About jewellery industry

What is the Jewelry Industry?

The jewelry industry encompasses the design, manufacture, marketing, and sale of ornaments
such as necklaces, rings, earrings, bracelets, and other decorative items made from precious
metals, gemstones, and other materials. It is a multi-billion-dollar global sector driven by cultural
traditions, fashion trends, and the inherent value of materials like gold, diamonds, and platinum.

The jewelry domain is a significant part of the global luxury market, with cultural, economic, and
artistic influences shaping its value and demand.

Importance of the Jewelry Industry

1. Cultural and Social Significance:

● Jewelry is deeply rooted in traditions and customs across the world, symbolizing status,
wealth, love, and religious beliefs.
● It plays a central role in major life events like weddings, engagements, and festivals
(e.g., Diwali in India, Christmas globally).
● Certain designs and materials reflect heritage and cultural identity.

2. Economic Contribution:
● A key contributor to the global economy, valued at over $300 billion annually.
● Employs millions of people worldwide, from miners and artisans to designers and retail
workers.
● Countries like India, China, and the UAE rely heavily on the jewelry sector for exports
and trade.

3. Investment Value:
● Jewelry, particularly gold and diamond pieces, is considered a safe investment.
● Gold jewelry holds intrinsic value, providing financial security and acting as a hedge
against inflation.

4. Fashion and Self-Expression:

● Jewelry is a major component of the fashion industry, allowing individuals to express
their personality and style.
● Modern consumers demand customizable and unique designs.
5. Global Trade and Exports:
● Countries like India and China are major exporters of gold jewelry and diamonds, fueling
global trade.
● Diamonds and gemstones mined in Africa are polished and processed in hubs like India
before entering international markets.

6. Technological and Sustainable Innovation:

● The industry drives advancements in technology, such as 3D printing for jewelry design
and AI for personalization.
● Growing focus on sustainability and ethical sourcing helps address environmental and
social concerns.

Jewellery industry is considered as unorganised sector and there are very few organized
players in industry like malabar,tanishq,joyalukkas,jos alukkas grt etc. and this industry is
mostly controlled by unorganised players but dominance of retail chains is growing due to lack
of proper management and process in these unorganised sector due to which it is difficult for
unorganized players to match the performance and service and win trust as retail chains
Jewellery industry functioning
The jewelry industry flow typically involves the following stages:

Upstream Segment

1. Mining and Extraction: Mining companies extract precious metals, diamonds, and gemstones
from the earth.
2. Refining and Processing: Refiners process the extracted metals and gemstones into usable
forms.

Midstream Segment

1. Design and Prototyping:

Jewelry designers create designs and prototypes for new pieces.
2. Manufacturing:
Jewelry manufacturers produce the designed pieces using various techniques, such as casting,
stamping, and setting.
3. Wholesaling
: Wholesalers purchase jewelry from manufacturers and sell it to retailers.

Downstream Segment

1. Retailing :
Retailers sell jewelry to end-consumers through various channels, such as brick-and-mortar
stores, e-commerce platforms, and catalogs.

2. Repair and Maintenance:

Jewelry repair services fix and maintain existing jewelry pieces.

Support Segment
1. Packaging and Display
: Companies provide packaging and display solutions for jewelry retailers.

2. Insurance and Appraisal

: Insurance companies and appraisers provide coverage and valuation services for jewelry
pieces.

3. Marketing and Advertising:

Marketing and advertising agencies promote jewelry brands and products.

Technology and Innovation

1. 3D Printing and Design

: Technology enables the creation of complex jewelry designs and rapid prototyping.

2. E-commerce and Digital Marketing:

Online platforms and digital marketing strategies enhance customer engagement and sales.

3. Blockchain and Authentication:

Blockchain technology ensures the authenticity and provenance of jewelry pieces.

The jewelry industry flow involves various stakeholders, from mining and manufacturing to
retailing and repair. Technology and innovation continue to shape the industry, improving
efficiency, transparency, and customer experience.
industry functioning flow chart
Jewelry Industry Flow Chart

1. Mining :Raw Material Mining & Refining

- Extraction of precious metals (gold, silver, platinum) and gems (diamonds, rubies, emeralds)
- Refining of raw materials to produce pure metals and gems

2. Bullion Merchants
- Purchase refined metals and gems from refineries
- Sell to manufacturers, wholesalers, and other industry players

3. Manufacturers
- Design and create jewelry pieces using metals and gems
- Produce jewelry in various styles, designs, and quality

4. Wholesalers
- Purchase jewelry from manufacturers
- Sell to retailers, other wholesalers, and industry players

5. Retailers
- Purchase jewelry from wholesalers or manufacturers
- Sell to end-consumers through physical stores, online platforms, or other channels

Challenges and Opportunities

- Every stage of the jewelry industry presents unique challenges, such as fluctuating raw
material prices, intense competition, and changing consumer preferences.
- Retailers face additional challenges, including thin margins, high operational costs, and the
need to deliver exceptional customer service.
- Technology has become a vital pillar for retail stores, enabling them to streamline operations,
reduce costs, and enhance customer experiences.
Mining
>Raw material mining
Raw material mining in gold involves several stages, from exploration to extraction, processing,
and refining. Here's an overview of the expenses and pricing of gold:

Expenses in Gold Mining

1. Exploration costs: $100-$500 per ounce (depending on the location and complexity of the
project)
2. Mining costs: $300-$700 per ounce (including labor, equipment, and infrastructure)
3. Processing costs: $100-$300 per ounce (depending on the type of processing and equipment
used)
4. Refining costs: $50-$100 per ounce (depending on the refining process and location)
5. Transportation and insurance: $50-$100 per ounce (depending on the distance and mode of
transportation)
6. Taxes and royalties: 10%-20% of the total revenue (depending on the country and
jurisdiction)
7. Environmental and social costs: variable (depending on the mining method and location)

Pricing of Gold

The price of gold is determined by market forces, including:

1. Supply and demand: The balance between gold production and demand from investors,
jewelers, and industrial users.
2. Global economic trends: Interest rates, inflation, and economic growth can influence gold
prices.
3. Geopolitical events: Wars, elections, and other global events can impact gold prices.
4. Currency fluctuations: Changes in currency values can affect gold prices.

The current gold price (as of 2023) is around $1,800-$1,900 per ounce.

Break-Even Analysis

To determine the break-even point for gold mining, we need to consider the total costs and the
gold price. Assuming an average total cost of $1,200 per ounce and a gold price of $1,800 per
ounce, the break-even analysis would be:

Break-even point = Total costs / Gold price

= $1,200 / $1,800
= 66.7% of the gold price

This means that if the gold price falls below $1,200 per ounce, the mining operation would not
be profitable.
Keep in mind that these are rough estimates, and actual costs and prices may vary depending
on various factors, including location, mining method, and market conditions.
Bullion Merchants
Bullion bank and merchants
Bullion banks source gold from refinery companies and sell it forward to bullion merchants in
local markets. Manufacturers then purchase the metal from these merchants to produce jewelry.

The profit margins for bullion banks and bullion dealers are relatively low, ranging from 0.001%
to 0.002% (approximately ₹100-200 per ₹1 lakh).

The bullion business is a high-turnover, volume-based industry, which allows it to operate with
low margins.

Typically, bullion banks and merchants are located in markets with wholesalers.

Coins and bars sold in retail stores and banks are charged a premium, which includes
manufacturing costs.

Few refiners are

International Refinery Dealers

1. PAMP (Switzerland)
2. Argor-Heraeus (Switzerland)
3. Valcambi (Switzerland)
4. Johnson Matthey (UK)
5. Asahi Refining (USA)
6. Rand Refinery (South Africa)
7. Perth Mint (Australia)

Indian Refinery Dealers

1. MMTC-PAMP India Pvt. Ltd.

2. Hindustan Copper Ltd.
3. India Government Mint

Here's an overview of the gold supply chain from mine to bullion merchants, including pricing
and profits in international standards (in us dollars)

Mining Company

1. Mining cost: $900-$1,200 per ounce

2. Selling price: $1,800-$1,900 per ounce (depending on market conditions)
3. Profit: $600-$700 per ounce

Refinery

1. Buying price: $1,800-$1,900 per ounce

2. Refining cost: $50-$100 per ounce
3. Selling price: $1,850-$1,950 per ounce
4. Profit: $50-$100 per ounce

Bullion Bank

1. Buying price: $1,850-$1,950 per ounce

2. Storage and insurance: $10-$20 per ounce
3. Selling price: $1,860-$1,960 per ounce
4. Profit: $10-$20 per ounce

Bullion Merchant

1. Buying price: $1,860-$1,960 per ounce

2. Markup: 2%-5% (depending on market conditions)
3. Selling price: $1,900-$2,000 per ounce
4. Profit: $40-$100 per ounce

Investor/Consumer

1. Buying price: $1,900-$2,000 per ounce

2. Premium: depends on the product (e.g., coins, bars)
3. Final price: $2,000-$2,500 per ounce

Note: The prices and profits listed above are approximate and may vary depending on market
conditions, location, and other factors.

Here are some well-known bullion merchants in India:

Publicly Traded Bullion Merchants

1. RSBL (RiddiSiddhi Bullions Limited): A leading bullion merchant and refiner in India.
2. DP Gold: A bullion merchant and refiner based in Mumbai, India.
3. IBJA (Indian Bullion and Jewellers Association) Gold: A bullion merchant and refiner affiliated
with the Indian Bullion and Jewellers Association.
4. MMTC-PAMP: A joint venture between MMTC Limited and PAMP Switzerland, offering
bullion and refining services.

Private Bullion Merchants

1. Khandwala Jewellers: A Mumbai-based bullion merchant and jeweller.

2. Bhogilal Jewellers: A Hyderabad-based bullion merchant and jeweller.
3. Swarnsarita Jewellers: A Kolkata-based bullion merchant and jeweller.
4. Jindal Bullion: A Delhi-based bullion merchant and trader.
manufacturers
manufacturers

Manufacturing involves converting raw gold into products with varying purities, colors, and
categories based on designed designs.

Regional Specialization in India

Each state in India has its expertise in jewelry making. Here are some state-wise manufacturing
hubs:

1. Andhra Pradesh - Vijayawada, Visakhapatnam, Hyderabad

2. Assam - Guwahati
3. Bihar - Patna
4. Chhattisgarh - Raipur
5. Delhi - Karol Bagh, Chandni Chowk, Lajpat Nagar
6. Gujarat - Ahmedabad, Surat, Rajkot
7. Haryana - Chandigarh, Gurgaon
8. Jharkhand - Ranchi
9. Karnataka - Bengaluru, Mysuru, Mangaluru
10. Kerala - Kochi, Thiruvananthapuram, Kozhikode
11. Madhya Pradesh - Indore, Bhopal, Jabalpur
12. Maharashtra - Mumbai, Pune, Nagpur
13. Odisha - Bhubaneswar, Cuttack
14. Punjab - Chandigarh, Ludhiana, Amritsar
15. Rajasthan - Jaipur, Jodhpur, Udaipur
16. Tamil Nadu - Chennai, Coimbatore, Madurai
17. Telangana - Hyderabad
18. Uttar Pradesh - Lucknow, Kanpur, Varanasi
19. Uttarakhand - Dehradun
20. West Bengal - Kolkata

Types of Manufacturers

1. Small Workshops: 1-50 employees, outsourcing some tasks like polishing, cutting, and stone
fitting.
2. Small and mega Factories: 1-5,000 employees, with departments for each task, and no
outsourcing.

