Questionable Business Practice of an Online Vendor

[Regular Guy]

Figuring out how to see clearly about who should have acted differently, and at what time, is probably a refreshing and healthy thing to try to do.

We all would like to work on a level playing field. Then again, life is not science, it is life, and we do the best we can.

How does a vendor bring value added to the situation? Using resources unique to them, necessarily?

Date: 9/15/2008 7:23:38 PM
Author:dww777

I've been talking to an online vendor for 2 or 3 weeks while I was researching and trying to find a diamond. The sales agent helped me quite a bit and helped me pull up quite a few GIA/AGS reports. For that I was thankful.

When it came time to order the stone, I did a price search using pricescope. I found the exact same stone being offered at $400 less.

At what point did vendor number 1 know what resources the shopper would take advantage of...after having put in 2 - 3 weeks of work. And...would this have made a difference?

 

[purrfectpear]

To some of us $300 just isn''t worth making a big deal out of something. I''m willing to spend extra to deal with my preferred vendor. Not $3K to $6K extra (as a recent poster was confronted with), but 1% to 2%, sure.

My car gets such great mileage that $300 would be more like 6 months of driving for me

 

[anthony187]

Can I have your car??? Because mine is $125 every week.

 

[Upgradable]

Wow!!! This whole discussion floors me! I think it's time to fish or cut bait! There could be preceived insincerities on either part. You were trying a power play, they called your bluff, time to show the cards. Either buy it or don't. This is America. This is how things are. Sheesh!

 

[dbsdiamonds]

I agree with Neil in the sense that the vendor should just have matched the price, kept his potential client happy and moved on to building the relatiionship with the new buyer. This "oh, I need to ask my manager" is Car dealership nonsense.

Now their shortsighted view has not only aggravated the buyer but ends any potential "be back" or referral business.

On the other side of the coin there IS a cost of time associated with doing much research for a buyer. If a vendor in question did a bunch of research, called to pull certs, pays for these calls, kept revisiting the search and then gets kinked because another online merchant mentions doing the deal at a little lower price to "steal" the transaction, one can see how the vendor''s hair got raised.

Having said that if the price for the same gem was posted on a competitor site at $400+ less the answer should be match/beat as long as validated...

Marty
CEO/Pres
Diamond Brokerage Service Inc
www.dbsdiamonds.com

 

[Sharon101]

The thing is, customers today do expect prices to be matched. Infact, if a customer comes to you and says we want you to have our business but will you do the same price as xyz....well they are doing you a favour. To say no is very insulting and odd imo.

We have a very odd situation going on in Melbourne. There is a watch shop that actually owns the Cartier shop nearby. Well you cant get a (big) discount in the Cartier shop on the watches, but in the no name shop you can get up to 30% off!!!!! This would possibly be the only situation where a shop wont price match that I know of!!!!

 

[denverappraiser]

If the vendor wants to argue that the deal is worth more because of their participation, by all means they should make their case. I’ll even agree that in many cases it’s a valid argument. Assuming they’ve already made this pitch, I would point out that, at least in this case, it doesn’t seem to be working all that well so maybe now it’s time for plan B.

By the way, I’m not saying they should have matched the price as part of the negotiation. Maybe they should have and maybe they shouldn’t. That depends on their own business model and they are welcome to charge more than their competitors if they can convince the customers that they’re worth it. Not everyone is looking for the same things in a deal and the lowest price is only one element. As Ira points out, that negotiation is over and they can’t go back. I’m suggesting they should match the price now because they’ve put themselves into a nasty bind by doing what they probably thought was a favor for a potential customer. It’s likely to cost them to get out of this if the deal collapses and the customer already thinks they’re ‘questionable’, which will get worse if they stick to their position and he/she decides to go elsewhere and it will leave a nagging doubt even if they decide buy. Either way they''re screwed. The cost of that is difficult to evaluate but it''s not zero and in many cases it can be quite a bit.

The first step to getting out of a hole is to stop digging.

Neil Beaty
GG(GIA) ICGA(AGS) NAJA
Professional Jewelry Appraisals in Denver

 

[strmrdr]

Date: 9/16/2008 10:53:35 AM
Author: dbsdiamonds

Having said that if the price for the same gem was posted on a competitor site at $400+ less the answer should be match/beat as long as validated...

Only if the other parts of the deal are the same.
Personally I would not automatically expect a vendor to price match a drop shipper with no trade up, buy back or information unless they degraded their own policies to match.

 

[John P]

Date: 9/16/2008 11:43:28 AM
Author: strmrdr

Date: 9/16/2008 10:53:35 AM
Author: dbsdiamonds

Having said that if the price for the same gem was posted on a competitor site at $400+ less the answer should be match/beat as long as validated...

Only if the other parts of the deal are the same.
Personally I would not automatically expect a vendor to price match a drop shipper with no trade up, buy back or information unless they degraded their own policies to match.

Definitely. Should a seller who offers a lifetime trade-up program, generous buy-back period, free resizing, a host of photos and data, etc., be expected to “price-match” someone who just flips the diamond? This is a matter of "service-matching" as much as anything.

A drop-shipper who provides the barest information incurs few additional costs. Even trivial benefits cost money; there's really no such a thing as "free shipping" or "free lifetime resizing." Such costs are spread across overall markup for client convenience, but they do cost. There is also gemological inspection and expertise. Is the seller encumbering shipping & insurance expenses for actually bringing items in (versus drop-shipping)? Are photos taken? Reports run? Is someone hired to document and post information, live or online? Is a specialist giving live time and expertise? Maybe one seller operates out of a basement while another maintains a showroom. Building security, power/water/air, payroll to maintain a qualified staff (sales, processing, gemologists, benchworkers, platinumsmiths, designers) and security costs extra.

