Are you looking for the most profitable ways of buying and selling gold jewelry? Whether you are getting into business or you are thinking of investing in gold jewelry, understanding the essential elements of the game is important in making sure that you run a successful business venture.
Unfortunately, it isn’t always easy to run a successful business buying and selling gold jewelry, and there is always a risk of running huge losses the first time your hand in this line of business.
You shouldn’t worry about it, though, because in this article, we’ll share important insights into everything you need to know about buying and selling gold jewelry and profiting from it.
How to buy gold jewelry at a low price
The first thing you need to do when trying to deal with gold jewelry is how to buy high-quality gold jewelry at the lowest possible prices. The reason for this is that in as much as gold prices are always soaring, there are periods where the prices are always plummeting. With these changes taking place within days or even hours of each other, you may not know what to do or when to buy the gold jewelry.
You’ll find yourself wondering if you should start selling the gold jewelry when the prices are on the rise or just how low you would have to let the gold prices drop before you can buy the gold jewelry. These are important factors because the price and value of gold often rebound, but even when it does, there is often the risk of you making a big loss.
If you are going to make a living buying and selling gold jewelry – and you could if you come up with the right strategy, you need to get everything about the business right.
In this section, we’ll let you in on the little secrets about buying gold jewelry at the lowest possible prices to be able to profit off the sale of the jewelry later. But before we do, how about a look at some of the basic terms you should be familiar with – these are important terms whether you are a buyer or a seller of high-value gold jewelry.
Important terms to familiarize yourself with:
Hallmark – the hallmark sign-on jewelry can be defined as the small stamp of authenticity that’s present on most high-value jewelry. This small impression is used as a certification which shows that the piece of jewelry actually contains the amount of pure gold it says it does. Hallmark signs are common for precious metals such as sterling silver, gold, and platinum.
Karat – Karat or karatage is the fractional measure of pure gold in gold alloys. The purity level is measured out of 24 parts. An 18 karat gold ring, for example, is gold jewelry that contains 18 parts of pure gold. The remaining six parts are often made of other metals or metal alloys. For such gold rings, the percentage of pure gold is 75%. The other hallmarks you need to be aware of include – .999 for 99.9% or 24K gold; .916 or 91.6% for 22k gold, .750 or 75% gold for 18K gold; .585 or 58.5% for 14k gold, and .417 or 41.7% for 10k gold.
What do you need to get started in the business of buying and selling gold jewelry?
A gold testing kit – this is the first thing you should invest in when working out the kinks for setting out a business in selling and buying gold jewelry. The good news is that there is a great variety of gold-testing kits online, and most of the jewelry tested using these kits will provide the best results. But you don’t just need the testing kit; you also need to understand what testing kits you need and what different hallmarks mean. Note that gold jewelry doesn’t always have hallmark signs, and there numerous cases where the hallmark signs are indecipherable, which is where the test kits come in handy. The gold testing kits are made of acids that easily tell the karatage of the gold in question. Besides, the gold test kit also comes with two more testing acids that can be used to test for metals like sterling silver and platinum. Note that these testing kits often come with different acids for testing of 10k, 14k, 18k, and 22k gold.
A professional jewelry scale – You also need a weighing scale to be able to start the new business. The professional jewelry scale might be a tad costly, but it offers years of excellent and highly reliable services. Despite the temptation, you really shouldn’t use a kitchen scale. Bear in mind that the reason for the professional jewelry scale is for you to take accurate readings of the gold pieces. Just make sure that you keep legal problems and maintain updated records of your gold jewelry.
File, Magnet, and Loupe – you will need the best quality magnet to test the different kinds of jewelry you buy and also what is brought to you. Get a good magnet as well as a metal file for easy scraping away of the outer layer of some of the metals brought to you. The good news is that these items aren’t expensive. Get the best magnifier loupe for easy discernment of smaller details, including smaller hallmark signs.
How to buy gold jewelry
To be able to buy gold jewelry affordably and to eventually make a good profit from future sales, follow the following steps in your purchase journey.
1.Research and Determine the best gold purity for you
Researching gold means familiarizing yourself with the different purity levels of gold; you should also determine what the most valuable gold purity level is. 18K gold, for example, has 75% pure gold, and it’s one of the most valuable types of gold you could invest in.
You may also want to think about vermeil or plated gold options – these are both created from the dipping of base metals into molten gold, creating a coating. Though cheap and almost invaluable, you can still find great value from some of these jewelry options.