Note: Some factories and small workshops may outsource tasks during peak seasons or
employee shortages

Here's an overview of the manufacturing process in the jewelry industry, along with its profits
and operational costs:
Manufacturing Process

1. Design: Creating designs and prototypes for jewelry pieces.

2. Material selection: Sourcing and selecting metals, gemstones, and other materials.
3. Casting: Creating metal castings using wax or resin models.
4. Setting: Setting gemstones into metal castings.
5. Finishing: Polishing, plating, and engraving jewelry pieces.
6. Quality control: Inspecting and testing jewelry pieces for quality and authenticity.

Operational Costs

1. Material costs: 30%-50% of total costs (metals, gemstones, etc.)

2. Labor costs: 20%-30% of total costs (designers, craftsmen, etc.)
3. Overhead costs: 10%-20% of total costs (rent, utilities, equipment, etc.)
4. Marketing and advertising: 5%-10% of total costs
5. Other costs: 5%-10% of total costs (insurance, shipping, etc.)

profit margins

So for a manufacturer has costs involved in manufacturing and has to cover its costs from
product so basically they charge a retailer or wholesaler in two different ways
1) Making per gram
2) 2) wastage percentage (percentage of net weight in terms of metal)
In some cases where the designing is exclusive they charge both wastage and making
In case of kundan and polki work (a type of jewellery where high skilled labour is used they
charge stone fitting charges also.
And with this charges retailers and wholesalers markup their profits and sell to clients or
retailers

For example
Making per gram type : A ring with a gross weight of 11g and a net weight of 10g, with making
charges of ₹500 per gram of net weight and stone cost of ₹500 per gram of stone weight, and
3% GST
Let's calculate the total cost of the ring:

Weight and Making Charges

- Gross weight: 11 grams

- Net weight: 10 grams
- Making charges per gram: ₹500
- Total making charges: 10 grams x ₹500/gram = ₹5,000

Stone Cost
- Stone cost per gram: ₹500
- Stone weight: 1 gram (11g - 10g)
- Total stone cost: 1 gram x ₹500/gram = ₹500

Subtotal

- Total making charges: ₹5,000

- Total stone cost: ₹500
- Subtotal: ₹5,000 + ₹500 = ₹5,500

GST (3%)

- GST amount: ₹5,500 x 3% = ₹165

- Total amount: ₹5,500 + ₹165 = ₹5,665

Wastage method: A ring has a gross weight of 11g and a net weight of 10g. The wastage is
10% of the net weight. The stone cost is ₹500 per gram of stone weight. The gold cost is ₹8,000
per gram. Calculate the total cost, including 3% GST.

Calculation

Gold Details

1. Gross Weight: 11g

2. Net Weight: 10g
3. Wastage: 10% of Net Weight = 1g
4. Total Gold Weight: Net Weight + Wastage = 10g + 1g = 11g

Costs

1. Gold Cost: ₹8,000 per gram × 11g = ₹88,000

2. Stone Cost: ₹500 per gram × 1g = ₹500

Total Cost

1. Subtotal: ₹88,000 + ₹500 = ₹88,500

2. GST (3%): ₹88,500 × 3% = ₹2,655
3. Total Amount: ₹88,500 + ₹2,655 = ₹91,155

Making and wastage method

A ring has a gross weight of 11g and a net weight of 10g. The wastage is 10% of the net weight.
The stone cost is ₹500 per gram of stone weight. The gold cost is ₹8,000 per gram. The making
charges are ₹100 per gram of net weight. Calculate the total cost, including 3% GST.
Here is the calculation:
Step 1: Calculate Wastage
Wastage = 10% of Net Weight = 0.1 x 10g = 1g

Step 2: Calculate Stone Weight

Stone Weight = Wastage = 1g

Step 3: Calculate Total Gold Weight

Total Gold Weight = Net Weight + Wastage = 10g + 1g = 11g

Step 4: Calculate Gold Cost

Gold Cost = ₹8,000 per gram x 11g = ₹88,000

Step 5: Calculate Stone Cost

Stone Cost = ₹500 per gram x 1g = ₹500

Step 6: Calculate Making Charges

Making Charges = ₹100 per gram x 10g = ₹1,000

Step 7: Calculate Subtotal

Subtotal = Gold Cost + Stone Cost + Making Charges = ₹88,000 + ₹500 + ₹1,000 = ₹89,500

Step 8: Calculate GST

GST = 3% of Subtotal = ₹89,500 x 3% = ₹2,685

Step 9: Calculate Total Cost

Total Cost = Subtotal + GST = ₹89,500 + ₹2,685 = ₹92,185

The final answer is: ₹ 92,185

Above, we have seen the pricing model, and these manufacturers have their profits embedded
in the making charges, wastages, and stone charges.

Basically in traditional way when we purchase the calculations is as follows

Gross Weight: [Insert details]

Stone Weight: [Insert details]
Net Weight: Gross Weight - Stone Weight
Purity: [Insert percentage]
Wastage: [Insert percentage]
Fine Weight: Net Weight * (Purity + Wastage)
Stone Charges: [Insert calculated amount]
Other Charges: [Insert details]
Total Charges: Stone Charges + Other Charges
Here is sample calculation
Gross Weight: 18 grams
Stone Weight: 1.2 grams
Net Weight: 16.8 grams
Purity: 75%
Wastage: 10%
Fine Weight: 16.8*(75+10)/100=14.28 grams
Stone Charges: ₹1,200
Other Charges: ₹500
Total Charges: ₹1,700
And in summary we spell as 14.28 grams fine and 1700 cash
This is how purchase is made in terms of product

For Bullion calculations

Gross Weight: [Insert details]

Net Weight: Same as Gross Weight (no stones)
Purity: 100% pure
Fine Weight: Same as Net Weight (since purity is 100%)

Sample calculations
Gross Weight: 20 grams
Net Weight: 20 grams (no stones)
Purity: 100% pure
Fine Weight: 20 grams (since purity is 100%)
wholesalers
Wholesalers

diffrent states and countries and sellig locally and their operation structure
Wholesalers play a crucial role in the jewelry industry by bridging the gap between
manufacturers and retailers. Here's an overview of their role, operations, and structure:

Role of Wholesalers

1. Procurement: Wholesalers source jewelry products from various manufacturers across

different states and countries.
2. Inventory Management: They maintain a large inventory of jewelry products to cater to
diverse customer demands.
3. Price Negotiation: Wholesalers negotiate prices with manufacturers to secure competitive
rates.
4. Quality Control: They inspect the quality of products before purchasing and reselling.
5. Marketing and Sales: Wholesalers promote products to local retailers, jewelers, and other
customers.
6. Logistics and Distribution: They handle transportation, storage, and delivery of products to
customers.

Operational Structure

1. Sourcing Team: Responsible for identifying and establishing relationships with

manufacturers.
2. Purchasing Department: Handles procurement, price negotiation, and inventory
management.
3. Quality Control Team: Inspects products for quality and authenticity.
4. Sales and Marketing Team: Promotes products to customers, manages sales, and provides
customer support.
5. Logistics and Distribution Team: Oversees transportation, storage, and delivery of products.
6. Accounting and Finance Department: Manages financial transactions, invoicing, and
accounting.

Types of Wholesalers

1. General Wholesalers: Deal with a wide range of jewelry products.

2. Specialized Wholesalers: Focus on specific types of jewelry, such as diamonds, gold, or
silver.
3. Import Wholesalers: Specialize in importing jewelry products from other countries.

Benefits of Wholesalers

1. Convenience: Provide a one-stop solution for retailers and customers.

2. Competitive Pricing: Offer competitive prices due to bulk purchasing.
3. Wide Product Range: Offer a diverse range of jewelry products.
4. Quality Assurance: Ensure quality control and authentication of products.
5. Logistical Support: Handle logistics and distribution, reducing the burden on retailers.
[12:44 am, 28/01/2025] Dinesh: diffrent states and countries and sellig locally and their
operation structure
[12:44 am, 28/01/2025] Meta AI: Wholesalers play a crucial role in the jewelry industry by
bridging the gap between manufacturers and retailers. Here's an overview of their role,
operations, and structure:

Role of Wholesalers

1. Procurement: Wholesalers source jewelry products from various manufacturers across

different states and countries.
2. Inventory Management: They maintain a large inventory of jewelry products to cater to
diverse customer demands.
3. Price Negotiation: Wholesalers negotiate prices with manufacturers to secure competitive
rates.
4. Quality Control: They inspect the quality of products before purchasing and reselling.
5. Marketing and Sales: Wholesalers promote products to local retailers, jewelers, and other
customers.
6. Logistics and Distribution: They handle transportation, storage, and delivery of products to
customers.

Operational Structure

1. Sourcing Team: Responsible for identifying and establishing relationships with

manufacturers.
2. Purchasing Department: Handles procurement, price negotiation, and inventory
management.
3. Quality Control Team: Inspects products for quality and authenticity.
4. Sales and Marketing Team: Promotes products to customers, manages sales, and provides
customer support.
5. Logistics and Distribution Team: Oversees transportation, storage, and delivery of products.
6. Accounting and Finance Department: Manages financial transactions, invoicing, and
accounting.

Types of Wholesalers

1. General Wholesalers: Deal with a wide range of jewelry products.

2. Specialized Wholesalers: Focus on specific types of jewelry, such as diamonds, gold, or
silver.
3. Import Wholesalers: Specialize in importing jewelry products from other countries.
Benefits of Wholesalers

1. Convenience: Provide a one-stop solution for retailers and customers.

2. Competitive Pricing: Offer competitive prices due to bulk purchasing.
3. Wide Product Range: Offer a diverse range of jewelry products.
4. Quality Assurance: Ensure quality control and authentication of products.
5. Logistical Support: Handle logistics and distribution, reducing the burden on retailers.

Pricing Model
The pricing model for wholesalers is similar to that of manufacturers, with some key differences.
Wholesalers typically mark up the costs of wastages, making, and stone charges to determine
their selling price
Lets see the pricing mechanism with manufacturer and wholesaler
Q)calculate pricing fo ring with 11g gross weight, 10g net weight, 1g stone weight, ₹500/g stone
cost, ₹8,000/g gold cost, 10% manufacturer's wastage, 12% wholesaler's wastage, 3% GST,
and ₹0 making charges, and also show the price difference and profit margin of wholeseller.

Calculations:

Manufacturer's Price
1. Gold Cost: ₹8,000/gram x 10g = ₹80,000
2. Wastage: 10% of 10g = 1g
3. Gold Cost (including wastage): ₹8,000/gram x 11g = ₹88,000
4. Stone Cost: ₹500/gram x 1g = ₹500
5. Subtotal: ₹88,000 + ₹500 = ₹88,500
6. GST: ₹88,500 x 3% = ₹2,655
7. Total Cost: ₹88,500 + ₹2,655 = ₹91,155

Wholesaler's Price
1. Gold Cost: ₹8,000/gram x 10g = ₹80,000
2. Wastage: 12% of 10g = 1.2g
3. Gold Cost (including wastage): ₹8,000/gram x 11.2g = ₹89,600
4. Stone Cost: ₹500/gram x 1g = ₹500
5. Subtotal: ₹89,600 + ₹500 = ₹90,100
6. GST: ₹90,100 x 3% = ₹2,703
7. Total Cost: ₹90,100 + ₹2,703 = ₹92,803

Price Difference and Profit Margin

Price Difference: ₹92,803 (Wholesaler) - ₹91,155 (Manufacturer) = ₹1,648
Profit Margin: ₹1,648 / ₹91,155 ≈ 1.81%
retailers
Retailers

"A retailer is the final link in the supply chain, where jewelry products are sold to the end
customer, catering to their needs and desires with personalized attention and service. Retailers
source products from various vendors and manufacturers across different parts of the country,
offering customers the latest designs, trends, and bespoke jewelry pieces. Additionally, retailers
provide after-sales services, ensuring customer satisfaction and building long-term
relationships, while also offering repair, maintenance, and customization services to enhance
the overall customer experience."

