There are three different numbers attached to a piece of jewellery, and almost every argument at a counter comes from someone using one of them while the person opposite is using another.
The three numbers
Melt value is the market price of the pure metal inside the piece. It is arithmetic: weight, times purity, times today’s spot price. It takes no account of design, age, maker, condition or stones, and it is the same for a beautiful ring and for the identical weight of gold in a lump. This is the number our gold calculator produces, and it is labelled melt value on every screen for exactly this reason.
Scrap price is what a buyer will hand you for it as metal. It is melt value minus their margin, and it is always lower — the ranges are published on the calculator page. Nobody pays melt, and anyone claiming to pay above it is pricing something other than the metal.
Resale value is what the piece is worth as a piece, to somebody who wants to wear it. This one is not arithmetic at all. It depends on who made it, when, whether anybody currently wants that, what the stones are, and what condition it is in. It can be anywhere from below scrap to a hundred times it.
Why the gap matters so much
For a plain worn-out chain with no marks, melt is roughly the whole story and scrap is a reasonable outcome. For anything else, selling at scrap can destroy most of the value in a transaction that takes ninety seconds and cannot be undone.
The categories where the gap is routinely large:
- A recognised maker. A signed piece by a house people collect is worth what collectors will pay, and that has no relationship to its weight. This is the single biggest reason to identify a mark before doing anything else.
- Age and period. Genuine Victorian, Art Deco or mid-century work is bought for what it is. Some of it is also in low-karat gold, so the melt figure is especially poor.
- Stones of any size. A scrap buyer values the metal and hands the stones back, or does not mention them. A one-carat diamond in a ring is not part of the melt calculation at all.
- Anything still current at retail. If the model is still sold, there is a second-hand market for it, and that market pays multiples of scrap.
The asymmetry, stated plainly
A gold buyer is not obliged to tell you that the ring in front of them is collectable. Many will; some will not; and the one who does not has broken no rule. They quoted you a fair price for metal, and you accepted it. The information gap is the whole business model of the low end of this trade, and it is legal.
This is also why this site does not recommend anybody. The useful thing is not a shortlist — it is knowing which number you are being quoted, so you can tell whether the conversation is about metal or about a piece of jewellery.
What to do about it
The rule that covers nearly every case: melting is irreversible, so treat it as the last option rather than the first. Before anything goes on a scale for scrap:
- Read the marks. Our hallmark reference covers the purity marks; a maker’s mark needs a maker’s register, and it is worth the twenty minutes.
- Work out the melt value yourself first, so you arrive knowing the ceiling rather than discovering it.
- Get an opinion from someone who is not buying it. An appraiser charges a fee and has no stake in the answer; a buyer’s valuation is an offer wearing a different hat.
- If it has stones, have them removed or valued separately before you agree a metal price.
None of this means do not sell. Plenty of jewellery genuinely is worth its metal and nothing more, and turning it into money is a perfectly sensible thing to do. It means find out which kind you have first, because that question has an answer and it takes an afternoon.