Want to make your shop more efficient and boost your cash flow? Here are three ways to do it.
FIRST MONEY SAVING TIP:Hire a High School Kid As a Polisher
Have a high school or college kid do your polishing. It only takes 30 days to train a high school or college kid to polish 80 percent of what jewelers do. If the jeweler wants to polish the 3-carat emerald ring, fine, but no need to polish sizings, heads, chain solders, earring posts, etc.
Look at it this way. The bench jeweler should be producing $100 to $150 an hour depending upon speed and skill. Every hour a jeweler polishes (because you don’t charge to polish the repaired item), you lose $100 for the time spent polishing. Pay a high school kid $10 an hour to start. While the polisher is polishing at a cost of $10 an hour, the jeweler is still producing $100.
SECOND MONEY SAVING TIP:Don't Roll Your Own Sizing Stock
If you don’t have enough hours in the day, then don’t roll your own sizing stock. I just went to Stuller’s site and 1 ounce of casting grain cost $772.34. I looked at buying a piece of 14K sizing stock equaling 1 ounce and the sizing stock is less than 2 percent more at $782.97 per ounce to be produced. The end result is that it costs $10.97 to have someone else’s machine make you 1 ounce (32 inches) of sizing stock. If you have more work than you can finish in the day, it’s not worth giving up $100 production income to save $10.97 for the hour.
Let me address a question you’ll bring up: “I buy it cheap off the street!”
Today, Stuller is charging $39 a pennyweight for sizing stock. You could say “I buy my gold at $25 a pennyweight.” If you send your old gold in for credit against new sizing stock, they will charge you a fee to refine it and of course a few bucks to mill the sizing stock.
So, your cost rises from $25 to $32 or $35, but still less than $39. Meanwhile, the jeweler is producing $100 per hour rather than trying to save so many dollars per ounce. And, the metal will be better quality because it’s been refined. Bottom line? Not enough time; don’t roll your own. Sitting on your hands? Fine, roll your own.
THIRD MONEY SAVING TIP:Cash in Extra Findings
All of the findings lying on your bench, in drawers and Ziploc bags that you think you’ll use one day? Cash ’em in.
When you need to replace a head, maybe you order a 6mm and 6.5mm just in case. But do you send the unused one back?
I visited a shop once where the jeweler needed an 8.55mm wide piece of gold to size a ring just two sizes larger. He took a 6mm wide piece and rolled the whole darn piece out to 8.5mm! Now we had an 8.5mm wide piece that was 10 inches long and no longer had any 6mm wide piece in the house!
That piece had been sitting on his bench for seven months with him thinking, “I’m sure I’ll use it.” I scooped up all of the gold stock/heads/parts/pieces he was saving, and when gold was $800 an ounce, his bench top had over $5,000 at cost of unused findings and sizing stock! I gave it to be melted for money.
David Geller is a consultant to jewelers on store management. Email him at dgellerbellsouth.net.
This article originally appeared in the June 2017 edition of INSTORE.
Something Big Is Missing From Gene the Jeweler's Business
Several somethings, actually. And as in many other cases, the issue is not so much about what the fictional jeweler is doing. It's what he's not doing.
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