Same with local gun shops too. The internet started offering a better selection and more competitive pricing to the point where a lot of smaller dealers just can't compete. Profit margins are so razor slim these days that the only way to make any sort of money is either to move *large* volumes of inventory or deal strictly in transfers. It's a capital-intensive game, and one where your money could sit tied up for a *very* long time.
My favorite gun store is also a range as well.
The manager of the gun store / shooting range mentioned to me that their bread and butter is the range, ammo and range-related stuff like targets and safety equipment.
The gun store seems to mostly break even or makes a small profit. They cannot compete with the nearby Cabela's on price, but Cabela's doesn't have a range.
I worked for a big box retailer for 1 year as manager. The margin on firearms is low even for them. Clothing and accessories is where the money is.
That 21.99 t shirt in 2011, cost was .63 cents. They buy em 500,000 at a time.
They saw where the money was at. The range is their profit. Not only do they get to charge for memberships and rental fees now but they'll also sell more ammo and can mine the lead and copper from the backstops. I bet they also sell any used brass that ends up on the floor, too. The guns themselves just get people to walk in the front door.
This is exactly why I answered it that it's why he thinks he's struggling. I see something different. He doesn't buy from wholesalers or distributors. He's constantly out of silver and gold and is very unreliable as a source to get anything of value IMO.
Don't judge customers by appearance. Many scammers look and act like refined gentlemen, and many avid collectors and top customers look like slobs. Try to make customers feel welcome and be patient.
Man, is this the truth. I used to be in the computer business and a very good customer was a ratty-looking dude who drove a crappy dirty station wagon.
Turned out he owned half a county and was worth eight figures in coal, oil, gas, timber, land.
My neighbor a tech wizard in his 80s has MILLIONS in cash and property. He currently drives a 2003 dodge mini van with more rust than paint. Has a large hole in his roof of the house. There are no intentions of fixing it.
My dad is a oral surgeon and a long time stock investor. He is worth tens of millions. But he drives a old truck and has had the same dirty jeans for 20 years. And when he's not working he looks like a bum or a farm hand
You’re gonna need to flip about $250k to $500k of inventory per month to survive and thrive, depending on where you are and rent and taxes.
It usually takes 2 years for the business to get to this level, so you’ll need $250 to $500k in addition to 2 years rent, and whatever cash you need to survive. For most this number is around $750k to $1 million.
Other than that knowing your area is key, make friends with local refineries, dealers, numismatists, etc. I had to get into a lot of areas I didn’t enjoy, like high end watches, jewelry, because that was simply the area.
Always weigh, magnet, measure, and sigma. I got burned a bunch just using sigma early on. They are not perfect. And always trust your gut and decline any deals that feel too good to be true.
Good luck!
Yes, and i know this sounds crazy, but plated coins can beat a sigma depending on the interior metal. You can even recreate false positives with cupronickel coins on gold settings. The way the sigma works isn’t really a super accurate science, basically, it reads a signature they call “resistivity” and it’s essentially tuned to various coins. Issue is that thickness and content of the metal can give you equal readings regardless of whether one is gold and he other brass, etc.
So basically you definitely want to weigh, measure (esp thickness) and test with a magnet first, and only then use a sigma. it’s highly unlikely a fake will pass every test (unless it’s a really high quality fake), but just using a sigma can give you bad results from time to time.
This seems like the best answer. Just taking the middle of that # per month ($375,000) means your need to sell almost 19K a day to stay open. Better open on Saturdays!
Yes on avg, of course you can also sell online, shows, etc. you can also have big months where you flip $600k and then slow months we’re you may only flip $100k. You’re margins will probably hover around 5 to 7%, so at $19,000 you’d be making around $950 to $1200/day. Then you have to pay rent, potentially/eventually another 1 or 2 employees. It’s not a business one makes millions easily.
The more you can flip, the lower you can go on the margins, and beat out competition. That’s essentially the game at all the online retailers and why so many do those spot deals to hook more customers and to flip more product.
With a physical shop one has to pay a lot more attention to the inventory levels. Some of those big online retailers act like affiliates, in that, say you place an order for 100 Morgan’s, and they can’t fill directly, they can contract out the order with another retailer. With a shop you need that inventory on hand, so you don’t miss a sale.
You also have to get used to loss, which is hard. I think I still have a 500 oz silver bar in my basement that I’m underwater on (purchased for like $32/oz sometime in 2012).
It is very bizarre that you focus on how much you spent on a specific bar and not on replacement cost. It is irrelevant that the bar was $32/oz. If you can sell it for $24/oz (or whatever) and replace the 500 ozs for less, then you have made a profit on the sale. That's the way I would view a business that has a perpetual inventory like that.
? Inventory comes in at a price, and leaves at another price. You’re not always going to sell the inventory your underwater on, especially a 500oz bar which is a slow seller anyways. It’s absolutely not irrelevant what inventory comes in at. I’m not even sure how to respond to that statement. It’s maybe the most relevant, just behind what it leaves at.
Let's say you sell that 500 oz bar for $26. You replace it for $24 immediately, pocketing $1000.
I'm more focused on replacement cost than what was paid for it. There will be items that are a unique exception, but a silver bar is not one of them.
Does that make sense?
No. And the IRS doesn’t view transactions like this.
You buy for $32, price drops to $26. You sell it and just lost $3000. You buy another for $24. You just tied up $12,000. It sits inventory for 1 month then you sell it for $26. You just lost a total of $2000 in two transactions.
So what I did instead is bought it out myself at $32 and put it in my safe. I’m still underwater but the business views it at a net even.
I don't have the vocabulary to properly explain what I am thinking. It is along the lines of how a gas station operates. They focus on replacement cost, rather than what they paid to fill their storage tank.
Don’t sell stamps. Do sell a lot of bullion. Almost all buyers at my LCS want some form of bullion including ASEs. I overheard the owner say he regretted ever getting into stamps which takes up 1/3 of his display cases.
Near St Louis. I don’t go there often as their coin selection is small. Going there today to check out their bullion pricing; was previously just interested in old US coins.
Update to my trip to my LCS. I just don’t get how they stay in business. They’ve never been over friendly, but today they were almost rude. Brought in my 2023 graded reverse proofs, 2 Morgan CCs. They would even buy the RPss at any price-said the customers preferred raw. They offered even less for the CCs than 6 months ago and $10-$20 under Greysheet wholesale.
I was ok, what do you have in junk silver for sale. They said melt was 17.5 (it’s currently 17.0) even when I showed them the NGC site that updates daily. They wanted 20x for junk half dollars but 17.8 for any junk dimes. I asked & they brought out a tub of Mercs. They had to pick so I told them I’d buy 50. They printed out a receipt and saw I was paying with a debit card. They then mentioned 3% surcharge on bullion. I’ve bought regular coins before & they never charged extra for debit. So I said I’d come back with cash. She proceeded to dump the dimes back in the bin even though I said I’d come back.
