GoldMax founder has shown Midas touch
Founder Jordan Sadoff talks about how GoldMax became a dominant player in Orange County's crowded cash-for-gold market.
Published by Orange County Register, March 1, 2013
Before expanding GoldMax into the one of the nation's largest cash-for-gold chains, Jordan Sadoff worked in the toy business and showed scant interest in the precious metal, even as prices climbed above $600 an ounce. He organized his first one-day gold-buying event in Chicago, his hometown, only at the urging of a friend.
"He must have bugged me no less than a dozen times," says Sadoff, who finally booked space at a hotel in 2008. The show was a hit, and, "Voila, we were in the gold business."
Sadoff founded Midwest Gold Buyers with his twin brother, Jake, and later added two other partners, Scott Garber and Abraham Gray, based in Atlanta. The chain, which now owns 242 stores in six states, adopted the GoldMax name during its expansion into Southern California, where it operates 58 locations, including 16 in Orange County.
Jordan Sadoff, now 35, lived in Los Angeles temporarily in 2010 to help spearhead the drive west.
Q. How did you make the transition from your first gold-buying show to doing gold full time?
A. One thing changed the entire business. We were at a show and a woman came in and sold her gold. She was excited ... she got about $350. She said, "Would you be interested in coming to my house and buying gold from my friends?" We went to her house and there were 20 or 25 people. We bought gold from all of them. From that party, we booked four more home parties. From those four, we booked nine parties the next month. The following month we booked 20 parties. The following month we went to 50 parties. Then it was 90, then 175. It was absolutely unbelievable. It topped out right around 350. We said, "Let's open a gold store. Let's create a permanent location."
Q. What's been the biggest challenge in running a cash-for-gold business?
A. Handling the growth. We had an appetite for growth and wanted to grow as fast as we could. But it's kind of like being at an all-you-can-eat buffet where your eyes are bigger than your stomach. As you grow, you've got a lot of things to deal with. For example, when we decided to open up the California market, we had to hire a new human resources department, hire a new management team, find new office space, and handle licensing and training and recruitment. Every time we grew, it wasn't just opening five stores. It was all the extra work that went into that. We were literally starting over from scratch.
Q. Why did you decide that Southern California was the place to open new outlets?
A. We knew we wanted to try another market. The decision was based on population size, density and the availability of good real estate. And we were going to have to move there for a certain period of time, so the fact that you have better weather than Atlanta or Chicago didn't hurt either.
Q. With gold hovering near $1,600 an ounce, cash-for-gold stores seem to be on every corner. How do you try to stand out?
A. GoldMax is different than a lot of other gold buyers. We're an upscale environment, very classy and comfortable. We show people what they have, teach them about the process. We weigh everything right in front of them. There's no pressure to sell. We're much different than a pawnshop or a jeweler that also buys gold.
Q. What is the best business advice you've received?
A. Never forget the golden rule. When you treat someone with respect, they'll respond in kind. When you treat someone with no respect, they'll do the same. Additionally, it always just feels good when you treat people the way you would want to be treated yourself.
Q. Who is the businessperson you most admire?
A. A sales manager I worked for while I was in college. He embodied honesty and integrity above all else. His success came from the fact that his customers and his sales staff alike all trusted him implicitly. This was in retail auto sales for an internship project while I was studying sales and marketing. It was very enlightening.
Q. Are you taking a big risk by opening so many gold stores?
A. It absolutely is a risk. With the success we've seen, I think the public is telling us it's worth the risk. Gold has been pretty steady for a while now. All of the economic factors point to gold staying strong for a long time.
Q. Is there room for still more growth?
A. We think the Southern California market for GoldMax can handle over 100 locations. As long as the public and the market want more stores, we'll continue to open them.
ORANGE COUNTY REGISTER / By David Ferrell
Created: Friday, March 1, 2013 1:37 p.m. PST