Role of a Retailer in the Jewelry Industry

1. Sourcing Products: Retailers source jewelry products from manufacturers, wholesalers, or

designers.
2. Pricing and Margin: Retailers set prices for the jewelry products and determine their profit
margins.
3. Marketing and Promotion: Retailers promote and market the jewelry products to attract
customers.
4. Customer Service: Retailers provide customer service, including sales, repairs, and
maintenance.
5. Inventory Management: Retailers manage their inventory levels to ensure they have the right
products in stock.

Retailer's Role in the Market

1. Creating Demand: Retailers create demand for jewelry products through effective marketing
and promotion.
2. Providing Variety: Retailers offer a wide range of jewelry products to cater to different
customer preferences.
3. Building Brand Loyalty: Retailers build brand loyalty by providing excellent customer service
and quality products.
4. Competing with Other Retailers: Retailers compete with other retailers to attract customers
and increase market share.

Operations of a Retailer

1. Store Operations: Retailers manage their physical stores, including inventory management,
staffing, and customer service.
2. Inventory Management: Retailers manage their inventory levels to ensure they have the right
products in stock.
3. Supply Chain Management: Retailers manage their supply chain to ensure timely delivery of
products.
4. Marketing and Promotion: Retailers promote and market their products to attract customers.

Types of Retailers in the Jewelry Industry

1. Independent Retailers: Small, family-owned businesses that operate a single store or a few
stores.
2. Chain Retailers: Large retailers with multiple stores across different locations.
3. Online Retailers: E-commerce websites that sell jewelry online.
4. Discount Retailers: Retailers that offer discounted prices on jewelry products.

Examples of Retailers in India

1. Tanishq: A popular jewelry retailer with a strong presence in India.

2. Malabar Gold & Diamonds: A well-known jewelry retailer with a strong presence in South
India.
3. Kalyan Jewellers: A popular jewelry retailer with a strong presence in South India.
4. PC Jeweller: A leading jewelry retailer with a strong presence in North India.

Profit Margin of Retailers in India

The profit margin of retailers in India varies depending on factors such as the type of jewelry,
market conditions, and competition. However, here are some approximate profit margins for
retailers in India:

1. Gold Jewelry: 10-15%

2. Diamond Jewelry: 15-20%
3. Silver Jewelry: 20-25%

Note: These are approximate profit margins and may vary depending on various factors.
technology in retail
Technology for managing stores is crucial in the jewelry industry, offering numerous
benefits and playing a vital role in driving business growth. Here are some key aspects
of store management technology and its importance:

Inventory Management
1. Automated tracking :
Accurately monitors stock levels, reducing manual errors.
2. Low-stock alerts:
Notifies staff when items need replenishment, preventing stockouts.
3. Inventory optimization: Analyzes sales data to optimize inventory levels and minimize
waste.

Point of Sale (POS) Systems

1. Streamlined sales:
Efficiently processes transactions, reducing wait times.
2. Customer data management:
Stores customer information, enabling personalized marketing.
3. Sales tracking:
Provides insights into sales trends, helping inform business decisions.

Loss Prevention and Security

1. Access control:
Restricts access to sensitive areas, protecting valuable inventory.

Customer Experience and Engagement

1. Digital displays:
Showcases products, promotions, and brand stories, enhancing the shopping
experience.
2. Clienteling apps:
Enables staff to access customer data, preferences, and purchase history.
3. Omnichannel engagement:
Seamlessly integrates online and offline channels, providing a cohesive brand
experience.
Data Analytics and Reporting

1. Sales performance analysis:

Provides insights into sales trends, helping identify areas for improvement.

2. Inventory turnover analysis:

Helps optimize inventory levels and reduce waste.

3. Customer behavior analysis:

Informes targeted marketing efforts and personalized customer experiences.

The importance of store management technology in the jewelry industry lies in its ability
to:

1. Enhance operational efficiency:

Automates processes, reduces manual errors, and increases productivity.

2. Improve customer experience:

Provides personalized engagement, streamlined sales, and a cohesive brand
experience.

3. Drive business growth

: Offers data-driven insights, optimizes inventory levels, and reduces waste.

4. Mitigate loss and risk:

Deters theft, provides evidence, and restricts access to sensitive areas.

5. Stay competitive:
Adapts to changing market trends, consumer behaviors, and technological
advancements.

By implementing store management technology, jewelry businesses can:

1. Increase revenue:
Through optimized inventory levels, streamlined sales, and personalized marketing.

2. Improve customer satisfaction:

By providing a cohesive brand experience, personalized engagement, and streamlined
sales.

3. Reduce operational costs:

Through automated processes, reduced manual errors, and optimized inventory levels.

4. Enhance competitiveness:
By adapting to changing market trends, consumer behaviors, and technological
advancements.

store management technology is essential for jewelry businesses to thrive in today's

competitive market. By leveraging these solutions, businesses can improve operational
efficiency, enhance customer experience, drive business growth, mitigate loss and risk,
and stay competitive.
industry key words and factors
Key Factors include in pricing of jewellery product

1. Gross Weight
The total weight of the jewelry item, including the weight of the metal, stones, and other
components.

2. Stone Weight
The weight of the stones or gems used in the jewelry item.

3. Net Weight
The weight of the metal used in the jewelry item, excluding the weight of stones and other
components.

4. Wastage
The amount of metal lost during the manufacturing process, usually expressed as a percentage
of the net weight.

5. Total Metal Charges

The total cost of the metal used in the jewelry item, calculated by multiplying the net weight by
the metal rate per gram and adding the wastage amount.

6. Metal Rate per Gram

The cost of the metal per gram, which varies depending on the type of metal and market rates.

7. Making Charges
The labor costs incurred during the manufacturing process, usually expressed as a percentage
of the total metal charges or as a fixed amount.
8. Stone Fixing Charges
The labor costs incurred for setting the stones into the jewelry item.

9. Other Charges
Any additional costs incurred during the manufacturing process, such as polishing, cleaning, or
packaging.

10. Hallmarking Charges

The cost of hallmarking or assaying the jewelry item to certify its metal purity.

11. GST (Goods and Services Tax)

The tax levied by the government on the sale of goods and services.

12. Final Charges

The Total Cost represents the final amount paid by the customer for a jewelry item. This
comprehensive price includes:

- Material costs
- Labor charges
- Overheads
- Taxes
- Other applicable charges

The Total Cost reflects the complete, all-inclusive price of the jewelry item.

13. Purity/Melting/tounch :
In the context of jewelry, "Purity", "Melting", and "Touch" are interchangeable terms referring to
the purity percentage of a product. This percentage indicates the proportion of precious metal
content, such as gold or silver.
Example
A product with 75% gold content would be labeled as "Purity 75", "Melting 75", or "Touch 75".
14. Fine
"Fine" refers to pure gold, meaning 100% gold. For instance, "Fine 12.25 grams" indicates
12.25 grams of pure gold.

When making purchases, we convert a product's purity to fine. For example, if a product weighs
10 grams with 75% purity, the fine weight would be:

10 grams x (75/100) = 7.5 grams fine

Additionally, we can add melting and wastage percentages to calculate the fine weight. For
instance:

10 grams, 75% purity, 10% wastage:

10 x (75+10)/100 = 8.5 grams fine

retail store operations
Four Key Financial Operations in Jewelry Retail Stores

1. Sales:
Selling ready-made jewelry products from various categories.
2. Repairing: Offering repair services to customers and non-customers, generating additional
revenue.
3. Order Fulfillment: Taking customized orders from customers, creating tailored products, and
delivering them.
4. Schemes: Implementing savings programs that collect money from customers, providing
benefits like discounts, wastage allowances, or rebates.

These core operations are the primary revenue generators for jewelry retail stores. All other
modules and functions are designed to support and facilitate these operations, ensuring smooth
execution and maximum profitability.

Retail part of jewellery is one of the crucial part of jewellery industry where customers gets
interacted to purchase jewellery.lets understand the core functionalities of retail stores
sales
Sales
Repairs
Repairs refer to the process of restoring damaged, broken, or worn-out jewelry to its original
condition.

Importance
Repairs are crucial in retail jewelry stores for several reasons:

1. Customer Satisfaction: Repairs help maintain customer satisfaction by ensuring their jewelry
is in good condition.
2. Building Trust: Providing repair services builds trust with customers, encouraging loyalty and
repeat business.
3. Revenue Stream: Repairs can generate additional revenue for the store.
4. Competitive Advantage: Offering repair services can differentiate a store from competitors.
5. Inventory Management: Repairs help manage inventory by identifying and addressing quality
issues.

Mandatory Aspects
Repairs are mandatory in retail jewelry stores due to:

1. Warranty Obligations: Many jewelry items come with warranties, requiring stores to provide
repair services.
2. Quality Control: Repairs help stores maintain quality control by identifying and addressing
defects.
3. Customer Expectations: Customers expect jewelry stores to provide repair services, and not
offering them can harm reputation.
4. Regulatory Compliance: Some regulations may require jewelry stores to provide repair
services for certain types of items.

Types of Repairs
Common types of repairs in jewelry stores include:

1. Cleaning and Polishing

2. Joints and Soldering
3. Threading
4. Stone Setting
5. Remodeling

Effective Repair Management

To manage repairs efficiently:

1. Track Repairs: Maintain detailed records of repairs, including customer information and repair
details.
2. Prioritize Repairs: Prioritize repairs based on urgency and customer needs.
3. Communicate with Customers: Keep customers informed about repair status and timelines.
4. Quality Control: Verify the quality of repairs before returning items to customers.
# Repair Fulfillment Process

1. Receive Repair Order: Receive repair request from customer.

2. Check Details: Verify repair details, including type of repair, metal, and stones.
3. Issue to Worker: Assign repair task to in-house or external worker.
4. Verify Repair: Inspect repaired item to ensure work is done correctly.
5. Verify Pricing: Confirm pricing, considering labor, materials, and market fluctuations.
6. Finalize Price: Fix price with customer, either at order receipt, during repair, or at billing.
7. Deliver to Customer: Return repaired item to customer.

This process ensures efficient repair management, transparent pricing, and customer
satisfaction.

# Repair Pricing Flexibility

1. Price Fixing Options: Offer customers flexibility to fix repair prices at:
1. Time of receiving the repair order
2. During the repair process
3. Time of delivery
2. Pending Repairs: For repairs with uncertain costs, keep the order pending until:
1. Worker confirmation
2. Customer approval
3. Careful Handling: Ensure careful handling of customer products throughout the repair
process.

This flexibility and careful handling ensure customer satisfaction, trust, and loyalty.
orders
An order is a request from a customer to purchase a specific piece of jewelry, often customized
to their preferences.

Importance
Orders are crucial to the jewelry industry for several reasons:

1. Customer Satisfaction: Orders allow customers to design or customize jewelry according to

their preferences, ensuring satisfaction.
2. Increased Sales: Orders can lead to higher sales, as customers are more likely to purchase
items they've designed or requested.
3. Customer Loyalty: Fulfilling orders builds trust and loyalty with customers, encouraging repeat
business.
4. Competitive Advantage: Offering order services can differentiate a jewelry business from
competitors.
5. Improved Inventory Management: Orders help jewelry retailers manage inventory more
effectively, reducing waste and overstocking.

Types of Orders
1. Custom Orders: Unique, made-to-order pieces designed according to customer
specifications.
2. Repair Orders: Requests for jewelry repairs, such as fixing broken pieces or resizing.
3. Alteration Orders: Modifications to existing jewelry, like changing gemstones or engraving.
4. Special Orders: Requests for specific, often rare or hard-to-find, jewelry items.

Effective Order Management

1. Clear Communication: Ensure customers understand the order process, timelines, and
expectations.
2. Accurate Record-Keeping: Maintain detailed records of orders, including customer
information and design specifications.
3. Timely Fulfillment: Meet or exceed promised delivery times to maintain customer satisfaction.
4. Quality Control: Verify the quality of ordered items before delivery to ensure customer
satisfaction.

