We recently had a conversation with a jewelry store owner who has 5 locations and spends his time traveling between the stores. Each store has a manage
r and the manager’s main concern is selling wedding rings, gemstones and custom jewelry. One of the stores has a resident goldsmith. All of the stone sizing, removal, changes and ring fitting that comes into the 5 stores is sent to the goldsmith. The goldsmith has different categories of scrap: gold, silver, and platinum as well as karat gold with stones. Each jewelry store has a different method of selling their gold scrap.
The stores have some things in common: they all use cash buyers for their gold and scrap jewelry, take trades from customers, and buy scrap jewelry from the public. Upon talking to the owner, buying gold and repairs are not his main concern.
His issue is over time he has found it cumbersome to follow what the individual stores did and essentially without knowing, he lost control of his precious metal refining. The gold buyers would come in, some were just friends of the jewelry store manager, some would use one buyer and some would rotate buyers.
The record keeping was not articulate enough for the owner to look and see if individual stores were buying right – were they paying too much for jewelry. It was just too vague. We proposed that we would take over his scrap refining, provide the goldsmith the containers they need for polishing dust and rings, mats and provide the 5 jewelry stores with containers for scrap jewelry. We also proposed that our customer service team would call each store bimonthly to see how their scrap accumulation was progressing. As an added value, we agreed if we had a large jump in price we would notify them so they can take advantage of it.
Since we rolled out this new program to the jewelers; the owner has a lot less to deal with and doesn’t have to worry about the cash buyer middlemen. All scrap is going to a REAL, true fire assay, refinery, Pease & Curren.
The owner can now tell who is keeping the gold too long and who is not buying well. We provide control and accountability over the scrap and all of the reports and checks go to the owner. The owner can check his balance at any time. A pattern develops and our customer service team will see the pattern and work with them. We also provide materials to help his employees buy better such as our Buyer Beware Newsletter and social media blogs and posts.
