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  • Damian J. Miles

Buying and Selling gold.


Once again I recently had a leaflet posted through the door for a travelling jewellery/gold buyer. All the usual things were included in the leaflet including "Top London Prices Paid", "Could be worth up to 10 times scrap", " No one offers more", "All transactions strictly confidential", "Payments in cash", "Up to **** paid" etc.

I have no problem at all with other businesses buying gold, jewellery and all the other bits and pieces, competition is healthy. I do have a problem with how it's done sometimes. A few years ago we all saw lots of gold buying companies spring up and many have now gone.The ones that have remained are generally jewellers that have been in this business for many years and have no option but to be upfront and honest, which is much more than I can say for a lot of the fly by nights.

I have seen and heard some shocking things about some of these gold buyers. I watched someone on a market stall re-set his scales with a cleaning cloth just resting on the weighing pan every time he was weighing some gold or silver. The same as you would zero your kitchen scales with a plastic bowl on so you wouldn't be weighing the bowl. This small bit of cloth would make a few grams difference, which could be £20 or so on gold. I've also seen 18ct gold pieces incorrectly tested to arrive at a 9ct gold conclusion and therefore a lower price offered. There have been many crooks, but they are receding as the gold price has slipped in the past couple of years.

The way I buy precious metals, jewellery and coins is thankfully different. I don't often buy scrap, that is pieces simply to melt down and sell on to my bullion dealer. As a manufacturing jeweller, I often recycle pieces into new jewellery or silverware, when I buy metal for this purpose it's higher than a standard scrap price as buying "fresh" metal costs much more than scrap price. If I'm buying as scrap, I will tell you. For broken jewellery that could be fixed, I have a "one day" box.These pieces go in the box and when it's a quiet time I start repairing and restoring them. I do buy pieces that I can sell on with little input from me other than ensuring they are correct and taking on all the liabilities that go with them such as adjustments and guarantees. This is what my profit needs to cover as well as pay the bills.

I tend to pay more than many others for coins, but not always.This is for 2 reasons, firstly I collect coins and secondly I hate to see coins treated in the way they often are by cutting them out, defacing them and generally destroying their use as a coin. I also have a one day box for these. People are often surprised by how much I will pay for gold coins as it's often above the metal content as most pay. Now before I get a deluge of people wanting to sell me Canadian Maples, Chinese Pandas (coins, not animals), Krugerrands and other similar coins, I'm not generally interested in these. My interest lies in the coins intended for circulation, Sovereigns, Rands, Swiss francs etc. these are the ones I want, not lumps of gold for trading as an investment metal. Having said that, the Chinese Pandas usually trade for well above their gold content.

One final bit of my process is about what happens next. I have to buy pieces for the lowest possible, but fair price. If I'm surprised by the outcome on something I've bought, I will contact the person I bought it from and top up their payment. Unfortunately for me it doesn't work the other way where if it sells for less than I hoped I ask for a refund from the customer, although that would be nice. This point is very evident in one case from a while ago. To my trade customers I offer a "Break and Rescue" service. They send me all the scrap metal they've bought and I remove the stones, other metals and bits and pieces for free, but I get to keep the bits that have come out. I will also substitute metal for pieces that I may be able to use. The other service is that I buy all the gold coins (intended for circulation) from them. One parcel I had included a Gold Sovereign in rough shape, but it was rarer than most. At the time I was going to be able to offer them £240 for the coin, but because it was special, they contacted their customer and we arranged to get it in an auction where it sold for just under £20,000. Both I and the jewellers had a commission, but their customer received an awful lot more than they accepted originally.

Not all buyers of precious metals are as straight and honest as they could be, but the majority are. Your local, high street, jeweller may not offer the highest price, but I'm sure they are reliable and there when you need them. Give them a chance or email me.


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