Cash 4 Gold business

Basically the way it works is similar to that of a pawn shop, customers come in with unwanted jewellery (rings, watches, necklaces etc.) and the cash for gold company buys the items for just above the scrap gold price. Therefore making a profit on the gold when they sell it to the people who melt down the gold into gold bars. Then said gold is sold to India, asia and middle eastern countries, made back into jewellery and sold back to USA(as an example, UK and AUS apply). Once back in the countries the cycle starts over again and eventually ends up back in the hands of the cash for gold companies.

It is a very lucrative franchise(I have a few close friends who do this and are making over $2,000-3,000 a week.

Thoughts on the process, how it effects our economy and the opportunity to cash in on such a franchise?

- Also please note this is a very short summary of how it works - it has a lot more detriment to the global and national economies than this.

 

It has ALOT of competition. If you search "cash for gold" on Google, you get:



Not to mention other shops who aren't on the internet. It is a very high competition business. So if you can't be one of the cheapest, you are just like the rest.

 

Moved to a more appropriate forum.

 

I guess it depends a lot on where you live if you are doing this locally. If you live in the dumps you wouldn't be getting many customers for example. Also have you researched if there are any other places like this around where you live that would be the competition?

 

Well there are several methods - the one my close friend did was via eBay/internet.

At first he bought jewellery from people on ebay (with a count totalling toward 10,000 feedbacks) before opening the website cash4gold.com or cashforgold.com - this was a few years back, I think he still has the domain. He made an absolute killing by doing this in the UK but upon moving to Australia had a lot of problem doing it via eBay as apparently a lot of Australians are scammers and do not send the specified carat or weight.

 

I have a close family friend that works as a jeweler and owns a jewelry store and does this (Buying scrap gold and silver, as well as just straight out bullion.) He said that this business is really slowing down, I mean it could be a regional thing but I believe you caught the tail end of this craze if you are interested in jumping on the bandwagon.

It also requires a lot of start-up cash and is quite difficult unless you are trained in that business.

 

Just make an awesome commerical like this and you'll be set: http://www.youtube.com/watch?v=NSQVVHyvOZU

On a more serious note I see tons of business from family owned gas stations to convenient stores buying gold. Basically, if you have any sort of retail business you should offer gold buying services because if you buy at the right price i'm guessing you can't go wrong.

 

You will need the right contacts and marketing is obviously very important, plus the way the economy is right now you will get extra business

 

south park made a good point with their cash for gold episode. gold has value in all countries of the world, and people are willing to pay hefty sums to obtain the gold. Industry is universal

 

There is so many of these shops here in the UK, like 3-4 in every high street.

 

Yes, South Park can turn comedy central viewers into philosophical geniuses in 5 minutes.

http://www.youtube.com/watch?v=_3OyF_UxJIk&feature=related


But yeah, I don't deal with gold jewellery or anything. I just purchase bullion and tuck it away because I have nothing better to do with my money

 

Buying bullion and tucking it away is a great thing to do.

 

Where I am theres so many of these shops. The problem is many of them are already established so it may take a difficult start. I also believe that this has slowed down now as many people are keeping their gold long term

 

Yea, I think people have noticed that all these shops are buying it so the price is going to go up no doubt so i'll keep my gold. Also the public must be running out of scrap gold to take to these places to business must be also slowing down.

 

Well keeping gold long term is always going to turn a profit - because it is not a renewable asset, the price, not unlike oil, will forever rise.

And I was not really contemplating this business at all, just wanted some general opinions about this. Also, I had not watched that South Park episode until today and it surprises me how accurate it is.