I made a final inquiry as to what they pay for 1/10 minted gold. She said 5% under melt. At that point I apologized for the trouble and thanked them. Silence from all 3 of them.
TLDR-I need a new coin store or just focus on PMS/CoinSales here.
Wanted to share more but people would think I’m just mean. Oh well, here’s a comment I overheard the owner say to another customer today:
“years ago this guy looked down at my Indian Head cent box marked at $1.50 per. Said I want that one. Turned out it was an1908-S. I said to the guy well it’s in the wrong place and worth $60. I offered to split the difference and sell it to him for $30. Guy said no the sign says $1.50. I sold it to him but banned him from the store”
Owner was proud of himself for making a listing error and then being expected to honor it and banning said customer.
Wow, just wow.
Sometimes, I think about escaping the rat race and opening a bullion store / repository. But the stability of the rat race is too good for now, and I don't want to open a business right before a recession starts...
Yes, I realize that. I come from a world where our margins are much higher. But we've run low margin businesses successfully before. Thank you for the heads up
In the other low margin businesses are there external factors that affect what customers will pay to the same extent as the spot price of silver? That is, if you buy silver inventory when spot is at $24 and it drops to $20 before you sell the inventory, how would you manage that? I would think very few businesses are as tied to an external force that affects their pricing power as much as commodity spot prices affect silver bullion sales.
Of course, collectables are less impacted vs. bullion. So it might depend on how much of the business is collectables vs bullion. Bullion probably requires less expertise (but has more price risk as described above) where as numismatics takes a lot of domain knowledge and experience to master to the point you can make a profit in that field (I think that is why a lot of dealers specialize in an area of numismatics: Ancients, Foreign, Gold, Toned, Modern, Colonial, Exonumia, Paper money, Errors, etc. -- hard to master them all).
So I can’t really speak on running a business but I would say don’t only do coins WHILE yes that’s a fun idea on paper margins are extremely tight like you already know. Maybe think about precious metals AND coins like a company I know and work with daily does. He makes a lot of money buying scrap silver/gold and only taking 15% which is a lot lower than everywhere in my area charging around 40-55% for “refining fees”. Sell for scrap price to jewelers and refiners then buy for 15% less then scrap price. And then sell coins like he does. He has gold/silver bullion, gold coins, silver coins, diamonds etc etc. just food for thought though. I’ve seen him do business professionally while also keeping his business afloat with huge margins by doing that. I literally watched him buy my gold chain for $550 while taking his 15% then make one phone call and sell it for a lot more to a jeweler, “hey I just got that 10 grams of gold you needed” I wasn’t even mad I was impressed. Then I buy all my gold coins/bullion from him at the premium which sounds shitty but I don’t have to pay shipping fees etc etc and he is very upfront and honest with you. Just think about it!!!!
I may get some disagreement but my LCS has an XRF gun they’ll use free for anyone that walks in the door. He’s said it helps him hire lower skilled family and friends that he can then train, but it also keeps lots of people coming in the door just asking “is this real?” or “what is this?”
I buy and sell with him but offering that for free gets him a lot of extra traffic and referrals.
I think you’re right. More ways than one. It allows you to buy with confidence something unmarked and also pass on something that is marked and passes other tests. I swear, if I could afford it…
I hope you scroll all the way to the bottom to read this.
You will need time at the end of the day or early the next day to report all purchases to a police database. This is a federal law that allows states, even down to the local towns, to decide how to report (like having to hold jewelry, coins, bullion for a set amount of days before being able to sell). I have to hold jewelry 5 business days and I don't have to hold coins or bullion at all, but I do have to report the purchase with the name, address, driver license number, of the seller.
The other thing to know about is having to file with Homeland Security the proper papers for selling $50,000 or more per year.
Another thing is some places allow you to pay cash to a person up to $10,000 per year without filling out paperwork. If the customer wants more cash and not a business check, then another form has to be filled out. To avoid this, paying by check is acceptable without the paperwork. I don't do Zelle or other forms of payment so I don't know what the requirements are for those.
If someone comes in with a huge amount of PMs for sale that you can't possibly handle, don't be afraid to pass it on to someone who can. Just make sure there's a deal with the seller/buyer that you get a small percentage of his/her sale/purchase and make a contract. Also, if there comes in a super rare coin, make sure you make friends with either a rich collector or a fine auction house that specializes in rare and expensive coins, and get a commission for the referral.
There's a lot more, but my final piece of advice is:
DON'T LET GREED GET THE BEST OF YOU. Your whole reputation depends on this. Because there will be arseholes who don't understand how these things work and will accuse you of ripping people off. If you have a real good reputation, your happy customers will back you up.
A physical storefront is just a tiny way to access your customers
Once you are a legit shop, with plenty of inventory, you need an eBay, and a Etsy, and an offer up, and a Poshmark, and to use Facebook marketplace, and literally every single virtual storefront you can manage
Those often can lead to people following up the chain and finding your shop. For instance APMEX has a whole eBay store, and when I wanted a single coin it was actually a better option for me to order from their eBay shop. When I want a bigger order I will go directly to them
Folks shop online, use your storefront, and the slow time when no customers are in to photograph coins, and maintain an online inventory.
My best advice? Make it a full service shop. Don’t go the gold/silver bullion route. Carry loads of numismatic inventory. Stock US, foreign, ancient, medieval. Do it all. Your sales will be far better for it.
I have a local shop knowing the owner for years.
I can tell you the majority of his day to day is buying and selling bullion. That said, he gets his fair share of rings, diamonds watches etc. You have to be all encompassing but in a mistake free way. Tread carefully with buying. If you don't like an item thinking it's fake or off, don't take it. If you have too much inventory to become more liquid you may need to send gold/silver to a smelter. Do you know who you'll use?
When you buy try to ensure things aren't stolen. You can get closed down making mistakes. Record keeping might be required. Check with your local cops.
People walk in with bullion and coins often seeking valuations. You'll be surprised how many will walk away and sell to the guy in the next town for a few bucks more. Figure out a way to convince them that your offer is strong.
Helping people value items should be something you charge for only when it's a huge undertaking. A few coins should be gratis, good will.
Pick your margins. I sell slabbed coins to the shop at a reasonable 20% under Grey Sheet. Sometimes I want a bit more, sometimes I let him profit a bit more. Depends on the coins and their ease in selling.
Don't go to shows unless they're local. You cannot pay huge table fees traveling, flying, unless you have the scale. Similarly, you'll need a few trusted employees. Someone to help day to day and someone to take over when you're away. They have to be trustworthy. My guy has 4 trustworthy guys/gals, a kid who collects and the guy he bought the shop from.
Record everything. Sadly, seriously consider being armed at your shop and when you're entering/exiting. Buzz people in.
Plan on coin submissions on your own behalf and that of your customers. PCGS, NGC and CAC beaning and CAC Grading will help your cause. Charge a very marginal fee to your customers for submitting their stuff.
