Pricing Gold Jewelry, An Insider’s POV

Keystone Pricing

Keystone pricing is taking the wholesale cost of a piece of jewelry and marking it up 100%.

Information site, About.Com, takes this a step further. They advise entrepreneurs:

“A simple formula when pricing for wholesale is to add up your costs (this includes labor, overhead, and supplies) and multiply by 2. For retail, do the same, but multiply by 2.5 to 3.”

In other words, they advise taking not only the cost of the jewelry into account, but also other variable business expenses to determine the net cost of jewelry and then to multiply by 2 to obtain a wholesale cost or 2.5  to 3 times to obtain a retail price.

Keystone refers to doubling the cost of jewelry, whereas triple keystone is tripling the cost of jewelry to determine the retail value (A staggering 300% Mark Up)!

This is not uncommon in the jewelry industry and some jewelers mark up jewelry even higher.

Apples of Gold Pricing Methodology

Where Apples of Gold Jewelry differs significantly from standard jewelry industry pricing is that at best we mark up our jewelry an average of 30% from the cost of the actual merchandise. On select designer pieces, we may mark up select items 40% – 50% (you can call this half-keystone, if you will).

Compare this to 100% to 300% markup of the traditional jeweler, and you will see why customers often call us to ask us how we are able to sell jewelry for so low.

This is where we stand apart from most traditional jewelers and even online jewelers. When comparing Apples of Gold to traditional jewelers we are usually 50% below retail and when comparing to online stores, Apples of Gold Jewelry is an average of 30% lower than most online jewelry competitors.

This leads us to our value-based pricing methodology.

Value Based Pricing

Apples of Gold strives to determine its jewelry prices based on the value that a piece of jewelry creates for our customers. We believe that this is more profitable for us in the long term–as we serve our customers and provide an affordable, quality product.

By selling with greater volume nationally across all U.S. States and internationally across Europe, Asia, Canada, and other parts of the globe, and by limiting overhead, and very significantly not having the huge burden of stocking every jewelry item in-house, we are able to sell at vastly lower prices than most jewelers, while providing a fair valuation of our gold jewelry.

Additionally, we combine our value-based pricing with a “fair pricing” method. “Sometimes it simply doesn’t matter what the value of the product is, even if you don’t have any direct competition. There is simply a limit to what consumers perceive as ‘fair’. If it’s obvious that your product only cost $20 to manufacture, even if it delivered $10,000 in value, you’d have a hard time charging two or three thousand dollars for it — people would just feel like they were being gouged” (entrepreneurs.about.com).

The Bottom Line

Most jewelers have to charge anywhere from 100-300% to maintain a profitable business. With large overhead, shifting gold and metals prices, employee costs, and most costly–expensive inventory–they cannot survive on smaller than keystone margins.

The difference with online jewelers–and especially those who have deep and mutually beneficial relationships with manufacturers and wholesalers, the markup on jewelry will be significantly less, usually not breaching 30%-50%.

At Apples of Gold, we recently were in talks with one of our major suppliers to get lower prices to obtain a 40-50% margin on products that they supply us, and the idea was quickly dismissed–because both we and our suppliers understood that to be competitive in the online environment, such a mark-up is difficult to achieve. We finally settled on a 29.5% margin on items that we purchase from them. So an item that cost us $300, we are selling for about $385.00. A traditional jeweler would normally sell an item obtained at wholesale for $300 for $600 (keystone), or possibly $900 (triple keystone).

That is why Apples of Gold rightly advertises our products are approx. 50% below standard retail (and that is a conservative estimate).

Learn more about Apples of Gold Jewelry and our value-based pricing methodology.

Featured Products in this Post

Men’s 14K Gold Angular Link Bracelet

Sea-Foam Green Amethyst and Diamond Ring

Art Deco 1/4 Carat Diamond Ring

Caedmon Celtic Wedding Band

Featured on ApplesofGold.Com.

