How To Start Gold Business: Invest In Buying And Selling Raw Gold And Scrap Jewelry
If you are looking to start a business of trading in gold or want to invest in gold buying business, I have highlighted some steps you need to take to start investing in gold. I have also discussed investment ideas in gold business which can guarantee you making huge returns when you start a business of buying and selling gold.
SEE: 3 Good Small Business Ideas With Low Startup Cost
Is Investment In Gold A Good Idea?
Many investors in gold preserve it in form of bullion coins and gold bars. These materials can be stored for a very long time because of the fact that their values are not tampered by inflation and recessions.
What Is The Best Way To Invest In Gold?
Gold is often sold in jewelry in alloyed form. Gold content of alloys and jewelry is measured in carats (k). Pure gold is designated as 24k. The higher the caratage, the higher the percentage purity of gold in the alloy. As such, the gold content in 22 carat (k) is greater than that found in 18 carat (k) gold. Copper, Silver and Palladium are the most common base metals used in alloying gold. Copper gives the finished product a characteristic reddish colour.
Guide To Investing In Gold
Gold can be found in reserves in different parts of Nigeria. You can invest in gold which comes in different forms such as gold bar, gold dust, gold ore and gold rock. Gold can be found in the following states Niger, Osun, Kebbi, Kaduna, Kogi, Kwara, Zamfara, Katsina, Kano and the FCT, Abuja. The gold deposits are mainly alluvial and are currently being processed on a small scale and they occur in small quantity that has to be worked on to produce gold bars.
How To Make Money Buying And Selling Gold
Buying and selling gold is a lucrative investment that gives great profit. You can even decide to start your gold business from home so long as you understand the rudiments and technicalities of the business.
List Of Investment Ideas In Gold
==> Direct ownership: Buying and storing gold is defensive way of holding value in an asset.
==> Investing gold mutual funds
==> Flipping gold: Buying when price drops and reselling for profit when price rises.
==> Opening a reseller shop: buying second hand used gold jewelry from people and reselling
==> Gold exchange-traded funds (ETFs)
==> Gold mining and sale of raw gold: investing in gold exploration and sale of raw gold bar or dust
==> Opening a goldsmith centre: providing services of gold casting, molding, purification, production and customization of gold rings, bracelets, neck chains, Apple Iphone, business cards etc.
If you are ready to start a business of investing in gold, here are some simple steps to take:
10 Steps To Start An Investment In Gold Business
1. Get Your Gold Business Registered
It is proper to make your gold business legitimate by registering your business and getting a business name for it. You can do that by visiting the CAC in Nigeria. Individuals, corporate organizations and the government will are more comfortable doing business with you when it is duly registered.
2. Write A Business Plan For Gold Business
A gold investment business plan will prepare you for challenges involved in gold business and planning on how to overcome them. The business plan will contain plans on how to expand this gold investment in the future. Many people ask what amount of money they need to start a gold business. Well, a well-written business plan would have answered most of your questions. No serious business survives without a well detailed and researched business plan. Same goes for gold business. You can get free samples of business plan to work with here:
Free Samples Of Business Plan Template In DOC And PDF Format
3. Research On The Best Type/Form Of Gold To Invest In
Take your time to carry out extensive market survey and feasibility studies on different types of gold before you start this investment. These will guide you into what kind of gold to invest in and where to source for market for gold. Examples include raw gold dust, gold ore, gold rock, gold bar, old and scrap gold jewelry, gold foil/leaf business cards, collection of gold-plated watches etc
4. Get Experience In Gold Value Assessment
Gold comes in different alloyed forms and weights. It is the responsibility of any serious investor in gold to be able to valuate how much gold is contained in a product and its weight in grams (g) or kilograms (Kg). This is called the percentage purity and is rated as Caratage. Thus we have very fine gold 24k (carat) which contains finite to no impurities and 10k (carat) that contains a higher degree of impurities as base metal.
5. Look For Sources Of Gold To Buy At Competitive Price
There is nothing cheap about gold. If it is cheap, it's most likely to be scam. Instead of looking for cheap gold to buy, why not get a supplier of gold who will give you at a price that can guarantee you decent return on your investment. Your choice of gold seller must be reliable, trusted and delivers on time.
6. Source For Market For Your Gold Business
Before starting a gold trading business, do well to conduct specific market survey. Know who your buyers of gold are, how much of gold you can easily sell of within a short time and what type of gold these gold buyers are willing to buy. Partner with other investors to raise enough capital to purchase more KG of gold and to be able to gather enough money to start wholesale business in gold. You may also work with gold shops and retailers. Gold is a luxury and not a necessity so you need to actively look for buyers of gold yourself.
7. Buy Equipment For Gold Business
If you don't want to be cheated into bankruptcy, it is wise to buy important tools use in gold business and ensure they are well maintained. Some of these equipment include those used in gold smelting, molding, weighing, testing etc.
8. Gold Business Promotion
Advertisement is the soul of business. To succeed in gold business, you need to spread your reach. If you can afford it, market your gold products and services on tv and radio as well as in print media. Several online platforms are also available for affordable advertisement.
9. Monitor Trends In Gold Investment
Demand, gold use and market price of gold fluctuates. As investor determined to succeed in gold business, please do well to monitor these changes. For instance there is significant variation in people's demand and taste for gold jewelry during different times of the month and year.
10. Secure Your Gold Business
Gold business is capital intensive. This usually attracts stealing and pilfering. It is good ideas to maintain high security around your gold business premises. Installation of tight security iron safe, security doors, electric fencing and CCTV, as well as the use of security guards is recommended if you can afford them.
How To Obtain Gold Mining License (Lease) in Nigeria
To obtain a license for mining gold in Nigeria, there are currently two routes available for prospective raw gold mining investors into the mining sector in Nigeria.
==> Purchase of a pre-existing gold mining property from the original owner. After acquiring the property, you can apply for a license from the Ministry of Solid Minerals Development.
==> Applying for the following mining rights.
1. Prospecting Right (PR)
2. Exclusive Prospecting Licence (EPL)
3. Special Exclusive Prospecting Licence (SEPL)
How much capital do I need to get started in this gold business?
Buying a good quality gold scale and gold testing kit may cost you around 10,000 Naira. Money will also be spent on advertising your gold business. Finally, you will require money to buy your first few pieces of gold. This may be between $500 - $5000 depending on how much gold you want to start with.
READ: Gold Coins, Gold Stocks Or Gold Bars - See What You Should Invest In