AUGUST 6, 2009 ISSUE
Business Spotlight
Gold Spa—A Wise Economic Move in Uncertain Times
You would be hard pressed to turn on the television these days without seeing an advertisement for “Cash for Gold” or for some other business trying to give you money for your unused or unwanted precious metals. And you can’t blame the advertising blitz—the price of gold has skyrocketed in the last five years.
But, concerning these television ads, are you really getting the best deal?
According to Jim (last name withheld due to personal safety concerns in regards to his business), owner of Gold Spa, located at 2120 Tynecastle Highway in Banner Elk, there are currently more than 160 Internet gold buyers, and each pay between $2 and $3 per pennyweight of gold. (For reference, 20 pennyweights equal one Troy ounce, or 31.1 grams.) At Gold Spa, Jim pays customers between $16 and $18 per pennyweight of gold.
“The difference is that I’m buying these for investments. The reason Gold Spa can pay more is because we are a direct investor,” explained Jim. “We pay on average five to six times higher than any Internet buying company, and we pay 100 to 200 percent above pawn shops.
“We buy gold, silver, diamonds, platinum, old paper money, sterling and flatware and we can pay more than scrap because we retail the items down in Florida,” added Jim.
Gold Spa is not a consignment shop. Jim pays cash on the spot for all gold and precious metals, meaning customers don’t have to send away their valuables in plastic bags to Internet buyers. At Gold Spa, if you don’t like the price you can take your gold and go; with Internet buyers, it takes between 14 and 21 business days to have gold returned.
Jim knows gold. He started collecting gold coins at age 16 and got into the jewelry store business at age 18. Now, 28 years later, Jim is trusted by gold buyers all over the nation—so trusted that the buyers will deposit money into his bank account without ever having seen the promised product.
When Jim started buying gold, it traded at $225 per ounce. Now, gold trades for roughly $960 per ounce, rising more than $500 in the last four years alone.
According to Jim, 99.9 percent of his business comes from women between the ages of 35 and 75.
“They’re all women because women are the ones with the gold,” said Jim. “The average woman has between $300 and $2,600 in scrap gold laying around.”
If customers bring Jim gold and then refer another customer and they bring in gold, then Jim rewards the person who started the word of mouth with 10 percent of the referral’s order. For example, if a customer of Jim’s refers a friend and that friend brings in $1,000 worth of gold, then Jim gives the original customer $100 as a thank you.
In the future, Jim would like to take his collection of scrap gold and silver and open a jewelry store in The Great Train Robbery in Banner Elk, but not until the market rebounds.
Gold Spa is located within The Great Train Robbery at 2120 Tynecastle Highway in Banner Elk. The business is open from 10:00 a.m. to 4:00 p.m. Monday through Saturday and by appointment on evenings and Sunday. The owner will also meet customers at the bank and, for bigger orders, will make house calls. For more information, call 828-898-6393.
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