Jewelry Hot List

Last was the year of new jewelry for Apples of Gold, with the addition of over 600 new, unique jewelry pieces. Below are some of the “hot seller” highlights from our newest fine jewelry pieces:

Black Diamond Rings became a hit for Apples of Gold with our Art Deco Black Diamond Ring and so we added several new designer pieces to our popular black diamond jewelry collection, including a Benchmark Black and White Diamond Eternity Band, 1 Carat Black and White Diamond Cross Pendant, as well as our all black diamond solid gold cross pendant for men.

Of course, we love our blue diamond jewelry too!

By far, our best selling blue diamond ring was our 0.93 Carat Blue and White Diamond Swirl Ring. Our popular blue diamond jewelry pieces was expanded to include our best selling 0.93 Carat blue and white diamond swirl ring. We added many other blue diamond rings to our blue diamond jewelry collection as well that turned quite a few heads.

Wedding Bands have always been at the heart of our jewelry line and Paisley Wedding Bands have always been at the top of our list. Our Paisley Collection was expanded with a new deeply engraved paisley wedding band in 14k white gold, 14k yellow gold, and our most popular paisley release: the 14k rose gold paisley wedding band.

It was our goal to added many new unique personalized jewelry pieces to our collection, and we met our initial goals!   The most popular being our Personalized Gemstone Circle Pendant, the Engravable Boy Gemstone Pendant and Engravable Girl Gemstone Pendant, our Personalized Gemstone Baby Shoe Pendant, and Personalized Gemstone Heart Pendant.

We also introduced a new line of Personalized Disney Jewelry, and new gold name pendants.

Benchmark Wedding Bands - A high-end wedding ring brand which includes a Lifetime Warranty and Lifetime Re-Sizing Policy. We plan on adding many new Benchmark styles in 2009.

Official Disney Jewelry – featuring popular Disney characters such as Tinkerbell Jewelry, Mickey Mouse Jewelry, Winnie the Pooh Jewelry, and more! Our Personalized Disney Jewelry collection also proved very popular and all very affordable!

Read more about our Disney Jewelry line: Disney Jewelry for an Imaginative Holiday, A Man Named Walt, and our official Disney Jewelry Release.

We plan on adding more popular Disney characters in 2009.

Apples of Gold’s most popular cross, The Polished Solid Gold Cross Pendant also saw a new addition, including: 18K Gold Cross Pendant, an 18K White Gold Cross Pendant,  and a Men’s Platinum Cross Pendant.

This cross is fully solid gold and finished on both sides (not hollow), measuring approx. 1 1/4″ tall x 1″ across and 2.5mm thick. Although originally crafted for men, both men and women enjoy this beautiful, expression of Christian faith.

This amazing cross was followed by the release of our 18K Gold Onyx Cross Pendant.

What is better than your own writing or the handwriting of your beloved, engraved onto a wedding band? Apples of Gold Jewelry created the concept of engraving your own writing onto a gold band with our new Personalized Handwritten Wedding Bands in 14k gold yellow, 14k white gold, and 14k rose gold.

Simply scan your handwriting onto your computer and email it to us! We’ll do the rest!

Our unique Victorian-Style Three Stone Diamond Ring became a hot seller in 2008 and as platinum prices dropped, we decided it was the perfect time to offer a Victorian-Style 1 Carat Three Stone Diamond Ring in Platinum also. Also available as a three stone 1 carat diamond engagement ring in 14k white gold or a 1/2 Carat Platinum Three Stone Diamond Engagement Ring.

We look forward to 2009 as we expect to add more items than we did in 2008! We expect to double our production in 2009, with 500 new jewelry pieces being added in the 1st Quarter alone. Yes, we plan on keeping the Apples of Gold Jewelry elves very busy through 2009!

2008 Jewelry Survey

Holiday shoppers may not be spending with reckless abandon this holiday season, but they will be spending. An interesting jewelry survey by National Jeweler, explains the psyche of the 2008 jewelry enthusiast.

Online spending grow only 1% in October 2008 compared to spending in 2007, the lowest monthly rate of growth since Comscore began “measuring the digital world” in 2001.

The good news is, jewelry, especially gold jewelry, is still on jewelry shopper’s list, according jewelry industry news magazine, National Jeweler. According to their October 2008 survey, 51% of those surveyed plan on still buying fine jewelry this holiday season.