By prioritizing orders and implementing effective order management strategies, jewelry

businesses can build strong customer relationships, drive sales, and maintain a competitive
edge.
Business flow of orders
# Order Fulfillment Process
1. Order Receipt: Receive orders from customers, ensuring thorough understanding of
requirements.
2. Order Details: Record every detail, including changes, stones, quality, purity, and other
specifications.
3. Job Work Order: Issue the order to vendors or manufacturing workers as a job work
assignment.
4. Production: Manufacture the item over a specified period.
5. Verification: Verify the completed item upon its return to the store.
6. Pricing Verification: Confirm pricing, considering any fluctuations or changes.
7. Billing: Generate the bill based on the verified price.
8. Customer Pricing Options: Offer customers flexibility to fix prices at order placement, during
production, or at billing.

This process ensures accurate order fulfillment, transparent pricing, and customer satisfaction.

# Order Pricing Flexibility

When taking orders, it's not mandatory to fix the price immediately. Instead, customers have
options to fix the price at different stages:

1. At the time of order receiving: Fix the price when the order is placed.
2. In between the order process: Fix the price during the production phase.
3. At the time of billing: Fix the price when the order is complete and ready for billing.

This flexibility allows customers to choose when to fix the price, providing convenience and
adaptability to market fluctuations.
schemes
Schemes are beneficial programs offered by jewelry retailers, fostering continuous relationships
and bonds with customers. These programs encourage store walk-ins, facilitate marketing, and
promote customer loyalty, ultimately driving sales and growth for the retailer while providing
value to customers.

# Benefits for Shopkeepers

1. Continuous Cash Flow: Regular income throughout the year, regardless of season.
2. Financial Stability: Reduced financial crunch, providing stability and support.
3. Customer Loyalty: Customers bond with the store, ensuring repeat business.
4. Predictable Sales: Guaranteed sales on maturity dates (e.g., 3, 6, 9, or 12 months).
5. Inventory Rotation: Improved inventory management and rotation.
6. Marketing and Promotion: Opportunities for marketing and promoting the store.
7. Legitimate Income: Official, white-money income for the store.

These benefits encourage shopkeepers to implement gold schemes, ensuring a stable and
profitable business.

Types of Schemes

Savings Schemes

1. Gold Savings Scheme (Metal): Fixed monthly deposits, metal rate fixed, metal accumulated,
and discounts.
2. Gold Savings Scheme (Cash): Monthly deposits earn interest, redeemable for gold jewelry.

Flexible Savings Schemes

1. Flexi Savings Plan (Cash): Varying monthly deposits, redeemable for jewelry or gold.
2. Flexi Savings Plan (Metal): Varying monthly deposits, metal rate fixed, metal accumulated,
and discounts.

Lucky Draw Schemes

1. Monthly Lucky Draw (Cash): Winner receives cash, exempt from further payments.
2. Monthly Lucky Draw (Metal): Winner receives metal, exempt from further payments.

These schemes offer flexibility, benefits, and excitement to customers, driving sales and loyalty
for jewelry businesses.
Puchases
Unlike other industries, transactions between vendors and retailers in the metal industry are
more complex. In other sectors, transactions are straightforward, with invoices generated based
on products sold and various payment modes available. Retailers may pay immediately or opt
for credit terms.

However, the metal industry operates differently. The value of metals fluctuates constantly,
making it essential to fix rates before finalizing transactions. This unique aspect of the industry
adds complexity to transactions, setting it apart from other sectors.

"As discussed earlier, Rate Fix is crucial in the metal industry. Let's explore how vendors handle
purchases involving multiple products of varying qualities.

When a retailer buys from a wholesaler or a wholesaler buys from a manufacturer, they may
purchase single or multiple purities. Here's the process:

1. Multiple purities/products are converted into "fine," accounting for purity and wastage.
2. Individual fine values are combined to determine the total fine.
3. Total cash value is calculated by adding individual cash values derived from each purity,
including costs like stone charges, hallmark charges, and making charges (if applicable)."

To summarize, we've established that the Rate Fix is not applied until the final stage of
purchase. At this point, various possibilities arise and the type of transactions

Here are possibilities:

1. Cash transaction: The buyer pays the full amount in cash.

2. Credit transaction: The buyer receives credit from the seller, with an agreement to pay later.

3. Partial payment: The buyer makes a partial payment upfront and agrees to pay the balance
later.

4. Other payment arrangements: Buyers and sellers may negotiate alternative payment terms.

Notably, the Rate Fix can be applied at various stages, including:

- At the time of delivery

- When payment is made
- Days or weeks later
- At a mutually agreed-upon time in the near future

The timing of Rate Fix application depends on the mutual understanding between vendors and
retailers, with no specific time constraints.
When a retailer purchases jewelry from a wholesaler, various scenarios can arise:

# Scenario 1: Cash Due

The retailer owes ₹1 lakh.

# Scenario 2: Metal Due

The retailer owes 20 grams of metal.

# Scenario 3: Combination Due

The retailer owes 20 grams of metal and ₹1,000.

# Scenario 4: Partial Conversion

The retailer converts 10 grams of the 20 grams owed into cash, at a rate of ₹1,000 per gram,
resulting in:

- 10 grams owed
- ₹10,000 (10 grams × ₹1,000/gram)
- ₹1,000 existing balance
- Total cash balance: ₹11,000

These scenarios illustrate the various possibilities that can arise in transactions between
retailers and wholesalers in the jewelry industry.

>The Rate Fix concept allows for flexibility in transactions. It's not necessary for physical
transactions to occur simultaneously. Instead:

- You can do Rate Fix today and pay in the near future.
- You can pay before and do Rate Fix today.

Both scenarios are possible, highlighting the adaptability of the Rate Fix system in
accommodating various transaction timelines.

>In the industry, it's common for retailers to work with:

- Single or multiple manufacturers

- Single or multiple wholesalers
- Both wholesalers and manufacturers

Regardless of the business arrangement, the calculation process remains the same. Often,
retailers work with multiple wholesalers, requiring them to maintain separate accounts.

Key details, such as:

- Type of bill
- Purchase date
- Due date

are crucial for clarity and accuracy in future transactions.

Vendor Payment
Vendor Payment Options

In this section, we'll explore how retailers pay vendors or manufacturers pay wholesalers. As
previously discussed, vendors can receive products on credit or pay cash, with various payment
options available:

Payment Methods
- Cash
- Gold
- Bank transfer

Credit Transactions
If the deal is on credit, retailers can pay their outstanding balance in multiple ways:

- Paying the full amount at once (e.g., 100 grams)

- Making partial payments (e.g., 20 grams + 80 grams later)
- Converting part of the outstanding balance into cash using Rate Fix (e.g., 50 grams converted
to cash and 50 grams paid later)

Rate Fix Application

When converting grams to rupees or vice versa, the Rate Fix feature is applied. If a retailer pays
in cash but has an outstanding balance in grams, they must eventually use Rate Fix to convert
the balance into grams.

Summary
Retailers have various payment options when paying vendors:

- Paying all at once

- Making partial payments
- Converting cash to fine (grams)
- Converting fine (grams) to cash

>In addition to the payment options, there are other important features to consider:

- Late Payment Interest Charges: Vendors can add interest charges if payments are delayed.

- Discounts and Adjustments: Vendors can offer discounts or make adjustments if there are
errors in calculation or other agreed-upon terms.

>In the industry, it's common for vendors to receive multiple credit bills, as they continuously
take products and make payments. Instead of settling each bill individually, they often settle
their accounts monthly.
Additionally, there may be instances where retailers overpay their vendors. In such cases, an
extra Rate Fix is possible. For example:

- Retailer owes 180 grams to the vendor

- Retailer receives 200 grams, resulting in a surplus of 20 grams

This surplus of 20 grams would be carried forward and settled in the future or with the next
purchase.
General transactions
General Transactions Feature

The General Transactions feature is a flexible and multipurpose module designed to record and
manage various financial transactions that fall outside of standard billing pages, including:

1. Order Billing
2. Sales Billing
3. Repair Billing

This feature enables users to:

- Create custom categories for different payment types (e.g., schemes, repairs, handloom)
- Record and manage small transactions that cannot be barcoded or recorded elsewhere
- Import and manage outstanding balances from previous transactions or external sources

The General Transactions feature offers versatility and adaptability, allowing businesses to tailor
it to their specific needs and record a wide range of financial transactions.
Advances
The Advances model is a flexible feature that allows shopkeepers to receive and manage
advance payments not linked to specific orders or repairs. This feature enables users to:

- Record advance payments directly

- Refund advances
- Transfer advances to customer orders or repair accounts

Benefits:

- Flexibility to receive payments without conditions

- Centralized management of advances from orders, repairs, and advances
- Easy reporting and tracking of advances

This feature simplifies advance payment management, providing a streamlined and organized
approach to handling customer deposits.
supportive modules
approval
Approval Process
The approval process allows stores to temporarily lend jewelry to clients, nearby vendors, or
family members to facilitate sales or orders. This provides flexibility and comfort for valued
customers.

Items Eligible for Approval Process

1. Sales products
2. Order products
3. Bar-coded products
4. Non-bar-coded products

Key Aspects:
1. Issue Point: Track when jewelry is lent out.
2. Receive Point: Monitor when jewelry is returned.
3. Timely Return: Ensure jewelry is returned to the store on time.

This process prioritizes customer convenience and satisfaction.

# Key Points for Approval Process

1. Confirmation: Verify customer details and approval terms.
2. Item Condition: Ensure the item is in the same condition when issued and returned.
3. Weight and Product Integrity: Verify the item's weight and ensure it is the same product.
4. Quality and Workmanship: Check for any damage to the item's quality and workmanship.

By following these key points, you can minimize the risk of fraud and ensure a smooth approval
process.
inventory
Inventory management refers to the process of tracking, managing, and controlling inventory
levels, including raw materials, work-in-progress, and finished goods.

Importance
Effective inventory management is crucial in the jewelry industry due to:

1. High Value of Goods: Jewelry items are often valuable and sensitive, requiring careful
handling and storage.
2. Variety and Complexity: Jewelry inventory can include numerous items with different
characteristics, such as metal types, gemstones, and designs.
3. Seasonal Demand: Jewelry demand can fluctuate seasonally, making it essential to manage
inventory levels accordingly.
4. Cash Flow Management: Excessive inventory levels can tie up significant capital, impacting
cash flow and business operations.

Maintenance
To maintain optimal inventory levels:

1. Conduct Regular Audits: Physically count and verify inventory to ensure accuracy.
2. Implement Inventory Tracking Systems: Utilize software or systems to monitor inventory
levels, track movements, and automate reporting.
3. Categorize and Prioritize: Classify inventory into categories (e.g., fast-moving, slow-moving,
and dead stock) and prioritize management efforts accordingly.
4. Set Optimal Inventory Levels: Determine optimal inventory levels based on historical demand,
seasonal fluctuations, and lead times.
5. Monitor and Adjust: Continuously monitor inventory levels and adjust management strategies
as needed to maintain optimal levels.

Benefits
Effective inventory management in the jewelry industry offers numerous benefits:

1. Improved Cash Flow: Reduced inventory levels and minimized waste.

2. Enhanced Customer Satisfaction: Ensured availability of popular items and reduced wait
times.
3. Increased Efficiency: Streamlined operations and reduced labor costs.
4. Better Decision-Making: Data-driven insights for informed purchasing, pricing, and inventory
decisions.
Samples
# Sample Management in Retail Jewelry Industry
Importance
Maintaining accurate records of customer samples is crucial to prevent errors,
miscommunication, and potential legal issues.

