How do you make money in the gold recycling business? Volume!
Each year, ARA buys tons of scrap gold and silver from jewelers, pawn brokers or “cash-for-gold” operations.
The company pays between 98% or 99% of the market value for the jewelry, processes it, and then resells the pure gold and silver at market prices.
The profit margins are razor thin, so ARA must process huge amounts of precious metals. “The amount that we deal with is pretty massive, which is why we do not deal with the public,” said Kilgore.
Once the company gets the jewelry, it recycles or “refines” it in its labs. The precious metals are melted down; stones and impurities are removed, and pure gold and silver bars are created.
Those bars are then sold to commodity firms, jewelry manufacturers and even the government at current market prices.
Photo by [sic!]ut.at.