The margin
How a scrap broker's margin works
A broker's margin is the difference between what the original seller agreed to take and the price the broker lists the material at. It is arranged privately and sits outside ScrapTrade.
Illustrative: a broker resells material sourced for A$800
| Original seller's agreed price | A$800 |
| Broker's listed selling price | A$1,000 |
| Potential gross margin before expenses | A$200 |
ScrapTrade does not calculate this margin or pass any part of it to the original seller. Platform charges are extra. Example only, not a price guide.
What ScrapTrade does
What the platform does and does not do
| The platform does | The platform does not |
|---|---|
| Process payment as a standard seller transaction | Calculate the broker's margin |
| Charge standard platform fees to the broker's sale | Deduct or distribute any share of the margin |
| Show the broker classification and the represented seller | Manage brokerage agreements or payouts to the original seller |
Ready to list material you have sourced? Register on ScrapTrade.
Register as a sellerBefore you call it profit
Costs that come out of the margin
The example shows a potential gross margin before expenses. Your own costs come out of it, for example transport, handling, storage, inspection, tax and ScrapTrade's platform fees. Work out these costs before you agree a price with the original seller, so the margin you expect is the margin you keep.
Risks to think through
- Agreeing a price with the original seller before you have a buyer
- A buyer cancelling or disputing after you have paid the original seller
- Material that differs from what the original seller described
- Costs you did not allow for
Pricing your listing
Set your own price
You decide the listing price. Check what similar material is listing for on ScrapTrade, such as in market prices, and decide whether your price leaves room for your costs while staying competitive. ScrapTrade does not guarantee that any price will sell.
In Australia
Margin, GST and records in Australia
Check with your state regulator what records you must keep for scrap you buy or sell, and whether the original seller must give you anything in writing. Ask a registered tax agent how GST applies to your margin.
Frequently asked questions
How does a scrap broker make money?
By the difference between what they agree to pay or give the original seller and the price they list the material at, before their own expenses. The margin is arranged privately.
Does ScrapTrade take a share of the broker's margin?
No. ScrapTrade does not calculate, deduct or distribute it. Standard platform fees apply to the sale.
Who pays the original seller?
The broker, under their own agreement with the original seller.
Is the margin guaranteed?
No. It depends on the price you agree, the price you can sell at and your costs.
What fees does the broker pay?
Standard platform fees apply to broker transactions, as for any seller.
More about scrap brokering
Sourcing scrap to resell?
Register on ScrapTrade and list it as a broker.
Related reading: Listing requirements · Broker responsibilities · Agreement with the original seller