Sample Management Process

1. Collect Sample: Receive sample from customer.
2. Issue to Vendor/Manufacturer: Send sample to vendor or manufacturer for replication.
3. Return and Maintenance: Receive replicated item, maintain accurate records, and store
sample securely.
4. Order Delivery: Deliver replicated item to customer.
5. Sample Return: Return original sample to customer upon request.

Key Considerations
1. Material Classification: Accurately record material type (e.g., gold, silver).
2. Diamond Verification: Verify diamond authenticity to prevent misrepresentation.
3. Clear Documentation: Maintain detailed records of sample receipt, replication, and return.
4. Secure Storage: Store samples securely to prevent loss or damage.

Consequences of Mismanagement
1. Customer Disputes: Errors or misrepresentation can lead to customer complaints and
potential legal action.
2. Reputation Damage: Poor sample management can harm business reputation and erode
customer trust.
3. Financial Losses: Mismanagement can result in financial losses due to errors, damage, or
loss of samples.
Delivery
The Delivery feature is a module where jewelry items are held for a certain period, typically
when customers have not paid the full amount. This feature ensures secure storage of items
until payment is completed.

# Two-Stage Delivery Process

1. Hold Delivery: Jewelry items are held, and documentation is provided to customers along with
sales billing.
2. Release Delivery: Upon payment of outstanding balances, items are released to customers,
and billing is finalized.

# Importance of Delivery Management

1. Inventory Accuracy: Maintaining accurate delivery inventory is crucial to prevent errors or
loss.
2. Secure Storage: Ensuring secure storage of held items prevents damage or theft.
3. Customer Satisfaction: Efficient delivery management enhances customer trust and
satisfaction.
4. Protocol Compliance: Following established protocols for delivery release prevents future
concerns and disputes.
Outstandings
The Outstanding module is a centralized feature that tracks and manages unpaid balances
across various application areas, including:

1. Sales Billing
2. Order Billing
3. General Transactions

This module enables users to:

- View all outstanding entries in one place

- Follow up on pending payments
- Manage and clear outstanding balances
- Search, filter, and analyze data as needed

Key features within the Outstanding module include:

1. Outstanding Management: Monitor, track, and manage all outstanding balances, including
due dates and follow-up actions.
2. Clear Outstanding: Record and process customer payments to clear outstanding balances.

The ultimate purpose of the Outstanding module is to efficiently manage and clear outstanding
balances, ensuring timely payment collection and improved cash flow management.
Product Knowledge
👉 metal details
types & purity of metals
Gold

1. 24K (99.9%): Pure gold, no alloys.

2. 22K (91.6%): 8.4% alloy (silver, copper, zinc).
3. 18K (75%): 25% alloy (silver, copper, zinc).
4. 14K (58.3%): 41.7% alloy (silver, copper, zinc).
5. 10K (41.7%): 58.3% alloy (silver, copper, zinc).

Silver

1. Fine Silver (99.9%): Pure silver, no alloys.

2. Sterling Silver (92.5%): 7.5% alloy (copper).
3. Vermeil (50%): 50% silver, 50% alloy (copper, zinc).

Platinum

1. Pt 950 (95%): 5% alloy (ruthenium, iridium).

2. Pt 900 (90%): 10% alloy (ruthenium, iridium).
3. Pt 850 (85%): 15% alloy (ruthenium, iridium).

Hallmarks and Stamps

925, 800, 900

- Platinum: Pt 950, Pt 900, Pt 85- Gold: 24K, 22K, 18K, 14K, 10K
- Silver: 0

Certification

- Assay offices: Verify purity.

- Hallmarking: Official stamps indicating purity.
Certifications
Certifications

Certification is a third-party validation process confirming a product, service or individual meets

specific standards, requirements or regulations. Certifications ensure quality, authenticity and
reliability.

Types of Certifications

1. Product Certification Verifies product quality, safety and performance (e.g., ISO 9001).
2. Professional Certification: Validates individual expertise and skills (e.g., medical, IT certifications).
3. Service Certification: Ensures service quality and standards (e.g., customer service certifications).
4. System Certification: Certifies organizational systems (e.g., ISO 27001 for information security).
5. Process Certification: Verifies manufacturing processes (e.g., ISO 13485 for medical devices).
6.

Importance of Certification

1. Builds Trust: Demonstrates commitment to quality and excellence.

2. Enhances Credibility: Validates expertise and competence.
3. Increases Customer Confidence: Assures customers of reliable products/services.
4. Improves Quality: Encourages continuous improvement.
5. Compliance: Ensures adherence to regulations and standards.
6. Competitive Advantage: Differentiates organizations from competitors.
7. Risk Reduction: Minimizes risks associated with poor quality or non-compliance.
8. Global Recognition: Facilitates international trade and business.
9. Improved Efficiency: Streamlines processes and reduces costs.
10. Enhanced Reputation: Demonstrates commitment to excellence.

Benefits for Individuals

1. Career Advancement: Enhances job prospects.

2. Increased Earning Potential: Leads to higher salaries.
3. Professional Development: Updates skills and knowledge.
4. Industry Recognition: Establishes expertise.
5. Personal Satisfaction: Boosts confidence.

Benefits for Businesses

1. Market Differentiation: Sets businesses apart.

2. Increased Sales: Enhances customer trust.
3. Regulatory Compliance: Avoids legal issues.
4. Improved Processes: Optimizes operations.
5. Talent Attraction: Attracts skilled professionals.
6. Enhanced Brand Reputation: Builds trust.

Certification Process

1. Application
2. Assessment/Audit
3. Examination/Evaluation
4. Certification Award
5. Maintenance/Renewal

In the jewelry industry, certification can generally be divided into two types:

1. Metal Certification
2. Stone Certification

For metals like gold, silver, and platinum, certification in India is issued by the Bureau of Indian
Standards (BIS) under the name of hallmarking. Previously, hallmarking involved stamping a
hallmark directly onto jewelry products. However, since 2023, BIS has implemented a new
system known as HUID (Hallmark Unique Identification). HUID is a unique six-digit
alphanumeric code assigned to each piece of gold jewelry after hallmarking.

Below is a sample comparison of the old hallmark and the new HUID.

Old hallmark
New huid

Bis logo

The hallmark for metals is issued by government-approved agencies located in almost every
city and major location across India.

Now, let’s discuss certification for stones. Unlike metals, which are certified by government
agencies, stone certification is handled by private agencies, each with its own standards for
certifying jewelry, loose diamonds, colored gemstones, and pearls. The Gemological Institute of
America (GIA) is one of the most preferred agencies for certifying high-value diamonds.
Generally, there are two types of stone certification:
1. Loose Stones
2. Studded Stones

Accurate certification can only be done for loose stones, as this allows the stone to be tilted,
rotated, and viewed from all angles for comprehensive analysis. In contrast, studded stones
cannot be examined from every dimension, nor can their girdles be fully inspected, making
precise evaluation difficult.

In conclusion, certifications for studded jewelry offer only an approximate quality assessment of
diamonds or gemstones rather than absolute accuracy
Finish types
Finish refers to the surface treatment or texture applied to metal jewelry to enhance its
appearance, durability, and wearability.

Types of Finishes in Jewelry:

Textured Finishes:

1. Brushed (Satin): Soft, scratched texture.

2. Matte: Flat, non-reflective finish.
3. Satin: Smooth, subtle shine.
4. Hammered: Textured, uneven surface.
5. Woven: Intricate, woven pattern.

Shiny Finishes:

1. Polished (High-Shine): Mirror-like reflectivity.

2. Glossy: Smooth, shiny surface.
3. Mirror-Finish: Highly reflective.

Distressed Finishes
1. Oxidized (Darkened): Chemical treatment for vintage look.
2. Patina: Natural aging process.
3. Distressed: Intentionally worn, vintage appearance.

Specialty Finishes:

1. Engraved: Intricate designs or patterns.

2. Filigree: Delicate, intricate metalwork.
3. Milgrain: Ornate, detailed edges.
4. Sandblasted: Frosted, textured surface.
5. Electroplating: Thin layer of metal deposited onto base metal.

Plating Finishes:

1. Rhodium Plating (White Gold): Enhances whiteness.

2. Vermeil (Gold Plating): Thin layer of gold.
3. Rose Gold Plating: Pinkish hue.
4. Silver Plating: Thin layer of silver.

Other Finishes:

1. Anodized: Electrochemically colored.

2. Laser Engraving: Precise, detailed designs.

Benefits of Finishes:

1. Enhances appearance
2. Increases durability
3. Reduces scratches
4. Improves wearability
5. Adds uniqueness

Considerations:

1. Maintenance requirements
2. Cost
3. Durability
4. Hypoallergenic concerns
5. Personal style
Tone in Jewelry
Tone in Jewelry

Tone refers to the color or hue of metal in jewelry, created by combining different metals or
alloys. Tone affects the overall appearance and style of a piece.

Types of Tones in Jewelry:

Gold Tones:

1. Yellow Gold
2. White Gold
3. Rose Gold
4. Pink Gold
5. Green Gold
6. Purple Gold
7. Black Gold
8. Champagne Gold
9. Honey Gold
10. Bronze Gold

Silver Tones:

1. Sterling Silver
2. Vermeil (Gold-plated Silver)
3. Oxidized Silver (Darkened)
4. Brushed Silver (Textured)
5. Polished Silver (High-shine)

Platinum Tones:

1. Platinum White
2. Platinum Gray
3. Ruthenium (Dark Gray)
4. Rhodium (White)

Mixed Metal Tones:

1. Two-Tone (e.g., Yellow and White Gold)

2. Tri-Color (e.g., Yellow, White, and Rose Gold)
3. Multi-Tone (Combination of three or more metals)
Tone Combinations:

1. Monotone (Single tone)

2. Duotone (Two tones)
3. Tritone (Three tones)
4. Ombre (Gradual tone transition)
Types of metal colours - gold
traditional Colors for gold

1. Yellow Gold (75% Gold, 25% Alloy)

2. White Gold (75% Gold, 25% Alloy, Rhodium-plated)
3. Rose Gold (75% Gold, 20% Copper, 5% Silver)

Contemporary Colors:

1. Pink Gold (Variation of Rose Gold)

2. Green Gold (75% Gold, 25% Silver, Cadmium)
3. Purple Gold (75% Gold, 25% Aluminum)
4. Black Gold (Oxidized or plated with ruthenium)

Color Enhancement Techniques:

1. Rhodium plating (Enhances whiteness)

2. Oxidization (Darkens metal)
3. Enameling (Colored glass or ceramic coating)
4. Polishing jewelry with external material

Silver and platinum jewelry are often made with a single color, which is their natural color.
However, in some cases, a coating or plating of a different color may be applied to give the
jewelry a specific look. This coating is usually temporary in nature and can wear off over time.

Types of Coatings

1. Rhodium Plating: A thin layer of rhodium is applied to white gold, silver, or platinum to give it
a reflective, white appearance.
2. Vermeil: A layer of gold is applied to sterling silver to give it a gold appearance.
3. Electroplating: A thin layer of a metal, such as gold or silver, is applied to a base metal using
an electric current.
4. PVD (Physical Vapor Deposition) Coating: A thin layer of a metal or ceramic material is
applied to the jewelry using a high-tech process.
Alloys
What is an Alloy?

An alloy is a mixture of two or more metals combined to create a new material with improved
properties. Alloys enhance the strength, durability, color, and resistance to corrosion of precious
metals like gold, silver, and platinum.

Purpose of Alloys in Metals:

1. Strengthens: Adds durability and resistance to scratches.

2. Changes Color: Creates different hues or shades.
3. Reduces Cost: Decreases the amount of precious metal used.
4. Improves Melting Point: Adjusts for easier manufacturing.
5. Enhances Corrosion Resistance: Protects against tarnish or corrosion.

