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Many jewellers allow some negotiation on making charges, especially during festive seasons, wedding seasons, or promotional offers
The price of gold jewellery is determined by several factors:
Understanding the dynamics of gold prices and jewellery pricing in India is crucial for making informed purchasing decisions. Making charges on gold jewellery are a significant component of the final cost you pay when purchasing gold ornaments. These charges can vary widely depending on factors such as design, craftsmanship and retailer policies.
Components of Jewellery Pricing
The price of gold jewellery is determined by several factors:
Gold Weight:
Gold is measured in grams, and its price varies daily based on market rates.
Gold Purity:
Gold purity is denoted in karats (K). Common purities:
- 24K (99.9% pure): Used for investments, not jewellery.
- 22K (91.6% pure): Standard for most jewellery.
- 18K (75% pure): Used in intricate designs and gemstone-studded jewellery.
Making Charges:
The added cost for crafting the jewellery (percentage-based or fixed per gram).
GST (Goods and Services Tax):
3% on the total jewellery price, including making charges.
How Gold Prices Are Determined?
Gold prices in India depend on:
International Market Trends:
Influenced by global demand, currency fluctuations, and geopolitical events.
Indian Rupee vs. US Dollar Exchange Rate:
A weaker rupee increases gold prices as gold is imported in USD.
Customs Duty:
India imposes an import duty on gold
Local Market Factors:
Seasonal demand during festivals, weddings, and special occasions impacts prices.
Spot Price vs. Retail Price
Spot Price:
The current market price for pure gold is usually per gram.
Retail Price:
Includes spot price + making charges + GST.
What Are Making Charges?
Making charges refer to the cost of converting raw gold into jewellery. This includes the craftsmanship, labour, and tools involved in creating the final piece.
Types of Making Charges
Percentage-Based:
Retailers often calculate making charges as a percentage of the gold value. For example, if the gold value of a piece is Rs 50,000 and the making charge is 10%, you’ll pay an additional Rs 5,000.
Per Gram Charges:
Some jewellers charge a fixed rate per gram of gold, e.g., Rs 300/gm. This is common for lightweight or mass-produced jewellery.
Factors Influencing Making Charges
Design Complexity:
Intricate and detailed designs require more labour and time, resulting in higher charges.
Handcrafted vs. Machine-Made:
Handcrafted jewellery has higher making charges due to the artisan’s skill and effort involved. Machine-made jewellery is often cheaper.
Type of Jewellery:
Items like bangles or necklaces, which are complex, typically have higher making charges compared to simpler items like rings or earrings.
Brand and Store:
Established or luxury brands often charge premium rates compared to local jewellers.
Negotiation on Making Charges
Many jewellers allow some negotiation on making charges, especially during festive seasons, wedding seasons, or promotional offers.
Hallmarking and Transparency
Hallmark Gold:
Always ensure that the gold is BIS-hallmarked to guarantee purity. Making charges is separate from this certification.
Transparency:
Reputable jewellers provide detailed bills, separating gold value, making charges, and GST (Goods and Services Tax).
Making Charges Discounts
Festive Discounts:
During festivals like Akshaya Tritiya or Diwali, jewellers often offer discounts or waive making charges.
Membership Programs:
Some jewellery brands offer loyalty programs or advance purchase schemes that reduce or eliminate making charges for members.
GST on Making Charges
Making charges are subject to 3% GST in addition to the 3% GST levied on the gold value.
How to Save on Making Charges?
Compare Stores:
Visit multiple jewellers to compare making charges.
Buy Gold Coins:
Gold coins have no making charges, but you’ll need to pay for their purity certification.
Opt for Simple Designs:
Choose jewellery with minimalistic designs to reduce making charges.
Alternatives to Reduce Costs
Pre-Loved Jewellery:
Consider purchasing pre-owned jewellery, where making charges might not apply.
Digital Gold or Gold ETFs:
If you’re investing in gold rather than buying jewellery, explore options like digital gold, gold ETFs, or sovereign gold bonds, which avoid making charges altogether.
Disclaimer: The views and investment tips by experts in this News18.com report are their own and not those of the website or its management. Readers are advised to check with certified experts before making any investment decisions.
