Bargaining At Gold Shops

[THAIPHUKET]

1. the Gold Shops are full of inventory.

2. this means that tons of gold in Thailand alone were bought well before the present price hike.

3. if that is so, would a buyer be able to bargain for a much better price than the published daily quote ?

4. even if they stick to the day quote, is there a margin difference shop to shop??

5. How much can I trust, that I get real Thai Gold? How to verify?

[Farma]

This is just my opinion, maybe others know more.

1. Sometimes, depending on seasonal factors like Chinese New Year etc.

2. Think of it as currency. Banks don’t give money away for free.

3. Not on the gold price, maybe on the added workmanship fee

4. Ditto to answer 3

5. Check stamps on the gold. Word of mouth or local knowledge for a reputable shop.

[THAIPHUKET]

Farma,

what you say makes sense , of course.

BUT, dont you think that much of the gold inventory has been financed with borrowings. That banks in these days want to see cash, cash, cash even if collateral value goes up?

I.e. should there be some pressure to reduce inventory through cash sales?

The craftsman aspect is an interesting one.

Would you have any idea how much margin is added to the value of the gold?

Or better question, where can I buy just a certain quantity of pure GOLD?

[britmaveric]

Gold jewelry is priced on what the gold rate is for the day. From my understanding you pay for the gold, not any of the workmanship - least this is the same story I was told from quite a few gold shops.

[Farma]

There’s a thread in the jobs economy banking forum where more knowledgeable posters than me may have your answers. http://www.thaivisa.com/forum/Buy-Gold-silver-t215462.html

For jewelry, chains etc I’ve known figures of 200 – 300 Baht workmanship per Baht weight added to the gold price depending on the complexity of design.

For bars, I was offered 10 Baht weight Thai gold (96.5% gold) bars recently in gold shops. They were being offered at the price of gold on that day.

[JimmyTheMook]

There's a thread in the jobs economy banking forum where more knowledgeable posters than me may have your answers. http://www.thaivisa.com/forum/Buy-Gold-silver-t215462.html

For jewelry, chains etc I've known figures of 200 – 300 Baht workmanship per Baht weight added to the gold price depending on the complexity of design.

For bars, I was offered 10 Baht weight Thai gold (96.5% gold) bars recently in gold shops. They were being offered at the price of gold on that day.

gold bars should be 99%

[Farma]

A Quote from the World Gold Council website.

"The baht is a Thai unit of weight. The most popular bar is the 10 baht cast bar, equivalent to 150.4 g or 4.9 oz. The traditional gold purity of baht bars is unusual: 96.5%."

[JimmyTheMook]

A Quote from the World Gold Council website.

"The baht is a Thai unit of weight. The most popular bar is the 10 baht cast bar, equivalent to 150.4 g or 4.9 oz. The traditional gold purity of baht bars is unusual: 96.5%."

And if you try cashing them in anywhere other than Thailand those few percentage points will effect the value.

I have seen gold bars here with the 99% stamp

[Farma]

Care to share where you saw the 99.9% bars. I'm interested in buying.

[bravingbangkok]

Ok so whatever the price that gold is trading at on the international markets is directly linked to the gold price we see in the shops. Basically 2 baht is 1 ounce but not exaclty.

So if Gold were being traded at 900US$ an ounce(2 baht), for 1 baht of gold (1/2 ounce 450US$) it would cost you anywhere in the region of 14600-15500, The price variation is to do witht he exchange rate between US$ and Thai Baht.

So say you buy 1 baht for 14600 depending on the quality of the design they will charge you between 300-600baht per baht bought. Once I bought a fair few bahts and they discounted the making charge to about 350 per baht bought. Some designs, necklaces, bracelts, rings are cheaper than others.

When buying gold bars you are only charged a couple of hundren baht maybe less if you buy a lot but you will be chaged something.

You cannnot bargain on the actual price of the gold in weight but you can bargain on the amount they charge for them making it. Sometimes the price of gold is cheaper in China Town so I would go there if I were you and stay away from the shops in MBK. If you want to buy real gold I would only go to one of the big gold shops in China Town. Over new year the price of gold usually goes up.

Here are some good sights for gold watchers out there

http://www.goldtraders.or.th/index_en.php

http://www.kitco.com/charts/livegold.html

http://goldprice.org/live-gold-price.html

Edited October 10, 2008 by bravingbangkok

[bravingbangkok]

Ok so whatever the price that gold is trading at on the international markets is directly linked to the gold price we see in the shops. Basically 2 baht is 1 ounce but not exaclty.

So if Gold were being traded at 900US$ an ounce(2 baht), for 1 baht of gold (1/2 ounce 450US$) it would cost you anywhere in the region of 14600-15500, The price variation is to do witht he exchange rate between US$ and Thai Baht.

So say you buy 1 baht for 14600 depending on the quality of the design they will charge you between 300-600baht per baht bought. Once I bought a fair few bahts and they discounted the making charge to about 350 per baht bought. Some designs, necklaces, bracelts, rings are cheaper than others.

When buying gold bars you are only charged a couple of hundren baht maybe less if you buy a lot but you will be chaged something.