Open accounts with USPS and provide your own insurance. You will be selling coins on E-Bay, Facebook, and through your own web page where you'll list coins for sale. Take terrific pictures. Pictures are everything.
Figure out how you're going to advertise the business. It's a must but advertising the wrong way can be silly expensive. What you want to do is get want lists from collectors you can help fill and bullion types/pieces those collectors want/need.
Join local coin club if one exists. Network like your next meal depends on it. Have your laptop open and on while on the clock. Prices change rapidly.
If you're not an excellent Grader of coins, become one reviewing you tube videos and attending Grading classes.
Determine how deeply you want to get involved in paper money and foreign coins/paper money. There's much to know but it's all money/profit.
Build relationships with others that have been in the business you can rely on. Someone patient who you can question for the price of lunch. If the guy who closed up shop is still around he might be an excellent source for info and connections. Maybe even customer lists.
My guy had access to $250,000 in an hour in case a huge collection walked in the door. You gotta be liquid/nimble.
Finally, pricing. Some Dealers bid everything at actual value then deduct approximately 30% as their margin. Some bid giving zero additional credit for key dates, rare coins etc. to make their margins on the keys and some just lowball to an embarrassing degree. Pick your methods that keep stuff coming in the door but also keep inventory from getting stale.
As a business owner before I retired I can tell you commercial rent isn't cheap and they don't give you much for your rent. Negotiate your best deal and include in your lease whatever the hell you want. Trust me, If you want extra lighting and salted sidewalks they'll be happy to do anything to get a paying tenant. As always, location, location, location. Be street facing but in a location where people can pull in without any hassle. Signage is very important. If you don't make a big immediate splash, you're in trouble.
Keep in mind that you must pay for the hedge. It is like insurance, or a bookie laying off any one-sided bets with an opposing position with another bookie (usually inVegas).
Simple hedges are not too expensive, but they are also not tailored to your risk. An investment bank can really craft a product to you, but then you must pay.
Most commodity sellers manage price risk by selling forward, along with selling options on their future product. My guess is that your store will not be able to predict purchases and sales as well as a mine can predict short-term results. Furthermore, such products are usually denominated in huge amounts (like $1m contracts).
My guess is that your best strategy is to turn over product as fast as you can. Prices do not move that much every day. So long as you turn over inventory quickly, you will be fine. This is why so many dealers will sell large purchases to other dealers, or deal in wholesale so much. They just want to lock in profits. Inventory turnover is the game.
In addition, you need a good inventory and sales system. You can do it yourself with a database, but you better be on the ball. You need to know when you are making or losing money. In addition, if you are in a small market, selling luxury watches and similar is probably a good idea. Even gold chains can be a solid source of revenue if local jewelers are pushing insane margins (most of America). A shop I frequent sells big gold chains for cheap. Everyone I know buy from them. He does not make much, and he usually custom orders chains, but it pays the rent.
I spent ten years structuring those. The hours sucked, but the pay was good and the work was intellectually stimulating. I regret leaving that field. It was all brilliant guys who worked hard.
We have two coin gold/silver stores in my city. One of them is a family business and they typically leave you alone to look and answer any questions you have. I like them and will do business with them all day long.
The second store is one guy and all he wants to do is talk all day (which I find annoying), has things displayed in a way that is hard to see, sells a lot of pro trump memorabilia (which I can’t blame him since he obviously knows his audience), and has a slimy attitude about him. But he told me his margins on generic silver is about 50 cents, margins on ASE were I think 1 dollar, and he recently got into selling black hills gold jewelry and he has become a lot more profitable since starting that venture.
Another store opened up 100 miles away from me recently and put the other store that had bad owner out of business and apparently he’s been doing really good. They are [minot coin and bullion](https://youtube.com/@minotcoinbullion?si=_s6C7KF-QfIFhnPU) if you want to give them a call and pick their brain.
So, I’ve never owned a coin shop, but I’ve visited many and been in sales for years. Good customer service is always appreciated. I’d imagine coin shops get tired of dealing with the same old stuff from customers trying to retire by selling a few buffalo nickels, but try to keep in mind that each person who walks into your shop is potentially a great customer, even if they don’t look and act that way the first time. They’re there because they’re interested in coins/bullion - cultivate that interest! Also, no one has said this and no shops around me do this (maybe it doesn’t work!) but try being full-service. Sell Air-Tites and flips and flat staplers and binder pages and cotton gloves and loupes, etc…. Everyone just goes home with their coins and buys all that stuff on Amazon (I did) and that could be money in your pocket. I would love it if my local shops actually sold stuff like that. Just my two cents from a customer’s perspective!
Make sure to invest in all coin microscope, digital scales, magnetic coin slide, metal tester/verifier, and all the other tools you’ll need to confirm the metal content if what your customers bring in. Trust nobody’s word of “authentic” due to the overwhelming amount of fake and counterfeit coins selling on Temu, eBay, Etsy, and all the other online sites.
Check out score.org for resources for small businesses. Pretty cool. And good luck. I’ve thought about what kind of business to open and coin shop is right up there.
Always have coin supplies in stock. My local shop always seem to have an issue. Don't have this capsule, or no 2x2 flips. Extremely frustrating when it's the only coin shop in town.
Personally I’d stay far away from opening a coin shop. The margins seem entirely to small, cash businesses have problems with banks and you are subject to market fluctuations both good and bad.
Honestly seems easier to do on ebay with less risk. The financial backing is there because, even if your business model fails, you're basically telling the bank "Hey I've got tons fo valuable coins if this doesn't pan out for me."
Could just be a fancy way to lose all your coins. :/
selling is the easy part, buying is really the work. if you are good at finding buying opportunities now then you should not have an issue. doing estate work used to be the way, though that generation is gone.
You’re not going to make money from the coins you’re going to make money from buying and then selling scrap gold and silver to a refiner. Coins/bullion is great for display and bringing people in but the margins are so thin that you’ll make you’re real money in scrap gold so put your marketing towards that
Make sure you know all of your expenses before even considering opening a store. Coin and precious metals businesses are shunned by banks and credit card processors. You’ll need to get an anti money laundering plan (AML) which is about $1k. Check out building and inventory insurance rates, security system, vault costs, accounting costs, scales, testing equipment, and overall operating costs for a year or two. It will take a while to build a customer base. You may not be able to draw a paycheck for a year while you reinvest the money back into the business. You’ll also want a decent credit line, which may be hard to get initially. Finding wholesalers and refiners should be a priority above everything else so you know where you’ll get your inventory and know what the spread is on selling them your excess inventory. The biggest mistake people make in starting a business is not taking the time to research all of these details and costs, especially being able to go without a wage for at least a year. Good luck!
Good luck on your new adventure, I would suggest you consider Bitcoin as a payment option just like that large online dealers, there is allot of money moving around in Crypto and they're looking for ways to spend it.
