Here’s a little look into the tradeshop business, from my
perspective. I hope it’s helpful to you. I would have loved to have
known this stuff twenty five years ago.
I generally charge half of Geller’s Blue Book for straightforward
labor and repairs, more for what I really excel at, less for work I
must charge less for because of competition or market forces. 30%
over cost for findings and stones, 10-20% over for metals, depending
on the finished weight of the piece, the type of metal and the labor
involved. That’s my pricing structure in a nutshell.
There is an old adage that there are three things a wholesale client
can ask for - low price, quick turn-around and high quality. They can
pick two, I set the third.
I deviate down from the Blue Book when there is a ton of stone
setting that’s really quick, like tennis bracelets, and things like
that. I can pretty much guarantee that if you try to charge someone
$11 a stone for a 56 stone square prong tennis bracelet they will
likely stare at you in open-mouthed amazement. The current trade
price around here for tennis bracelets is between $1.50 and $3 per
stone depending on the type of bracelet and the type and cut of the
stones. If you can set 60 stones an hour, that’s pretty good money
for a benchie. Even 30 stones an hour pays better than a lot of
other stuff does. It may be boring, but the experience gained and the
money earned make it well worth the effort to seek out this and other
types of production work.
I charge extra for setting stones that are not consistent in size
and/or cut. Setting cheap, lumpy goods is a real p.i.t.a, and I get
paid for their savings in per-carat price. I play that by ear and
adjust based on the extra labor involved. Tell them an extra buck a
stone. Sounds cheap, but it comes to $50 or $60 for the extra hour or
so you’ll spend on a tennis bracelet cutting each and every seat
I deviate up from the Blue Book when I am doing something that other
shops either can’t do or don’t do as well. $150 per hour is my
wholesale rate for this kind of specialized work (which is really
only a little over what I can make setting tennis bracelets, so it
really isn’t that high). This kind of work generally is done by
estimate, so I break the job down into individual tasks, figure how
long each task will take if all goes well, what the materials are
going to cost and estimate the job based on that. My estimates stand,
unless the client changes something like carat weight or type of
metal, so I’ve got to figure the time right if I’m going to make
decent money doing it right. Those extra little details can eat up a
lot of time if you’re not careful. If you’re going to charge that
kind of money, you better be able to deliver; your work better be
top-notch and clean and be able to stand up to the microscope, even
if it takes you a few more hours than you planned on. You might not
get a second chance if it’s not.
Another little tip, pick up a pawn shop or two. You’ll see a lot of
junk, they’ll want it cheap and fast, but they are rarely picky and
pay cash (real portraits of dead presidents, you’ve seen them,
they’re kind of green in color) on delivery. Meaning, when you
deliver it to them, not when they deliver it to their customer like
so many trade accounts seem to think the term means. They can end up
being surprisingly good accounts, for a lot of really different
reasons. Mainly, they know how to make money. You can learn a lot.
(Wink-wink, nudge-nudge, say no mo’, eh?) Just make sure you have a
tea-ball for cleaning their stuff. You’ll spend hours looking for
stones in the bottom of your ultrasonic if you don’t.
One thing I used to do with new accounts (I’m not accepting those
anymore) is to look around at what’s in the cases and ask for a copy
of their current price list. That will tell you what kind of jewelry
they buy and what they are accustomed to paying for certain things.
This can give you insight as to where you might get a little
resistance or maybe a bit more $$$ than you currently do. It is also
important in finding out exactly what you will be working on. If they
are selling it, you’ll be working on it. If you see glaring
differences in their pricing structure and yours, or jewelry that is
poorly made (do pawn shop jewelry for a year and you’ll be able to
spot that junk from across the room - without your glasses) or has
impossible to recreate finishes (a lot of European designer jewelry
has very creative finishes that’ll have you scratching your head),
it’s better to address it up front so there are few surprises.
It is also a good idea to get a feel for what kind of client they
are going to be, and adjust your prices accordingly. Ask them why the
last shop didn’t work out or why they’re ready for a change or what
is most important to them in a trade shop. Ask them if they are going
to have different standards for different customers or different
types of work. That’s not as rare as you might think. Some want cheap
repairs, but only the highest quality custom work. Others want
exactly the opposite. Most will want a mixture. One store I did work
for put a gold star on jobs indicating a special customer, needing
the highest quality and best service; red stars on jobs needing the
lowest price or easiest fix. Pretty good system.
See the current thread entitled “Magnification frustration” for an
example of someone you may need to have a heart to heart with the
owner or manager, adjust your prices upward for, or avoid taking on
altogether. That would be an account that I would charge $150/hour;
I’ll do the best work I know how and they can study it all they want.
Or they can make a choice as to which is more important, the price or
the microscope. Sometimes, the client doesn’t get a second chance.
Don’t be afraid to fire a wholesale client that is not profitable for
you. Wholesale’s a whole different mindset compared to retail. There
are more good clients than good trade shops, way more. It’s OK for
you to be picky too, ya know. If you’re good, before long you won’t
have to go looking for them, they’ll find you.
I’m not taking in new trade accounts anymore. Too much work for too
little money and all the hassles of hand-holding with ignorant
tightwads with microscopes and shrinking schedules are just not worth
it to me any more. The retail side of the business, the two or three
really good trade accounts we have and the odd small production run,
pave’ or engraving job that comes our way are keeping all three of us
benchies plenty busy. The general public is a lot more fun to work
with, a whole lot more appreciative and pay more. Most importantly,
they pay on delivery instead of 30, 60 sometimes 90 days later. It
really stinks when you need to pay a supplier for stuff you ordered
for a client that hasn’t paid you yet, so you can order more stuff,
to do more of their work, so you can get paid even later. No thanks.
Had my fill of that garbage.
But I will also add that retail isn’t a walk in the park either. You
trade one set of demons for another when you sign that first lease.
This can be one tough business, even in good times, no matter which
side of the wholesale / retail line you work. You better love it, or
you’ll end up hating it.
Enjoy the journey. It’s a real trip.