Frank Schaffer has been a diamond cutter on Jewelers’ Row for nearly 20 years. In that time he has built his company and his brand and has become one of the most well-known institutions on the row (indeed, many people stopped and said hi to him during the interview). In this series Frank talks about how he became a diamond cutter, how he came to be on Jewelers’ Row, why he loves being on the row, why he is against the new development proposal, and why he has an impressive collection of prehistoric fossils hanging in his storefront.
PART 2: HOW FRANK’S BUSINESS WORKS
Kevin Wohlgemuth (KW): So, you’re the only diamond cutter [in the area]?
Frank Schaffer (FS): In the five state area. Every state that actually touches Pennsylvania, I’m the only one… Pennsylvania, Maryland, Delaware, New Jersey, and Ohio.
KW: How is that the case?
FS: Lost art, [it’s a] lost art. It’s absolutely a lost art. Now I’m not saying that [I’m the only trained diamond cutter]… I’m the only one who is actively pursuing it.
KW: That’s great for you.
FS: Pretty wild. You’d think it would be wonderful, but you’d be surprised how business has actually changed over the years, how imports have pretty much destroyed [the cutting business]. So, you here have the last bastion of hope for the jewelry industry. You have New York, you have Philadelphia, you have guys here who are really doing it.
I never saw the talent that I see in Philadelphia anywhere, and I know the talent, trust me.
I don’t see it in New York, because it’s very transient. It’s a faster pace of just… I don’t want to say junk, because there’s some high end stuff that goes through New York, too. But as for the craftsmanship, that is available… at any given time I could walk up to the second floor of 704 and I can find a talented guy, I can find one of the most talented laser guys in that building, just because you have a laser doesn’t mean you know how to use it. I’ve seen him do things that are just incredible that I’ve seen nowhere else in the world.
… I actually taught another fellow too who actually moved on and found gainful employment as he moved on with his life. And Sary and I have been together for thirty years now. We know each other now since 1989… I would have to sit there and say 1992. Yeah, that we really were good friends. No. Oh, man. It’s much longer than that. Sary and I have been best friends since… 1988. Sary is Cambodian American citizen who was a dissident in Cambodia during the regime of Pol Pot in 1975. He settled here finally when he was of age after he did a tour in the army and that’s pretty much what they did. They brought them over here and then you gave a little tour to the army and that was it. [Then he] came to Jewelers’ Row and never left. [He came to Jewelers’ Row] in 1982 [and started] cutting. That’s all he ever did. Gemstone cutting. Now he works with me. I say with me, I don’t say for me. He works with me. We’ve been best friends ever since. Yeah…
FS: I pay my employees anywhere from $40,000 to $70,000 a year. Those are living wages… You are not going to work on people’s jewelry with inexperienced help.
KW: How many employees do you have?
FS: Right now I have three full-time employees beside myself and… three part-time. There was a point where we had more full-time employees, but I had to release two of them because I had an $80,000 opal that went missing. They had to go.
KW: What do you mean, “Went missing?”
FS: That’s what happened. Stuff gets stolen in this business, absolutely. Oh, yeah. I had to release another two employees, too. One was, he had a terrible drinking problem. He needed to straighten his life out. The other guy, I thought it was narcolepsy, but it wasn’t, it was prescription medicine and he would fall asleep. Yeah, I really didn’t want him to have a heart attack at work…
KW: You said you still go to shows?
FS: Yes, absolutely, I’m very active.
KW: Tell me, how does that work?
FS: The only way you’re going to get out there. I always tell people, “How many albums do you think Beyoncé can sell if she doesn’t go out on the road?” She has to be on the road, she has to. Get those people what they want and from there…
…there’s no other cutter like me in the country. I cut both colored gemstones and diamonds.
Mostly diamonds I get in now are repairs from other people, because there’s enough work out there that I don’t even have to import rough [diamonds] anymore. Colored stones, no one cuts colored stones like we do. Which is a lost art here in America. Most of them can’t compete with the Chinese labor, but we compete because we cut it big. In China, you’ll never cut bigger than a four carat stone, amethyst or quartz, because the people will swallow it. Believe me. They’ll swallow it and they’ll try to steal it. So they cut small stones. That’s why. We cut big.
