Artificial Intelligence driven Marketing Communications
Resource Co. is owned by founder Shane Swan, an analytical chemist who specializes in data analytics. We offer the service of connecting pawnshops. The product is a website that allows owners to buy and sell to each other. The focus starts with gold and diamond rings already owned by the pawnshops. These are high dollar products with comfortable margins. Resource Co. makes money by charging 10% per transaction. The objective of the business is to ensure that pawnshops no longer hold onto valuable goods without creating cash flow. The ability to move valuable products from one store to another will prove invaluable for the individual and franchise pawnshop owners. The data collected will allow for guaranteed income based on simple supply and demand for individual pawnshop owners, who collect goods at prices far below market value in their business model.
This is important to me for a few reasons.
1) Pawnshops are limited to their geographical location and digital business capabilities. They service their communities and therefore this limits low-income loan availability.
2) Pawnshops operate their business in two segments: Pawn loans and selling pawned or sold items. Pawn loans are generally for lower-income individuals without established credit. This opens up the amount of money a pawn shop can now loan an individual because the sale of the item can be guaranteed by a buyer. This increases the number of loans a pawnshop can have at one time effectively increasing pawnshops’ total revenue.
3) Pawnshops are scattered collections of mini-warehouses and banks all in one. Each shop holds thousands of dollars of inventory and money is lost every minute the inventory sits idle.
Personally, I was in a position where I had to use a pawnshop to survive. I made it to my last semester of college after losing my parents and guardians without taking on any loans. I had inherited a few pieces of gold and diamonds that I was able to hold on to while starving and bumming rides. I had problems with my financial aid package and had to pay parts of my tuition until the government could reimburse me. This created a multi-thousand dollar hole in the budget of a struggling pizza delivery driver. I was forced to sell some items and pawn my grandfather’s ring. The market valued the ring around $4500. After trying all local pawnshops and traveling 50miles to New Orleans, I settled for a measly $700 loan. It was enough to get me by for the time I needed but it made me realize that so much money is left on the table. The pawnshops I would go to have literally pulled out drawers of rings to show me how saturated their supply was (some wouldn’t even make an offer because of this).
This is inefficient because so many different people are interested in these goods, particularly gold and diamonds. With time, the price of gold naturally increases. Every market scare or natural disaster creates people looking to buy gold but it’s not easy. Resource Co. will allow for the expansion of the gold and diamond buy and sell market. Whether its the worried collector wanting bulk gold by the oz or someone trying to buy a cheap engagement ring with some flare, people are interested in gold and diamonds. It doesn’t make any sense that these valuable goods sit for any amount of time so I hope I can convince some of you to help me make dollars because of it.
The scope of the project is quite sizeable. Some of the inherent challenges are customer acquisition, technical support for the product, trust for the purchase of large dollar amount items, and of course competition. Customer acquisition: The two main problems will be the why and the maintenance of products that are available. I propose the following, it only takes one shop in any given geographic location to sign up in order to gain access to that market. With every addition, thousands of dollars of wares can be made available to pawnshops in different locations to sell. It also only takes one sell to make someone stick with the product. We aim to create relationships between pawn shops that are lasting and mutually beneficial. Product maintenance will be time-consuming for the update of all the sales occurring. We are looking to build a way for sales to update real-time. This can only be tested as more users are acquired as we find the limits of the demo product. Technical support for the product: The bulk of the time spent outside of customer acquisition will be product maintenance and updates. The product is the most important and fluid piece of the entire project and will take the lion share of available time. This will ensure users have the best experience at any given time despite more users being added. Technical support will be as alive and responsive as humanly possible. Trust: The aim is to partner with the most reputable pawnshops in an area. These are naturally the ones who have better revenue in their stores. We can connect reputable, like-minded business owners to form the core network that allows for legitimately certified valuables to flow. We also plan to use a third party shipper like FedEx or US Postal and ship everything next day priority. This will limit the amount of liability assumed by Resource Co. and allow for pawnshops to feel more comfortable working together through shippers they know and trust. Competition: The risk of competition in any market is always palpable. Here, our main competitors offer products designed strictly for an individual business to increase their own sales. This means that the burden is placed on the individual pawnshop to sign up for all of the competitors’ services for fees. Pawnshop owners have endless ways to try and sell their own items but there is no way to connect with guaranteed buyers. The competitors would cannibalize their own core products by fostering an attitude of cooperation instead of competition. Pawnshops are considered slimy dens of the black market and so it could also be a PR nightmare for a large established brand to take on this market.