Why Businesses Should Accept Goldbacks

When business owners first hear about accepting Goldbacks, two questions usually come up:

Those are reasonable questions, but they also point to one of the biggest misconceptions about accepting Goldbacks as payment.

A business does not have to accept every purchase entirely in Goldbacks. It does not have to accept more Goldbacks than it wants. And it certainly does not have to immediately liquidate every Goldback it receives.

In fact, one of the greatest advantages of accepting Goldbacks may be the amount of control the merchant has over the transaction.

A business can decide how much of a sale it is willing to accept in Goldbacks, how Goldbacks fit into its payment policy, how much it wants to retain, and what it ultimately wants to do with the precious metals it accumulates.

That can turn Goldbacks from simply another payment method into something potentially much more useful:

One of the Best Ways to Acquire Goldbacks May Be to Accept Them

If you go to a precious-metals dealer to buy Goldbacks, the seller determines the price.

When a customer comes into your business and offers Goldbacks in exchange for your goods or services, the situation is different.

You are the merchant. You control what you are willing to accept.

Goldback Inc.'s merchant program allows participating merchants to accept Goldbacks as full or partial payment, giving the business considerable flexibility in determining how Goldbacks fit into its operations.

That means Goldback acceptance does not have to be an all-or-nothing decision.

Consider Taking the Profit Margin in Goldbacks

One strategy we often discuss with business owners is to accept the profit portion of a sale — or even just a percentage of that profit — in Goldbacks.

Suppose your business makes a $100 sale.

For simplicity, assume approximately $70 represents your cost of providing the product and approximately $30 represents your gross profit.

You could accept the entire $100 in Goldbacks.

But you don't have to.

Instead, you could establish a policy allowing the customer to pay up to $30 of that purchase in Goldbacks.

Your underlying cost is still being covered primarily by dollars, while the profit portion of the transaction is being accumulated in gold.

A more conservative business might accept only half of that profit in Goldbacks.

The business retains most of the cash flow it needs for normal operations while gradually building a precious-metals reserve.

Instead of asking:

“How quickly can I get rid of these Goldbacks?”

the question becomes:

“How much of my business profit would I like to save in gold?”

Don't Accept More Goldbacks Than You Want to Keep

This may be the simplest advice we can give a business considering Goldback acceptance:

If your business needs substantial cash flow every day, accepting 100% of every transaction in Goldbacks may not be appropriate.

That's fine.

Accept 10%. Accept 20%. Accept the estimated profit margin. Accept half of the estimated profit margin.

The goal is not to force Goldbacks into a business model where they do not fit. The goal is to develop a policy where accepting them does fit.

You Don't Have to Reprice Your Business in Goldbacks

Accepting Goldbacks doesn't mean changing every price tag in your store.

Your $19.95 item can still cost $19.95.

Your $300 service call can still cost $300.

Goldback Inc. publishes a Daily Exchange Rate and provides tools that allow merchants and customers to convert the dollar amount of a purchase into its Goldback equivalent.

Goldbacks can also be used as partial payment. A customer might pay part of a purchase with Goldbacks and the remainder using another payment method accepted by the business.

There Are Several Ways a Business Can Accept Goldbacks

Goldback acceptance is not limited to someone physically handing a Goldback across the counter.

1. Accept Physical Goldbacks

The simplest method is the traditional one.

A customer presents physical Goldbacks at checkout. The business accepts them according to its payment policy and retains the Goldbacks as an asset received in the normal course of business.

The merchant can then decide whether to keep them, spend them, deposit them, lease eligible holdings, use them for promotions, or eventually liquidate them.

Physical transactions also avoid the traditional credit-card network entirely.

2. Accept Goldback Payments Through an Alpine Gold Account

Businesses can also receive precious-metals payments through an Alpine Gold Account.

These accounts were commonly referred to in the past as UPMA accounts. Alpine Gold Exchange now identifies them as Alpine Gold Accounts, so throughout the rest of this article we'll simply call them Alpine accounts.

For an online merchant, account-to-account payment can be particularly attractive because it allows a customer to use eligible precious-metal holdings toward a purchase without first converting those holdings into a conventional credit-card payment.

Today, qualifying K2BX customers can select an Alpine payment option during checkout and pay using eligible holdings in their Alpine account rather than processing that portion of the purchase through a traditional credit-card network.

For the merchant, the important distinction is that the payment arrives through the account system. The business does not first receive physical Goldbacks that later have to be packaged, shipped, and deposited.

That can make account-to-account payment particularly useful for e-commerce businesses that want to accept Goldback value while reducing some of the friction associated with handling physical Goldbacks.

3. Accept In-Person Payments Using an Alpine QR Code

The same concept can work at a physical cash register or sales booth.

Participating merchants can use an Alpine payment QR code. The merchant displays the code at the register, counter, booth, or show table, and a customer with an appropriate Alpine account can scan the code and make the payment through the account system.