One has to ask whether National Review surveyed their subscriber base of jewelry enthusiasts to come up with a majority of shoppers wanting jewelry this year. Still, the results are educational to say the least, with gold jewelry remaining on the top of jewelery shoppers lists (50% of respondents). This was followed by silver jewelry (38%) and diamond jewelry (35%). Other survey choices included gemstone jewelry (21%), fine watches (14%), and pearl jewelry (12%).

Many jewelers were surprised to hear that gold jewelry ranked #1 among jewelry shoppers, given the precious metals higher than average prices over the last several years. Some jewelers, Apples of Gold Jewelry, among them, has also noticed a resurgence in yellow gold among its customers. White gold, of course, had been the industry leader from some time.

Although most surveyed say they prefer shopping at independent jewelers, Internet jewelers ranked high relative to discount jewelers, warehouse clubs, and television shopping. Internet jewelry stores rose from 9% of those surveyed to 13% compared to the previous year. Price considerations and increased reliability among internet jewelers has played a factor in this steadily growing surge.

Given the “gloomy” and unpredictable economic fears facing Americans this year, respondents considered price and value the #1 factor influencing their decisions (42% ), followed by personal taste (37%), and the opinion or suggestion of a “significant other” (22%).

While the majority of those shopping jewelry plan on buying jewelry less than $100 (21%), this was followed by $100-$500 (16%), and by those who say they will spend $500-$1,000 (9%). 6% of shoppers surveyed said they will buy Jewelry over $1,000.

Aside from price, shoppers overwhelmingly said they want personal attention when shopping. What jewelery shoppers did not seem to care much about was: what celebrities are wearing (2%), what they see in magazines (3%), internet ads (3%), and TV ads (5%)–in other words, consumers want to be influenced by their own tastes, considerations, and qualities.

Once Upon A Jewelry

There is a treasure trove of historical information regarding jewelry of the bygone days. We all know about rings, earrings, necklaces, bracelets, and pendants because they are very much in existence today. But do you know that there is at least one kind of jewelry that was so much en vogue in the 17th century?  This was the kind worn by high society and the nobility and were often featured in their life-sized paintings by the grand master painters of centuries past.  Unfortunately for us, these pieces have not been worn publicly beginning in the early 18th century and has since been relegated into the closets of museums and auction houses.

We are talking about stomacher jewelry or stomacher brooch jewelry. It was first introduced in Spain in the early 1600 and was quickly adapted as a fashion trend in the whole of Europe. Wikipedia defines a Stomacher as :

“… a decorated triangular panel that fills in the front opening of a woman’s gown or bodice. Stomachers were often embroidered, or covered in pearls, diamonds and other jewels.”

In many instances, a stomacher is created in interlocking sections (see photo at left), which could be worn together or individually depending on the occasion and the wearer’s whim. It could also be part of a set of jewelry that includes a ring, earring, bracelet and a pendant.  Originally designed with beautiful embroidery, it was during the renaissance period that precious stones, pearls and diamonds were incorporated through sewing onto the stomacher fabric.  The design is very  ornate that usually extends from the neckline to about 10 inches deep into the waistline. The workmanship, the details and the amount of jewelry set into it is awe-inspiring, to say the least.

Moreover, stomachers were not permanently affixed to the dress; it was simply held together by pins, usually under the bustier, and can be removed to pair with another dress that matched it. It was a must-have accessory for a woman who wanted her wealth and status affirmed.

No one really knows why this fashion did not take off like every other piece of jewelry still in use today. We could only surmise. But the more important thing is once upon a time, history lent us a period when man’s creativity, and to some extent its profligacy, reached the degree that it did during the trend of the Stomachers.

Jewelry Affiliate Program

Apples of Gold Jewelry has launched its official jewelry affiliate program with Google network (formerly Performics).

What is the Apples of Gold Affiliate Program?

The Affiliate Program is an excellent way to generate additional income and add value to your web site by linking to ours. We offer 2,500+ affordable jewelry products at an average of 50% below retail which your viewers will appreciate! Best of all, it’s Free to join and all you need to do is follow the easy step by step plan to getting started. You don’t need inventory, now you can create your own store without the headaches, hassles or time.

