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Over-The-Counter Buying Tool Kit

Here’s how to add another profit center to your business.

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REX SOLOMON OF Houston Jewelry made $12 million annually buying gold, jewelry and coins during the Great Recession. He took out full page ads in the newspaper that encouraged hundreds of people to line up every day to sell their wares.

It’s still paying off.

“This is what got us through the financial crisis, through multiple hurricanes and through the pandemic,” he says. “I can’t see how an independent can be without it.”

Buying gold and other precious metals is a good source of cash flow, but Solomon has found diamonds to be the key to his OTC enterprise. At least 50 percent of inventory in his showcases comes from loose diamonds or gemstones bought from the public or made in his shop with recycled gold, often set with stones he has salvaged. Solomon sends promising diamonds to the GIA for certification and a grading report and brands them as his own; he may also send it to a cutter to make it the best diamond it can be.

“Now I have a diamond that I price competitively and can undercut online sellers and be profitable on it,” he says. “That’s where the independent can beat the chain every time because the chain cannot be nimble like that.”

To prevent security problems, Houston Jewelry’s OTC buyers ask for ID and photocopy the items being sold along with their ID immediately.

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Solomon cautions that every state and city has different regulations regarding OTC buying, including how long the purchased pieces must be held before being melted. In Texas, to purchase crafted precious metals, the buyer must be registered with the commissioner of consumer credit. The city of Houston also requires a license and an FBI criminal background check every year. Every purchase transaction must be recorded within 24 hours to either the chief law enforcement of the county or the chief of police.

Another thing to realize is that crafted precious metal dealers are considered financial institutions under the Patriot Act. Jewelers can use a free service called Leads Online to capture the image of the seller and their electronic thumbprint to satisfy IRS reporting requirements. “Those kinds of records will save you tremendous stress, heartache and potential fines,” Solomon says.

Eileen McClelland is the Managing Editor of INSTORE. She believes that every jewelry store has the power of cool within them.

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Wilkerson Testimonials | Sollberger’s

Going Out of Business Is an Emotional Journey. Wilkerson Is There to Make It Easier.

Jaki Cowan, the owner of Sollberger’s in Ridgeland, MS, decided the time was right to close up shop. The experience, she says, was like going into the great unknown. There were so many questions about the way to handle the store’s going-out-of-business sale. Luckily for Cowan, Wilkerson made the transition easier and managed everything, from marketing to markdowns.

“They think of everything that you don’t have the time to think of,” she says of the Wilkerson team that was assigned to manage the sale. And it was a total success, with financial goals met by Christmas with another sale month left to go.

Wilkerson even had a plan to manage things while Covid-19 restrictions were still in place. This included limiting the number of shoppers, masking and taking temperatures upon entrance. “We did everything we could to make the staff and public feel as safe as possible.”

Does she recommend Wilkerson to other retailers thinking of retiring, liquidating or selling excess merchandise? Absolutely. “If you are considering going out of business, it’s obviously an emotional journey. But truly rest assured that you’re in good hands with Wilkerson.”

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