KW: And if you lose one, it’s a big loss?
FS: Absolutely. Exactly, we’re here, we cut it big. So, now we do four gem shows a year. I cut it down to the most cost effective means… I take the whole show out on the road we have the merchandise picked up then we travel and most of these are down in the DC area. Now, we will start, December I believe is our first one in Hong Kong. We should have actually been doing that for the last six months, however because, actually we were going to start two years ago, but we’ve been hearing this rumbling from Roberto for about two years now. You know, where he talks about, “Oh, Toll Brothers would come in here and they would do this, this, and this.” And we thought it was just stories. Absolutely. And then when finally we saw this permit get posted around the corner, so underhandedly, so that the city even says, “Oh, yeah, it’s no problem.” Come on.
KW: How many shows did you say you do?
FS: Four. I used to do nine. Now, I got good, so I just do four… In the DC area, where there is a big international community. Now in December I believe it’s December or April, we will start doing the Hong Kong shows and we’ll do two to four a year. And we can now make a living just from doing those two to four Hong Kong shows a year. But you’re not going to sell Chinese [nationals] Chinese made mountings. They already sold them to you and that’s what I’m trying to tell these guys. Instead of continuing on with the high end merchandise, they sold out and they just buy stuff that’s made in China and they wonder why they have no business. Well, they do have business, but you’re not going to sell it to that kind of clientele who has the major money and that’s what this is about. You can’t sell a Lexus to somebody who is making $15,000 a year, it just doesn’t happen, You know?
KW: Who are your clients, generally?
FS: High earners. Yes. My business, it’s people who invest in gemstones. Absolutely, that’s my client. All the time. The person and what I sell goes up in price, it never goes down… we make sure of that. We’re not selling like a retail item, just because it’s pretty. We sell for investment… and ethically sourced materials from all over the world, but mostly from Africa…
KW: How do you get your clients?
FS: Shows… website. We have a major website. I have, honest to God, probably $70,000 put into my website, just in the last year and a half. In labor and upkeep and that’s what you need to do. And then you need to promote the website. You don’t just put it up there and let it sit there. You have to promote it, you have to use social media…
KW: When did you notice that you needed to start having a big on-line presence?
FS: I always had an on-line presence probably since 2003. However, I really saw the need to re-do that website probably two years ago. Make it very web accessible from the phone and make it huge. And do something that none of the other websites are doing and that’s not to use Photoshop to make the picture look any better than the gemstone itself. To give people exactly what they see. Or, if they see it, they order it, they get it, and it’s going to look even better. I can use that to bring the clients in here.
KW: What percentage of your clients actually comes to the shop?
FS: Just about all of our business, all our retail comes from the shows. So, what’s really nice is anyone who sees me at the show I’m able to do business out of state, which is kind of unique, because then the government has a really weird way of saying it. You have to pay taxes to [the state] where that person first saw the item.
KW: So, if they see it at a DC show?
FS: Yes, you have to pay the taxes to DC… or what they can do, no one can ever prove that that’s where they bought it. They contact you here, you ship it to them, they get to save on taxes… and then most of what we do is wholesale. Wholesale for jewelers all over the country, mostly all over the country. Not too much oversees. That’s going to change with the Hong Kong show, I know it will. I know it will be a huge success… I have things that I can use here, American mined stones like large turquoise, the gem silica chrysocolla, red emerald, things like that that I can still find here and source out a collection that I can sell over there.
KW: That’s something I’m trying to get a sense for as I’m talking to people here, is how much of the businesses on the row work together and how many do their own thing.
