What jewelry related items have the most commodity value as a % of their retail price? It seems like pearls, gemstones and stuff like that would be pretty low. Diamonds somewhere in the middle And gold, platinum and silver at the top?
I would say that diamonds and gemstones are not exactly commodities because they are so individualized (of course, there are commodity diamonds for example but they suck). You can buy simple gold jewelry for only slightly more than the metal costs. I don’t know anything about pearls.
Well, the components of a jewelry price are fivefold (unless I’m forgetting something, which I might) - cost of materials, cost of labor, design, brand, and historical/sentimental significance. You might include transport and taxes too. Materials: obviously you could melt down the metals in jewelry, extract the gemstones and sell them. And a manufacturer can’t sell an item for less than the materials cost and stay in business very long. Diamonds and gemstones are somewhat individualized, but there are standard grades and colors and sizes of gems (not unlike oranges or other agriculultural commodities). Labor: these days, a lot of jewelry, even if designed in developed countries, is manufactured in developing Asia - China (inc Hong Kong), Malaysia, Philippines, etc… Those costs tend to be fairly low, but they do factor in. Design: in developed countries, this is where value added can come in. It’s hard to command a premium on a plain gold band, since there isn’t a lot of differentiation. However, a good design will attract a higher price. Design is an interesting thing, since it adds value, and is a finite (not everyone can do good design) but non-rival resource (one person designing well doesn’t mean that fewer other people can design well). Brand: OK, if the plain gold band comes from Tiffany & Co., or Cartier, etc., you get a premium. Historical/Sentimental significance: If Queen Anne owned it, it’s probably worth more than all the others with the same quality. If your grandma owned it, it’s probably worth more to you than others are willing to pay for it. So basically, if you want high commodity value as a percentage of your jewelry, you want to go for non-sentimentally-significant, unbranded, plain design jewelry. Jewelry without gemstones is probably better, because you would have to sort and grade them, whereas gold can be melted down and separated.
Oh, and something I learned in high school chemistry… If you have a house fire, your diamondsd are liable to combust as the carbon burns and turns into CO2 and Carbon Monoxide. Your pearls, however will most likely survive the fire. The lesson (according to Ms. Lawrence, my H.S. chem teacher): if you’re trying to decide between diamonds and pearls for your girl… you STILL go for the diamonds!
Lol. In fact, when a diamond burns up since it is all carbon it leaves no ash - just poof and it’s gone. However, cubic zirconia require really high heat to burn so one way you can tell the difference between cubic zirconia and a real diamond is with a propane torch…
Haha that is the best way to tell if a diamond is real. I test every diamond I see that way.