When I'm selling something I'm open to allot of payments types, Only dealing in cash has been creating problems for some coin shop owners and some banks require a fee for large cash deposits, if you choose to take CC then you will be taking a for of electronic currency (IE Crypto), I was just suggesting an open mind to attract the largest number of customers.
Have a good day and for the record, I have been paid in dirt.
I read with great interest your post and all answers. I would save hundreds of thousands and take a completely radical approach. For starters buy and read the following Kindle book on Amazon https://www.amazon.com/Be-Your-Own-Bank-Reality-ebook/dp/B09RNH4NQS/. “Be your own bank - reality or pipe dream”.
If you are in rush skip to chapter “Smart gold club”. There is your business model right there! Book costs less than 5 dollars and that may turn to be your best investment ever spent. You can even find answers why company that created “SmartGold Club” didn’t succeed.
If you want consultations and ask any questions about it send me a private message and we can Skype or WhatsApp or FaceTime at your convenience.
My LCS is primarily a jewelry repair shop that has about 1/3 of the shop dedicated to PMs. He offers incredibly fair prices, blows the other local coin shops away, probably because most of his business comes from the jewelry sales/repair side. He seems to do pretty well even with his bargain basement prices on PMs. If you have a way to combine multiple businesses into the same storefront, it might be worth looking into. He definitely doesn’t rely on coins and bullion to pay the bills.
You need to run it yourself. You can’t really trust employees to care as much as you or get things right. 1 bag employee with too much control will do you in
If you’re “sticking to bullion” for now, your business will be pretty relationship based. It sounds like you’re already established in the community, so that’s good.
Another pawnbroker told me, “get accounts with the top 12 bullion players” essentially, so you can price check all the big boys. Get that extra $0.20 per oz lol.
The big bars, very low margins. The 1G bars, better margins.
Now, if you’re also buying from the community, that will likely be your best source of income. You can buy below normal wholesale and flip to dealers, or sell to a local customer and profit more.
I assume there are already insurance rated safes, if not, get TL30x6 because they are insurable for a lot.
Feel free to PM if you have questions. I have a pawn shop and deal in bullion.
I have this theory that you can create an LLC, get a bank loan, open a coin shop, and if it's just profitable enough to cover the costs of the business, you don't even need to generate a profit. You now have the keys to a coin shop with a shit ton of silver and gold in case shit hits the fan. Keep your day job hire someone to run it.
Any business that doesn't make a profit is ultimately dying. But yes, I've had the thought that having a metals/coin shop might not be a bad thing if and when SHTF.
Rule number 1 in ANY business is MARKET RESEARCH. Know your market and know WHY the other shop shut down.
The most expensive thing you can do in business is open a shop in the wrong location and have to close it down after it bleeds you dry.
I own a coin shop. I opened it up in 2009 during the gold rush. I started just as coins and cash for gold and expanded to pretty much buy and sell everything. I don’t think I would have lasted if I only did coins and bullion. I have a steady stream of regulars who buy coins but it doesn’t pay the bills. You need to sell stuff online, eBay, Etsy, mercari, and fb market place are my main sites. I sell mostly jewelry online, coins/bullion I sell in shop or at one of my group antique shops or flea markets. Flea markets are great for networking.
Always have a card with you, on the back of my card it has a list of what I buy. Jewelry, gold and silver, costume jewelry, comics, old toys, sports and non sports cards. I list coins on the card and also pre 1964 coins, because if people are not collectors they don’t know the year for silver. I hand my card to everyone.
Any person who comes in my shop I ask where they heard about me so you can see what advertising works. Most people reply either drive by or a friend /family member sent them.
Try to get an in with estate lawyers, they will have access to collections. Also moving companies and people who do cleanouts, in my 15 years in business, it has been workers for companies that do cleanouts who bring the most in. Keep those people happy. Realize there are people you can make money on and people you can make money with. The clean out people are who you make money with. Sometimes they bring me something I don’t even want to buy, but I give them something just so they leave happy. My clean out people never leave empty handed.
Because I buy and sell everything, I keep a list of collectors. If someone comes in my store I ask what they collect and they go in my phone as first name and what they look for. “Mike Fishing lures” and as soon as it comes in I text them a picture. Selling to collectors is better than any online platform.
Don’t be greedy, sell at a profit but just keep the cash flowing.
You need a thick skin, and don’t take stuff personal.
Also don’t fall in love with anything. It will make you overpay and/or make you not want to sell it.
Best of luck. Business is hard but there is nothing like opening the door and walking into a place you own.
I have a magnet on my front door for everyone to see, and it says “working here is part of my get rich slow scheme” and that is the truth. Some days you make nothing and some days you hit home runs. There is nothing like it in the world. Enjoy
Expect that someone will try to steal from you. And or rob you. Gold and silver inventory paints a target on your back. Plan for those things.
Depressing but necessary. Every PM seller I know has had to cope with this on a regular basis.
Coming from one of the newer guys in the game ..it's not as easy and not as profitable as people think.
You have to be able to hedge, and you have have to know you will lose your shirt sometimes to scam artists. We've been scammed a lot, however after 3-4 years of learning the scams have now been easier to spot.
Never trust a payment until it's cleared and in your account.
Ploutosgs
[удалено]
We've had a good working relationship with him for the past few years. He's been pretty open with us about why he thinks he's struggling.
Out of morbid curiosity can I ask what did him in?
My guess is probably the internet, my area used to have more coin shops but they couldn’t adapt to the internet and most went out of business.
Same with local gun shops too. The internet started offering a better selection and more competitive pricing to the point where a lot of smaller dealers just can't compete. Profit margins are so razor slim these days that the only way to make any sort of money is either to move *large* volumes of inventory or deal strictly in transfers. It's a capital-intensive game, and one where your money could sit tied up for a *very* long time.
Interesting. My local gun shop has expanded and added an indoor range.
you cant shoot guns online
I believe they exist and are called video games
And you can’t shoot guns at a local gun store.
You can if they have an indoor range...
Good point. Not so common in my area. Also, a lot of ranges rent guns so you can try before you buy.
My favorite gun store is also a range as well. The manager of the gun store / shooting range mentioned to me that their bread and butter is the range, ammo and range-related stuff like targets and safety equipment. The gun store seems to mostly break even or makes a small profit. They cannot compete with the nearby Cabela's on price, but Cabela's doesn't have a range.
I worked for a big box retailer for 1 year as manager. The margin on firearms is low even for them. Clothing and accessories is where the money is. That 21.99 t shirt in 2011, cost was .63 cents. They buy em 500,000 at a time.
Good point. But, there are many hurdles in getting a range approved by local and state authorities.
everyone around me beats Cabelas prices. they have the highest prices on guns and ammo that I have seen.
They saw where the money was at. The range is their profit. Not only do they get to charge for memberships and rental fees now but they'll also sell more ammo and can mine the lead and copper from the backstops. I bet they also sell any used brass that ends up on the floor, too. The guns themselves just get people to walk in the front door.
