The Cost of Holding Out

Jewelry Discussion
1

Hello All, I am a relatively new Orchid member and have been lurking
for a little while now. I treasure sitting down to read my digest
with its wealth of knowledge and expertise. I thank you all for
being part of this forum and for your contributions. I am learning
a lot. I have been dabbling with the lapidary arts since I was 12
and with metalsmithing since high school. It has been primarily a
hobby for me but it has truly been my passion for most of my life.
It is probably only by several (severe) twists of fate that I do not
do this for a living. Since I have been unemployed for the last
year after being downsized, I have been focusing more of my energies
in this area and I have been really enjoying getting back to it
again finally. I have even been selling some pieces.

Anyway, I have been following this thread with great interest. The
diversity (now there’s an overused word) of opinions regarding
pricing philosophy is remarkable. Thusfar I have resisted the
temptation to throw in my 2 cents worth, as there are many
Orchidians far more knowledgeable than I. But alas, I can resist no
more. I generally don’t let my ignorance stand in the way of my
having an opinion for very long. While I do not make a living in
the jewelry industry, I feel I can respond both from the consumer
side as well as from some limited sales experience of my own since
the age of 12.

Ron, with all due respect I do not recall anyone advocating fixing
repair prices nationwide. Certainly you are correct when you say
that many local factors must be taken into account when determining
your pricing. I don’t recall anyone saying anything that would
contradict this view. Competition certainly is a factor when
determining pricing but competition is not limited to pricing alone.
Competition also extends to quality of work, timeliness, and less
tangible aspects such as store environment, reputation, and the
attitude of the jeweler. I prefer not to think of these aspects in
terms of competitive factors, but if you consider the elements that
would make a customer choose your services over those of another
jeweler then they would have to be considered as such. I once went
to have a ring repaired at a local jeweler. The price was
reasonable, the workmanship was good, and the repair was timely.
However, she had such a holier-than-thou and generally snitty
attitude that I would rather go across town and pay twice the price
rather than ever go back there again. I don’t even want to run into
her at the grocery store! She couldn’t compete on attitude. (She is
no longer in business in this town.) Everything else being equal,
it would come down to only price. Everything else is not equal
though. Especially in the jewelry business. It’s not like buying a
refrigerator. If I’m buying a refrigerator I’m looking at the same
refrigerators no matter which store I’m in (can’t do this with
carpeting) and it comes down to price alone. Certainly you must be
aware of what others in your area are charging for what service.
This does not necessarily mean you must charge the same or less for
the same service. You must also be aware of the other competitive
factors and take those into account when setting your prices.

I do not believe that charging what the market will bear and
charging a fair price are mutually exclusive. On the contrary,
unless you are the only option a customer has (I don’t think anyone
has to worry about this), what the market will bear and a fair price
are the same thing. A customer’s other options will take the
"competitive" factors other than price into account also. Charging
what the market will bear does not mean you are milking the customer
for all you can. Charging a fair price also means charging a price
that is fair to you who are doing the work.

The reason jewelry artisans cannot charge the same kind of rates
that auto mechanics can is because jewelry falls into the category
of discretionary spending. If my car breaks, walking is not an
option so I must pay to have it fixed, whatever the cost. If my
ring breaks, I can put it in the drawer and wait for better times.
That is just the sad fact of the industry you are in. This is why
it can be such a difficult business to make a living at even with
years of study and great expertise. But another reason can
sometimes be that the jewelry craftsperson can be a master at their
craft but not necessarily be a master at the business end of things.
There is no shame in that. But this is where I think David
(Geller) has made some valuable contributions. Perhaps you have
evaluated your market correctly and have set your prices
appropriately. If you have and are making a comfortable living
doing what you love then you are blessed. If not however, then what
I get out of reading what David has written is that pricing may be
an area worth taking another look at.

OK. I’m done now. I think that was more like 3 or 4 cents worth.
Sorry for being so long-winded. I’ll go back to lurking now.

Dale Brighton, MI Aspiring jewelry craftsman…metalsmith…jewelry
artisan…master of…oh whatever, as long as you smile when you say
it!

2

D.Burnett, Thanks for your thoughtful and concise response to my
criticism of Geller"s ideas. My approach to business is somewhat
different than most. I have always had a social conscience
underlying all of my actions. I also have a strong sense of the need
to be profitable and meet my financial obligations while living a
decent lifestyle. I don’t need to pursue extravagance nor do I need
to “charge what the market will bear” I am quite satisfied with
getting a return for my efforts that meets my basic financial
needs.Becoming wealthy is definitely not my goal. I have had periods
in my life when my financial circumstances were realtively unlimited
AND I was not happy. When you have substantial assets you can be
sure that the predators are not far behind. You have to develop a
certain paranoia just to keep them at bay. You are also beset by
overwhelming asset management challenges. You must eat, sleep and
drink wealth management.

As for price fixing ,I feel that any book that suggests uniform
pricing on a nationwide basis is, at the very least, an attempt to
establish a “one size fits all” approach to pricing. And, since the
prices are , in my opinion, excessive, they are bad for the customer
and may be bad for the industry in the long run. As for your
contention that jewellers may not charge as much for their services
as mechanics, my reply is that they had better charge every bit as
much ! For example: When a jeweller charges thirty dollars for a
simple downsizing, he is probably charging three hundred dollars an
hour ! I charge ten to fifteen dollars for same and my profit is
quite sufficient. What is happening here is that many jewelers sub
out their work and the price to the customer is based on suporting
two businesses; the jeweller and the sub contractor… Unfortunately,
the jeweler generally gets at least seventy five per-cent of the
charge while the pooir guy doing the work gets twenty five percent.

I hope that I have clarified some of the issues involved. You ,
Dale, apparently have not had the benefit of being in the jewelry
business for any significant period of time. I think that you will
have a greater appreciation for the complexities involved after you
have had more experience.

I bear no malice toward David Geller. His efforts to enhance the
business thinking of people who are often not oriented toward
business principles is a step in the right direction. I merely want
to see a lot more flexibility and depth in these considerations. The
one size fits all approach is definitely not the right way to go in
my opinion nor do I subscribe to the approach of charging what the
market will bear.In this latter instance, there is too much room for
abuse. This is why auto mechanics sometimes damage their industry by
charging too much or by taking advantage of the innocent . The last
time I went to an independent garage for auto service I got charged
twenty seven dollars for a three dollar air filter…let’s not get
started on this one ! Ron at Mills Gem, Los Osos, CA.

3

Thank you for your response, Ron. I must confess that I have not
read David’s book :frowning: I was basing my response on what I have been
reading on Orchid. I suppose I must now find and read David’s book.
I applaud your social conscience. I also applaud your ability to
perform a down sizing (I really don’t like that term) in six
minutes. I’m nowhere near that good. That would give you a
distinct competitive advantage over me and allow you to charge a
lower price than I would have to. Fortunately I’m not competing
with you (or anyone really for that matter). I still stand by my
opinion (although I’m allowed to modify it in light of new
, but you are quite correct in that I do not have the
benefit of the experience that many of my fellow Orchidians have.
That is precisely why I find these type of discussions so valuable,
as well as in the technical aspects of jewelry creation. So I will
continue to lurk and learn and please forgive me if I occasionally
feel compelled to throw in my 2 cents worth.

Let the discussions continue!
Dale, Brighton, MI