By Shawna Kulpa
Jewelers’ workshops have likely never been as clean as they are right now. With precious metals prices on the rise, many jewelers are taking the opportunity to scour every inch of their shops, hoping to capture each and every errant particle of gold to send in for refining to take advantage of the elevated metal prices.
Perhaps you’ve been doing some fall shop cleaning of your own. But are you really capturing all the precious metal that you could? And how do you know if, in your efforts to maximize your refining return, you’re not wasting money sending in materials for refining that won’t give you a return on investment? The following are some tips that you can put to use to help guarantee that you’re maximizing your metal returns.
To David Siminski, vice president of sales and marketing at United Precious Metal Refining in Alden, New York, “the biggest thing that [you] can do is to build a relationship with your refiner so you can always ask them questions.” Whether it’s regarding how they’ll process your lot or whether or not something is worth sending in for processing, they’ll help you to understand the refining process, their fee structure, and when something does or doesn’t make sense for refining.
“Build that rapport,” he says. “Education and knowledge are the key.”
Any refiner will tell you that one of the most important things that jewelers can do is to separate their scrap. While it’s not necessary to separate gold by karat and color (though it would help your record keeping, you should plan to combine all of the gold into one lot for processing), gold and silver should be kept separate from platinum group metals. “When platinum and palladium are mixed in with gold and silver, the lot is more expensive to refine,” says Siminski. “It can be done, but it’s more way more costly.”
Also, you may see a better return if you separate higher-grade bench sweeps from lower-grade floor sweeps. “As the precious metal percentage goes down, so does your return,” says John Antonacci, director of marketing and strategic accounts at Gannon & Scott in Cranston, Rhode Island. “For example, you could have 50 percent gold content in high-grade sweeps, diluted down to 20 percent by mixing with a low-grade lot. ”
While Antonacci would love to see jewelry manufacturers employ a clean room mentality, with all employees outfitted in HAZMAT suits, gloves, and booties, he recognizes that it’s not realistic. However, at the very least he recommends jewelers require employees in production areas to wear booties that can be slipped over shoes and then later collected for refining.
If booties aren’t feasible for a workspace, jewelers should use sticky mats on the floor in front of production area exits. When workers exit the space, any metal on the soles of their shoes will stick to the mats, which can later be sent in for refining. “It would be great if they could get these measures in place,” he says. “It’s for their own sake.”
When it comes to cleaning the floors in your shop area, have just one vacuum that’s used to clean only the shop area. If you use the same vacuum throughout the entire facility, including in lobbies or an attached retail storefront, you risk sucking up non-metal impurities from these other areas. Since the processing charges for refining are based partially on the weight of the material being refined, the more non-precious metal debris that gets sucked up by the vacuum, the more you’ll be paying to refine the lot.
And when it comes to that dedicated shop vacuum, don’t be quick to send the entire thing in for refining once it reaches the end of its lifespan. “I understand the desire, but really think it through,” cautions Antonacci. “If it’s going to add weight to your lot, your processing fee will go up. Don’t pay that money to process something that won’t give you any value.” You often will be better off simply by giving it a good wipe down, inside and out, and then sending in those towels for refining.
In addition to paying attention to the precious metal dust that falls down onto the shop floor, don’t forget to look up too. When you’re getting ready to send in a lot for refining, wipe inside any ductwork in the workspace. “As the air is pulled out of the room, it can take metal dust with it,” says Antonacci. “Wipe it down, then collect and refine the wipes you use. You may be surprised at what’s in there.”
And speaking of ductwork, make sure any air filters in the shop are outfitted with HEPA filters, which are designed to capture 99.5 percent of particulates. When it’s time to change them, toss the used ones into a barrel to send in with your next sweeps lot.
While you’re on the ladder wiping down your ducts, take note of the ceiling material used in your production area—there just may be gold inside it.
“In the past, we refined a lot of ceiling panels because the dust would get into the pores,” says Larry Fell, CEO and president of David H. Fell & Co. in Commerce, California. Though he notes that it isn’t that common anymore due to improvements in air filtration systems, it might be worth sending in ceiling panels if they’ve been in place for decades.