Common Alloys Used:

Gold Alloys:

1. Copper (Rose Gold)

2. Silver (White Gold)
3. Zinc (Strengthens)
4. Nickel (White Gold)
5. Palladium (Strengthens)

Silver Alloys:

1. Copper (Sterling Silver)

2. Nickel (Strong, resistant)
3. Zinc (Less expensive)
4. Brass (Cost-effective)
5. Vermeil (Thick silver layer over base metal)

Platinum Alloys:

1. Iridium (Strengthens)
2. Ruthenium (Hard, resistant)
3. Osmium (Extremely hard)
4. Palladium (Strong, lightweight)
5. Rhodium (White, reflective)
Benefits of Alloys:

1. Improved durability
2. Enhanced appearance
3. Increased strength
4. Reduced cost
5. Broader design options

Challenges with Alloys:

1. Potential skin irritation (e.g., nickel)

2. Risk of corrosion or tarnish
3. May require additional maintenance

Alloy Composition:

1. Gold: 75% (18K), 58.3% (14K), 41.7% (10K)

2. Silver: 92.5% (Sterling), 80% (Nickel-Silver)
3. Platinum: 95% (Pt 950), 90% (Pt 900)

Manufacturing Processes:

1. Melting
2. Mixing
3. Rolling
4. Forging
5. Casting

Applications:

1. Jewelry
2. Coins
3. Bars
4. Industrial components
5. Medical devices
Metal prices
The prices of metals in the jewelry industry are determined on a daily basis by bullion
merchants, who take into account international metal prices, local taxes, customs, freight
charges, and other factors.

The international metal prices are derived from commodity markets, such as:

- Multi Commodity Exchange (MCX) in India

- London Metal Exchange (LME)
- COMEX (New York Mercantile Exchange)
- Shanghai Gold Exchange (SGE)

These commodity markets use real-time data to determine metal prices based on supply and
demand. The prices can fluctuate rapidly, changing in a matter of milliseconds.

The prices determined by these commodity markets are then used as a benchmark by bullion
merchants to set their prices, which in turn affect the prices of metals in the jewelry industry.

The factors that influence metal prices in the jewelry industry include:

- International metal prices

- Local taxes and duties
- Customs and import duties
- Freight charges and transportation costs
- Supply and demand dynamics
- Market sentiment and speculation

The rapid fluctuations in metal prices can be attributed to various market and economic factors,
including:

- Geopolitical events
- Economic indicators (e.g., inflation, interest rates)
- Central bank policies
- Currency fluctuations
- Speculation and market sentiment

Overall, the prices of metals in the jewelry industry are influenced by a complex array of factors,
and their prices can change rapidly in response to market dynamics.

Retailers typically fix their prices based on the market opening price, and then adjust the prices
according to the purity of the metal. Here's how it works:

- 24K (100% pure) gold price is taken from the market, let's say ₹3,000 per gram.
- Retailers then adjust the prices according to the purity of the metal, using the following
calculations:
Example Purity Prices:

- 22K (91.6% pure) gold: ₹2,750 per gram (91.6% of ₹3,000)

- 18K (75% pure) gold: ₹2,250 per gram (75% of ₹3,000)
- 14K (58.3% pure) gold: ₹1,750 per gram (58.3% of ₹3,000)

Similarly, for silver:

- 999 (99.9% pure) silver: ₹40 per gram (taken from market)
- 925 (92.5% pure) silver: ₹37 per gram (92.5% of ₹40)
- 800 (80% pure) silver: ₹32 per gram (80% of ₹40)

Deriving Gold Prices for Different Purity Levels from bullion websites

Retailers use the following calculations to determine the prices of different purity levels based
on the market price of 24K gold:

Step 1: Remove GST from the Market Price

- Divide the market price by (100 + GST percentage)

- GST percentage is typically 3% in India

Example:

- Market price of 24K gold per gram = ₹8300

- GST percentage = 3%
- Remove GST: ₹8300 ÷ (100 + 3) = ₹8300 ÷ 103 = ₹8058.25 per gram

Step 2: Calculate Prices for Different Purity Levels

- Multiply the GST-free price by the desired purity percentage

- Divide the result by 100

Example:

- GST-free price of 24K gold per gram = ₹8058.25

- Calculate price for 22K gold (91.6% purity):
- ₹8058.25 × 91.6 ÷ 100 = ₹7385.41 per gram
- Calculate price for 18K gold (75% purity):
- ₹8058.25 × 75 ÷ 100 = ₹6043.69 per gram
By following these steps, retailers can derive prices for different purity levels based on the
market price of 24K gold, ensuring their prices remain competitive and aligned with market
rates.

Jewelers derive prices for their jewelry products from reputable bullion websites, such as RSBL,
DP Gold, IBJA, MMTC-PAMP, and others, which provide real-time prices for gold, silver, and
other precious metals.
Publicly Traded Bullion Merchants

1. RSBL (RiddiSiddhi Bullions Limited): http://www.rsbl.in/

2. DP Gold: http://www.dpgold.in/
3. IBJA (Indian Bullion and Jewellers Association) Gold: http://www.ibja.co/
4. MMTC-PAMP: http://www.mmtcpamp.com/

Private Bullion Merchants

1. Khandwala Jewellers: http://www.khandwalajewellers.com/

2. Bhogilal Jewellers: http://www.bhogilaljewellers.com/
3. Swarnsarita Jewellers: http://www.swarnsarita.com/

Local bullion markets

Local bullion dealers often sell gold bars in cash, which means without GST. However, the cash
price is determined by market forces of demand and supply, rather than a straightforward 3%
GST discount.

In most cases, the prices with GST and without GST are similar. However, when demand is low,
a significant price difference can emerge between RTGS (banking, i.e., legal) and cash (illegal)
prices. This difference can range from 0.5% to 5% of the RTGS rate.

Conversely, when demand is high, a premium on the RTGS rate can occur, exceeding the legal
rate.

A similar phenomenon is observed in the silver market, where the difference between cash and
RTGS prices is often higher than in the gold market.

Key points:

- Local bullion dealers sell gold bars in cash (without GST) based on demand and supply.
- Cash prices may not reflect a straightforward 3% GST discount.
- Price differences between RTGS and cash prices can occur, especially during low-demand
periods.
- Premiums on RTGS rates can emerge during high-demand periods.
- Silver market prices exhibit similar trends, with potentially larger differences between cash and
RTGS prices.
calculations
This chapter aims to provide a comprehensive understanding of calculating various costs
associated with gold jewelry, including different types of charges, taxes, and fees. By working
through various cases with different charges, you'll gain hands-on experience and develop a
deeper understanding of the calculations involved.

Let's break down the key components typically involved in these calculations:

1. Gold weight and price: Net weight, gross weight, and the price per gram of gold.
2. Making charges: Fees for crafting the jewelry, often per gram.
3. Wastage: Allowance for gold lost during the manufacturing process.
4. Stones and other components: Costs of precious stones, like diamonds or rubies.
5. Taxes and duties: GST (Goods and Services Tax), customs duties, etc.
6. Hallmarking and certification: Fees for authenticity and quality assurance.
7. Other charges: Insurance, shipping, or other miscellaneous costs.

By examining different cases and scenarios, you'll become proficient in navigating these
components and accurately calculating the total cost of gold jewelry.

Q1)"What is the total cost of a gold chain with a net weight of 10 grams, a price per gram of
₹8,000, 10% wastage, and 3% GST?"
Answer:
1. Gold Cost:
1. Net weight: 10 grams
2. Price per gram: ₹8,000
3. Total gold cost: 10 grams * ₹8,000/gram = ₹80,000

2. Making Charges (Wastage):

1. Wastage percentage: 10% of net weight
2. Wastage weight: 10% of 10 grams = 1 gram
3. Wastage cost: 1 gram * ₹8,000/gram = ₹8,000

3. GST (Goods and Services Tax):

1. GST percentage: 3%
2. GST amount: 3% of (₹80,000 + ₹8,000) = 3% of ₹88,000 = ₹2,640

# Total Cost of the Chain

1. Gold Cost: ₹80,000
2. Making Charges (Wastage): ₹8,000
3. GST: ₹2,640
4. Total Cost: ₹80,000 + ₹8,000 + ₹2,640 = ₹90,640

The final answer is: Rs 90,640

Q2)"What is the total cost of a gold chain with a gross weight 11 gram net weight of 10 grams,
1 gm ruby stone and price per carat is 200 a price per gram of ₹8,000, 10% wastage, and 3%
GST?"
Answer :
Gold Cost
1. Net weight: 10 grams
2. Price per gram: ₹8,000
3. Total gold cost: 10 grams * ₹8,000/gram = ₹80,000

Ruby Stone Cost

1. Weight: 1 gram = 5 carats (assuming 1 carat = 0.2 grams)
2. Price per carat: ₹200
3. Total ruby cost: 5 carats * ₹200/carat = ₹1,000

Making Charges (Wastage)

1. Wastage percentage: 10% of net weight
2. Wastage weight: 10% of 10 grams = 1 gram
3. Wastage cost: 1 gram * ₹8,000/gram = ₹8,000

GST (Goods and Services Tax)

1. GST percentage: 3%
2. GST amount: 3% of (₹80,000 + ₹1,000 + ₹8,000) = 3% of ₹89,000 = ₹2,670

Total Cost
1. Gold Cost: ₹80,000
2. Ruby Stone Cost: ₹1,000
3. Making Charges (Wastage): ₹8,000
4. GST: ₹2,670
5. Total Cost: ₹80,000 + ₹1,000 + ₹8,000 + ₹2,670 = ₹91,670

The final answer is: Rs 91,670

Q3)"What is the total cost of a gold chain with a gross weight 11 gram net weight of 10 grams,
1 pcs ,1 gm ruby stone and price per carat is 200 a price per gram of ₹8,000, 10% wastage,
making charges 50 rs per gram and hallmark cahrges 100 per piece and 3% GST?"
Answer:

Gold Cost
1. Net weight: 10 grams
2. Price per gram: ₹8,000
3. Total gold cost: 10 grams * ₹8,000/gram = ₹80,000

Ruby Stone Cost

1. Weight: 1 gram = 5 carats (assuming 1 carat = 0.2 grams)
2. Price per carat: ₹200
3. Total ruby cost: 5 carats * ₹200/carat = ₹1,000

Making Charges
1. Making charge per gram: ₹50
2. Total making charges: 10 grams * ₹50/gram = ₹500

Hallmark Charges
1. Hallmark charge per piece: ₹100
2. Total hallmark charges: ₹100

Wastage
1. Wastage percentage: 10% of net weight
2. Wastage weight: 10% of 10 grams = 1 gram
3. Wastage cost: 1 gram * ₹8,000/gram = ₹8,000

GST (Goods and Services Tax)

1. GST percentage: 3%
2. GST amount: 3% of (₹80,000 + ₹1,000 + ₹500 + ₹100 + ₹8,000) = 3% of ₹89,600 = ₹2,688

Total Cost
1. Gold Cost: ₹80,000
2. Ruby Stone Cost: ₹1,000
3. Making Charges: ₹500
4. Hallmark Charges: ₹100
5. Wastage: ₹8,000
6. GST: ₹2,688
7. Total Cost: ₹80,000 + ₹1,000 + ₹500 + ₹100 + ₹8,000 + ₹2,688 = ₹92,288

The final answer is: Rs 92,288

Q4) What is the total cost of a gold chain with a gross weight 11 gram net weight of 10 grams, 1
pcs ,1 gm ruby stone and price per carat is 200 a price per gram of ₹8,000, 10% wastage,
making charges 50 rs per gram and hallmark charges 100 per piece, other charges for
certification 800 rs per carat of ruby and 3% GST?"
Answer:
Gold Cost
1. Net weight: 10 grams
2. Price per gram: ₹8,000
3. Total gold cost: 10 grams * ₹8,000/gram = ₹80,000

