Most advertising campaigns by De Beers feature their famous slogan “A Diamond is Forever.” Consequently, women seldom sell diamonds and more often than not feel uncomfortable buying diamonds that were previously owned by other women. There is a sentimental aspect to diamonds that is very different from other tangible assets like boats, houses or automobiles.
However, there are occasions when consumers need to sell their diamonds and, unlike the used car market, there is not a well-developed method for consumers to sell them. As a consumer, you face some unique challenges when trying to get the best price for your diamond in a safe and comfortable manner.
Your starting point is to know exactly what you are selling. This is much easier if the diamond has a grading report from a major laboratory like the GIA or AGS. You have more of a challenge if there is no formal grading report. In this case, you need to find an independent appraiser who can evaluate the diamond and determine its quality and potential value.
Once you know your diamond’s specifications, you can find the current retail asking price by checking with online retailers to see what similar diamonds are selling for in today’s retail market. It is unlikely you will be able to get the going retail price for your diamond.
Selling your diamond at 80% to 90% of that amount would make for a quicker sale. Be realistic about your expectations. The lowest cost online retailers, not the expensive jewelry stores with double the price, will set the value of your diamond.
You now know your target price and simply have to figure out how to find the right buyer for your diamond.
There are several options available to sell your diamond and you need to determine which is best for maximizing your money and safety while minimizing your time and effort.
Your first thought might be to go to the closest jewelry store or pawnshop and sell your diamond. The key to remember here is that jewelry stores and pawnshops do not need your diamond. They can obtain all the diamonds they need on the wholesale market. The only reason they will buy your diamond is if the price is a fraction of the wholesale price.
They hope you need the money badly enough to take 25%-50% of what your diamond might really be worth. They might offer you a little more if you “trade up” to something in their display case. However, this often results in you paying more for the new diamond and receiving less for your diamond than if you sold it elsewhere.
Several online brokers specialize in buying diamonds and estate jewelry from consumers. They typically have you ship the diamond to them so they can determine the amount they will pay you. All too often, this amount is much less than their preliminary estimate so you must either pay the return shipping, or accept their price. If your main priority is getting money fast, this is a valid option.
If your main priority is getting top dollar for your diamond, there are better selling methods available to you.
Auctions like eBay are very popular for selling jewelry items but there is so much low quality jewelry listed, it is hard for a potential buyer to find your quality diamond. You are competing with jewelry retailers whose entire business is selling on eBay so they are experts at writing the descriptions (often with exaggerated quality), taking impressive pictures and shipping their items quickly.
Even if a bidder does find your item, the odds of getting your target price are rather slim since other retailers are advertising items with similar descriptions for a greatly reduced amount. It may not be similar quality but the similar descriptions can be misleading at times.
A buyer faces many concerns since they most likely do not know you. Your trustworthiness is totally unknown to them and you are not able to offer any service – resizing, payment plan or certification. So with all of this in mind, a buyer would expect a particularly good discount on the price.
Another effective way to find a buyer is through classified ads in the local press and bulletin boards at shopping centers, your local church or in your workplace. The challenge is reaching enough people to find at least one buyer willing to pay your price.
Always be careful with this type of transaction, especially if selling to a stranger and do the transaction in a safe place. Be aware of phony cashiers cheques or bad personal cheques.
Some jewelry stores and online retailers will sell your diamond on consignment. Online retailers with a local presence have an advantage in that they have large numbers of diamond shoppers on their website, plus walk in traffic that can actually see your diamond in person.
They also have lower overhead and prices so you can get a better selling price. With jewelry stores often marking up prices over 100%, your share is likely to be less than half of the selling price.
Be sure to get a written description of the item you are giving on consignment and the minimum amount you will accept for your diamond. All too often sellers are unable to get their jewelry items back from a store or they only receive a fraction of the amount they expected from the sale.
However, if you have patience and a low priced, trustworthy retailer to broker your diamond, you have an excellent chance of getting an excellent price for your diamond without the hassle and safety issues of selling it yourself.
If you choose to sell through an agent you have a commission fee to pay.