Soliciting any and all input from you guys. I am interested in what is mostly known out their as the "Cash for Gold" business. Right off the bat I do want to ask if anyone knows anything I should know about this business?
Ok, I became interested in this recently while reading a book about it that a friend of mine wrote on the subject. He has dabbled in this area for about 30 years, longer than I've been alive! So needless to say he had some good info. However, he still only lightly dabbles in it so one question I need to ask him is why he isn't "fully invested" in the idea. I have a feeling however that the true answer is the comfort and security of working for the man, especially with a wife and kids which I don't have.
I think it satisfies the CENTS criteria:
Need: People are in need of money these days more than any time I remember and trading in gold/silver from past decades is a quick way to do it.
Entry: I make my current living from a few ecommerce sites, and I don't see this one being quite so easy. There are certain government regulations that I'm becoming aware of, and you need to start out with some capital in order to actually give people cash for their gold.
Control: This one is tricky based on the personal touch I want to offer as a unique selling point (USP), but I want to go strictly mail order where people send in their gold, so we are talking nationwide and not just my area. In fact, I don't want people walking in at all as that feels like a pawn shop and there is probably a level of risk despite the 1911 I usually keep strapped to my hip.
Scale: I envision having/using/renting a call center of sorts that can answer people's questions if it got to that volume. So I think it can go big, again, not just local.
Time: Also a little tricky. To start I envision myself being the one testing the gold then making the offer of what can be paid for it. Honestly, that takes like 5 minutes and a couple hundred (or much more) can be made on a piece of jewelry. So if I were spending 8 hours a day processing these types of orders, that would be crazy money... but in regards to this commandment, even this process can be taught to a good employee if need be.
I am big into having Unique Selling Points that set you apart from the competition. I feel that companies like Cash4Gold are impersonal, and quite frankly pay out peanuts. Not having the overhead that they have I could beat their prices, and prices of pawn shops/jewelry stores, and really emphasize that point. The whole, "one-man shop, so I keep my costs way down allowing me to give you TOP DOLLAR for your gold" sort of thing. I would want a very personable, easy to use website, be available for questions through email/phone (I know, not the eventual goal as I'm strapping myself down, but you can get someone to do that), and also, a big one is instead of simply sending out a check for peanuts that the person can choose to cash or not, making it hard to get their gold back if they decide not to do it, I would contact first with a quote, re-emphasizing in a personable, one-on-one kind of way that this price is much better than anywhere else. I hate to run a business based on "being the cheapest", but it still leaves PLENTY of room for profit margins as pawn shops/cash for gold places routinely give anywhere from 20% to AT VERY BEST 50% (if you're lucky) of the worth of your gold, and I was thinking about hitting 60%. My friends contacts in turn give 95-98% of the worth with no additional fees, if you bring in a little bit of volume (which is another barrier to entry and a reason why Joe Blow can't just take his jewelry to these places). You have to set up a business relationship with them and bring a little volume.
Ok, I've rambled. Let me just leave it there for now. I'd love to hear what you guys think.
Ok, I became interested in this recently while reading a book about it that a friend of mine wrote on the subject. He has dabbled in this area for about 30 years, longer than I've been alive! So needless to say he had some good info. However, he still only lightly dabbles in it so one question I need to ask him is why he isn't "fully invested" in the idea. I have a feeling however that the true answer is the comfort and security of working for the man, especially with a wife and kids which I don't have.
I think it satisfies the CENTS criteria:
Need: People are in need of money these days more than any time I remember and trading in gold/silver from past decades is a quick way to do it.
Entry: I make my current living from a few ecommerce sites, and I don't see this one being quite so easy. There are certain government regulations that I'm becoming aware of, and you need to start out with some capital in order to actually give people cash for their gold.
Control: This one is tricky based on the personal touch I want to offer as a unique selling point (USP), but I want to go strictly mail order where people send in their gold, so we are talking nationwide and not just my area. In fact, I don't want people walking in at all as that feels like a pawn shop and there is probably a level of risk despite the 1911 I usually keep strapped to my hip.
Scale: I envision having/using/renting a call center of sorts that can answer people's questions if it got to that volume. So I think it can go big, again, not just local.
Time: Also a little tricky. To start I envision myself being the one testing the gold then making the offer of what can be paid for it. Honestly, that takes like 5 minutes and a couple hundred (or much more) can be made on a piece of jewelry. So if I were spending 8 hours a day processing these types of orders, that would be crazy money... but in regards to this commandment, even this process can be taught to a good employee if need be.
I am big into having Unique Selling Points that set you apart from the competition. I feel that companies like Cash4Gold are impersonal, and quite frankly pay out peanuts. Not having the overhead that they have I could beat their prices, and prices of pawn shops/jewelry stores, and really emphasize that point. The whole, "one-man shop, so I keep my costs way down allowing me to give you TOP DOLLAR for your gold" sort of thing. I would want a very personable, easy to use website, be available for questions through email/phone (I know, not the eventual goal as I'm strapping myself down, but you can get someone to do that), and also, a big one is instead of simply sending out a check for peanuts that the person can choose to cash or not, making it hard to get their gold back if they decide not to do it, I would contact first with a quote, re-emphasizing in a personable, one-on-one kind of way that this price is much better than anywhere else. I hate to run a business based on "being the cheapest", but it still leaves PLENTY of room for profit margins as pawn shops/cash for gold places routinely give anywhere from 20% to AT VERY BEST 50% (if you're lucky) of the worth of your gold, and I was thinking about hitting 60%. My friends contacts in turn give 95-98% of the worth with no additional fees, if you bring in a little bit of volume (which is another barrier to entry and a reason why Joe Blow can't just take his jewelry to these places). You have to set up a business relationship with them and bring a little volume.
Ok, I've rambled. Let me just leave it there for now. I'd love to hear what you guys think.
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