How do diamond vendors put a hold on diamond inventory?

[nukezero]

Okay, maybe I need someone to explain in brief detail how this diamond business works and just a quick paragraph of how this whole organization works.

But basically, I want to know how the diamond vendors like JamesAllen, B2CJewels, Eternity, ERD, WhiteFlash, and such reserve their diamonds from some "magical" and "unknown" supplier in some again unknown country of origin "overseas" and then

1. hold it so that nobody else can buy it, even though the vendor hasn't paid for it yet. why can't all vendors just call in and "hold" a million diamonds from the supplier then?

2. who are these suppliers and where are they located? It seems my research is that they are in Hong Kong, India, or Dubai

2.a. and if they are in Hong Kong or India or Dubai, I am guessing these are the people we see in movies with a handcuff around a suitcase carrying boatloads of diamonds and traveling with bodyguards all day

3. Lastly, when they "hold" the diamond and take pictures, ASET, IDEAL images for us, I am assuming this "supplier" has some state-of-the-art facility to do all this work? These people are the guys that go into sales meetings with DeBeers on a yearly basis to buy a box of diamonds sight-unseen as part of a club of the elites? And they cannot negotiate the price, it's take it or leave it.

Thanks

 

[Texas Leaguer]

Well, you aren't the first to ask these questions and I am sure much has been written here on the subject. But the short answer is that the global network of diamond manufacturers and dealers is large and variable. There are some very big companies in the mix, but many more small and micro businesses. There are some common practices, but it is up to the individual company as to the terms they put in place to run their operations. The landscape has changed rapidly over the past few years and policies, practices and new technologies are pretty scrambled up. With the internet making it possible for the same diamonds to be offered on multiple websites, you sometimes get several sellers trying to access the same stone for one customer. That creates problems, disappointments, misunderstanding. Add to that the fact that the diamond business has a tendency to be secretive and you have a situation where you can never be sure you know the full back story.

Some diamonds on virtual lists are in fact overseas. There are new imaging technologies that are being adopted by more and more companies to produce ASET, Idealscope, H&A, magnified images and videos. It is not rocket science to provide this information and it does not take a sight holder to do it. It does take time and care and the companies providing it to consumers are doing a service for the market.

If the stone you are looking for is not readily available, the best advice is to shop for a vendor who you trust and can do good work for you in terms of providing the information, services, protections, added value policies and such. And have them find the right diamond for you. You will win in the end with this common sense approach. Trying to figure it all out on your own can often be a recipe for frustration.

 

[Rockdiamond]

To add a bit to Bryan's excellent answer.
Why putting diamonds on hold is something sellers need to be careful about:
It's like the story of the boy who cried wolf. Ask to many times, with never, or rarely a sale, and the supplier starts to avoid your calls.
Maintaining excellent supplier relationships is key to surviving in the diamond business today.

Where are all these diamonds?
The bulk of the diamonds listed on the "virtual" sites are located in India, New York City, Israel, Hong Kong....probably in that order in terms of how many are where.

It is possible to travel with 50 million bucks worth of diamonds in a normal sized briefcase- if the diamonds are 2ct Intense pinks
In the "old days" I used to travel around selling to stores carrying a small briefcase with quite a few diamonds inside.
This was before the internet, and times were a lot different. I would not want to have that job today.

Today, diamonds are shipped internationally using insured services, specifically designed for carrying small, high value packages.
Any reputable company will comply with all import regulations. Entering the US without declaring a "wholesale" amount of diamonds is a BIG problem- but if properly declared there's virtually no duty.

Aside from the sites only selling stones off the "virtual" list, there are also sites that offer diamonds in their possession.There are sites that only offer diamonds they own. There are sites that offer the "virtual" diamonds, as well as a premium line- stones they have selected and purchased so that no place else can offer them.

Hope this helps.