In times of economic uncertainty and stock market crashes, people tend to securitize their assets in the form of precious metals like gold or silver. Gold has been traditionally viewed as being a stable investment that will retain its value even in the most troubled of times and hence it is a favored investment option by many investors even if they are active in other markets such as equity or real estate. Consequently, there is a huge demand of gold worldwide and a career option as a gold dealer can indeed be extremely lucrative. Becoming a bullion dealer is not very difficult, and if you make the right moves, can be very rewarding.
How Does One Start
Before actually embarking on a career of a gold dealer, you should decide the sort of gold that you wish to deal in. This may come as a surprise to those who do not know that gold is sold and bought in many forms. Bullion, for example, is available in the form of bars, coin, and ingots. Bullion is a term that is used to mean a number of precious metals, including gold, silver, and platinum. The prices of bullion depend on the weight and the purity of the metal. A dealer in gold bars will not generally deal in any other form of gold such as coins as the markets are very specific and specialized. Though all forms of gold have great value, there are different levels of interest in each.
Make a Business Plan
A good way of preparing yourself to buy and sell gold silver is to conduct extensive market research and find out the level of competition in your area and find out if there are opportunities that can be explored and exploited. Develop a business model that seems workable and then try and adapt it to your local environment so that you stand a better chance of success. Make detailed notes of how much you need to invest in starting off your business. The cost of operation can be quite different if you were to have a physical outlet rather than to preferring to operate online. For a brick and mortar store, you need to account for rentals, insurance, cost of utilities, and manpower, not to speak of security that is integral to the business. If you prefer not to be tied down to specific geographical limits, it can be a very good idea to have an on-line presence, however, you need to be tech-savvy, and bear the cost of a domain name, website design and hosting fees as well as tying up with a payment gateway for accepting payments.
Prepare Marketing and Promotion Plan
While you cannot expect your business to be an overnight success, you also need to be actively preparing and implementing a plan for marketing your services. You should identify a list of potential clients with whom you can start off a sales dialogue. When building the list, you need to also include the names and contacts of key decision makers, the nature of the business, their preferences and any service they may be looking out for but not getting currently.
Selling and buying gold in many parts of the nation does not require anything more than a “Doing Business As” (DBA) license that can be easily acquired for a measly $30 or less from the local city hall. However, there might be other locations that require additional documentation, so be sure of the local regulatory framework and ensure compliance. There are no specific licenses necessary for becoming a dealer in gold bars, however the business is capital intensive as you would need to buy gold on your own account and then engage in sales for profit. To be a United States Mint Authorized Purchaser, permitted to directly buy coins, you need to have an asset base of a minimum of $50 million.
The best way to purchase gold is to attend the specialized trade shows and conferences that provide a common meeting ground for producers of gold and wholesale vendors as well as large purchasers of gold bars. Many of the large gold dealers may be willing to start working with you since smaller dealers are crucial to expansion of their transaction volumes. Develop an understanding of the reputation of various dealers and work with ones that are completely above board to avoid complications of quality and quantity for which, your clients will hold you responsible.
Author bio: Charlie Brown is a freelance content writer. He has written a number of articles in the on-line media for buyandsellgoldsilver.