Ruby Stone Cost

1. Weight: 1 gram = 5 carats
2. Price per carat: ₹200
3. Total ruby cost: 5 carats * ₹200/carat = ₹1,000

Making Charges
1. Making charge per gram: ₹50
2. Total making charges: 10 grams * ₹50/gram = ₹500

Hallmark Charges
1. Hallmark charge per piece: ₹100
2. Total hallmark charges: ₹100

Certification Charges for Ruby

1. Certification charge per carat: ₹800
2. Total certification charges: 5 carats * ₹800/carat = ₹4,000

Wastage
1. Wastage percentage: 10% of net weight
2. Wastage weight: 10% of 10 grams = 1 gram
3. Wastage cost: 1 gram * ₹8,000/gram = ₹8,000

GST (Goods and Services Tax)

1. GST percentage: 3%
2. GST amount: 3% of (₹80,000 + ₹1,000 + ₹500 + ₹100 + ₹4,000 + ₹8,000) = 3% of ₹93,600 =
₹2,808

Total Cost
1. Gold Cost: ₹80,000
2. Ruby Stone Cost: ₹1,000
3. Making Charges: ₹500
4. Hallmark Charges: ₹100
5. Certification Charges for Ruby: ₹4,000
6. Wastage: ₹8,000
7. GST: ₹2,808
8. Total Cost: ₹80,000 + ₹1,000 + ₹500 + ₹100 + ₹4,000 + ₹8,000 + ₹2,808 = ₹96,408

The final answer is: Rs 96,408

Q5)What is the total cost of a gold chain with a gross weight13 gram net weight of 10 grams, 1
pcs ,5 carats ruby stone and price per carat is 200 ,4 carats pearls 80 Rs per carat ,6 carat
sapphire and per carat cost is 250 ,a price per gram of ₹8,000, 10% wastage, making charges
50 Rs per gram and hallmark charges 100 per piece, and 3% GST?"

Step 1: Calculate the Gold Cost

1. Net weight: 10 grams
2. Price per gram: ₹8,000
3. Total gold cost: 10 grams * ₹8,000/gram = ₹80,000

Step 2: Calculate the Ruby Stone Cost

1. Weight: 5 carats
2. Price per carat: ₹200
3. Total ruby cost: 5 carats * ₹200/carat = ₹1,000

Step 3: Calculate the Pearl Cost

1. Weight: 4 carats
2. Price per carat: ₹80
3. Total pearl cost: 4 carats * ₹80/carat = ₹320

Step 4: Calculate the Sapphire Cost

1. Weight: 6 carats
2. Price per carat: ₹250
3. Total sapphire cost: 6 carats * ₹250/carat = ₹1,500

Step 5: Calculate the Making Charges

1. Making charge per gram: ₹50
2. Total making charges: 10 grams * ₹50/gram = ₹500

Step 6: Calculate the Hallmark Charges

1. Hallmark charge per piece: ₹100
2. Total hallmark charges: ₹100

Step 7: Calculate the Wastage

1. Wastage percentage: 10% of net weight
2. Wastage weight: 10% of 10 grams = 1 gram
3. Wastage cost: 1 gram * ₹8,000/gram = ₹8,000

Step 8: Calculate the GST

1. GST percentage: 3%
2. GST amount: 3% of (₹80,000 + ₹1,000 + ₹320 + ₹1,500 + ₹500 + ₹100 + ₹8,000) = 3% of
₹91,420 = ₹2,742.60

Step 9: Calculate the Total Cost

1. Gold Cost: ₹80,000
2. Ruby Stone Cost: ₹1,000
3. Pearl Cost: ₹320
4. Sapphire Cost: ₹1,500
5. Making Charges: ₹500
6. Hallmark Charges: ₹100
7. Wastage: ₹8,000
8. GST: ₹2,742.60
9. Total Cost: ₹80,000 + ₹1,000 + ₹320 + ₹1,500 + ₹500 + ₹100 + ₹8,000 + ₹2,742.60 =
₹94,162.60

The final answer is: Rs 94,162.60

In many cases, making charges and wastage are combined and mentioned as a single "making
charge" on the bill. This is because wastage is indeed a part of the making process, and
combining the two charges can simplify the billing process.

Recent articles and industry guidelines suggest that it's acceptable to mention the combined
charge as "making charges" on the bill, as long as the breakdown of the charges is clearly
communicated to the customer.

For example, a bill might show:

- Gold weight: 10 grams

- Gold price: ₹80,000
- Making charges: ₹8,500 (includes wastage and making charges)
- Stone charges: ₹1,000
- GST: ₹2,742.60
- Total: ₹92,242.60

In this example, the making charges include both the wastage and the actual making charges,
but the customer is still aware of the total amount being charged.

It's essential to note that transparency and clear communication are key. Retailers should
ensure that customers understand the breakdown of charges, even if the wastage and making
charges are combined.
questions
Questions practice

Q1. "What is the total cost of a gold bangle with a net weight of 20 grams, a price per gram of
₹7,500, 12% wastage, and 3% GST?"

Answer: ₹173,040

Q2. "A gold necklace has a net weight of 15 grams, a price per gram of ₹9,000, 8% wastage,
and 3% GST. What is the total cost?"

Answer: ₹150,174

Q3. "Calculate the total cost of a gold ring with a net weight of 5 grams, a price per gram of
₹8,500, 10% wastage, and 3% GST."

Answer: ₹48,152.50

Q4. "What is the total cost of a gold earrings with a net weight of 8 grams, a price per gram of
₹7,000, 12% wastage, and 3% GST?"

Answer: ₹64,601.60

Q5. "A gold pendant has a net weight of 12 grams, a price per gram of ₹8,000, 9% wastage,
and 3% GST. What is the total cost?"

Answer: ₹107,779.20

Questions with stones

Q1) "What is the total cost of a gold chain with a gross weight 12 gram net weight of 11 grams,
1 gm ruby stone and price per gram is 250 a price per gram of ₹8,500, 10% wastage, and 3%
GST?"

Answer: ₹106,193

Q2) "What is the total cost of a gold chain with a gross weight 15 gram net weight of 13.5
grams, 1.5 gm emerald stone and price per gram is 300 a price per gram of ₹9,500, 11%
wastage, and 3% GST?"

Answer: ₹147,091.73

Q3) "What is the total cost of a gold chain with a gross weight 10 gram net weight of 9 grams, 1
gm sapphire stone and price per gram is 200 a price per gram of ₹8,000, 9% wastage, and 3%
GST?"
Answer: ₹81,040

Q4) "What is the total cost of a gold chain with a gross weight 18 gram net weight of 16 grams,
2 gm ruby stone and price per gram is 250 a price per gram of ₹8,500, 10% wastage, and 3%
GST?"

Answer: ₹154,603

Q5) "What is the total cost of a gold chain with a gross weight 14 gram net weight of 12.6
grams, 1.4 gm emerald stone and price per gram is 350 a price per gram of ₹9,000, 10%
wastage, and 3% GST?"

Answer: ₹128,986.90

Q1) "What is the total cost of a gold chain with a gross weight 16 gram, net weight of 15.1
grams, 3.5 carats emerald stone, 1 carat ruby stone, and price per carat of emerald is 300 and
ruby 250 and a price per gram of gold is of ₹9,500, 11% wastage, 3% GST, and ₹100 hallmark
charge?"
Answer: ₹165,448.39

Q2) "What is the total cost of a gold chain with a gross weight 20 gram, net weight of 18.6
grams, 5 carats sapphire stone, 2 carats emerald stone, and price per carat of sapphire is 400
and emerald 350 and a price per gram of gold is of ₹8,500, 10% wastage, 3% GST, and ₹100
hallmark charge?"
Answer: ₹182,011.30

Q3) "What is the total cost of a gold chain with a gross weight 14 gram, net weight of 13.3
grams, 2.5 carats ruby stone, 1 carat emerald stone, and price per carat of ruby is 250 and
emerald 300 and a price per gram of gold is of ₹8,000, 9% wastage, 3% GST, and ₹100
hallmark charge?"
Answer: ₹120,511.03

Q4) "What is the total cost of a gold chain with a gross weight 22 gram, net weight of 20.2
grams, 6 carats sapphire stone, 3 carats emerald stone, and price per carat of sapphire is 350
and emerald 400 and a price per gram of gold is of ₹9,000, 11% wastage, 3% GST, and ₹100
hallmark charge?"
Answer: ₹211,359

Q5) "What is the total cost of a gold chain with a gross weight 18 gram, net weight of 16.8
grams, 4 carats ruby stone, 2 carats sapphire stone, and price per carat of ruby is 200 and
sapphire 300 and a price per gram of gold is of ₹8,000, 10% wastage, 3% GST, and ₹100
hallmark charge?"
Answer: ₹153,820.20
stones
Importance and Usage

Stones are a crucial component in jewelry making, adding aesthetic value, symbolism, and
emotional significance. They are used in various types of jewelry, such as rings, earrings,
necklaces, and bracelets.

Weighting Systems

The weight of stones is typically measured in:

1. Carats (ct): A carat is a unit of weight equivalent to 0.2 grams or 200 milligrams.
2. Points (pt): A point is one-hundredth of a carat.
>In the jewelry industry, stones are weighed in both grams and carats. To convert between
these units:

- 1 gram is equivalent to 5 carats

- To convert grams to carats, multiply by 5
- To convert carats to grams, divide by 5

Grams to Carats

- 0.5 grams = 0.5 x 5 = 2.5 carats

- 1.2 grams = 1.2 x 5 = 6 carats
- 3.5 grams = 3.5 x 5 = 17.5 carats
- 4.8 grams = 4.8 x 5 = 24 carats

Carats to Grams

- 3.2 carats = 3.2 ÷ 5 = 0.64 grams

- 9.5 carats = 9.5 ÷ 5 = 1.9 grams
- 12.8 carats = 12.8 ÷ 5 = 2.56 grams
- 20.5 carats = 20.5 ÷ 5 = 4.1 grams

Types of Stones

Stones can be broadly classified into:

1. Precious Stones: Diamonds, rubies, sapphires, and emeralds.

2. Semi-Precious Stones: Amethysts, aquamarines, citrines, garnets, peridots, topaz, and
tourmalines.
3. Natural Stones: Stones that occur naturally, such as pearls, opals, and jade.
4. Synthetic Stones: Man-made stones, such as lab-created diamonds, rubies, and sapphires.
5. Treated Stones: Natural stones that have undergone treatments to enhance their color,
clarity, or durability.

Commonly Used Stones

The Nine Navratna Stones

1. Ruby (Manik): Associated with the Sun, symbolizing power and prosperity.
2. Diamond (Heera): Linked to Venus, representing love, beauty, and spiritual growth.
3. Blue Sapphire (Neelam): Connected to Saturn, signifying wisdom, discipline, and protection.
4. Emerald (Panna): Associated with Mercury, representing intelligence, creativity, and good
fortune.
5. Yellow Sapphire (Pukhraj): Linked to Jupiter, symbolizing wisdom, prosperity, and spiritual
growth.
6. Hessonite (Gomed): Connected to Rahu (North Node), representing strength, courage, and
protection.
7. Cat's Eye (Lahsuniya): Associated with Ketu (South Node), signifying intuition, wisdom, and
spiritual growth.
8. Pearl (Moti): Linked to the Moon, representing emotional balance, peace, and spiritual
growth.
9. Coral (Moonga): Connected to Mars, symbolizing energy, courage, and protection.

Besides the Navratna stones, there are many other natural and simulant stones used in jewelry.
Here are some examples:

Natural Stones

1. Opal: Known for its iridescent colors and unique patterns.

2. Turquoise: A blue-green stone often used in Native American jewelry.
3. Jade: A symbol of good luck and prosperity in many Asian cultures.
4. Quartz: One of the most common minerals, often used in crystal jewelry.
5. Amber: Fossilized tree resin, often containing insects or plant material.

