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IdahoMole

Well-known member
Supporting Member
Joined
May 3, 2016
Messages
125
Location
Pacific Northwest
In 2017 I would like to expand my refining customer base from 0 to 1 or 2 (I am self employed and want to transition from my current occupation into refining over the next few years.) Toll refining only. I am not interested in buying any metal. I can do gold and silver, probably stone removal, not really interested in PGM's.
My thought is to make contact with the local jewelers and see if they can be convinced to make a change from their current refiner to my service. My problem is that I know almost nothing about the jewelry trade. I have been working on a refining schedule and I believe I can add a point or two to their bottom line but beyond that what do they want or need? ie 24k casting grain or pre alloyed? Plus many other questions. One probably leading to another.
If you have worked with the jewelry community I would be interested in talking with you either in the open forum, via PM, or over the phone. What ever y'all are comfortable with.

Thanks for your time.
 
One thing that might help: Point out to them that they usually pay a premium over spot for their casting gold. When you toll refine and return their gold, you might offer the same rate (85% of spot or so) that their usual refiner offers, but they no longer have to pay that premium over spot to buy the next run!

If they karat their own gold, they'd save money right there. If they buy pre-made casting shot, you can alloy their returns for them into the alloy of their choice (most common being 14K yellow here in the states) as an extra service (and with an extra charge). You can purchase Master Alloys (the additives for a given alloy of gold, kinda like pre-made cocktail mixes lol) at jewelry supply places like Stuller, Rio Grande, etc. You'll need a tax ID for a Stuller account, but not for Rio.

Oh, and this of course only works if they do in-house casting.

--Eric
 
upcyclist said:
Oh, and this of course only works if they do in-house casting.
Yep, and there are fewer of those shops around these days. Most stores now just buy from large manufacturers and resell. They may do some repairs and size rings, but they don't do their own casting, so many have no need of casting grain. :(

Dave
 
Yes, sadly. I need to find those few mom-and-pop stores that do their own smithing and casting for both my gemcutting and any refining work, and they're few and far between.

For some reason, Zales & Kay aren't interested in my one-off danburite, lol
 
Some shops may buy castings from a supplier if so they may be able to run a metal account using fine gold which keeps down the cost, some bullion dealers offer the same deal for findings and fabricated metal, I used to use this method to buy wedding rings and it was the cheapest way.
 
Thank you for the replies thus far. Keep them coming. :p

I have been looking at various refiners on the web and they are all over the place as far as pricing and minimum lot size etc. One place needs lots of over 8ozt to meet the minimum refining fee. One place charges spot +10% for casting grain but will give you a break (2 or 3%?) if you want your metal returned that way. Another will return metal as casting grain for no additional charge but adds a premium of you want it back as bars.

I am willing to do Au lots as small as 1ozt pure and return the pure metal any way they want it for no additional charge. Returning alloy would add a premium but also means I have to learn how to do it.

I would like to cater to their needs, just not sure what those needs are. I don't want to look like an idiot when I start talking to them. :lol:
 
IdahoMole said:
Returning alloy would add a premium but also means I have to learn how to do it.
Unless you know what you're doing, and have the proper equipment, I would be wary of venturing into this. Every time alloys are melted, some of the base metals are going to oxidize. If you melt them to form the alloy, some oxidize. When the jeweler melts them to cast, more oxidize. If there is too much oxidation, it can result in porosity in the casting. This is why most jewelers are wise enough not to try to just remelt alloys and recast them. It can be done, and some get away with it, but eventually it will bite them in the butt and they'll not try it again. If you're the one providing the alloy, and they waste their time creating the castings and end up with trash, they won't be using you again.

I would like to cater to their needs, just not sure what those needs are. I don't want to look like an idiot when I start talking to them. :lol:
Start by talking to some that you won't be broken hearted about if you do. You'll learn what your market wants as you go. When you learn a little more, you'll be better prepared to approach the ones you really want to work with.

