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tvanwho

Why Do Coin Dealers And Jewelers....?

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so why do coin dealers and jewelers tell us the retail price on our found jewelry is like $1,000 + and then they turn around and offer us pennies for it? I never understood this ?

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They have to make a profit. Wholesale versus retail.

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On 8/12/2018 at 3:35 AM, Steve Herschbach said:

They have to make a profit. Wholesale versus retail.

 

On 8/11/2018 at 4:39 PM, tvanwho said:

so why do coin dealers and jewelers tell us the retail price on our found jewelry is like $1,000 + and then they turn around and offer us pennies for it? I never understood this ?

I am with you tvanwho. Bit of a difference between $40 & $1000. They are parasites. The most they have to do, outside of cleaning & maybe put another stone in, is to get off their chair....look over the counter at what you have & then slap you in the face with an insult like that offer. I understand there is a profit for them to make......but.....Human greed knows no bounds. After all the "hard" work & effort that has gone to in finding it. I better stop there. Or was he just pulling your leg? 

Very nice find Happa54 👍

JW :smile: 

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Not all are like that.  I sold several ounces of rings and got 90% of spot.  That seems fair doesn't it?  No stones involved.

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90% of spot is about the melt value that I was offered, so how do they manage to get people to pay the $1,000 figure ? Next time I am looking at rings I will ask what the return policy is or if I need to sell it back to them ,what will they give me for it? Too bad I can't legally record the conversation tho? Maybe the flea market is the place to go or ask around at work if anybody is looking for a ring I found and get offers? Man's greed knows no bounds it seems...buy for $50 and sell for 10-20 times that, what a racket ??

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Market the item youself. Retail price on jewery is insane and is usually bought on impulse. Jewelry is a loss not an investment.

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1 hour ago, dsrtdwg1 said:

Market the item yourself. Retail price on jewelry is insane and is usually bought on impulse. Jewelry is a loss not an investment.

Unless you have found the gold & made some jewellery yourself. Then it has real worth, meaning & value. It doesn't have to be a monetary value. Reminds me of an article I read in a paper here in NZ quite a few years ago. An english couple who were engaged to be married were doing an organised bus tourist trip through NZ called the "Kiwi Experience". https://www.kiwiexperience.com/book-your-nz-trip/kiwi-experience-deals?gclid=CjwKCAjw-8nbBRBnEiwAqWt1za7QqCqf1GQVKcDheywkQ9zhwhW3sKYek8-ci3RWOlhx81r1zmnFEhoC5LMQAvD_BwE&gclsrc=aw.ds?gclid=CjwKCAjw-8nbBRBnEiwAqWt1za7QqCqf1GQVKcDheywkQ9zhwhW3sKYek8-ci3RWOlhx81r1zmnFEhoC5LMQAvD_BwE&gclsrc=aw.ds

Queenstown area. Click on the you tube footage

 https://www.kiwiexperience.com/discover-new-zealand/nz-north-island-travel-guide/queenstown

The accomodation was all sorted for each night on there travels at the various places they passed through on their tour. They were coming down the West Coast of the South Island & stopped in the old gold town of Ross. http://www.rossgoldtown.org/

They got wind that it was a gold town & long story short was that the idea of panning their own gold to make their wedding rings was hatched. They decided to try to do that & organised to leave the bus & get picked up on a later bus going through. They had never panned for gold ever & had no idea what they were in for. The romance side of it was in their hearts. (suckers):rolleyes::biggrin: There story was taken to heart by locals & they were given all the encouragement despite being told there chances to get enough gold for two rings were slim in the public fossicking area. But they were keen as mustard to give it their best shot. They were determined. So they were loaned a sluice box, shovel, pan & buckets & showen where to go & how to go about it & were left to it. I don't recall how many days they stuck to it & despite blisters, being total wrecks & in agony, they got enough gold to make the two rings. What a memory, meaning & value they will place on those two rings. I just hope they are still married.

Ross is home to NZ's largest known recorded nugget. https://nzhistory.govt.nz/page/nz-s-heaviest-ever-gold-nugget-discovered

Ross is still pumping out gold. You may like to scroll backward & forwards on this next link for a bit of a quick NZ gold history. https://teara.govt.nz/en/photograph/8652/ross-west-coast.

This makes for interesting reading https://teara.govt.nz/en/photograph/8652/ross-west-coast

Got carried away....again....sorry.:rolleyes:

Cheers

JW :smile:

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Thanks for sharing the interesting info. I like the policy of mining companies having to purchase bonds for the cleanup.  I just did some research and found that companies are required in the U.S as well to buy bonds or to pay a percentage of the cost of clean up, up front. Quebec require 70% of the cost of cleanup, up front.

