Diamond Brokering
What is a Diamond Broker?
By James M. Collier, GG
The options available for purchasing a diamond can be overwhelming. The consumer can choose between mall chain stores, independent retail jewelers, home shopping channels, and even diamond vendors on the internet. Deciding where to shop for a diamond is almost as difficult as deciding which diamond to buy.
One alternative which is gaining popularity among consumers is to hire a diamond broker. The legitimate diamond broker acts as your representative to help you locate and purchase a diamond of high quality and value. The broker does not own the diamonds, but acts as your agent to find just the right gemstone in one of the alternative markets. Among these alternative markets are private sales, auctions, diamond cutters, and wholesalers. For this service the broker charges a preset fee.
The advantages of working with a diamond broker are three-fold: lower cost, higher quality and time saved.
1. Lower Cost - By working with a broker the consumer is in effect buying a diamond from a cutter, dealer, or wholesaler. The total cost to the consumer is the wholesale cost of the stone plus the broker's fee, usually an additional 10 to 20% of the wholesale cost. This is significantly less than the typical 50 to 300% retail mark-ups.
2. Higher Quality - A qualified diamond broker is an expert in the grading and evaluation of diamonds. The broker assures that the stone you are buying has been accurately graded and is fairly priced. As an expert in the diamond markets, the broker also knows where to go to get just the right diamond to meet your needs.
3. Time Saved - At Noble House Precious Investments when we broker a diamond for a client we locate the best 2 or 3 diamonds that meet the client's desires. We then have the diamonds shipped to our offices, or to our client, where the client can examine each stone and select the one that he/she likes the most. This saves you the time and frustration of "shopping around" and mentally trying to compare diamonds at different stores.
Once you have decided to work with a diamond broker, your next challenge is find one who is qualified and will work diligently for you. In the next section I will discuss how you select a qualified diamond broker, but for now I offer a few words of caution.
Caveat emptor! Not all diamond brokers are created equal.
Increasing consumer interest in working with a diamond broker (and saving time and money) has lead some unscrupulous retailers and diamond merchants to misrepresent themselves as brokers working for the public.
Whether you are shopping at the mall, in an independent jewelry store, or on the internet, you should be wary of vendors offering to sell you "diamonds at or below wholesale cost." Often times they are merely selling stones they have purchased for inventory and are misrepresenting the quality grade and wholesale value of the diamonds.
A true diamond broker does not own the diamonds they help a client purchase. The broker's responsibility is to help the client locate and purchase the best diamond available in the marketplace.
To learn more about finding a qualified diamond broker, please read the chapter, Selecting a Diamond Broker!
Noble House, Your Diamond Experts.
Working with a Diamond Broker
Let's face it, shopping for a diamond is not fun. It can be a daunting and even frustrating experience. To make a wise and informed purchase, you need honest answers to two important questions:
1. What is the true quality and beauty of the diamond being considered? Are the color, cut and clarity of the diamond being accurately described by the seller?
2. Is the diamond fairly priced? Given the size, quality and beauty of the diamond, does the price represent a good value?
To help consumers find answers to these important questions, we offer our Diamond Brokering Service. When a client hires us to act as their diamond broker, we help them find the best diamond that meets their quality criteria and fits within their budget. The advantages of hiring us as your diamond expert are three-fold: assured quality, lower cost, and greater beauty.
1.
Assured Quality
In addition to being knowledgeable about locating and sourcing fine diamonds, we are also experts in the grading and evaluation of diamonds. We use our expertise to assure that the diamonds you are considering are accurately graded and fairly described. We thoroughly examine and evaluate each diamond in our in house gemological laboratory. Thus, you do not have to worry about whether the seller or the certification lab has accurately described and represented the diamond you may purchase.
2.
Lower Cost
When acting as your diamond broker we enter the wholesale markets to find diamonds that meet your criteria. If you purchase a diamond, you are, in effect, buying it directly from a diamond cutter or wholesaler. As a result, the cost of your diamond will be significantly lower than if you bought it at a traditional retail store or from an on-line diamond seller.
3.
Greater Beauty
The best way to find an exceptional diamond is to compare firsthand a selection of the very best stones in the marketplace. After reviewing numerous diamonds from a variety of cutters, we select the two or three best stones and create a dazzling line-up for your review. This allows you to compare the diamonds side-by-side and select the stone that is truly "the best of the best."
Viewing one or two stones in a retail store or sorting through diamond certificates on an online database does not allow you to make the side-by-side comparisons needed to select the most beautiful diamond or the best value.
Selecting a Diamond Broker.
In an earlier chapter, I described how many cost-conscious consumers are hiring diamond brokers to assist them in the purchase of expensive diamonds.
The advantages of working with a diamond broker are three-fold:
1. Significantly Lower Cost - By working with a broker you will be purchasing your diamond directly from a cutter or wholesaler.
2. Higher Quality - A qualified broker assures that the color, cut, clarity and weight of any diamond you consider purchasing are accurately and fairly described by the seller.
3. Time Saved - The broker is responsible for locating in the diamond markets the 3 or 4 stones that best meet your desires and budget.
In short, because the diamond broker works for you, you avoid typical retail mark-ups, misrepresented or misgraded diamonds, and the time and frustration needed to locate and compare different diamonds in different jewelry stores.
The key to successfully working with a diamond broker is to first find one who is knowledgeable and committed to working for you. There are many individuals who are willing to sell you a diamond, but very few who will work in your best interests. To help you find a qualified diamond broker, I offer the following guidelines:
1. A qualified diamond broker must be an expert in the appraisal and grading of diamonds. At a minimum the broker should be a Graduate Gemologist (GG) trained by the Gemological Institute of America. This is not to be confused with "Diamondologist" credentials, which take a weekend course at a Holiday Inn to obtain.
2. In addition to expertise in evaluating diamonds, your broker must also be knowledgeable about the retail, wholesale, and alternative markets for diamonds. You want to work with a broker who knows where to find the specific stones you desire and how to negotiate the lowest possible cost.
3. Finally, a broker who is truly working for you, will fully disclose the wholesale cost of any diamonds you consider. If a "broker" is unwilling to show you the seller's invoice or the wholesale price guides, do not work with them.
Consumer Alert: Be wary of diamond merchants who are selling stones off of a standardized price list at allegedly "wholesale" costs. Often the prices shown on these lists are not at true wholesale and include a significant hidden margin. Guess who keeps the hidden margin!
When choosing a diamond broker invest the time to learn about their credentials, experience in the diamond markets, and willingness to openly work with you. A qualified broker will respect your concerns and gladly answer any questions. A qualified broker will also take the time to learn about what you desire in a diamond and educate you about the brokering process. If they do not, keep on looking!
No other purchase you make for the one you love, will compare to that of buying a diamond.
Nature has created each diamond to be unique. Which is why when diamonds of the same quality grade are viewed side by side, only one will capture her heart. For this reason it is vital that you seek the guidance of a professional gemologist/broker and view a selection of several diamonds at the same time. Comparing grading certificates on a computer screen is no substitute for seeing and comparing actual diamonds in person.
Sincerely,
James M. Collier, GG
Noble House Precious Investments
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