Selling Jewellery

[jennyjoan]

How come a jeweller will buy gold etc from a person yet he has millions of pounds to sell in his shop - how does he benefit. TIA

[grasscarp]

He will buy your gold because it is a commodity and can be sold as jewellery or for scrap. He will not lose money - that is the benefit.

[woofgang]

What he sells in his shop is marked up for his profit and also includes manufacturing costs. The price you pay for a piece of jewellery is well above scrap gold value. The jeweller will also pay you a bit less than the posted scrap value to make his cut when he sells it on. people who process gold scrap won't buy ounces here and there so jewellers buy bits and pieces and amass them into larger amounts to sell to the processor.

[jomifl]

He sells it for more than it costs him, that is how business works.

[jennyjoan]

thanks for your replies but still withall - you know with the recession not many people are buying jewellery from the jewellers so surely their first priority would be to get rid of the jewellery they have to sell.

[woofgang]

why? Its a separate area of the business.

[factor-fiction]

Over time he will sell at least as many as he buys, and he'll sell for a lot more than he pays

[Hypognosis]

@jennyjoan

You cannot eat gold so, in a recession, those who need cash more than they need body decorations willingly exchange their jewellery for cash. Jewellers have a steady trade and will seldom fall on hard times.

If they were to prioritise selling their stock over all new acquisitions, the reduced product choices would drive some customers elsewhere and then they really would risk going down the tubes due to cashflow problems (if rent/rates/utility bills/wages etc. exceed income).

[boxtops]

I'm not aware that people are not buying jewellery these days - perhaps not spending quite so much, but they're still buying.

[Old_Geezer]

Adding to stock is no bad thing so long as you have enough finance to to cover cashflow. Longer term it is bought to be profitable so long as there is sufficient difference between the buy & sell prices. That presently only the rich are buying and the poor are selling (more or less) isn't going to affect it that much.