(Continued from part 1)
So back in May, Jerry and I decided that we should take a few days and sneak away from our market-maker friends to sneak around to some of the more prevalent shops in town to see what kinds of business practices made them moguls (and which ones are posers). We were surprised at several of our findings, giving us new respect for a few buyers, and renewing our distrust in others. For our first round of tests, we took a small amount of jewelry from our Social Media Marketing Consultant, Anne Haynes. Anne’s jewelry consisted of a small amount of scrap gold and silver- various jewelry items of varying karats- some with hallmarks, and some without. It was a small lot, but perfect for our purposes. Since some of the items were not marked, it presented an opportunity for our competitors to show us how honest they are. Augustus’ payout on the items to Anne was $120.15.
Our first stop took us by the shop of a family who has been in the business for over 50 years. The clerk was nice and showed us around answering questions about their other inventory. We sat down for him to test our items, he pulled out an electronic tester and testing acids, and commenced to testing each piece individually. He did not disclose what the percentages were that he used to calculate the payment, he did give us prices for the gold and silver separately, so we were able to calculate it ourselves. And although the total price he quoted us was over $110, his quote for the sterling silver items was only about 30% of what Augustus pays. When we asked him what price it was calculated on, he said that the price that day was about $14 per ounce, and it was actually almost $18 per ounce.
As he tested the gold items, they were separated into different piles- 8k, 9k, 10k, 12k, 14k, 16k, 18k, 20k, 21k, 22k. All the items we brought in should have been sorted into 10k, 14k, and 18k, but almost all were ‘downgraded’ as he put them into piles for the karat below what they actually were. As gold buyers, we are quite familiar with the fact that almost no gold jewelry has an actual test assay as high as the karatage that it gets stamped with, however, usually the discrepancy is minor, such as a 14k gold chain, which should assay at 58.33% gold actually testing at 57.5%. The problem was that this fellow was putting ost of the 14k in the 12k pile, as if it were only 50% gold, etc, etc. One always has to wonder if this practice is what the clerks are taught to do, or if, in fact, they may be skimming while the boss is away. Either way, the first competitor in our test squeaked by with a C+ overall with footnotes that they lack integrity in their testing practices and don’t pay much AT ALL for silver.
Our second stop was only a couple of miles down the road from the first. The lady who owns the establishment was a hanger-on at our fraternal gatherings for a while before opening her store. She brought in bags of things for a long time that she’d bought from individuals that she tried to shop around among our colleagues- many of which were either not real gold or silver or that didn’t have the kind of antique or artistic value she thought she’d bought into. Many times Jerry and I had been annoyed by her peering over our shoulders or watching us from another room as we worked on deals with other dealers or tested large lots of gold and silver. She used the information she harvested from us and from other dealers to start a website that had no success because she only copied the parts of our business she thought would be useful. She opened her store several months later with the help of a few silent partners, and her new website had information posted on it that was almost verbatim from our site. It was time to learn what selling gold to them was really like.
So we went into the store directly after leaving the first place. The place was nice, but not really set up to serve many clients. They had banners hung across the pillars out front claiming that they pay up to 300% more than other buyers!! The kid working at the counter was a punk who seemed to have a chip on his shoulder. I knew some of the items we were bringing in had some obvious marks on them from acid, where they had been tested at the last place. “That’s OK,” I thought, “at least that way he’ll know that we’ve already gotten one quote, so his better be good if he wants to buy it.” Wrong. The clerk used the same methods of testing- electronic tester and acid. He also used the ‘karat piles’ method for keeping track of it. Jerry punched me in the shoulder and whispered to me, “Can you believe this guy??” the SECOND time he had to call his boss on the phone because he had a question about what to do. In the end, the price he offered for our items was about $43. I do remember laughing a little and asking him if he was joking, but he didn’t see the humor in the situation at all. This one gets an F- for not knowing what he was doing, price integrity, and for generally being a punk and not having any customer service skills.
This experiment goes to show you- if you want to get the most cash for gold, call Augustus Gold and Silver- The Gold Buyer You Can Trust!!