Dave
 
You may need to talk to a bullion dealer or supply house about trading in scrap or refined gold for product, the needs of a small jeweller cost money to supply but if you can supply their products to the small jewellers they may give you a discount so you can make a profit, by using a metal account you save them the financing charge and reduce the need for staff to supply the small jewellers, this has been done many times before but you need the finances to start the metal account or the metal. The name of the game is negotiation, you get a discount on the product and then supply on with your profit, for those wanting one wedding ring or a panel of solder selling their karat scrap wil, not suit either party but if you can fill that gap you are in business.
 
IdahoMole said:
In 2017 I would like to expand my refining customer base from 0 to 1 or 2 (I am self employed and want to transition from my current occupation into refining over the next few years.) Toll refining only. I am not interested in buying any metal. I can do gold and silver, probably stone removal, not really interested in PGM's.

If I may be blunt (as per usual) you need to reconsider your approach to buying metal or material. I do a lot of toll refining and I use the proceeds from this to buy material. If you pop along to one of your suppliers and offer them cash for product the price drops accordingly and therefore your margin increases. I understand that initially the cash may or may not be an issue however do not be afraid to reinvest your profits. If you take Tndavid as a benchmark, he is constantly investing and reinvesting. Look what he has achieved in a few short months.


My thought is to make contact with the local jewelers and see if they can be convinced to make a change from their current refiner to my service. My problem is that I know almost nothing about the jewelry trade.

I don't think jewellers should be your main avenue of attack. Most of them know the best places to get top money already and in order to win their business you will just have to be cheaper than your competition. That's a hiding to nowhere. You will end up being a "busy fool" if you pardon the expression. Go see the recyclers and make friends with them. They are always up for either cash deals or gold in their pocket and they have a regular supply of stock.

I have been working on a refining schedule and I believe I can add a point or two to their bottom line but beyond that what do they want or need? ie 24k casting grain or pre alloyed? Plus many other questions. One probably leading to another.

See above.


If you have worked with the jewelry community I would be interested in talking with you either in the open forum, via PM, or over the phone. What ever y'all are comfortable with.


Thanks for your time.
 
FrugalRefiner wrote,
I would be wary of venturing into this.
I am.

anachronism wrote,
If I may be blunt 
Of course. Blunt does not preclude politeness and I took your words in the spirit they were offered.

A little more about my situation. After developing an interest in refining earlier in the year I took a button I produced into the bullion store I purchase my silver from. After a few conversations he looks at me and says "I should have you refine my metal.", "seriously?" I say, and we struck a deal. He understood I still have things to learn and was and never applied undue pressure. Things were great. Well he is also a military reservist and he got orders for deployment. The store is closed.
Not only will I miss my friend but I need a new source of material to process. I have produced some excellent Au and Ag and had a few setbacks along the way. Looking for new customers is not the best route, reputation is everything, don't want to trash that and it is a very real risk. I don't have a big bank roll to buy scrap with. I am brainstorming. I'll keep thinking, there is no rush. Slow and steady wins the race right?

Thanks again. I do appreciate this great community.
 
If as you say your friend has had to shut his shop perhaps advertise to buy scrap, ask your friend what he paid and pay the same and you should get material in, you may need to ship as live scrap if your funds are limited to keep your cash flow going to start but you should slowly build up some capital so you can refine the material you buy and get a better deal when you sell on.
Trying to break into a new market is hard especially if you have no business premises or capital and the people you are approaching do not know you or of you, perhaps a new stream of material that can be purchased cheaper such as e scrap could generate some income and a stream of material to process,there will be something you just need to find it.
 
