[Jewelry making - Article 00046] - Re: [Orchid] Gemstones costing and pricing

[R . E . Rourke]

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    1) find a few reputable gemstone suppliers, ask for quotes on the
    sizes and quality and in which quantities you wish to buy them, and
    where in that quote do price breaks occur for a) quantity b)
    quality/colour . then after calculating the best price on what you
    want, and inspecting the parcels you will actually recieve ask if the
    company that you want to deal with will sell them to you at a price
    you deem fair ( based on the prices you have accumulated from the
    dealers you have access to) for the stones. for any stone. basically
    if it's in print it's too high- that I believe is universal to
    anything marketed. markets change faster thatn printing can keep up
    with those things that afffect change- trends, mining, taxes on
    producing nations, or collectives, the abhorrent practices of " the
    diamond dealers"-( as an institution that has for decades
    overinflated the value and monopolized-or attempted a monopoly, on
    the sale and distribution of diamonds. ) and the perception of you
    and/or your enterprise by a dealer that is obviously more
    experienced in the trade of stones than you are - and I mean no
    offense by that statement, simply that if you are asking these
    questions, you have not dealt with stone dealers much. that's normal
    in your experiencing all aspects of being a jeweler and your
    continuing education as a consumer (obviously involved in the process
    of becoming an informed consumer as you are seeking some perspectives
    with your post!) of the wholesale components that are used in the
    fabrication/ manufacture of jewelry and the beginning of learning how
    to negotiate the lowest price possible for gem materials..diamonds or
    any gem material. and it requires negotiation and entering into a
    mutually beneficient relationship with dealers of the stones you wish
    to purchase and use in your "lines". 

    finding out the origins of the gem material that interest you is
    helpful in negotiations of not only price but how many "middlemen"
    you wish to eliminate in your procuring the stones you want to use
    for whatever your purposes are. I, for instance, would far rather
    travel to Thailand once a year to buy from the small scale producers
    and collectives that are combing the gravels in their fields for an
    addition to their near subsitence incomes than opening a catalogue
    and paying a price that is at least marked up X x 2. 5 ( standard
    retail), and in the case of most larger US distributors is higher
    still than that- and limited to what they have gotten the best prices
    on by buying in quantity from a larger distribution entity than the
    rough miners, or even the cutters that are mostly owned by that
    entity that distributes the gem materials globally through trade
    shows, or organized collectives like Israeli diamond merchants, IDEX,
    or deBeers, or even smaller collectives like independant asian owned
    distribution channels that are ultimately " state" operated..However
    most small scale jewelers are not able to afford direct buying or
    travel and expenses relative to procuring a year or two worth of
    stones, so the only alternative is to open a catalog, attend a "gem
    show"or resort to ebay, or other auction-like venues to purchase as
    directly as is financially feasible. and the small scale jewelry
    manufacturer can develop relationships and make very good purchases
    from those alternatives. always remeber that any dealer of stones is
    charging more than they paid for the prices you see on the tables, or
    in the catalogues, and no good business person will pass up a
    reasonable offer. 

    so make reasonable offers, don't be afraid to ask for a period of
    time to inspect a parcel and a reasonable return clause when signing
    any contract, or entering into any buying arrangement with any
    dealer or distribution channel. always inspect what you will receive
    and refuse anything that is flawed beyond your standards..always
    offer the "sticker" price minus 20% as an opening figure. it is
    negotiable- anything is negotiable in the gem trade. as you become
    more experienced and more relationships are built with dealers, you
    will be offered parcels that the dealer knows you- his/her target
    market- will likely buy and pay the price they know they can get from
    you. they eventually will regard your business as either negligible
    or substantial and your money is almost immaterial as far as the
    dealer is concerned. their concern is moving quantity, moving
    inventory that is out of vogue or that is in excess in their stores,
    moving merchandise that is flawed or rejected and possibly only good
    for recutting, ( chipped or abraded materials),,and you will learn
    who the cheapest recutters are and who offers you the best service
    and quality for the money and turn around time. there are no pat
    answers to your queries just that experience and your personal
    financial picture are the variables- all stones are available all the
    time- the prices are always negotiable, and in time you can construct
    or propogate a network that suits your own needs. and perhaps your
    propensity to create a collective group of buyers of gemstones to
    help the group buy in quantity which always commands more attention
    and eventual personalized services and far more reasonable prices
    than are availble to the jewelr that buys 5 carats of tourmailine,
    10 round garnet cabs, and 8 10 pt. diamonds of SI1 quality. quantity
    is almost the single most relevant factor to keep in mind as you try
    to develop an efficient buying strategy for your needs. 

    3- markup: that is derrived from your asessment of time, labour,
    studio (and employees) overhead, costs of materials, and consultation
    (if it's custom or one-off work), and any taxes you have to pay as a
    manufacturer of jewelry. it is relative to each piece and each price
    tier you offer your target market. All bear equally as the previous
    components of figuring the retail cost ( or wholesale for that
    matter) of your work and how much you value it yourself. 

R. E. Rourke
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