[Jewelry making - Article 00014] - Re: [Orchid] Setting customer stones

[Daniel R. Spirer]

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    Once again a lot of you are forgetting about some basic costs
    involved when setting expensive gems. Let's put aside the breakage
    issue for the moment and assume as John Donivan has said that if you
    are breaking a lot of stones then you need to learn how to not break
    them and that you shouldn't burden an individual customer with the
    potential costs of your mistakes (or, as he pointed out, for those
    times when a colored stone--opals are known for this---just decides
    to crumble in your hands before it even gets near a setting tool). 

    So let's get on to the real costs associated with taking in a
    $100,000 stone to set (or let's say 5 $20,000 stones at the same
    time). I don't know how many of you actually read your insurance
    policies, or have an agent as good as mine, who comes in and goes
    over your coverage, but when you buy a jeweler's block policy, you
    have to come up with an average value of goods in your possession
    (that aren't yours) at any one point in time. This is so that if you
    are only normally covered for your own goods (let's say you have a
    half million in coverage for that), but that you routinely take in
    expensive goods belonging to other people, the insurance company has
    a pretty clear idea of what their MAXIMUM liability is. If you
    routinely have $2-300,000 worth of other people's jewelry in house,
    for whatever reason, you have to buy coverage to insure against loss
    of that average amount (over and above your half million in coverage
    on your own stock). If you don't tell them what your average is or
    understate it severely, and the day you get robbed you have 10 times
    that average amount you're basically screwed. The insurance companies
    don't have to pay out if they find you've lied to them, and if they
    believe you've lied to them about one thing, they will pretty much
    assume that everything you told them is a lie, and good luck then in
    collecting against even your legitimate stock amounts. 

    But here's the thing: 

    All that extra coverage costs money. Occasionally, you even have to
    go to your insurance company and get a rider if you're handling stuff
    way out of line with your normal coverage. Consequently all of those
    expensive goods coming into your hands do in fact increase your basic
    costs of doing business. Then let's not forget about the safe you
    need. If you routinely are handling only $100,000 worth of your own
    goods and someone else's stuff together then you don't need much of a
    safe. On the other hand if you routinely have a half million dollars
    or more in things you need protected you need a much better safe.
    Safes cost a lot of money. You wouldn't need such a good one if you
    weren't taking in expensive goods. Another increased basic cost. And
    then there is also the fact that any time you take in a very
    expensive piece, not only are you going to spend more time working
    on it, but you are going to spend more time taking it in from the
    customer, to insure that everyone is clear on exactly what they have.
    Often you need to do stone plots on the spot for the customer. You
    have to be paid extra for this kind of time too. 

    So in my book charging extra for working with high value pieces is
    not only legitimate but necessary (if you intend to remain in
    business for any period of time). Whether you choose to do this by
    charging more on high value pieces or adding a charge to all of your
    work to cover the extra costs is up to you. But to assume that
    working on a high value piece doesn't cost you more is living with
    your head buried in the sand. 

    I don't want to get into the fact that Verizon charged me $75/hour
    to have a guy come into my house 5 years ago to run a little wire
    around it. Those of you who think your time is worth only $20-30/
    hour still are just going to have to come to grips with that
    yourselves. 

Daniel R. Spirer, G.G.
Daniel R. Spirer Jewelers, LLC
1780 Massachusetts Ave.
Cambridge, MA 02140
www.spirerjewelers.com
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