2.Inspect the gold jewelry
Every time a customer brings you a piece of jewelry, or you come across a nice piece at a yard sale or a pop upmarket, you should first inspect that jewelry keenly. Look out for the hallmark sign showing that karats first. You could use the loupe to check and confirm the hallmark signs.
As mentioned above, you can still run an acid test to confirm the hallmark on the gold jewelry. Just make sure that you confirm with the owner before you scratch the piece. Once you have the owner’s go-ahead, make a very small scratch on the piece of jewelry’s outer layer, using the metal file.
Then start running tests on the piece, using the acid test from the 10k gold acid test going upwards.
Note this – if this is the first time you are testing the gold jewelry, you may want to start out with your pieces first to gain confidence and only run tests using jewelry owned by others once you are confident in your abilities.
The best way to value gold jewelry is to value the pieces. You can do this by running valuation parties where the invitees are asked to bring their gold if they wish to, and as they enjoy different snacks, they could take offers for the gold, take your business card and go home, maybe think about it, or just contact you later on.
This is a great way for you to gain customers who would have otherwise gone to the cash-for-gold shops.
4.Try buying gold teeth.
Though not obvious, gold teeth are one of the unexpected yet profitable ways of buying gold. You can buy gold teeth from dentists. If this is what you are offered, you could knock the tooth away from these gold teeth before weighing them. Just use latex gloves and hand wipes.
5.Buy from reputable dealers.
You could also kick off your business by buying gold jewelry from some of the most reputable gold jewelry dealers like Zales or Nordstroms. They offer high-quality products and promise great margins. Also, always ask for the warranty information for the jewelry.
6.Get the jewelry inspected independently.
You can do this to avoid all doubts about the jewelry’s quality. Take the jewelry to a certified jeweler for more information about the gold jewelry and its authenticity.
Actionable Tips for Selling your Gold Jewelry for high profit
Follow these steps when selling authentic gold jewelry:
1.Know that the precious metal prices are quite volatile – Never act on impulse
And like any other investment, the value of the precious metals is highly volatile. However, you should be careful about the decisions you make and don’t be too fast to act when the prices dip too fast; the fluctuation is pretty much second-nature in the jewelry business.
You should evaluate the pieces of gold jewelry carefully, especially the ones you are willing to sell. Bear in mind the emotional value of the jewelry too, and only sell the pieces of gold jewelry when you are sure that they attract great value and will make great profit margins.
2.Get the appraisal
As mentioned above, during the purchase process, you should get the jewelry appraised. This is important for the highly intricate, antique pieces of jewelry, especially the ones that are paid for by weight. For these appraisals, contact reputable and independent jewelers.
3.Determine the value of the jewelry’s design vs. the material of the gold jewelry
Often, the scrap value of jewelry might appear too low, but when the scrap is melted into bullions, you could get much more value selling these bullions. But, just check the hallmark stamp on these metals before you test the purity level of the gold.
In other words, you must know exactly what you have. This is the most crucial consideration for you to bear in mind because the gold jewelry in your possession is hardly ever made of pure gold.
Even solid gold is made of impure gold, which means that whether you are looking to sell 10k, 14k, or 18k gold jewelry, you must have an understanding of what the jewelry is, exactly. The gold alloys will have gold in different percentages, and the higher the percentage of pure gold, the higher its value.
4.Find reputable buyers
Once you’ve determined the value of the gold jewelry, you’d have to find a reputable buyer to sell to.
For starters, the buyer must have a license to buy the gold, preferably in the state you live and run your business from. Check out their membership in reputable associations, registration, and trustworthiness.
What this means is that before you settle on a buyer, you must take time to research and shop around for the jewelry. Ask for bids from multiple companies and only settle on a buyer once you are sure about doing business with them.
5.Protect yourself, always.
You can do this by documenting and photographing everything necessary about the jewelry. Check the reimbursement policy for the jewelry in case of losses, and also get an appraisal in case of high-value pieces of jewelry.
6.Always know the actual price of gold.
To sell the gold appropriately and for a good profit, you must know the actual market prices for gold. As mentioned above, the prices fluctuate pretty much every day, which means that you should do market research for gold every day.
7.Maintain realistic expectations
Selling gold will not necessarily make you rich, but it might put some money in your pockets if you are smart about the business.
If you have been struggling to get into the business of buying and selling gold jewelry, this article shares important insights to help you run your business most efficiently. The most important thing you need to know about this trade is the importance of research and keeping up with trends and market changes.