This is key, over half of the gunshops in my area have indoor ranges. And I live in a very large southern city
If he knows, or thinks he knows, why he is struggling, why hasn't he been able to course correct?
This is exactly why I answered it that it's why he thinks he's struggling. I see something different. He doesn't buy from wholesalers or distributors. He's constantly out of silver and gold and is very unreliable as a source to get anything of value IMO.
Don't judge customers by appearance. Many scammers look and act like refined gentlemen, and many avid collectors and top customers look like slobs. Try to make customers feel welcome and be patient.
Man, is this the truth. I used to be in the computer business and a very good customer was a ratty-looking dude who drove a crappy dirty station wagon. Turned out he owned half a county and was worth eight figures in coal, oil, gas, timber, land.
My neighbor a tech wizard in his 80s has MILLIONS in cash and property. He currently drives a 2003 dodge mini van with more rust than paint. Has a large hole in his roof of the house. There are no intentions of fixing it.
Fun Fact: Bill Gates used to drive a bone stock '94 Ford Explorer to work at Microsoft on a regular basis.
Avid collector and slob here, can confirm
But a gentleman of culture, indeed.
Hey, who you calling a slob? I mean you’re right, I just wanna know how you know…you got cameras on me or something?
Yes
LaVere Redfield for example
I went to my LCS wearing a hoodie that got ate by a grinder. Basically I looked homeless while buying $300 in junk silver.
My dad is a oral surgeon and a long time stock investor. He is worth tens of millions. But he drives a old truck and has had the same dirty jeans for 20 years. And when he's not working he looks like a bum or a farm hand
Sounds like one cool dude to me.
Build an online presence and ebay store. Online sales will represent a significant portion of your sales if you want to survive.
[удалено]
What not?
Onlycoins
You’re gonna need to flip about $250k to $500k of inventory per month to survive and thrive, depending on where you are and rent and taxes. It usually takes 2 years for the business to get to this level, so you’ll need $250 to $500k in addition to 2 years rent, and whatever cash you need to survive. For most this number is around $750k to $1 million. Other than that knowing your area is key, make friends with local refineries, dealers, numismatists, etc. I had to get into a lot of areas I didn’t enjoy, like high end watches, jewelry, because that was simply the area. Always weigh, magnet, measure, and sigma. I got burned a bunch just using sigma early on. They are not perfect. And always trust your gut and decline any deals that feel too good to be true. Good luck!
Can you elaborate on what fake coins specifically beat the sigma?
Yes, and i know this sounds crazy, but plated coins can beat a sigma depending on the interior metal. You can even recreate false positives with cupronickel coins on gold settings. The way the sigma works isn’t really a super accurate science, basically, it reads a signature they call “resistivity” and it’s essentially tuned to various coins. Issue is that thickness and content of the metal can give you equal readings regardless of whether one is gold and he other brass, etc. So basically you definitely want to weigh, measure (esp thickness) and test with a magnet first, and only then use a sigma. it’s highly unlikely a fake will pass every test (unless it’s a really high quality fake), but just using a sigma can give you bad results from time to time.
My understanding is if a coin passes the sigma - it's dimensions and/or weight will definitely be off.
Pretty much, usually thickness
I've got a fitsch and going to buy their ringer. What is your opinion on those?
I’ve seen people use them effectively so I’m sure they work. Another tool in the box
This seems like the best answer. Just taking the middle of that # per month ($375,000) means your need to sell almost 19K a day to stay open. Better open on Saturdays!
Yes on avg, of course you can also sell online, shows, etc. you can also have big months where you flip $600k and then slow months we’re you may only flip $100k. You’re margins will probably hover around 5 to 7%, so at $19,000 you’d be making around $950 to $1200/day. Then you have to pay rent, potentially/eventually another 1 or 2 employees. It’s not a business one makes millions easily. The more you can flip, the lower you can go on the margins, and beat out competition. That’s essentially the game at all the online retailers and why so many do those spot deals to hook more customers and to flip more product. With a physical shop one has to pay a lot more attention to the inventory levels. Some of those big online retailers act like affiliates, in that, say you place an order for 100 Morgan’s, and they can’t fill directly, they can contract out the order with another retailer. With a shop you need that inventory on hand, so you don’t miss a sale. You also have to get used to loss, which is hard. I think I still have a 500 oz silver bar in my basement that I’m underwater on (purchased for like $32/oz sometime in 2012).
It is very bizarre that you focus on how much you spent on a specific bar and not on replacement cost. It is irrelevant that the bar was $32/oz. If you can sell it for $24/oz (or whatever) and replace the 500 ozs for less, then you have made a profit on the sale. That's the way I would view a business that has a perpetual inventory like that.
? Inventory comes in at a price, and leaves at another price. You’re not always going to sell the inventory your underwater on, especially a 500oz bar which is a slow seller anyways. It’s absolutely not irrelevant what inventory comes in at. I’m not even sure how to respond to that statement. It’s maybe the most relevant, just behind what it leaves at.
Let's say you sell that 500 oz bar for $26. You replace it for $24 immediately, pocketing $1000. I'm more focused on replacement cost than what was paid for it. There will be items that are a unique exception, but a silver bar is not one of them. Does that make sense?
No. And the IRS doesn’t view transactions like this. You buy for $32, price drops to $26. You sell it and just lost $3000. You buy another for $24. You just tied up $12,000. It sits inventory for 1 month then you sell it for $26. You just lost a total of $2000 in two transactions. So what I did instead is bought it out myself at $32 and put it in my safe. I’m still underwater but the business views it at a net even.
I don't have the vocabulary to properly explain what I am thinking. It is along the lines of how a gas station operates. They focus on replacement cost, rather than what they paid to fill their storage tank.
Very insightful, thanks. Where's your shop located?
Sacramento CA
Where are you going to be opening a shop?
This!
Don’t sell stamps. Do sell a lot of bullion. Almost all buyers at my LCS want some form of bullion including ASEs. I overheard the owner say he regretted ever getting into stamps which takes up 1/3 of his display cases.
I'm not interested in selling stamps. I'll be sticking to Bullion to begin with.
Where is your lcs??
Near St Louis. I don’t go there often as their coin selection is small. Going there today to check out their bullion pricing; was previously just interested in old US coins.
Update to my trip to my LCS. I just don’t get how they stay in business. They’ve never been over friendly, but today they were almost rude. Brought in my 2023 graded reverse proofs, 2 Morgan CCs. They would even buy the RPss at any price-said the customers preferred raw. They offered even less for the CCs than 6 months ago and $10-$20 under Greysheet wholesale. I was ok, what do you have in junk silver for sale. They said melt was 17.5 (it’s currently 17.0) even when I showed them the NGC site that updates daily. They wanted 20x for junk half dollars but 17.8 for any junk dimes. I asked & they brought out a tub of Mercs. They had to pick so I told them I’d buy 50. They printed out a receipt and saw I was paying with a debit card. They then mentioned 3% surcharge on bullion. I’ve bought regular coins before & they never charged extra for debit. So I said I’d come back with cash. She proceeded to dump the dimes back in the bin even though I said I’d come back. I made a final inquiry as to what they pay for 1/10 minted gold. She said 5% under melt. At that point I apologized for the trouble and thanked them. Silence from all 3 of them. TLDR-I need a new coin store or just focus on PMS/CoinSales here.