This can be useful for retail stores, restaurants, coin shows, trade shows, farmers markets, conventions, mobile businesses, and service providers.

K2BX primarily operates online, so we do not use the QR payment option every day. But it is available to us and can be particularly convenient when we're selling in person at a show.

For a brick-and-mortar business, the Goldback payment QR code could sit right beside the traditional payment terminal.

Merchants should verify the current transaction fees and account terms that apply to their particular Alpine arrangement.

Physical Goldbacks Have a Cost to Deposit — Plan for It

This is where controlling your acquisition cost becomes especially important.

If you physically receive Goldbacks from customers and later send those out-of-network Goldbacks into an Alpine account, an applicable physical Goldback deposit fee currently applies.

At the time of writing, the published lower-tier fee for qualifying out-of-network physical Goldback deposits is 5%.

That should not necessarily discourage a merchant from accepting physical Goldbacks.

It simply means the merchant needs to understand the cost before accepting them, not after.

If your plan is eventually to deposit some of the physical Goldbacks you receive, that cost should be part of your business calculation.

Goldbacks Don't Have to Stay Goldbacks

Once a merchant begins accumulating precious metals, another important question arises:

“Do I have to keep everything in Goldbacks?”

Not necessarily.

An Alpine account can provide access to different precious-metal holdings, including Goldbacks, gold, and silver.

A merchant might decide to retain some Goldbacks because they are useful for commerce, while allocating another portion of its precious-metals holdings toward gold or silver.

Put Goldbacks to Work Through a Precious-Metals Lease

Accumulating Goldbacks does not necessarily mean they have to sit idle.

Alpine currently offers precious-metals lease programs covering eligible Goldbacks, gold, and silver holdings.

An account holder can allocate eligible precious metals into a lease while continuing to own the underlying metals.

In return, the lease generates periodic payments.

At the time of writing, Alpine's published lease tiers range from 2% to 5% APR, based on the total value of metals placed on lease, with lease returns credited monthly.

The Goldback Lease is particularly interesting for a Goldback-accepting merchant.

The current minimum is 10 Goldbacks, and returns on a Goldback Lease are paid in Goldbacks.

Instead of viewing accumulated Goldbacks as an idle asset waiting to be liquidated, a merchant may have an opportunity to put some of those holdings to work.

Lease rates, minimums, eligibility requirements, notice periods, fees, and other terms can change. Review Alpine's current lease terms before participating.

Precious Metals Can Also Be Part of a Longer-Term Retirement Strategy

Business owners often think beyond the business itself.

Alpine also offers Self-Directed Precious Metals IRAs capable of holding eligible physical precious metals, including gold, silver, and Goldbacks.

This should be viewed as a separate retirement-planning strategy, however — not as a way to simply take Goldbacks out of the cash register and place them directly into a personal IRA.

Alpine states that IRA contributions must be made through the appropriate custodian in accordance with applicable rules, and direct deposits of metals as IRA contributions are not permitted.

Interestingly, precious metals already held within an eligible Self-Directed Precious Metals IRA may potentially participate in qualifying lease programs, subject to applicable rules and program requirements.

Use Goldbacks as Business Savings

Of course, none of this requires a complicated program.

A merchant can simply keep the Goldbacks.

Suppose every week the business accepts a small percentage of its profit in Goldbacks.

Those Goldbacks go into the business treasury.

Week after week.

Month after month.

Instead of periodically having to say, “We should really take some cash and buy gold,” the accumulation is already happening as part of normal sales.

That can make Goldback acceptance a kind of automatic precious-metals savings strategy for the business.

Spend Goldbacks With Other Businesses

Goldbacks were designed to circulate.

A merchant receiving Goldbacks can turn around and spend them with another business willing to accept them.

That might eventually include suppliers, contractors, professional services, restaurants, local retailers, repair services, advertising providers, and other business expenses.

Goldback Inc. maintains a merchant network and merchant map to help Goldback owners locate participating businesses.

Alpine also maintains a directory of businesses that accept precious metals.

The more businesses that both accept and spend Goldbacks, the more useful the network becomes.

Use Goldbacks for Customer Promotions

Goldbacks can also become part of your marketing strategy.

Instead of offering another forgettable coupon, consider putting something tangible in the customer's hand.

A traditional loyalty point exists in a database.

A Goldback is something the customer can actually hold, save, collect, or spend.

Use Goldbacks for Employee Recognition

The same concept can work inside the business.

• Sales awards
• Employee anniversaries
• Attendance incentives
• Performance recognition
• Safety awards
• Holiday gifts
• Special achievements

Instead of another gift card, the employee receives something containing physical gold.

Magnum Opus Financial: Another Path to Goldback Liquidity

Eventually, even a business that wants to accumulate Goldbacks may ask:

“What happens if we eventually have more Goldbacks than we want to hold?”

