| If perfect timing is a gift successful entrepreneurs | | | | prosper if consumers begin to sell more of their |
| have naturally, consider Michael H. Gusky naturally | | | | gold jewelry. Aronson maintains there will be a |
| gifted. | | | | certain portion of the nation's population that |
| The Weston-based businessman, who last year | | | | always wants to sell jewelry. Gusky agrees. |
| sold his leading gold jewelry manufacturing | | | | "I looked at how consumers struggle to sell |
| company, Aurafin, to billionaire investor Warren | | | | jewelry," he said. "Retailers don't buy it. Pawn |
| Buffett's Berkshire Hathaway, launched online gold | | | | shops aren't dealers in precious metals, and local |
| buyer GoldFellow on Feb. 6. This came just as the | | | | independent jewelers aren't there to buy it, |
| price of gold was hitting historic highs and | | | | they're there to sell it. Some people don't have |
| consumers were paying more attention to it. | | | | access to gold buyers unless they drive a |
| During March, his Web site reported 43,000 | | | | distance." |
| visitors. | | | | Gold-buying companies advertising on TV often |
| Gusky's idea is to offer consumers a fast, more | | | | pay consumers a fraction of what is fair, he said, |
| secure way to sell their gold, platinum and silver; | | | | and ask consumers to mail them their jewelry - |
| pay better than most competitors; and boost | | | | only offering to insure it for $100, even when the |
| business by educating people about the cash | | | | items' value greatly exceeds that. Sometimes, |
| potential in gold jewelry. | | | | they don't insure it, leaving no trace of packages. |
| Advertising has primarily been via the Internet, | | | | Some buyers also mislead by only posting what |
| taking prime spots with search engines like | | | | they pay for larger amounts than most people |
| Google, which trigger his ads to appear when | | | | have to sell, he added. |
| consumers search for items such as plasma TVs | | | | Gusky: 'i'm raising the bar' |
| and iPods. GoldFellow's national radio campaign is | | | | "Everybody is in business to make money, but I |
| to begin on 450 stations in May, and TV spots | | | | was disappointed to learn some companies are |
| are planned for July. The campaigns center on | | | | taking advantage of people who need the money |
| "raising the bar for gold exchange." | | | | the most," Gusky said. "I'm raising the bar on how |
| "We want people to understand they can turn | | | | consumers can sell jewelry. The time is right |
| their broken and unwanted jewelry into money | | | | because of the price of gold and the public's |
| for other things by working with a company they | | | | increased interest in it. The business should be |
| trust," he said, noting more wealthy people are | | | | more transparent." |
| selling their gold - even Kruggerands and | | | | The Jewelers Vigilance Committee, a nonprofit |
| high-karat jewelry - due to increased awareness | | | | trade association supported by the jewelry |
| of its current high price or the pressures of the | | | | industry, lists tips for selling gold on its Web site, |
| slow economy. | | | | and noted prices buyers pay for gold are not |
| Within the year, Gusky hopes to buy $4 million | | | | regulated, "so parties are free to negotiate a price |
| worth of gold a month and do $1 million of | | | | that's acceptable to both sides." |
| advertising a month for the company he started | | | | To see what their unwanted gold is worth, |
| with his wife, Robin Gusky, and friend, Janis | | | | consumers can print GoldFellow's free, in-bound |
| Rafkin, former editor of the Business Journal's | | | | FedEx shipping materials via its Web site, where |
| SoFlorida Magazine. GoldFellow's start-up costs are | | | | the company posts daily what it will pay per |
| $2 million, Gusky said, and it has seven | | | | pennyweight ounce for gold. Each package is |
| employees. | | | | insured for $500 - or more under special |
| In the past month, GoldFellow bought $1.65 million | | | | arrangement - at the company's cost, and |
| in precious metals from consumers. The company | | | | consumers can trace their mailings from drop-off |
| processed 300 packages a week for an average | | | | to delivery. The company videotapes the opening |
| payout of just under $700 each, with some | | | | of packages, assesses the value of the jewelry |
| worth thousands of dollars. | | | | by testing its gold content and pennyweight, then |
| GoldFellow isn't the only South Florida company | | | | posts its offers online for consumers within 24 |
| panning for business success in gold. | | | | hours. There, they can accept or decline it, and |
| Cash4gold is competition | | | | are paid within a day via check or direct deposit. |
| Pompano Beach-based Cash4Gold has bought gold | | | | On April 8, when the price of gold was $915 a |
| for eight years, now averaging about 20,000 | | | | troy ounce, Goldfellow was paying $15.53 per |
| packages a month with payouts that range from | | | | pennyweight for 14-karat gold when the |
| $20 to $5,000, according to CEO Jeff Aronson. | | | | customer was selling five to 10 ounces, while |
| The company, which employs 65, owns a | | | | Pompano Beach-based Cash4Gold was paying |
| refinery. | | | | $6.30. The five to 10 pennyweight range is most |
| GoldFellow's competition also includes, Gold Kit, | | | | typical of the amounts consumers have to sell, |
| Broken Gold, US Gold Buyers, My Gold Envelope | | | | Gusky said. On April 14, when gold was about |
| and Sell-Gold. | | | | $928 an ounce, Cash4Gold's site did not list that |
| Having sold more than 300 tons of gold chains, | | | | quantity range as an option. Its price per |
| bracelets, rings and earrings with Aurafin, which he | | | | pennyweight for 14-karat gold when the |
| founded in 1982, Gusky is seeing familiar pieces | | | | customer was selling 10 to 50 ounces was $16.59, |
| return to him as changes in fashion leave much | | | | while GoldFellow's was $17.04. |
| jewelry unworn. If Americans join their | | | | Aronson said pricing changes on Cash4Gold's Web |
| international counterparts in understanding gold has | | | | site may be made several times a day. Its |
| intrinsic value - not just as adornment - they will | | | | payouts fluctuate with any change in gold's price |
| learn to sell, and perhaps replace gold jewelry | | | | due to the company's high volume of business. |
| regularly - selling when gold's price is high, Gusky | | | | Cash4Gold's extensive marketing costs also |
| said. | | | | affect its pricing, he said. |
| Gold's mostly upward price trend over the past | | | | Cash4Gold's client procedure is similar to |
| 10 years has seen a troy ounce (24 karat | | | | GoldFellow's, Aronson said. But FedEx delivery is |
| 0.99995 pure gold) go from $300 at the beginning | | | | not always used, there's no videotaping of |
| of 1998 to a record high of $1,030 on March 17. | | | | packages' openings, extra insurance on packages |
| But, by March 20, gold fell to $919 a troy ounce. | | | | whose value exceeds $100 in insurance must be |
| Recently, the metal seen as a hedge against oil-led | | | | approved and payouts made by direct deposit |
| inflation and an alternative investment to | | | | carry a service fee. |
| currencies was at $928. | | | | "My goal is to bring disruptive innovation to the |
| Regardless of gold's fluctuating price or changes in | | | | industry," Gusky said. "Gold is very misunderstood |
| the economy, the gold-buying industry stands to | | | | in terms of its value. |