How Does It Work?

Apples of Gold will pay you attractive commissions on purchases generated from your site. Compare our merchandise to other sites, and you’ll see that the commission you could collect from a few items at Apples of Gold might take you quarters to accumulate through other affiliate programs. We handle all transactions, processing and customer service. We’ll even provide you with detailed online reports that track sales activity originating from your site through the Google Affiliate Network.

Excellent Creatives for your site!

Why Apples of Gold?

Apples of Gold is Online Jeweler since 1999 with 25 years of experience offering 2,500+ affordable jewelry products at an average of 50% below retail. We offer affiliate only coupons, 45 Day Return Policy, Free Shipping via FedEx and are members of the BBB with a “AA” rating. Our staple products include: wedding bands, engagement rings, gold bracelets, gold chains, gold necklaces, gemstone jewelry, gemstone rings and diamond rings. We also carry specialty items: colored diamond jewelry, blue diamonds, black diamonds, alternative gold types such as rose gold, handmade wedding bands, bangle bracelets, Christian jewelry and personalized jewelry. Our brand name pieces include Benchmark Rings, and we are expanding to other name brands in the upcoming year.

Why should I join the program?

Linking to The Apples of Gold offers your viewers a value-added service that helps fulfill their overall shopping needs. This is a key sales opportunity to strengthen the long-term impact of your web site, while elevating your status as a respected Internet resource. As our affiliate partner, you decide how to integrate The Apples of Gold text links & banner graphics with your site. No matter how you design your interface, you’ll earn commission on purchases generated from your site using our link campaign. The more you refer, the more you earn – it’s as simple as that. We provide all the logos, banners and text links you will need to to get started! Ultimately, it’s up to you! Our most successful affiliate’s merchandise the product directly on there site with a personal recommendation and when clicked upon comes directly to ApplesofGold.com for order fulfillment and commission.

The Apples of Gold Affiliate Program Program Details:

• Join for Free and earn a generous referral fee!
• 30 Day cookie – you get credit for up to 30 days!
• Average sale is $500 and get paid on a monthly basis!
• Enhance your site with Apples of Gold Jewelry Products from an industry leader!
• Easy cut & paste html library of banners & text links to help you increase sales!
• Check your earnings and traffic reports online anytime.
• We process the orders, ship the products, bill the customers.
• We handle all customer service!

To get started now, just follow these instructions:

• Complete the online application at Google Affiliate Network
• Upon approval, we will send you an email detailing all the information you need to get started

If you have any questions at all or need assistance, please feel free to
contact us!

Jewelry: A Modern Story

Jewelry’s modern story begins in the late 19^th century, which heralded many historic events affecting jewelry making and design, including:  

1. The birth and success of the industrial revolution;

2. The introduction of fashion and costume jewelry, and;

3. The launch of high-quality jewelry firms that have continued the tradition of fine jewelry into the 21^st century.

 

The industrialization of this age led to more jobs for the masses, ergo, economic freedom for the majority. This social phenomenon somewhat diminished the reputation of jewelry as a symbol of social rank. The new wealth created by this economic boom afforded the working class the option of buying jewelry that mostly matches their tastes. It is also important to note that as a result of this new economic opportunity, we witnessed the birth of society’s Middle Class.

 

The demand for affordable and simple-design jewelry increased. For supply to keep up jewelry was mass-produced and this in turn cheapened the market price.  Usually made from imitation of precious stones and electro-plated gold and silver, this jewelry eventually became known as fashion/costume jewelry that is devoid of intrinsic value. But it became a hit with many in the populace as it could be versatile and very inexpensive.

 

Men, for the majority of history up to this point, wore an equal amount of jewelry as women. But in this period, men’s jewelry was greatly reduced to buttons, cufflinks, and rings. At the same time, threatened by middle class consumption of something previously and exclusively enjoyed by the nobility, the wealthy sought the services of master craftsmen and goldsmiths to design personalized and high quality jewelry for them instead.

