recycling Process. There are various methods of recycling which you can choose the one that appeals to you based on your expertise, strength, man’s power, and the cost.

There are several phases of recycling that you require you to determine. Certain recycling processes are done at the beginning of the process in which cleaning, melting, and cooling are all that is needed, whereas other processes require polishing, refining, and finishing. Each stage has its requirements and they provide different results.

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Cost is another issue since the more recycling you do, the lower the price will be needed. The benefit is that you’ll get more money when selling your recycled products.

Marketing to Sell Your Product

It is important to get acquainted with people involved in this Scrap Metal Business to learn what the industry is. You must build an alliance with those who are interested in this. In time, you’ll discover the markets in which you can sell this recycled material.

It is important to be on guard during this process since you could find a market that allows your product to be sold at a lower cost than what you would normally pay, so be on the lookout.

What determines the success of your market is the quality and type of the recycled product you’re providing. We have mentioned earlier that they offer various levels of recycled goods and all of them are available at various costs.

Return on Investment

It should take at minimum an entire year to begin receiving returns, and perhaps a few years before you are rewarded with the money you deserve. One thing advantageous to you is the fact that the market is massive and costly, so your profit will also be massive as time passes.

Recycling metals are offered at a reasonable price and are used directly by manufacturers of metal products. It is believed that up to 40 percent of the steel comes from scrap steel.

The amount you earn will depend on the kind of recycled item you’re selling. The higher the quality, the higher your return.

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