When it comes to jewelry buying, paying retail doesn’t always make sense. There are hidden costs built into a retail price and savvy consumers need to know this up front. Boston Jewelers, for example, have a totally different supply chain than a pawn shop that results in a higher price to the consumer. Let’s look at why that is the case.
Since 1985, Empire Loan has been buying gold and diamond jewelry based on the scrap price of the metal and a percentage of the wholesale price of any diamonds the jewelry may have. While we’ve been doing it based on where gold is trading on the commodities market, the fact is, Empire Loan and other pawn shops are buying jewelry for less than any retailer can. That means we can sell for less than any other retailer out there. Compared to most jewelry and department stores, Empire Loan’s prices are half to a quarter of what you would pay retail anywhere else.
People see Boston Jewelers and national chains advertising low prices for gold and diamond jewelry and assume that these stores will have the best prices. The assumption is that because they’re a big company, they have greater buying power, and the ability to pass on savings to the customer. But this is not the case. While it may be true that they have buying power, the supply chain their merchandise travels through involves more people and more costs along the way, which drives prices up.
Let’s assume the gold and diamonds used in their jewelry was dug up in a mine. The company that ”dug it up” has their markup when they sell it to the manufacturer who is going to make the jewelry, adding more cost and profit. Now it’s sold by a distributor who also tacks on a profit. That’s before the department or jewelry store marks it up and sells it to consumers. That’s 4 different markups before you even see it in their display cases!
Specialty jewelry stores are another avenue. You walk into a high end store and are met by a professional sales person who is an “expert” in gold and diamond jewelry. They will sell you nothing but the best! These fancy stores allow novices like you and I to feel that this is the only place one should go because they have a reputation to uphold. The fact is, their supply chain is just like the one mentioned above with one exception — they add on a bigger markup for that “reputation”. In the end, gold is a certain karat and weight, and the diamonds are a certain quality, wherever you buy it. The fancier the store, the “fancier” their prices.
In all of these cases, when you buy a ring, necklace or pair of earrings, they simply go in the back room and grab another one to fill the display case. These stores sell hundreds, if not thousands, of the same items over and over.
At Empire Loan, the jewelry we sell is truly one of a kind. It may be unique estate jewelry, or recycled jewelry in which the materials of an old piece are reused to create a new one. Either way, without the supply chain involved in retail jewelry operations, we can offer you beautiful pieces at the lowest possible price around. Stop in and have a look for yourself.
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