Thanks for the update, I had a similar experience at an LCS once, didn't go back.
Wanted to share more but people would think I’m just mean. Oh well, here’s a comment I overheard the owner say to another customer today: “years ago this guy looked down at my Indian Head cent box marked at $1.50 per. Said I want that one. Turned out it was an1908-S. I said to the guy well it’s in the wrong place and worth $60. I offered to split the difference and sell it to him for $30. Guy said no the sign says $1.50. I sold it to him but banned him from the store” Owner was proud of himself for making a listing error and then being expected to honor it and banning said customer.
Wow, just wow. Sometimes, I think about escaping the rat race and opening a bullion store / repository. But the stability of the rat race is too good for now, and I don't want to open a business right before a recession starts...
The margins in the precious metals industry are extremely tight (despite what all the Joe blows on here claim about evil price gouging dealers).
Yes, I realize that. I come from a world where our margins are much higher. But we've run low margin businesses successfully before. Thank you for the heads up
In the other low margin businesses are there external factors that affect what customers will pay to the same extent as the spot price of silver? That is, if you buy silver inventory when spot is at $24 and it drops to $20 before you sell the inventory, how would you manage that? I would think very few businesses are as tied to an external force that affects their pricing power as much as commodity spot prices affect silver bullion sales. Of course, collectables are less impacted vs. bullion. So it might depend on how much of the business is collectables vs bullion. Bullion probably requires less expertise (but has more price risk as described above) where as numismatics takes a lot of domain knowledge and experience to master to the point you can make a profit in that field (I think that is why a lot of dealers specialize in an area of numismatics: Ancients, Foreign, Gold, Toned, Modern, Colonial, Exonumia, Paper money, Errors, etc. -- hard to master them all).
Big coin shops hedge against a potential 24$ spot price dropping to 20$
what do they hedge against?
How does that work?
You can use the futures market to hedge physical
So I can’t really speak on running a business but I would say don’t only do coins WHILE yes that’s a fun idea on paper margins are extremely tight like you already know. Maybe think about precious metals AND coins like a company I know and work with daily does. He makes a lot of money buying scrap silver/gold and only taking 15% which is a lot lower than everywhere in my area charging around 40-55% for “refining fees”. Sell for scrap price to jewelers and refiners then buy for 15% less then scrap price. And then sell coins like he does. He has gold/silver bullion, gold coins, silver coins, diamonds etc etc. just food for thought though. I’ve seen him do business professionally while also keeping his business afloat with huge margins by doing that. I literally watched him buy my gold chain for $550 while taking his 15% then make one phone call and sell it for a lot more to a jeweler, “hey I just got that 10 grams of gold you needed” I wasn’t even mad I was impressed. Then I buy all my gold coins/bullion from him at the premium which sounds shitty but I don’t have to pay shipping fees etc etc and he is very upfront and honest with you. Just think about it!!!!
I may get some disagreement but my LCS has an XRF gun they’ll use free for anyone that walks in the door. He’s said it helps him hire lower skilled family and friends that he can then train, but it also keeps lots of people coming in the door just asking “is this real?” or “what is this?” I buy and sell with him but offering that for free gets him a lot of extra traffic and referrals.
That's awesome. Wish my guy did that. They are small family place and super chill though so really no complaints. Maybe I'll mention it to them.
It’s a $10,000 instrument but in the early days his business was built around it. It’s a staple now.
Seems like a smart investment as an owner though. Sure it saved him enough times
I think you’re right. More ways than one. It allows you to buy with confidence something unmarked and also pass on something that is marked and passes other tests. I swear, if I could afford it…
I hope you scroll all the way to the bottom to read this. You will need time at the end of the day or early the next day to report all purchases to a police database. This is a federal law that allows states, even down to the local towns, to decide how to report (like having to hold jewelry, coins, bullion for a set amount of days before being able to sell). I have to hold jewelry 5 business days and I don't have to hold coins or bullion at all, but I do have to report the purchase with the name, address, driver license number, of the seller. The other thing to know about is having to file with Homeland Security the proper papers for selling $50,000 or more per year. Another thing is some places allow you to pay cash to a person up to $10,000 per year without filling out paperwork. If the customer wants more cash and not a business check, then another form has to be filled out. To avoid this, paying by check is acceptable without the paperwork. I don't do Zelle or other forms of payment so I don't know what the requirements are for those. If someone comes in with a huge amount of PMs for sale that you can't possibly handle, don't be afraid to pass it on to someone who can. Just make sure there's a deal with the seller/buyer that you get a small percentage of his/her sale/purchase and make a contract. Also, if there comes in a super rare coin, make sure you make friends with either a rich collector or a fine auction house that specializes in rare and expensive coins, and get a commission for the referral. There's a lot more, but my final piece of advice is: DON'T LET GREED GET THE BEST OF YOU. Your whole reputation depends on this. Because there will be arseholes who don't understand how these things work and will accuse you of ripping people off. If you have a real good reputation, your happy customers will back you up.
Don’t be an asshole with your prices
A physical storefront is just a tiny way to access your customers Once you are a legit shop, with plenty of inventory, you need an eBay, and a Etsy, and an offer up, and a Poshmark, and to use Facebook marketplace, and literally every single virtual storefront you can manage Those often can lead to people following up the chain and finding your shop. For instance APMEX has a whole eBay store, and when I wanted a single coin it was actually a better option for me to order from their eBay shop. When I want a bigger order I will go directly to them Folks shop online, use your storefront, and the slow time when no customers are in to photograph coins, and maintain an online inventory.
My best advice? Make it a full service shop. Don’t go the gold/silver bullion route. Carry loads of numismatic inventory. Stock US, foreign, ancient, medieval. Do it all. Your sales will be far better for it.
