How to Price Custom Jewelry: The Complete Guide

The four components of any custom jewelry price

Every custom jewelry quote, regardless of the piece, breaks down into four parts: material cost, labour, overhead and markup. Getting any one of them wrong cascades into the final price.

1. Material cost: gold and silver

Start with the spot price, not a rounded number you remember from last month. Gold moves daily and significantly — a $30/oz swing on a 5-gram piece adds about $5 to your material cost before markup. Over a month of quotes, that adds up.

The formula for gold cost in a piece:

Purity factors: 10K = 0.417, 14K = 0.585, 18K = 0.750, 24K = 1.000

The waste factor is where a lot of jewellers lose money. When you cast or fabricate a piece, you lose metal to sprues, filings and polishing dust. A realistic waste factor is 5–15% depending on the piece complexity. For a simple band, 5% is reasonable. For a complex prong setting with a lot of filing, budget 12–15%.

For a 5-gram 18K yellow gold ring at a gold spot of $85/gram (CAD):

Do not skip the waste factor. That money comes out of your margin if you do.

2. Material cost: diamonds and gemstones

Stone pricing is more variable than metal because there is no universal live market rate for diamonds the way there is for gold. Your cost depends on your supplier, the stone grade and quantity purchased.

For melee diamonds (under 0.25ct), most Canadian jewellers work from a cost-per-carat figure tied to their supplier — commonly Nivoda, Rapnet or a local wholesaler. Set a standard price-per-carat figure for your common sizes and update it when your supplier invoices change.

For larger stones (0.5ct+), price from the actual invoice on that specific stone. Do not use a blanket rate. A 1ct H/SI1 and a 1ct D/VVS2 have completely different costs and your client may ask where the number comes from.

Stone setting labour is a separate line item, not bundled into the stone price. A 6-prong solitaire setting takes a skilled jeweller 20–40 minutes. Price that labour separately so you can see it clearly.

3. Labour: the number most jewellers undercount

Bench labour is consistently the most underestimated cost in custom jewelry pricing. There are two reasons: jewellers underestimate how long tasks actually take, and they use an hourly rate that does not reflect the real cost of their time.

Track your actual bench time on a few jobs this week — not your estimate of the time, the real clock time. Most jewellers find they are 20–30% slower than they think, especially on detailed work like setting, milgrain or engraving.

On hourly rate: if you are a single-location shop and you are the bench jeweller, your rate should account for the fact that non-bench time (customer service, admin, quoting, ordering) is real overhead. A common framework:

If you are charging less than $50/hr for skilled bench work, you are almost certainly undercharging.

4. Overhead allocation

Overhead is every cost that does not belong to a specific job: rent, utilities, insurance, software, equipment maintenance, marketing. These costs exist whether or not you complete a job today, and they need to be recovered somewhere.

A simple allocation method: add up all fixed monthly costs, estimate how many jobs you complete per month, divide. If your overhead is $4,000/month and you complete 25 jobs:

Add $160 to every quote before markup. This is a rough estimate, but it is far better than nothing. Adjust it quarterly as your job volume changes.

5. Markup

Once you have your total cost (materials + labour + overhead), you apply your markup to arrive at the retail price. Industry standards for custom jewelry work typically range from 2x to 3.5x on materials, but markup-on-cost as a full formula looks like:

For a piece with $400 in materials, $180 in labour, $160 overhead at a 2.5x markup:

That 2.5x multiplier represents a 60% gross margin — a reasonable target for custom design work. Repairs and production pieces typically run lower (2x or below). High-complexity custom work can justify 3x or more, especially when you are the only shop offering the service in your area.

The quoting workflow that holds it all together

Having the right formula means nothing if your quoting process takes 90 minutes per job. The math above needs to happen in real time while a customer is in front of you or waiting for an email.

The fastest way to run this calculation consistently is purpose-built jewelry quoting software that pulls live gold prices, has your stone prices pre-loaded and calculates margin in real time. Manual spreadsheets break down when gold moves, when stone prices change, or when you have multiple jobs to quote in a day.

GemQuote was built specifically to run this calculation in under 5 minutes per quote — live spot prices, your diamond price table, your labour rates and margin all in one place.