Aren’t The Gold Guys Just Upscale Pawn Shops?

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I keep seeing all these ads for “The Gold Guys” or other companies like them that pay you cash for your jewelry. (Also, in case you’re wondering, this is NOT a sponsored post or a review or anything – I’m just rambling of my own accord.)

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I get it. The gold market is awesome and prices are good if you want to sell stuff. Fine.

What I don’t understand is why everyone seems to be treating this like a whole new business concept. I mean, aren’t The Gold Guys just upscale pawn shops? Pawn shops have been buying jewelry for cash from folks for years. There’s nothing new there.

The difference, of course, seems to be in the specialization and the clientele. We’re not talking about folks that are desperate to make their rent payment or don’t have other options for a short-term loan. Now we’re talking rich men and women who have plenty of money (and plenty of jewelry) to turn this into a lucrative business.

To me, this is pretty brilliant marketing. Take one piece of a store concept that already works, rebrand it, and market it to a new customer base. Voila! Suddenly it’s cool to have one of these stores in upscale shopping centers, with more upscale customers than your typical pawn shop patron.

The other part, of course, is that the business model differs in the goal of the company. Where pawn shops look to make a profit on loan interest or resale of the items they receive, these Gold Guys are melting down the precious metals to sell them in a wholesale environment.

Still, I’m totally intrigued. I think I might check it out this weekend. I have a few old necklaces I don’t wear anymore. I wonder how the experience at the pawn shop (and the price) would compare to going to the Gold Guys. I’ll keep you posted.

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Comments

  1. The payout on both isn’t very good. Pawn shops usually look to resell the jewelry as jewelry, but they have also been known to resell the gold to be melted if the item stays in their inventory too long. Typically a gold buying place will calculate the amount of gold in a piece (weigh it and run the kt ratio) to find out how much actually gold there is and then offer around 25% of the going rate for item(s) you drop off. Therefore if you drop off 24 grams of 14 kt items, you would have 14 grams of actual gold or ~.49 oz. At a gold price of $1743.80 (as it is today), they would offer $215.29. Sometimes you can negotiate a higher price, but don’t ever expect more than 50%.

  2. My Grandparents sent some of their old gold jewlery away and they really didn’t get much for it at all. It is not worth it if you ask me… They sure do market it a lot though.

  3. I took some gold there and got what I felt like was a decent price for it. Let us know how it goes!
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