How do I price my stones?
This is a fairly difficult question and everybody seems to do it differently. My advise is to do what works best for you. If you are not sure where to start, read on… I have been cutting and selling stones for a long time and I have worked out a method that works well for me. I think it will work for most other cutters also.
Here is what I do.
I go to quite a few of the major gem shows through out the year, the Tucson February show is one of the best for this by the way. June in Las Vegas is decent also, JCK, AGTA, GLDA.
Where ever I go, one of the most important things I do (besides look for rough and talking to friends) is to shop for cut goods. I price everything that I can find, commercial, custom, and anything else that looks interesting. I am shopping for color, quality, and clarity. I am also looking for availability, supply (they are different), and any trends that I can spot. Frankly, it is a fair bit of work, but I enjoy looking at stones of all types. I actually keep a chart that lists what I have seen and the pricing.
When I get home, I look through my notes and try to ball park the prices of what I have seen. Generally as you look through the data, a pricing trend will begin to show. This is especially true of the better quality, larger stones (1 1/2 carats and up usually). These types of stones are what I am especially interested in because they are the type of goods I sell. This process is not perfect, but it gives me a pretty decent handle on what things are going for wholesale. Once I have done this, I price my cutting.
Note: Of course my rough cost are also considered in the pricing.
There is no magic formula, and no truths written in stone. I make a mistake once and a while, but over all I generally manage to get what I think are pretty good prices. I do price for the quality of both the finished stone (material) and my cutting.
Quality cutting is worth more than commercial cutting (this is a fact, look at the Germans and many others that make a living doing it), and there are people that will pay for it. After all they cannot get top quality in all that many places. You want to go first class, it costs more.
How does this help you price your stones?
Well, if you are able too, I recommend that you adopt a method similar to mine. Feel free to adapt what ever parts of my method that you can use. It may not be perfect for you, but at least this is a fairly good starting point. If you are unable to go to major gem shows, or just do not want to. You can use my pricing structure, and other peoples pricing (look around) as a starting place.
Keep in, mind that the prices that I have posted on my website are what I would call low retail. By this, I mean that I do have some retail mark on them (usually 25% to 60%). I do this for several reasons, but mainly to protect the many jewelers that I deal with on a wholesale level. I do not want to under sell my wholesale customers.
My wholesale customers have to provide positive proof of their wholesale status, by the way. On the other hand, I am not setting the stones and feel that I cannot and should not mark them up to full retail prices, which is usually double wholesale, depending on the retailer.
So if you are looking for what I would sell something wholesale for, subtract 25% to 60% from my posted price. If you are looking for a retail price (at least mine), what is posted, is the price.
There are always exceptions. Some stones that I think are especially good or bad (happens to all of us) take special pricing. I price them using my judgment on what I think is best, and usually try to note anything special in the stones description.
Another thing that happens on occasion. I see a type of stone that I think is on the way up in price because the rough is running out, or it is just getting hot in the market. I will generally price these stones higher. If you have not noticed yet, stones almost never get cheaper over time. Occasionally something is going down in price, but it is pretty rare.
Sometimes I just do not care if I sell a particular stone, so if somebody wants it, well…
I highly recommend that you shop gem shows both wholesale and retail, in your area of the country. Prices are different from coast to coast, some times. Look on the web, there are several other custom cutters out there, as well as a lot of commercial goods. The more you look around, the better handle you will have on pricing.
For people that think I am priced too high or too low (I have heard both sides), well all I can say is that what I do works for me.