Catfish is probably the best member to answer your questions. Also, go to his profile and look at his posts, especially his earlier ones. He pretty well outlined his methods in these posts.
The pricing depends on who you're buying from and how much you're able to sell it for. If you buy from the public, the profit margin is much greater than if you buy from pawn shops, coin stores, jewelers, or other buyers. However, both are lucrative if you get your numbers straight. Buying from the buyers is lower margin but higher volume.
Although some would disagree, I think more money can be made on karat gold by simply buying and selling, without refining it. In my experience, the secret is to turn your money as often and as many times as possible per unit time. The refining process slows this down considerably. Also, by turning the metal fast, you are not as affected by daily changes in the market price. If you get to the point where you're doing big volume, that's when you MIGHT consider doing your own refining.
When I bought and sold karat gold, I sometimes quoted how much I was paying, per gram or pennyweight, for 10Kt, 14Kt, 18Kt, and 22Kt, based on a certain percentage of the market price. I never mentioned the market price - only what I was paying. These numbers change daily and sometimes hourly, depending on what the market is doing. You really have to keep on top of it. Another way is to keep silent about what you paying until you have evaluated and weighed the material. Then you say something like, "I will give you X dollars for this bunch of material." When buying from the public, they will usually take what you offer, unless they've been shopping around. If you quote on the low side, you can always negotiate and increase your offering price. A friend of mine, who owns a scrap metal yard, often says, "It's not my job to educate the public." When buying from buyers, they are more savvy and will often ask what you are paying for 10Kt, 14Kt, etc.
You can usually buy from the pubic at somewhere between 50% to about 80% of spot. If you buy from buyers, you will pay from about 80% to 90% of spot. Whatever the traffic will bear. When selling your karat gold, the price you can get depends on volume, the honesty of the buyer (or, refiner), how you have prepared the scrap, and how well you've covered your butt. When selling small amounts, you'll usually get somewhere between 93% and 98% of spot. For very large amounts, you might get over 99%. Always shop around when looking for a buyer. Also, don't forget that, when you buy, you're paying cash and, when you sell, you usually get a check. Catfish may disagree with these numbers. I haven't done this in awhile and different strategies are needed in different markets. As in all things, buy low and sell high but, don't price too low or, you'll price yourself out of the market. There is plenty of competition out there.
You will have to go through a learning curve on how to determine the karat of gold objects. Some gold is not marked and, even that that is marked can be marked wrong. Catfish tests everything, even if it's marked. This is a very good idea.
When I was manager of a refinery in Hong Kong, I once asked the owner of the largest Hong Kong gold exchange what he thought the gold market was going to do. He said that there were only 2 great experts in this field. One thought the market was going to go up and the other thought the market was going to go down. I have never forgotten this. In other words, when buying and selling, never worry about the market. Just make sure the proper buying/selling spread is present, on every deal, and turn your money as fast as possible.
This is only the tip of the iceberg and these things are only my ideas. I'm sure that Catfish can provide much more info than what I've given you.
(Just key in scrap gold for recovery and then look at some of the sellers' histories.. the story says it all.. they wouldn't keep doing it if they weren't turning a decent profit... right?)