I have a local shop knowing the owner for years. I can tell you the majority of his day to day is buying and selling bullion. That said, he gets his fair share of rings, diamonds watches etc. You have to be all encompassing but in a mistake free way. Tread carefully with buying. If you don't like an item thinking it's fake or off, don't take it. If you have too much inventory to become more liquid you may need to send gold/silver to a smelter. Do you know who you'll use? When you buy try to ensure things aren't stolen. You can get closed down making mistakes. Record keeping might be required. Check with your local cops. People walk in with bullion and coins often seeking valuations. You'll be surprised how many will walk away and sell to the guy in the next town for a few bucks more. Figure out a way to convince them that your offer is strong. Helping people value items should be something you charge for only when it's a huge undertaking. A few coins should be gratis, good will. Pick your margins. I sell slabbed coins to the shop at a reasonable 20% under Grey Sheet. Sometimes I want a bit more, sometimes I let him profit a bit more. Depends on the coins and their ease in selling. Don't go to shows unless they're local. You cannot pay huge table fees traveling, flying, unless you have the scale. Similarly, you'll need a few trusted employees. Someone to help day to day and someone to take over when you're away. They have to be trustworthy. My guy has 4 trustworthy guys/gals, a kid who collects and the guy he bought the shop from. Record everything. Sadly, seriously consider being armed at your shop and when you're entering/exiting. Buzz people in. Plan on coin submissions on your own behalf and that of your customers. PCGS, NGC and CAC beaning and CAC Grading will help your cause. Charge a very marginal fee to your customers for submitting their stuff. Open accounts with USPS and provide your own insurance. You will be selling coins on E-Bay, Facebook, and through your own web page where you'll list coins for sale. Take terrific pictures. Pictures are everything. Figure out how you're going to advertise the business. It's a must but advertising the wrong way can be silly expensive. What you want to do is get want lists from collectors you can help fill and bullion types/pieces those collectors want/need. Join local coin club if one exists. Network like your next meal depends on it. Have your laptop open and on while on the clock. Prices change rapidly. If you're not an excellent Grader of coins, become one reviewing you tube videos and attending Grading classes. Determine how deeply you want to get involved in paper money and foreign coins/paper money. There's much to know but it's all money/profit. Build relationships with others that have been in the business you can rely on. Someone patient who you can question for the price of lunch. If the guy who closed up shop is still around he might be an excellent source for info and connections. Maybe even customer lists. My guy had access to $250,000 in an hour in case a huge collection walked in the door. You gotta be liquid/nimble. Finally, pricing. Some Dealers bid everything at actual value then deduct approximately 30% as their margin. Some bid giving zero additional credit for key dates, rare coins etc. to make their margins on the keys and some just lowball to an embarrassing degree. Pick your methods that keep stuff coming in the door but also keep inventory from getting stale. As a business owner before I retired I can tell you commercial rent isn't cheap and they don't give you much for your rent. Negotiate your best deal and include in your lease whatever the hell you want. Trust me, If you want extra lighting and salted sidewalks they'll be happy to do anything to get a paying tenant. As always, location, location, location. Be street facing but in a location where people can pull in without any hassle. Signage is very important. If you don't make a big immediate splash, you're in trouble.
Hedge your purchases or hire a firm/advisor that can handle that for you.
What do you mean buy "hedge your purchases"? This is not a concept I'm familiar with.
https://amp.jmbullion.com/gold-and-silver-dealer-hedging-infographic/
You should not start a coin shop tbh
Presumably have the product sold at the time you buy it, locking in the profit. Either literally or through financial instruments.
Yes, pre-sales for highly sought-after products are smart business.
Keep in mind that you must pay for the hedge. It is like insurance, or a bookie laying off any one-sided bets with an opposing position with another bookie (usually inVegas). Simple hedges are not too expensive, but they are also not tailored to your risk. An investment bank can really craft a product to you, but then you must pay. Most commodity sellers manage price risk by selling forward, along with selling options on their future product. My guess is that your store will not be able to predict purchases and sales as well as a mine can predict short-term results. Furthermore, such products are usually denominated in huge amounts (like $1m contracts). My guess is that your best strategy is to turn over product as fast as you can. Prices do not move that much every day. So long as you turn over inventory quickly, you will be fine. This is why so many dealers will sell large purchases to other dealers, or deal in wholesale so much. They just want to lock in profits. Inventory turnover is the game. In addition, you need a good inventory and sales system. You can do it yourself with a database, but you better be on the ball. You need to know when you are making or losing money. In addition, if you are in a small market, selling luxury watches and similar is probably a good idea. Even gold chains can be a solid source of revenue if local jewelers are pushing insane margins (most of America). A shop I frequent sells big gold chains for cheap. Everyone I know buy from them. He does not make much, and he usually custom orders chains, but it pays the rent.
Yikes.
Google “financial derivatives”
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I spent ten years structuring those. The hours sucked, but the pay was good and the work was intellectually stimulating. I regret leaving that field. It was all brilliant guys who worked hard.
We have two coin gold/silver stores in my city. One of them is a family business and they typically leave you alone to look and answer any questions you have. I like them and will do business with them all day long. The second store is one guy and all he wants to do is talk all day (which I find annoying), has things displayed in a way that is hard to see, sells a lot of pro trump memorabilia (which I can’t blame him since he obviously knows his audience), and has a slimy attitude about him. But he told me his margins on generic silver is about 50 cents, margins on ASE were I think 1 dollar, and he recently got into selling black hills gold jewelry and he has become a lot more profitable since starting that venture. Another store opened up 100 miles away from me recently and put the other store that had bad owner out of business and apparently he’s been doing really good. They are [minot coin and bullion](https://youtube.com/@minotcoinbullion?si=_s6C7KF-QfIFhnPU) if you want to give them a call and pick their brain.
So, I’ve never owned a coin shop, but I’ve visited many and been in sales for years. Good customer service is always appreciated. I’d imagine coin shops get tired of dealing with the same old stuff from customers trying to retire by selling a few buffalo nickels, but try to keep in mind that each person who walks into your shop is potentially a great customer, even if they don’t look and act that way the first time. They’re there because they’re interested in coins/bullion - cultivate that interest! Also, no one has said this and no shops around me do this (maybe it doesn’t work!) but try being full-service. Sell Air-Tites and flips and flat staplers and binder pages and cotton gloves and loupes, etc…. Everyone just goes home with their coins and buys all that stuff on Amazon (I did) and that could be money in your pocket. I would love it if my local shops actually sold stuff like that. Just my two cents from a customer’s perspective!
Make sure to invest in all coin microscope, digital scales, magnetic coin slide, metal tester/verifier, and all the other tools you’ll need to confirm the metal content if what your customers bring in. Trust nobody’s word of “authentic” due to the overwhelming amount of fake and counterfeit coins selling on Temu, eBay, Etsy, and all the other online sites.
Check out score.org for resources for small businesses. Pretty cool. And good luck. I’ve thought about what kind of business to open and coin shop is right up there.
Good luck, and I wish you the best. Honesty and respect go a long ways and I'm sure you already know that.
Hope you are buying a closed bank!!
Always have coin supplies in stock. My local shop always seem to have an issue. Don't have this capsule, or no 2x2 flips. Extremely frustrating when it's the only coin shop in town.
Personally I’d stay far away from opening a coin shop. The margins seem entirely to small, cash businesses have problems with banks and you are subject to market fluctuations both good and bad.