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On 8/10/2018 at 9:39 PM, tvanwho said:

so why do coin dealers and jewelers tell us the retail price on our found jewelry is like $1,000 + and then they turn around and offer us pennies for it? I never understood this ?

3,000 pounds of #2 steel only costs about $350. If you ignore the design, alloying, fabricating, shipping, storage, dealer profit, taxes, CAPEX, labor and marketing costs a small car shouldn't cost much more than $500.

Jewelers do all that and then display and advertise their goods in expensive limited exposure retail settings for months or years before selling them. The elemental gold and gems in a simple necklace or ring often involves a higher cost of raw material than a car that sells within 6 months in a very low overhead retail setting.

The car dealer takes the car into stock on credit, the jeweler carries their stock on a cash basis. When you factor in the costs for the time and opportunity value of money the jeweler has a much higher unit overhead and still manages to provide a unique product, unlike the auto manufacturers.

Why should a car with a few thousands of dollars worth of material and labor cost $30,000 new and only net $500 when sold for scrap value? Is the junkyard that's buying your scrap car making a fortune from that $500 purchase? Or maybe the car manufacturer is a crook?

When you bought your last car or jewelry did you weigh them and figure out their raw material value before you bought them or did you buy the car or jewelry that best fit your desires and budget?

You can't really blame the buyer of your gold/gems for the situation. At best they will make about 5% on the transaction after their costs are subtracted.

If you purchased your jewelry or car with an eye to resale values you could receive more in a public resale situation than any jewelry scrap dealer or junkyard will pay you. A Cartier or Bulgari necklace will usually appreciate in resale value over time. A Walmart 14k gold necklace has a market value little better than scrap the day you purchase it.

If the jeweler tells you they think your jewelry has a retail value of $1,000 and you accept less than spot value for the metal is it the jewelers fault you decided to scrap the piece rather than selling it yourself for $1,000?

If a used car dealer tells you the car you purchased for $30,000 7 years ago is now worth $2,000 in the retail market and you sell it to a scrapyard for $500 is it the used car dealer that's at fault for your "loss"?

You can't really expect either the used car dealer or the jeweler to purchase your used goods at the retail value and  put them into their stock, there would be no profit left for them.

The jeweler and the used car dealer both have distribution networks where they can buy and sell goods just like the ones you are offering for considerably less than retail. They have long term relationships and credit built up through these networks. Why would they pay you anywhere near their wholesale cost when there is only one transaction involved and you won't be there to back up your deal or provide more business in the future?

I realize you have little control over the quality or value of your finds but I hope the above will give you a basis for understanding the concept of "value" when applied to jewelry. There are ways to get more money for your finds but they involve more work than just figuring out scrap value.

If you want better offers from your buyers establish yourself as a long term customer/supplier. Find one or two buyers who offer you the best deals and build a relationship with them. Once you show some knowledge, respect and consistency your offers from them will increase right along with your value to them as a long term customer. I know several jewelers and coin dealers who regularly give me much better deals than they would an unknown off the street customer who was offering the same goods. That's because I've created a long term ongoing relationship that is mutually beneficial.

Or you can try selling your finds at retail prices to the public. The jeweler or coin dealer has already provided you with a good estimate of retail value for free. After a few rounds of the retail experience you will better understand how overhead and the time cost of money affects the final cost of goods. You will get more money for your find but it will involve more expense and take considerably longer for you to complete the transaction.

Business is about making a profit but for tradesmen it's also about building relationships that will further their business goals. Try to walk a mile in their shoes and I think you will discover that the real value in jewelry is all about market realities and is not based on the cost of materials they are made of or the price tag in a display case. If you continue to sell your finds for scrap value you can't really expect to get retail values. If you want retail values you will need to find a profitable way to sell them yourself at retail.

 

 

 

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First, I would recommend a relationship with the coin or jewelry dealer.  Buy something from them.  Sell them some stuff. Mine knows I will be in to trade silver and gold jewelry I find for coins or bullion, so I get fair deals on things both ways.  We are at the point where she expects to see some of my more interesting finds, and she also knows what types of things I am looking for, and sets them aside for me to look at.

My  1, 2.5, 5, and 10 dollar gold coins for testing my detectors have all been purchased or traded for with her...some are in PCGS holders, some are damaged or were jewelry...but we are both making out well with our transactions now.

There are a bunch of coin/jewelry dealers in my area I trust about as far as I can throw them, and it took a while to find this one...so have patience.  An impatient person will never get value, imo.

Good luck.

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