Simulant Stones

1. Cubic Zirconia (CZ): A popular diamond simulant, known for its brilliance and durability.
2. Moissanite: A lab-created gemstone with a similar brilliance to diamonds.
3. White Sapphire: A type of corundum, often used as a more affordable alternative to
diamonds.
4. Zircon: A natural mineral, often used as a simulant for diamonds and other gemstones.
5. Glass: Sometimes used as a simulant for gemstones, often in costume jewelry.

Other Simulant Options

1. Lab-created gemstones: Grown using advanced technology, these stones have similar
physical and chemical properties to natural gemstones.
2. Composite stones: Made from a combination of natural and synthetic materials.
3. Coated stones: Natural stones coated with a layer of material to enhance their appearance.

These simulant stones offer more affordable and accessible options for jewelry enthusiasts,
while still providing a similar look and feel to natural gemstones.

there are many other types of stones used in jewelry making.

Wastages & Profits
In the jewelry industry, "wastage" refers to the amount of metal or material lost during the
manufacturing process. This can occur due to various reasons such as:

1. Cutting and shaping: When cutting or shaping metal or stones, small pieces may be lost or
become unusable.
2. Filing and polishing: During the polishing process, tiny amounts of metal may be filed away,
contributing to wastage.
3. Soldering and joining: When joining two pieces of metal, some material may be lost due to
the soldering process.
4. Repair and modification: When repairing or modifying existing jewelry, some material may be
lost or become unusable.
5. Mistakes and errors: Human error or mistakes during the manufacturing process can result in
wastage.

Wastage is typically calculated as a percentage of the total material used in the manufacturing
process. For example, if 100 grams of gold are used to create a piece of jewelry, and 5 grams
are lost during the process, the wastage would be 5%.

Jewelry manufacturers and retailers often factor in wastage when calculating the cost of
production and pricing their products.
Wastage in the Jewelry Industry: A Key Profit Driver

Wastage is a critical factor in determining profit margins for manufacturers, wholesalers, and
retailers in the jewelry industry.

Breakdown of Wastage Percentages

- Manufacturer: 5%
- Wholesaler: 6-7% (adding 1-2% to the manufacturer's wastage)
- Retailer: 10-15% or 20% (adding 3-15% to the wholesaler's wastage)

By increasing the wastage percentage, each entity can earn a higher profit margin, highlighting
the importance of wastage in the jewelry industry's profit structure.

Additional Profit Streams

In addition to wastage, retailers and wholesalers also earn income through:

1. Stone Charges Margin

Retailers and wholesalers add a margin to the stone charges, which contributes to their overall
profit. This margin varies depending on factors such as:

- Type and quality of the stone

- Market demand and competition
- Relationship between the retailer/wholesaler and the supplier

By including this margin in the stone charges, retailers and wholesalers can increase their
revenue and profitability.

2. Total Profit Structure

To recap, the profit structure for retailers and wholesalers in the jewelry industry includes:

1. Wastage
2. Margin on stone charges

These two components significantly contribute to the overall profit margins of retailers and
wholesalers in the industry.
Rate Fix
Rate Fix, Rate Cut, or Price Fix are interchangeable terms that refer to the practice of two
parties agreeing on a fixed price for metals, which are subject to fluctuating prices. This concept
is essential due to the constant price variations, often changing by the second.

>The Rate Fix concept is prevalent in various industries, including:

- Retail
- Wholesale
- Manufacturing
- Bullion
- Mining

Until the rate is fixed, the value of metals is communicated in grams. Only after the Rate Fix is
the monetary value determined.

>In the context of Rate Fix, the two parties involved can be:

- Manufacturers and wholesalers

- Wholesalers and retail vendors
- Retail vendors and end customers

Typically, retail stores determine the rate per gram in the morning and maintain it throughout the
day. However, manufacturers, wholesalers, and miners often calculate prices in real-time,
reflecting live market fluctuations.

To facilitate a transaction, it is essential for both parties to agree on a fixed price at any given
point in time. This ensures clarity and mutual understanding, enabling the transaction to
proceed smoothly.

Examples
Retail Store and End Customer

- A customer walks into a jewelry store and selects a gold necklace weighing 10 grams.
- The store owner fixes the rate at ₹5,000 per gram.
- The total price of the necklace is ₹50,000 (10 grams x ₹5,000 per gram).

Wholesaler and Retail Vendor

- A wholesaler supplies gold bars to a retail vendor.

- The wholesaler fixes the rate at ₹4,800 per gram.
- The retail vendor purchases 100 grams of gold, totaling ₹480,000 (100 grams x ₹4,800 per
gram).
Manufacturer and Wholesaler

- A gold refinery (manufacturer) supplies gold to a wholesaler.

- The refinery fixes the rate at ₹4,600 per gram, based on the current market price.
- The wholesaler purchases 500 grams of gold, totaling ₹2,300,000 (500 grams x ₹4,600 per
gram).

Miner and Manufacturer

- A gold mine (miner) supplies gold ore to a refinery (manufacturer).

- The miner fixes the rate at ₹4,400 per gram, based on the current market price.
- The refinery purchases 1,000 grams of gold ore, totaling ₹4,400,000 (1,000 grams x ₹4,400
per gram).

Rate Fix can be applied in two ways:

1. Converting metal to cash, known as "fine to cash" (monetary value, e.g., rupees)
2. Converting cash to metal, known as "cash to fine" (e.g., rupees to grams)

To convert metal to cash, you multiply the weight in grams by the fixed rate.

Example: Fine gold weight = 80 grams, Fixed rate = ₹7,550

Metal converted to cash = 80 grams × ₹7,550 = ₹604,000

To convert cash to metal, you divide the cash amount by the fixed rate.

Example: Amount to pay = ₹604,000, Fixed rate = ₹7,550

Cash converted to metal = ₹604,000 ÷ ₹7,550 = 80 grams fine

Few more examples

Fine to Cash Examples

1. Fine gold weight = 50 grams, Fixed rate = ₹7,800

Metal converted to cash = 50 grams × ₹7,800 = ₹390,000

2. Fine silver weight = 200 grams, Fixed rate = ₹540

Metal converted to cash = 200 grams × ₹540 = ₹108,000

3. Fine platinum weight = 20 grams, Fixed rate = ₹28,500

Metal converted to cash = 20 grams × ₹28,500 = ₹570,000

Cash to Fine Examples

1. Amount to pay = ₹300,000, Fixed rate = ₹6,000
Cash converted to metal = ₹300,000 ÷ ₹6,000 = 50 grams fine

2. Amount to pay = ₹180,000, Fixed rate = ₹3,600

Cash converted to metal = ₹180,000 ÷ ₹3,600 = 50 grams fine

3. Amount to pay = ₹900,000, Fixed rate = ₹30,000

Cash converted to metal = ₹900,000 ÷ ₹30,000 = 30 grams fine

The Rate Fix concept has evolved to address the fluctuating prices of metals. This
concept is crucial and is a daily part of operations in the metal industry.

The importance of Rate Fix lies in its ability to provide a mutually agreed-upon price
between two parties, ensuring clarity and transparency in transactions. By fixing the rate,
buyers and sellers can determine the monetary value of metals, facilitating smooth trade
and minimizing potential disputes.

The Rate Fix concept is essential for various stakeholders, including manufacturers,
wholesalers, retailers, and customers. Its applications are diverse, ranging from
converting metal to cash (fine to cash) to converting cash to metal (cash to fine).

In summary, the Rate Fix concept has become an indispensable part of the metal
industry's daily operations, providing a standardized framework for price determination
and ensuring seamless transactions.
Gst & hsn
GST in Jewelry

GST (Goods and Services Tax) is a comprehensive tax levied on goods and services in India. In
the jewelry industry, GST is applicable on:

- Manufacture and sale of jewelry

- Wholesale and retail trade of jewelry
- Repair and maintenance services for jewelry

The GST rates for jewelry are:

- 3% for gold, silver, and platinum jewelry

- 5% for diamonds and precious stones
- 18% for other jewelry-related services

HSN Code

HSN (Harmonized System of Nomenclature) is an international coding system used to classify

goods for taxation purposes. In India, HSN codes are used to classify goods under the GST
regime.

HSN Types in Jewelry Industry

Here are some common HSN codes used in the jewelry industry:

- 7113: Articles of jewelry and parts thereof, of precious metal or of metal clad with precious
metal
- 7114: Articles of goldsmiths' or silversmiths' wares and parts thereof, of precious metal or of
metal clad with precious metal
- 7102: Diamonds, whether or not worked, but not mounted or set
- 7103: Precious stones (other than diamonds) and semi-precious stones, whether or not
worked or graded, but not strung, mounted or set
- 7116: Articles of natural or cultured pearls, precious or semi-precious stones (natural, synthetic
or reconstructed)

These HSN codes are used to classify various types of jewelry, precious stones, and metals for
GST purposes.

Importance of HSN Codes

Using the correct HSN code is crucial for:

- Accurate taxation
- Compliance with GST regulations
- Avoiding penalties and fines
- Streamlining business operations

By understanding and applying the correct HSN codes, jewelry businesses can ensure
compliance with GST regulations and avoid any potential issues.
old jewellery
Old jewelry refers to the process where a customer visits a store to exchange or sell their pre-
owned gold, silver, or platinum jewelry for either new jewelry or cash.

Old Jewelry Evaluation Process

1. Product Identification: Check the product and identify its group (gold, silver, platinum).

2. Purity Testing: Test the purity using an XRF machine or through oral assessment based on
experience.

3. Weight Adjustment: Remove any dust, stone, or other material weights to determine the net
weight.

4. Calculations:
- Multiply the net weight by the purity to get the fine weight.
- Alternatively, directly multiply the price with its reference quality.

5. Evaluation: Calculate the value of the old jewelry based on its fine weight and current market
price.

6. Exchange or Cash Option: The evaluated value can be exchanged for new jewelry or cash. If
cash is chosen, a depreciation amount is deducted as part of process expenses.

Old Jewelry Process Summary

1. Estimation: Provide an initial estimate of the old jewelry's value.

2. Finalization: Finalize the estimate with minor adjustments (if needed).
3. Old Jewelry Purchase:
1. Create an old jewelry bill for the customer.
2. Alternatively, accept the old jewelry as part of payment for:
- New purchase
- Repair
- Order
- Any other application where payments are made.

This process ensures a smooth transaction for both the customer and the store.

Calculations example:
Question 1
Gross weight: 8 grams
Net weight: 7.2 grams
Purity: 18 karats
Price: 4800 per gram (for 18 karats)
Value = Net weight x Price
Value = 7.2 grams x 4800 per gram
Value = 34560

Question 2
Gross weight: 12 grams
Net weight: 10.8 grams
Purity: 22 karats
Price: 7200 per gram (for 22 karats)

Value = Net weight x Price

Value = 10.8 grams x 7200 per gram
Value = 77760

Question 3
Gross weight: 5 grams
Net weight: 4.5 grams
Purity: 24 karats (Note: 24K is 99.9% pure, so we can use the net weight directly)
Price: 8000 per gram (for 24 karats)

Value = Net weight x Price

Value = 4.5 grams x 8000 per gram
Value = 36000

Practice
Question 1
Gross weight: 10 grams
Net weight: 9 grams
Purity: 22 karats
Price: 7200 per gram

Answer: 64800

Question 2
Gross weight: 7 grams
Net weight: 6.3 grams
Purity: 18 karats
Price: 4800 per gram

Answer: 30240

Question 3
Gross weight: 15 grams
Net weight: 13.5 grams
Purity: 24 karats
Price: 8000 per gram

Answer: 108000