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Mission Possible: Slashing Prices with No Loss in Markup or Margins

By Lisa Brooks-Pike

Pity the traditional jeweler who must discount his traditional jewelry to stay alive.

Adventures in penny pinching. Lisa Brooks-Pike uses this popular, classic three-stone style from Stuller’s voluminous catalog to show bargain-hungry customers every cost-cutting option open to them with regards to metals and gems so that they can save up to thousands of dollars—with no loss in quality and beauty.

I don't discount to survive. I give affordable alternatives. I am the bargain hunter's dream come true.

How? I have learned how to be a non-traditional jeweler who can sell traditional jewelry by re-inventing it. Others give the old for less. I give the new for less. It's easy to do. Let me show you my method:

Let's take a three-stone ring (mounting #4797) from Stuller that I frequently offer customers.

Why am I using Stuller? Stuller's catalog is a great place to introduce shoppers to the incredible diversity of choices available to them. I use the catalog to explain alternative gems and metals that save money without sacrificing quality or beauty. But be forewarned: the catalog is useless if the jeweler doesn't have knowledge and appreciation of the cost-savings detours they are offering.

This 5.97-carat white zircon has everything a diamond has--except the price. Photo courtesy of Color First, Tampa, FL.

Remember: Sell only what you love or respect. I honestly believe white zircon is as beautiful as diamonds. And I think palladium is infinitely preferable to white gold. At every stage in the alternatives process, you must be able to talk knowledgeably about the options you are proposing. And you must believe in these options. So if you don't know about the alternatives, bone up on them. I find Colored Stone gives me constant tutoring in new gems and metals.

Okay, let's get started. I've prepared a table that will take you from high to low prices for a three-stone ring that is an object of great desire for many women. You won't need your calculators. I've done the computations for you. Get ready to be amazed at how much you can save your customers.

For those who want the fine blue of sapphire for far less money, may we suggest this 6.83-carat tanzanite. Photo courtesy of Color First, Tampa, FL.

[Note: I’ve used Stuller’s catalog as a main frame of reference so that you can double-check my prices. However, I source some gems such as white zircon from other dealers. All prices are double keystone.]

Here’s how this exercise in price-slashing works. I start at the top of expense chain and work down, substituting lower-price metals and gems as I go along. See for yourself how easy it is to play price-hero to consumers without sacrificing margins and profitability.

 

For bottom fishing consumers, there are stones like this 1.51 crystal quartz that give the colorlessness of diamonds at a tiny fraction of the cost. Photo courtesy of Color First, Tampa, FL.

Mounting #4749 with diamonds (5.8mm center; 4.88 mm side stones):

Set in platinum: $7,378.64
Set in 18k white gold: $6,826.00
Set in 14k white gold: $6,624.50
Set in 10k yellow gold: $6,495.00

Mounting #4749 with white sapphires:
Set in palladium: $697.00

Mounting #4749 with white zircon:
Set in palladium: $500.00
Set in sterling silver: $250.00

Mounting #4749 with colorless quartz or topaz:
Set in sterling silver: $100.00

Now, let’s price the piece with alternate center stones:

Mounting #4749 with tanzanite center stone:
Set in 14k white gold: $3,123.00
Mounting $4749 with iolite center stone and white sapphire side stones:
Set in palladium: $466.00
Set in sterling silver: $260.00

By offering traditional settings with alternative gems and metals, jewelers can weather the current recession—saving customers bundles of money and, in the process, saving their businesses.

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