 

Fortunately, the 19^th century had provided for this particular need. There were several notable firms founded in this period that propagated the fine jewelry tradition well into the present times. Among them are by Peter Carl Faberge in 1900 Russia; Alfred and his son Louis Cartier in 1898, Paris; Charles Lewis Tiffany in 1851, New York; Bulgari in 1884, Rome; and Patek Philippe in 1851, Geneva (an acknowledged pillar of the timepieces industry).

 

Watches and matching jewelry were introduced in this period and have remained a significant part of jewelry ownership.

 

One thing we can affirm is that modern day jewelry is a thoroughly eclectic collection of various, differing cultures and religions; as well as from the artistry of craftsmen and goldsmiths who once upon their time, dabbled in the design and indulged the whims of their richer patrons.

Jewelry: A Walk Through Time

The term jewelry came into the English language in the mid-thirteenth century; it is derived from the French word joule, which in turn came from the Latin word jocale; the term roughly translates to as plaything.

Curiously, what began as a mere plaything became an important part of every society, and through all and every culture, in mankind’s history. The use of jewelry is one of the few practices that has remained to endure time and change-whether social, cultural or political.

As jewelry use surpassed its primordial function as playthings to our prehistoric man, it then evolved into a symbolic accent to denote an individual’s social and religious rank. Moreover, gemstones in particular, were the popular jewelry of choice to ward off evil spirits, and were preferred by the more superstitious culture. Much later, jewelries were incorporated into functional and practical uses in clothes as buttons and accessories. Gold, on the other hand, served as a currency to trade or buy other goods.

Most of us living today may not know it, but wearing jewelry dates back to as far as 85,000 years ago. Based on the most recent archeological find at Grotte des Pigeons, Taforalt in Eastern Morocco, shell beads coated with red ochre are believed to be the oldest form of ornament or jewelry used in prehistoric time. In addition, early ancestors of modern jewelry were made, crudely and simply, from various natural materials like beets, stones, teeth and shell beads, strung together to form a necklace, anklet, or armlet. Among these ancient forms, it was the shell beads that had amazingly survived time, particularly of the genus Nassarius, the same kind of shell beads previously found in the caves of Israel and Algeria.

There are no existing data that points to when exactly the practice of burying jewelry with its owner began. Most discoveries of these ancient pieces were found in tombs- from the Egyptians to Roman burial chambers; from the caves of prehistoric man to the Incas and Mayans, these jewelries were buried together with the owners. Historians can only assume that the owner may be a high-ranking spiritual or tribe leader to afford to be buried with their possessions.  These days, jewelry is passed on to the next generation of family members.

Archeologists have acknowledged that there is no conclusive evidence the latest find is the oldest they will ever find. Like the previous discoveries, it is simply a matter of time before another string of shell beads will turn up. As to when, only luck knows!

(End of the First in a Three-Part Series)

Next week: A look into the use of jewelry in the Middle Ages-Renaissance periods.

Photograph courtesy Ian Cartwright, Institute of Archaeology, Oxford University

Apples of Gold Jewelry Launches Its Official Blog

After eight years as a leading online jeweler, Apples of Gold Jewelry has launched its official weekly blog.

Covering major jewelry industry news and topics, Apples of Gold’s objective is to provide interactive and trustworthy content to its customers and jewelry enthusiasts.

Apples of Gold is expecting a powerhouse of qualified writers, including Yelena Jenkins, who has worked as Senior Editor for California luxury lifestyle magazine, Hills & Lagoons as well as Style Editor for StarStyle.com. She currently writes for eHow.com, Celebrations.com, Shoetube, and Elite Hawaii Weddings. Yelena will be covering the Jewelry Trends, News, & Tips category for Apples of Gold.

Learn more about our writers, which include professional fashion blogger, Tierra Wilson and freelance writer Sheryl Martinez.  Tierra Wilson’s work can also be seen on Gadget Spice, The Watchery, and Stylefeeder with an insightful and penetrating look at fashion and luxury products. Cheryl Martinez, business owner and freelance writer, will be giving us an in depth look at jewelry history.