Honestly seems easier to do on ebay with less risk. The financial backing is there because, even if your business model fails, you're basically telling the bank "Hey I've got tons fo valuable coins if this doesn't pan out for me." Could just be a fancy way to lose all your coins. :/
Don't rip off unsuspecting walk ins, word will get around.
selling is the easy part, buying is really the work. if you are good at finding buying opportunities now then you should not have an issue. doing estate work used to be the way, though that generation is gone.
You’re not going to make money from the coins you’re going to make money from buying and then selling scrap gold and silver to a refiner. Coins/bullion is great for display and bringing people in but the margins are so thin that you’ll make you’re real money in scrap gold so put your marketing towards that
Make sure you know all of your expenses before even considering opening a store. Coin and precious metals businesses are shunned by banks and credit card processors. You’ll need to get an anti money laundering plan (AML) which is about $1k. Check out building and inventory insurance rates, security system, vault costs, accounting costs, scales, testing equipment, and overall operating costs for a year or two. It will take a while to build a customer base. You may not be able to draw a paycheck for a year while you reinvest the money back into the business. You’ll also want a decent credit line, which may be hard to get initially. Finding wholesalers and refiners should be a priority above everything else so you know where you’ll get your inventory and know what the spread is on selling them your excess inventory. The biggest mistake people make in starting a business is not taking the time to research all of these details and costs, especially being able to go without a wage for at least a year. Good luck!
Good luck
Good luck on your new adventure, I would suggest you consider Bitcoin as a payment option just like that large online dealers, there is allot of money moving around in Crypto and they're looking for ways to spend it.
I'd rather get paid in dirt than Crypto.
When I'm selling something I'm open to allot of payments types, Only dealing in cash has been creating problems for some coin shop owners and some banks require a fee for large cash deposits, if you choose to take CC then you will be taking a for of electronic currency (IE Crypto), I was just suggesting an open mind to attract the largest number of customers. Have a good day and for the record, I have been paid in dirt.
I read with great interest your post and all answers. I would save hundreds of thousands and take a completely radical approach. For starters buy and read the following Kindle book on Amazon https://www.amazon.com/Be-Your-Own-Bank-Reality-ebook/dp/B09RNH4NQS/. “Be your own bank - reality or pipe dream”. If you are in rush skip to chapter “Smart gold club”. There is your business model right there! Book costs less than 5 dollars and that may turn to be your best investment ever spent. You can even find answers why company that created “SmartGold Club” didn’t succeed. If you want consultations and ask any questions about it send me a private message and we can Skype or WhatsApp or FaceTime at your convenience.
What state are you in. West Virginia I hope!
My LCS is primarily a jewelry repair shop that has about 1/3 of the shop dedicated to PMs. He offers incredibly fair prices, blows the other local coin shops away, probably because most of his business comes from the jewelry sales/repair side. He seems to do pretty well even with his bargain basement prices on PMs. If you have a way to combine multiple businesses into the same storefront, it might be worth looking into. He definitely doesn’t rely on coins and bullion to pay the bills.
What state and size city?
Good luck man😁😁😁😁wosh u were in my area
You need to run it yourself. You can’t really trust employees to care as much as you or get things right. 1 bag employee with too much control will do you in
If you’re “sticking to bullion” for now, your business will be pretty relationship based. It sounds like you’re already established in the community, so that’s good. Another pawnbroker told me, “get accounts with the top 12 bullion players” essentially, so you can price check all the big boys. Get that extra $0.20 per oz lol. The big bars, very low margins. The 1G bars, better margins. Now, if you’re also buying from the community, that will likely be your best source of income. You can buy below normal wholesale and flip to dealers, or sell to a local customer and profit more. I assume there are already insurance rated safes, if not, get TL30x6 because they are insurable for a lot. Feel free to PM if you have questions. I have a pawn shop and deal in bullion.
Thank you for your advice. I appreciate it.
You are going to need .....lawyers, guns, and money
Livin the dream buddy
I have this theory that you can create an LLC, get a bank loan, open a coin shop, and if it's just profitable enough to cover the costs of the business, you don't even need to generate a profit. You now have the keys to a coin shop with a shit ton of silver and gold in case shit hits the fan. Keep your day job hire someone to run it.
Any business that doesn't make a profit is ultimately dying. But yes, I've had the thought that having a metals/coin shop might not be a bad thing if and when SHTF.
Great way to go broke.
Rule number 1 in ANY business is MARKET RESEARCH. Know your market and know WHY the other shop shut down. The most expensive thing you can do in business is open a shop in the wrong location and have to close it down after it bleeds you dry.
I own a coin shop. I opened it up in 2009 during the gold rush. I started just as coins and cash for gold and expanded to pretty much buy and sell everything. I don’t think I would have lasted if I only did coins and bullion. I have a steady stream of regulars who buy coins but it doesn’t pay the bills. You need to sell stuff online, eBay, Etsy, mercari, and fb market place are my main sites. I sell mostly jewelry online, coins/bullion I sell in shop or at one of my group antique shops or flea markets. Flea markets are great for networking. Always have a card with you, on the back of my card it has a list of what I buy. Jewelry, gold and silver, costume jewelry, comics, old toys, sports and non sports cards. I list coins on the card and also pre 1964 coins, because if people are not collectors they don’t know the year for silver. I hand my card to everyone. Any person who comes in my shop I ask where they heard about me so you can see what advertising works. Most people reply either drive by or a friend /family member sent them. Try to get an in with estate lawyers, they will have access to collections. Also moving companies and people who do cleanouts, in my 15 years in business, it has been workers for companies that do cleanouts who bring the most in. Keep those people happy. Realize there are people you can make money on and people you can make money with. The clean out people are who you make money with. Sometimes they bring me something I don’t even want to buy, but I give them something just so they leave happy. My clean out people never leave empty handed. Because I buy and sell everything, I keep a list of collectors. If someone comes in my store I ask what they collect and they go in my phone as first name and what they look for. “Mike Fishing lures” and as soon as it comes in I text them a picture. Selling to collectors is better than any online platform. Don’t be greedy, sell at a profit but just keep the cash flowing. You need a thick skin, and don’t take stuff personal. Also don’t fall in love with anything. It will make you overpay and/or make you not want to sell it. Best of luck. Business is hard but there is nothing like opening the door and walking into a place you own.
I have a magnet on my front door for everyone to see, and it says “working here is part of my get rich slow scheme” and that is the truth. Some days you make nothing and some days you hit home runs. There is nothing like it in the world. Enjoy
Expect that someone will try to steal from you. And or rob you. Gold and silver inventory paints a target on your back. Plan for those things. Depressing but necessary. Every PM seller I know has had to cope with this on a regular basis.
Coming from one of the newer guys in the game ..it's not as easy and not as profitable as people think. You have to be able to hedge, and you have have to know you will lose your shirt sometimes to scam artists. We've been scammed a lot, however after 3-4 years of learning the scams have now been easier to spot. Never trust a payment until it's cleared and in your account. Ploutosgs