How does gold price markup work?

Question

I have been shopping for a gold necklace I did some research on gold prices and I downloaded a gold price calculator so I know how to get current prices per gram for the different karats. What I don't know is how does the markup for workmanship and things of that sort work. For example I saw a 10k gold necklace that weighed 30g for $625, at the current gold price 30g of 10k gold would be about $315 so the markup is $310 on the necklace is that right? What determines this markup?

Answer 1

Well, a necklace is not a lump of gold, there is obviously some artistry and workmanship involved.  How much is it worth?  That is obviously open to discussion.  That said, I have observed that markups on jewelry seem quite high compared to more common consumer products.  Of course, jewelers don't make as many sales every day as the corner grocery store, so I suppose the need to stay in business.

Grandpa

Answer 2

When I bought gold in the Dubai gold sook (I think I have spelt that wrong but the market).  You basically bargain on the workmanship, so if you imagine how long it took someone to make your necklace and but a price on the hourly rate for that.  Then I guess they have to add overhead costs (shipping, the lights in the store etc).  It may be arbitrary or if the necklace is from a specific place it may be based on a recommended retail price set by the manufacturer.