FS: The retailers are retail. They have their clientele over the last 20, 30, 40 years. The wholesalers now sell to them. They give them their work at wholesale prices… Like for the gem cutting, I give them a wholesale price, and if that person comes over, suppose I get a phone call and someone says they’re looking for a two carat sapphire and I have the exquisite color they want and they’ll come to me… I get a couple of calls from the jeweler for a two carat sapphire and I give them a price and they might even pick up a stone or two from me and the person looks at it. Then that person happens to walk through my door and they ask for a two carat sapphire. I will not give them [a price that is lower] than I gave [the jeweler]. I put a mark up on it, so that jeweler still has the ability to make 25% maybe 50%. Yeah, you have to protect it because they do pay my salary.
KW: What is the flow through your building into the other [businesses]? So, you cut and then sell to…
FS: To just about every jeweler down here, absolutely… [I do] a lot of wholesale. Most of my business is wholesale, most of my business is wholesale. And the retail outlet I have is done far enough away that it doesn’t [impact their business]… That’s what being a nice guy is all about… Why would I know sell retail on the same street where I’m getting wholesale work, but if I’m not getting wholesale work, then I have to go look for other avenues to move my merchandise. Hence the website.
BONUS FEATURE: TOUR OF FRANK’S STORE AND SHOP
(Inside FGS Gems)
FS: The rarest thing, besides the 12’ crocodile, which the only that’s fake on the whole wall is his tail and that’s why we put it down here so people can touch it. Because very seldom did you ever see a 12’ crocodile that was 100% intact. But the ichthyosaur in the center is actually a toddler. The ichthyosaur was the terror of the sea 85 million years ago before the great white or the megalodon. [Above that] is actually the mom. The reason it was such a terror is it came out about this size…[the mom] bore live young. They grew 90 feet long.
KW: How did you get into this?
FS: Dr. Helman. He’s the chief medical examiner for Delaware County and probably one of the leading paleontologists. He respects the fact that he also is, I believe, the upcoming President or Vice President of the Tuscarora Lapidary Society. Typically very highly educated people are usually into gemstones. It doesn’t have to be that but they have an affinity for what we do.
FS: I have a 700 sf. Showroom. I give people the whole idea of natural light so I don’t have to just turn on the super sparkly lights so they can see everything.
KW: (In workshop) And this is where the magic happens.
FS: This (bench) has been in constant use since 1849. This actually has floating bearings. It is so cool that this technology was used way back and now they’re just starting to bring it back. We use the belt drive because you get less vibration than a direct drive, even though the direct drives are more expensive. But you do have to adjust the speed a lot because of belt slippage. This was in constant use since 1849 so what we actually did was use the CAD process to design a whole new top, use the same guts and the bearings to update the top of it.
I use green energy now. I use 220V motors and they’re energy saving. They still cost some money to run but we redesigned the whole thing.
I also am very adept at designing jewelry. So, this bench is much older than you think it is but I keep it in good shape.
KAW: Do you sell the jewelry you design?
FS: Sure. Especially when it comes to setting color stones I know how not to break them. This is also an old bench too that I redesigned the cutting table.
But this is 1849. I know there is a date on it somewhere up underneath the bench. I just can’t remember where it is. [Hard to find it now] because it’s all bolted down. I didn’t even tell you the best part. These are variable frequency drives so what I actually can that is totally different that nobody can do is that I use the technology to be able to use it into a DC current and actually slow the 1.5 horsepower motor down to 50 rpm so I can find that facet that is chipped, find it then turn it back up to 4000 RPM and cut it right in.
KW: You have a lot of control on this, that’s amazing.
FS: No one has a problem leaving me work because they know I live here. I also watch out for the other guys on the street because we have 27 cameras all over the place.
KW: Any of the cameras go to the exterior?
FS: Oh yes, absolutely.
I purposely got rid of my other house so I could be here close to the diamonds. One of the ploys would be me buying a house in Society Hill or Old City so I’m still in the McCall catchment and going to the Neff building with a 3 year lease with 2000 square feet.
KW: Yeah, we did an interview with Rona Fisher in the Neff Building. She was saying that all they’re getting over there are 3 year leases. They won’t do any longer.
FS: Remember what I told you. Exactly what I said. They only give 3 year leases. So they figure this way: if this works out for them, by the time it’s done, they can sell their whole property.