No matter how good the ventilation in your shop is, metal dust created in production processes such as polishing will wind up in the air and land on anything and everything in your shop. To collect as much of that as possible, regularly take paper towels and wipe down your tools, equipment, and all work surfaces and then toss those towels in with your low-grade sweeps for refining. “Any time you wipe down your shop, never disregard those towels as trash,” says Siminski.
Keep your sweeps clean, so to speak. Some jewelers maintain a barrel for floor sweeps that they also use for shop trash. After all, who’s to say that gold dust didn’t transfer from a jeweler’s hands to the can of Coke he enjoyed with his lunch? But remember that part of the processing charge for refining is based on the weight of the lot sent in. The more a lot is weighed down with aluminum cans or other detritus, the more you’ll pay to have it processed, and you won’t see a return on that investment. “You shouldn’t use the refinery as a landfill,” says Siminski.
“Most jewelers are pretty savvy and will send in only high-grade sweeps, but some will send in separate lots with essentially trash,” adds Antonacci. “Separate sweeps: The higher the grade, the better it is for your return.”
And if you’re really worried about potential dust on that Coke can, wipe it down with a paper towel, throw that towel in with your sweeps, and then toss the can in your recycling bin.
Every jeweler has likely heard the tale: A fellow jeweler who used the same bench chair for 40 years sends in that chair for refining and gets a check back large enough to treat himself to a new car. Before you start boxing up your bench chair to ship to your refiner, remember that the chair’s weight will affect your processing fee. If the chair is metal, it likely won’t even make it into the burn at the refinery. Instead, pull off any cushions and then dismantle the chair. Wipe down all of the chair parts with paper towels and then place the cushions and the towels into the container with your shop sweeps.
As with so many other aspects of business, data is king when it comes to collecting and tracking metal scrap. Antonacci recommends jewelers evaluate their internal systems to identify areas where precious metal collection needs to be improved.
“One way to do this is by segregating material collection into separate streams and monitoring the results that come back from the refiner,” he says. “The more data you can collect, the better off you are.” However, he cautions that capturing the data is just one step. “You have to understand what the data means to you. Where are the major losses? Identify those areas of loss.”
Also, remember that there’s no finish line to cross when it comes to collecting data. The more data you collect, the easier and faster it will be to identify any issues. “Build up a constant history,” says Siminski. If you track “once a month, a quarter, every six months, it makes it easier to track any fluctuations.”
Deciding when to ship in your materials is up to you, though many refiners recommend avoiding trying to time the market. Instead, they recommend waiting until you have enough materials to make the refining process worthwhile.
“Most refiners have a lot charge or assay fee per batch and many have sliding scales for the recovery rate, depending on the weight submitted,” says Fell. “If the jeweler can save X percent by holding the material until they generate enough to get to the next price break, they could compare that savings to their need for cash in the shorter term, or the cost to borrow that cash for the term.”
However, he does note the importance of knowing about the regulations in your state when it comes to holding on to old material.
“In a few states, jewelry polishings are regulated as hazardous waste,” he says. “As such, there are regulatory limits on how long the generator can store it without a storage permit.”
When it comes to shipping your materials to the refiner, make sure the containers are sturdy, tamper-proof, and are not marked with any indication that there is precious metal inside. (“Avoid writing things like ‘gold sweeps’ or ‘high-value lots’—yes, we’ve seen that,” warns Antonacci.)
Drums work best for shipping and can often be obtained directly from your refiner so contact them about their shipping program. If you use cardboard boxes, be sure to reinforce the edges to prevent anything from leaking out during transit. Also make sure that any liquids, such as from sink traps, have been dried out prior to shipping, lest they soak into the box and cause it to break down.
“The bottom line is pack the materials as if you knew it was going to be dropped off the back of a truck doing 25 miles per hour,” advises Fell.
Whatever type of container you use, be sure that it’s covered by insurance and adhere to any guidelines the insurer re-quires. In addition, if you’re unclear if any of the materials in the shipment might be considered hazardous, such as certain types of solvents, check with your refiner or shipping company. “Give them the Safety Data Sheet and they’ll let you know if it has to ship as hazardous,” says Antonacci. In those instances, make sure you adhere to all hazardous shipping guidelines. “You’re the generator; if something happens between your place and the refiner, you’re responsible for that,” he says. “Make sure you have your ducks in a row.”