Our competitors are coin , scrap, refiners, buy & sell, and like acquires. Some of these businesses have regulatory advantages. The business of Metal exchange (cash for gold) is a line of business and should not be analyzed or viewed as a stand-alone business model. It is one of the many lines of businesses that a business can add to their other businesses lines like the watch battery business, car stereo, musical instruments and hundreds of other niche opportunities.
High margin businesses like the Gold exchange business, which is easy to do, attracts competition. As an example, the payday industry are currently expanding into this business and they will inevitably push the margins down.
Market competition dictates the margin, and competition will push there competitive advantages in a direction that suits there business model. It’s just prudent for us to be prepared and get ready for more competition. Just hope someone like Wal-Mart does not come to the market.
Gold is cash. It’s the most liquid hard asset we take, which means there is virtually no inventory carry cost. You can send in the material and receive cash in your account faster than a head of lettuce.
If you run a well-organized business, working on small margin, as low as 3 - 5%, you could have a pretty nice business model. The transactions needs to flow with precision and frequency. We need to build our internal competencies so that we make it hard for others even to think about getting into one of our business lines.
Gold is cash. It’s the most liquid hard asset we take, which means there is virtually no inventory carry cost. You can send in the material and receive cash in your account faster than a head of lettuce.
If you run a well-organized business, working on small margin, as low as 3 - 5%, you could have a pretty nice business model. The transactions needs to flow with precision and frequency. We need to build our internal competencies so that we make it hard for others even to think about getting into one of our business lines.
Whether it’s a new metal gun, or a refiner that pays 100% of the metals they refine ( I spoke to a Pawnbroker in Florida that said his refiner keeps his stones and diamonds), or a better process to create operational efficiency (acquiring the items properly at the counter can result in as much as 6% more net profit), we as an Industry need to be the leader through smart competitive strategy and execution.
The bottom line is the bottom line. Net Dollars in our pocket. We can make more if our margins go down. We can make more profit dollars by being more efficient, make less mistakes, and make sure we are getting the highest return from our refiners. And, if we can increase or maintain our margin forever, even better.
How BRAVO can help you...
I believe that every category of merchandise that we can acquire in our stores are a line of business. Tools 36% margin, TV’s 30%, Purses 42%, Bikes 52%. Firearms 26%, as an example. Bravo Store Systems includes 650 categories with the ability to see margin and turnover at a glimpse by Manufacture and Model. If high margin categories is your interest, there are many categories that reach up to 80% margin. Bravo Store Systems also shows by category the dollars that are generated. So, although you might be making $10,000 on Tools with a 36% margin, you might be making $30,000.00 on TV’s with a 30% margin.
With Bravo, now it is easy for Store owners to see the roll up of this activity, down to the specific item, real time, anytime, anywhere. Bravo is 100% web based.
The first to sign up get the entire system for $149.00 per month, per store. I am offering a live web demonstration of Bravo. Just give me a call.