You cannnot bargain on the actual price of the gold in weight but you can bargain on the amount they charge for them making it. Sometimes the price of gold is cheaper in China Town so I would go there if I were you and stay away from the shops in MBK. If you want to buy real gold I would only go to one of the big gold shops in China Town. Over new year the price of gold usually goes up.

Here are some good sights for gold watchers out there

http://www.goldtraders.or.th/index_en.php

http://www.kitco.com/charts/livegold.html

http://goldprice.org/live-gold-price.html

Edited October 10, 2008 by bravingbangkok

[bruceboy]

Is it true the Chinese own most of the gold shops in Thailand?

[bravingbangkok]

Is it true the Chinese own most of the gold shops in Thailand?

Most certainly is Bruce, probably about 90% of them, maybe more.

[THAIPHUKET]

most interesting responses!

And gold certificates, if I dont want physical gold?

There ought to be a price differential in favor of paper gold.

Another naive question=

would you trust Thai -gold -certificates? Does the issuer have to deliver actual physical gold on demand or only the counter value in money ?

I admit I didnt digest the gold links provided by bravingbkk , thank you very much

[bravingbangkok]

most interesting responses!

And gold certificates, if I dont want physical gold?

There ought to be a price differential in favor of paper gold.

Another naive question=

would you trust Thai -gold -certificates? Does the issuer have to deliver actual physical gold on demand or only the counter value in money ?

I admit I didnt digest the gold links provided by bravingbkk , thank you very much

http://www.galmarley.com/framesets/fs_trad...utures_faqs.htm take a look at this one to understand more about Gold and how you can buy/sell/trade it.

[PoorSucker]

Gold -9.03% (10 Oct)

http://finance.google.com/finance?client=o...p;q=NASDAQ:GOLD

[JetsetBkk]

Is it true the Chinese own most of the gold shops in Thailand?

Yes.

[Travel2003]

Sometimes the price of gold is cheaper in China Town so I would go there if I were you and stay away from the shops in MBK. If you want to buy real gold I would only go to one of the big gold shops in China Town.

Here are some good sights for gold watchers out there

Hi

I dont get it.

To purchase real Gold one must go to one of the shops in China Town?

Does this mean that the Gold in the bigger Malls can be questionable Gold?

I always thought the Gold in the malls were a bit more expencive due to rental costs the shops might have.

But I also believed that the shops in the Malls were very careful in regards to cheat you, due to the repurtation they (and the mall itself) might get.

But then again, I really do not know, and would appreciate more educational posts here, so please keep it up.

Thnx

[bravingbangkok]

Is it true the Chinese own most of the gold shops in Thailand?

Yes.

hahaha classic jetset

[bravingbangkok]

Sometimes the price of gold is cheaper in China Town so I would go there if I were you and stay away from the shops in MBK. If you want to buy real gold I would only go to one of the big gold shops in China Town.

Here are some good sights for gold watchers out there

Hi

I dont get it.

To purchase real Gold one must go to one of the shops in China Town?

Does this mean that the Gold in the bigger Malls can be questionable Gold?

I always thought the Gold in the malls were a bit more expencive due to rental costs the shops might have.

But I also believed that the shops in the Malls were very careful in regards to cheat you, due to the repurtation they (and the mall itself) might get.

But then again, I really do not know, and would appreciate more educational posts here, so please keep it up.

Thnx

No no no the gold itself is fine but I think they charge a higher making/labour fees and they are not as quick on changing the prices as they are in China town. Last month when gold when down rapidly I went to MBK to take a look and they had still not brought down the price, I went to China town it had already been brought down.

I think you are right about the rent being higher in MBK so therefore they are looking to make a little extra.

[Johpa]

To purchase real Gold one must go to one of the shops in China Town?

To purchase "real" gold, you will need to travel to Hong Kong which is where all the hi-so Thais go to purchase gold. You are deceiving yourself to think they would shop with the masses buying Thai "baat" gold in Yaoworat or elsewhere. As others noted baat gold is, at best, around 96%. Priced as if it were 100%, that allows the merchant a minimum 4% margin from the get go.

So within Thailand baat gold is a liquid asset, but outside of Thailand it is not so easy to sell. I have found that Chinese gold shops in the US prefer to avoid baat gold. I was not able to find a single jeweler willing to even attempt a very minor resizing of my gold ring out of fear of cracking something slightly less malleable assumed to be inside.

If properly stamped with the hallmark of one of the major Thai gold shops, the baat gold can be sold back to another gold shop in Thailand at a slight discount to the current price. Within the country it is a valid hedge, with risk, against currency fluctuations and inflation. But you are kidding yourself if you think the gold merchants in Thailand are working on 4% gross profit margins. There are reasons why the Thai elite prefers to purchase in Hong Kong.

[torrenova]

When you buy jewellery you pay the 100% gold price but only get about 96%. When you sell they only pay you 96% at best (unlikely) and often down as much as Bt500 a baht.

I had one greedy hag trying to convince me that I had to discount the amount of workmanship from the price when selling. I told the old bat she must think I am stupid if I am going to lose that when smelting it, which I bet they hardly ever do just to rob the next recipient. They are near out and out thieves.

Like oil, gold is charged at replacement cost, not inventory cost. That is why you pay the current market price.