How to open a gold shop: paperwork, cost and software

Opening a gold shop is not like opening any other shop. The goods change value every hour, are measured on a scale rather than counted, and are more tightly regulated than most trades. This guide gathers what a new shop needs in order to run, with one important warning: legal details differ from country to country and from city to city, so what follows is a general map, and the authority is the official bodies and your accountant where you are.

The paperwork usually required

Names and bodies differ, but most countries ask for something like this:

• A commercial registration or trade licence that names gold and jewellery trading explicitly.
• Tax registration, and VAT or sales-tax registration where it applies.
• Registration with the assay or precious-metals authority, or the gold division of the chamber of commerce, where one exists.
• A shop licence from the municipality, sometimes with security requirements for the shopfront and the safe.
• Anti-money-laundering duties: checking the customer’s identity on large or cash transactions, keeping records, and reporting when something is suspicious.

Where the capital really goes

What surprises most first-time owners is that fit-out and rent are not the largest item. By a long way the largest item is the gold itself, because stock must be paid for, in gold or in cash, before it is sold.

Example: a shop that wants to display one kilo of 21K, with pure gold at — for illustration — 5,000 per gram:

And one kilo is a modest display. That is why many start with a supplier on a gram account: the shop takes the goods and settles later in gold or cash. That account — how many grams you owe the supplier, at which fineness — must be kept in weight, not money, because the money changes with the rate and the grams do not.

Essential equipment

• An accurate, calibrated and certified scale reading to at least 0.01 g, with a reference weight to check it every morning.
• A safe suited to the value of the stock, and insurance that covers it — many insurers set requirements for the safe and the cameras.
• Security cameras covering the front, the counter and the safe, with recordings kept long enough.
• A device to sell on — a computer or tablet — a receipt printer, and a label printer if you want barcodes on pieces.
• A way to test fineness if you will buy used gold, or a relationship with an assay lab.

What the software must do from day one

Many shops start with a notebook and a calculator, then discover months later that they do not know their profit. Software is not a luxury to add later, but it has to be built for gold, because general software assumes a product has a fixed price and that stock is counted in pieces. At the minimum you need:

• A gram rate for each fineness, updated more than once a day, with a buying and a selling rate.
• Stock by weight for each fineness, not only by piece count.
• An invoice showing weight, fineness, gram rate, making charge and tax under the right rule for your country, with its figures saved so a reprint never changes them.
• Trade-in and scrap: the customer pays part of the price in old gold, and the shop buys used gold.
• A day close that compares the expected grams and cash with what was actually counted.

ZahabFlow is built on exactly this list: price is rebuilt at every sale and never stored on the piece, stock is kept in grams per fineness, and tax follows the shape set up for your country. Sign-up is self-serve and free during launch, so you can try it before you buy your first piece.

Common mistakes in the first months

• Printing the price on the tag: the market moves, and a printed price only ever loses in one direction.
• Mixing customers’ gold left for repair with the shop’s stock: it is held in trust, not goods you own.
• Buying used gold without recording the seller, their identity, and the weight and fineness of the piece.
• Leaving the stock count to the end of the month: a small gap is found on the day it happens; a week later its trail is gone.