That is where having more than one liquidity option becomes valuable.

Magnum Opus Financial offers services aimed at Goldback merchants and businesses interested in precious metals and alternative financial strategies.

One program of particular interest to Goldback-accepting merchants is its 90-Day Forward Purchase Agreement.

Under information provided for the Goldback merchant program, eligible Goldbacks may qualify for purchase at 2X the current spot price of gold, subject to the complete terms, eligibility requirements, timing provisions, and other conditions contained in the agreement.

That can create a very different type of exit opportunity from simply asking what a dealer would pay for Goldbacks today.

Liquidity Can Change How a Business Uses Goldbacks

If the only thing a merchant knows how to do with a Goldback is immediately sell it, every Goldback received can begin to feel like unwanted inventory.

But when the business has multiple potential pathways available, Goldbacks become much more flexible.

Liquidity does not necessarily have to be the purpose of accepting Goldbacks.

It can simply be an exit option that makes holding, accumulating, and using Goldbacks more practical along the way.

A Potential Premium-Based Exit Strategy

A merchant could potentially accumulate Goldbacks through everyday commerce while assigning different purposes to different portions of its holdings.

One portion might remain in the business treasury.

Another might be used for customer promotions.

Another might participate in an eligible lease.

Another might eventually be earmarked for a Forward Purchase Agreement.

The business is no longer treating every Goldback exactly the same way.

It is allocating an asset.

Instead of asking:

“We accepted $1,000 worth of Goldbacks. How do we get our $1,000 back?”

the merchant can begin asking:

“We now have another business asset. What is the best use for it?”

The 2X spot feature should not be interpreted as an unconditional guaranteed buyback price. Merchants should obtain and review the complete Forward Purchase Agreement, including all eligibility requirements, timing provisions, and contractual terms before making business decisions.

Accepting Goldbacks Can Help Attract New Customers

There is another benefit that should not be overlooked:

Goldback users actively look for places to spend Goldbacks.

Goldback Inc. maintains a merchant network and merchant map so Goldback owners can locate participating businesses.

Goldback Inc. also provides participating merchants with educational and promotional support and Goldback acceptance materials.

For a local business, that means Goldback acceptance can potentially become a customer-acquisition strategy.

Someone who has never visited your restaurant, store, or service business may discover you specifically because they were looking for somewhere to spend Goldbacks.

And once they walk through the door, they're still a customer.

Train Your Employees

One of the easiest ways for a Goldback program to fail is also one of the simplest to prevent.

Make sure your employees know you accept them.

Every participating business should have a basic written policy covering questions such as:

• Do we accept Goldbacks?
• What exchange-rate policy do we use?
• How much of a transaction can be paid in Goldbacks?
• Do we accept physical Goldbacks, account payments, or both?
• How do we calculate change?
• Can the balance be paid using another method?
• How is the transaction entered into the POS?
• Where are physical Goldbacks stored?
• Who reconciles them at closing?
• What is our refund policy?

This does not need to become a 40-page employee manual.

A one-page instruction sheet beside the register may be enough.

A Simple Goldback Plan for a Business

Step 1: Decide Why You Want to Accept Goldbacks

Your goals might include attracting new customers, reducing dependence on conventional payment processors, building precious-metals savings, creating a business gold treasury, offering unique promotions, or supporting a local sound-money economy.

Step 2: Decide How Much You Want to Accept

Maybe it's 10% of each transaction, 25%, your profit margin, half of your profit margin, or 100%.

Choose the amount that works for your cash-flow needs.

Step 3: Decide How You'll Accept Them

Possible methods include physical Goldbacks, online Alpine account payments, in-person Alpine QR payments, or a combination.

Step 4: Account for Your Costs

Understand physical deposit costs, payment fees, spreads, and program-specific expenses before designing your policy.

You control your acquisition strategy.

Use that advantage.

Step 5: Decide What You'll Do With the Goldbacks

You can keep them, spend them, use them for change, reward customers, reward employees, allocate precious-metal holdings, lease eligible holdings, maintain them as part of a business treasury, use available liquidity programs, or eventually liquidate some or all of them.

You do not have to choose only one.

That's ultimately the bigger Goldback merchant story.

Goldbacks are not simply another button on a cash register.

For the right business, they can potentially become part of a broader precious-metals strategy.

A merchant can accept them from customers, control how much it accepts, build the cost of acquiring them into its business model, circulate them through other merchants, use them to attract and reward customers, use them to recognize employees, save them as part of a business treasury, allocate precious-metals holdings according to its goals, put eligible holdings to work, and maintain multiple pathways toward liquidity.

The merchant does not have to convert its company to a Goldback-only economy.

It does not have to accept every Goldback somebody offers.

It does not have to put its operating cash flow at risk.

And it does not have to immediately sell every Goldback it receives.