The steep rise in gold prices in 2020 has not only affected the investors who are looking for more secure places to store their money but also the demi-fine jewellery market.
The demi-fine jewellery is a famous category, designed to complement casual wear. They are even priced for inspiring modest shopping. However, the demi-jewellery designers are struggling with increased prices, just like the retailers carrying their brands.
Gold’s price was slightly less than £1,167 an ounce on January 1, and the price was hovering at £1,430 an ounce on October 1. And prices are continually fluctuating.
Zoe Chicco is the founder and designer of a Los Angeles-based jewellery collection, sold at stores like Bloomingdales, Nordstrom and Saks Fifth Avenue, and also boutiques such as Browns in London.
According to her, “It does make a huge difference, and we have to be incredibly conscious about it.” She is planning to enhance her jewellery prices in January, but it is indeed a hard thing for her to do. This is because customers are accustomed to seeing a specific price of jewellery from this brand.
In the persistent anxiety about losing jobs and the long-standing economic effects of Covid-19, it is speculated that small gold items can be the highlights of many collections in 2021.
Pascale Monvoisin is a Paris-based jeweller who has two boutiques in the French capital. Also, retailers such as Liberty and Net-a-Porter sell their creations. Ms Monvoisin is known to work on a collection of charms that will cost nearly 30% less than a pendant with a chain.
She bought two kilograms of gold in June when the metal’s price was about £1,284 an ounce. She is already working on the jewellery items using that gold and will start selling next year. Now:
The profit margins of the brand decreased 8-10% this year between March and October. But yet the company is willing to maintain its jewellery prices.
The chief executive of the brand, Aurelie Bressou believes that –
“We think if we increase our retail prices, maybe people are not going to follow us. We don’t want to lose them.”
However, according to Ms Monvoisin, price increment might be unavoidable. It will be challenging for them to continue with the same retail cost if the price of gold increases more and more.
On the other hand, Anna Sheffield Fine Jewellery brand is twisting some parts subtly like creating clasps on smaller pieces to maintain the prices. What’s the advantage?
“This might not alter the design terribly, but would give you a lower weight and a slightly lower cost on a finished piece”, said the chief executive and founder Ms Sheffield.
A British jewellery brand, Alex Monroe, also encountered less profit due to the cost of gold. Thus, its creative director Emma Burgin-Fox professed that they would increase the price of all its solid gold pieces by nearly 20% in January.
For example, the retail price of a thin-textured gold band featuring a diamond of 0.25ct that is now around £1,730 may rise to £2,100.
Prices of all gold items, including pieces with a small amount of gold, are likely to appreciate. Increasing gold prices will influence everything. Even the gold plated items are likely to become incredibly expensive.
As per the current report from the World Gold Council, sales of gold jewellery have decreased all over the world. It reduced by nearly 29% from July to September when compared to the same period in 2019.
However, the demi-fine jewellery market has experienced strong sales. For instance, Alex Monroe has reported that their sales were up nearly 12% during the first lockdown in Britain.
Ms Collins at WGSN said in a statement that the pandemic seems to have not affected the demi-fine jewellery at all. Amidst the restrictions and agitation due to the coronavirus, people were buying.
Those who buy demi-fine jewellery have the perception that gold is a responsible material to buy. She added, “It goes back to that thing that fine jewellery is seen as an investment purchase. It’s something that you can keep for yourself, and it’s timeless.”
Price of gold is yet wandering. It is predicted to escalate as much as £2,270 per ounce by the end of 2021.
Well, keeping the current surge in gold’s price in mind, it is perhaps the best to sell gold items, especially the ones that you no longer use or gathering dust in your drawer.
Whether it is scrap gold or a tangled gold ring, they can fetch you an astonishing amount of cash for gold.
Fill up our online form now or call on 0207 242 9160 today for a free competitive valuation.
Sell scrap gold or any gold jewellery pieces to The Luxury Hut and receive the best price possible for it based on the spot gold price on the day of valuation.
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