Gold prices have surged since the beginning of 2024 and many people have bought physical gold. Costco made it easy by selling one-ounce gold bars online and had racked up $100 million in sales by the end of 2023.

But the Wall Street Journal reports that some of those buyers have encountered frustrations when trying to sell. Some said their offer price was below what they paid.

While it’s true that the market price of gold fluctuates, other market forces may also be in play. Not everyone who buys gold from consumers has the same price structure.

“Each type of business has different overhead costs and profit margins,”  Alex Ebkarian, chief operating officer and co-founder of Los Angeles-based Allegiance Gold, told ConsumerAffairs. “Some may aim to purchase metals at the lowest possible price, while others, particularly high-volume dealers, typically pay closer to wholesale cost.”

First, have a plan

 Nick Fulton, managing partner at USA Pawn and past president of the Mississippi Pawnbrokers Association, says you should not invest in gold without first formulating a plan that answers two crucial questions.

“First, if I buy physical gold, where is a reputable business that I can sell when I want to cash out?” Fulton said. “Second, what percentage of the value will the business take off the top when I am ready to sell?”

Ebkarian says there are other steps that may be advisable. He suggests researching a dealer’s history through the Secretary of State.

“Every state offers a free search to check registration dates and compliance with state requirements,” he told us.

He says the lowest purchase price or highest buyback offer may not always be the best deal. Consider factors like shipping fees, service quality, and turnaround time.

The ConsumerAffairs research team has analyzed 25 major gold dealers in the U.S. and selected the five best here.