Lower mark-up is a big part of our lowest price equation. When you charge less, you get more customers. More customers allows even lower mark-ups. After 34 years of lowering prices you become a very tough competitor.
Another huge reason for our lower prices is how we buy. We are the only jeweler in Utah that travels to India to buy directly. India is the source where 10 out of 11 of the world’s diamonds are cut. The prices are the best, but you have to have lots of cash to do business there. Most jewelers in the Utah/Provo area have cash flow problems, so they borrow diamonds (called “on memo”) from dealers instead of buying them outright from direct sources. They only have to pay for them when they sell, but they pay 30-40% more for their diamonds doing it that way.
Cash flow problems also mean that most jewelers borrow money constantly. This creates interest overhead which further complicates cash flow. We have never borrowed money to run our business, but instead elected to grow at a slower rate and have cash with which to buy at the lowest world rate there is.
A third reason is our specialization. We only sell diamonds and engagement rings which sell much faster than watches, porcelain, and fashion jewelry. Our faster turnover gives us the cash with which to buy from direct sources overseas. We are the only jeweler in Utah that sells only engagement rings.
A fourth reason is our non-commissioned sales people. We don’t have to pay out a percentage on each sale as others do.