I know its an older thread but great ideas but your numbers are way off as far as our cost go for things such as shot of cast karat gold. I started an estate Jewelry, Silversmith shop just south of kansas city 8 years ago. The most ive ever paid for any 999 gold shot, casting pellets etc was 30 over spot and that was when gold was closer to 2000. And never a dollar over spot on silver. Plus everyone in the business uses a refinery that pays98% of spot price for their karat gold so long as its at least 10% gold in and out in less than 30 mins. I started in the same position with only 40 dollars and only bought sterling silver scrap. In a search for better margins (10% was good but it meant i was only making 4-5 bucks at a time) I stumble across a massive source of free copper at my local recycling center and it hits me small business are as efficient as can be thats how they survive meanwhile huge corporations was stuff all the time and my first haul was 1100 dollars worth of copper and aluminum in the for of pots and pans this led to a contract with Toshiba they actually pay me to haul of all their copier rentals.
 
kcsilversmith said:
I know its an older thread but great ideas but your numbers are way off as far as our cost go for things such as shot of cast karat gold. I started an estate Jewelry, Silversmith shop just south of kansas city 8 years ago. The most ive ever paid for any 999 gold shot, casting pellets etc was 30 over spot and that was when gold was closer to 2000. And never a dollar over spot on silver. Plus everyone in the business uses a refinery that pays98% of spot price for their karat gold so long as its at least 10% gold in and out in less than 30 mins. I started in the same position with only 40 dollars and only bought sterling silver scrap. In a search for better margins (10% was good but it meant i was only making 4-5 bucks at a time) I stumble across a massive source of free copper at my local recycling center and it hits me small business are as efficient as can be thats how they survive meanwhile huge corporations was stuff all the time and my first haul was 1100 dollars worth of copper and aluminum in the for of pots and pans this led to a contract with Toshiba they actually pay me to haul of all their copier rentals.

30%, wow.. Thats terrible.

I would, and do, do it for far less..
PM me if you are interested.
I can return your gold in shot, bar or button form. Silver comes as fine crystals straight out of the silver cell.

To the mods, do I need to make my posts in the businesses section now? :?:
 
Topher, you don't need to do all your posts in the business section. Only if you advertise a commercial service. You can still answer posts like this any day.

By the way, I think he was talking about $30 above spot, not 30%. It's quite a difference. :wink:

Göran
 
g_axelsson said:
Topher, you don't need to do all your posts in the business section. Only if you advertise a commercial service. You can still answer posts like this any day.

By the way, I think he was talking about $30 above spot, not 30%. It's quite a difference. :wink:

Göran

A massive one!
Thanks for the clarity G, I guess my mind wanted it to be an opportunity so bad that it misread!
 
30% lol no mean $30 over spot price on gold per ozt less than a dollar per oz on silver. thats a little over 2% on gold per ozt and 3% on sliver per 10ozt. Also the only charge 2% for refining gold 10% on silver and platinum this is how we are able to pay at least 90% for scrap karat that leaves us a 8% margin and we go up to 95% for example we received a 3.72 ozt muffin yesterday it assayed at .9992 we paid 95% ($4557.83) and for our $4557.83 invest received gross profit of $143.93 ($4701.76 - $4557.83). To go from hobbyist to business you are going to want to avoid the refining aspect in most cases. Like we process on average 5kg of gold filled on a weekly basis and rarely refine it to .999 because weather it 99% gold or 10% gold we are paid the same. An exception would be if an order was large enough for us to harvest platinum metals. Have you had any luck visiting your local jewelry shops? The cant see it working as a business since there isn't really a void in this area I can however see it working if you were to sell the finalized product on a place like etsy or if you have a business license I can give you contact information for a refinery but they are really only interested in gold filled refining.
 
RioGrand is charging a little over 10% of spot for 1ozt of 24k casting grain and that seems to be average. I don't doubt that you may be getting yours for 2% over but I have not found any advertised at that price.
You mention that your refiner pays 98%. Are there any other fees associated with that? What kind of volume do you bring them? If you are in and out in 30 minutes you must have a refiner right around the corner. Not everyone has that luxury.
I have not met with any jewelers yet. Between the day job, some minor health issues, lab maintenance and repair, and a few refining jobs I've done there has been little time for other things.
 
A lot of refiners who ship their karat scrap out melt gold filled into smaller (50-100 oz) bars and assay the melt before pouring individual bars. Then they do the math to keep the gold content above the minimum and enjoy karat gold rates for gold filled scrap.
 
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