I received an email in response to a recent blog post asking for more information about buying gold from the public. The downturn of the Asian economy offers an opportunity to help your customers while creating a new profit stream for your store. Before you start buying gold over the counter (OTC) you need to check your local laws. In the US most jurisdictions require special licensing and have specific paperwork that must be filled out on every purchase you make. There may be holding periods before you can sell or refine the gold and you might need to provide daily reports to the local police department. Once you have confirmed and complied with local laws you can move on to the 4 C’s of buying gold.
For many people, selling their jewellery to raise cash is a stressful endeavour. You need to get them relaxed before anything else. Don’t have your gold buying station at a stand-up counter. Use a desk and provide comfortable chairs for your customers. Spend some time chatting with them before getting down to business. You want the experience to be as pleasant and stress free and possible.
You need to project a calm, professional manner. Be prepared. Have gold testing supplies, scales and other at hand. Be sure you are comfortable and confident in using them. You want your customer to believe you know what you are doing and that they are in good hands.
The quickest way to lose your customer’s trust is to guess at the price you are willing to pay. Build a spread sheet so you can enter the gold weights of different karat qualities and the spot price, and it will automatically calculate your buying price based on your desired margins. Then you can show the customer the price your computer recommends. People tend to believe in computer results more than a verbal offer.
This is the most important part of the equation and the one thing that will set you apart from your competition. Your customer may be in dire financial straits and might feel embarrassed by needing to sell their well-loved jewels to survive. A little kindness and compassion can ease their discomfort. They may have jewellery that is precious to them, but you recognize as not having much value. Never say that it is junk or worthless. Instead find a way to let them know that you don’t have a strong need for that particular item and can’t offer very much. If you feel you offer will be insulting to them, you may just want to say you can’t use it at all and should keep it as something to enjoy for themselves. Always remember–you or someone close to you could be in their position. Treat them as you would want to be treated.
OTC buying can be fun and profitable and a good way to get your jewellery store through difficult economic times. Follow these 4 C’s and your buying will be successful.