Some sellers have been around for decades and are not going anywhere. That kind of 'brand recognition' can be worth a premium; to know the dealer won't disappear in a puff of smoke tomorrow. There is great security in buying from a company associated with quality and consistency. Sometimes the premium is modest, sometimes you pay much more for it (see Tiffany).

Regardless of the situation in this thread, I would suggest “price-matching” goes beyond the simple flip of a number.

 

[John P]

Date: 9/16/2008 11:43:28 AM
Author: strmrdr

Only if the other parts of the deal are the same.
Personally I would not automatically expect a vendor to price match a drop shipper with no trade up, buy back or information unless they degraded their own policies to match.

If there are differences in service between the sellers this might be a route the OP could pursue.

 

[Allison D.]

Date: 9/16/2008 11:33:35 AM
Author: Sharon101
The thing is, customers today do expect prices to be matched. Infact, if a customer comes to you and says we want you to have our business but will you do the same price as xyz....well they are doing you a favour. To say no is very insulting and odd imo.

I'm sorry, but I have to disagree with this.

Price-match would be a reasonable concept if it truly meant 'same price for same service'.....i.e. price-match AND service-match. Then I could see it.

That rarely happens in a diamond purchase. The overwhelming majority of customers don't feel confident making a purchase decision on a diamond with only the scant information provided on brokered stones. That means a vendor has to become involved to collect information (i.e. grading reports, Sarin data, etc. etc.) that ultimately bring the customer to a point of comfort in saying 'yes, that's the stone I want."

During the 2-3 weeks that Vendor #1 has been doing this work investing time/energy (labor expense), what has Vendor #2 been doing to help the customer become confident that this is a good stone for him? Has he been asked to gather that data, too? If so, did he say 'sorry, I can't get that'? Why would the customer been working with Vendor #1 for 2-3 weeks if Vendor #2 (the lower priced vendor) was able or willing to do the same homework?

If Vendor #1 has spent 2-3 weeks gathering homework and Vendor #2 has done nothing to date, why should Vendor #1 match his price? He's provided a service that Vendor #2 hasn't (and therefore borne a labor cost that Vendor #2 hasn't), and the information from that service has influenced the customer's comfort level to proceed with a purchase.

I don't think it's reasonable to expect a price match in that scenario. It's fine to negotiate on what you think those services might have been worth, but I don't see the logic in expecting a price-match when there clearly wasn't a service-match.

 

[dww777]

HI Allison,

It''s good to see another online vendor (don''t worry, Whiteflash isn''t involved). Certainly Vendor #1 could have said "no" to my price-match request if they thought their services warranted the extra premium. But what is your view on Vendor #1''s calling-in of the inventory/diamond during my price-match request? Is that something common to online vendors?

Thanks,

David

 

[Allison D.]

Date: 9/16/2008 12:56:59 PM
Author: dww777
HI Allison,

It''s good to see another online vendor (don''t worry, Whiteflash isn''t involved). Certainly Vendor #1 could have said ''no'' to my price-match request if they thought their services warranted the extra premium. But what is your view on Vendor #1''s calling-in of the inventory/diamond during my price-match request? Is that something common to online vendors?

Thanks,

David

Hi, David:

My answer to this thread was indeed meant more generally speaking; I was confident that Whiteflash wasn''t involved, but thanks for confirming it here.

Yes, I agree that Vendor #1 could have (and likely should have) said no to the price-match request with the explanation as to why they feel the services they''ve provided to date don''t allow them to price-match a vendor who is now the equivalent of a drop-shipper having provided no support/assistance in the decision-making process.

As for the vendor calling in the stone, I don''t feel it''s really fair of me (or any of us) to say what he did was right/wrong because we aren''t privvy to the communications between you and your sales assistant. If he felt confident that you wanted to buy from him (and confident enough that he felt a slight price difference wouldn''t dissuade you from doing business with him), it may not have been out of line. Perhaps he was a bit more confident in the transaction than you are.

Whiteflash tends to be more conservative when it comes to calling in brokered stones. As Neil pointed out, it can get costly to eat return shipping charges by being too speculative, so we like to be fairly certain of a client''s intent to buy before calling them in. We feel this also makes for better relationships with outside suppliers who know we aren''t tire-kicking when we ask for stones.

All of that said, our practices may not be the norm because our niche is different. Because we stock more dedicated inventory that many other classical ''online'' vendors, our first priority is supporting our own brand. We provide access and service to brokered stones as a service to our clients when it''s necessary, but it''s not our bread and butter, so our outlook may not be representative of others who rely more heavily on brokered stones.

 

[jellycat]

Date: 9/16/2008 12:56:59 PM
Author: dww777
HI Allison,


It''s good to see another online vendor (don''t worry, Whiteflash isn''t involved). Certainly Vendor #1 could have said ''no'' to my price-match request if they thought their services warranted the extra premium. But what is your view on Vendor #1''s calling-in of the inventory/diamond during my price-match request? Is that something common to online vendors?


Thanks,


David

That is what i have issue with. the fact that they could have just said, "no, sorry we cannot price match" instead, what they did was call in the stone to essentially hold it hostage, then say "no we cannot price match. if you don''t want it, we''ll find someone else to buy it." It''s not about the $300, it''s about the way they handled this potential purchase.

there are several PS vendors who have a great service and lifetime upgrade policies, so you could go with one of the others. i do know that it can be frustrating when you feel like you may have finally found the stone. but would you feel okay buying from them and tied to their lifetime upgrade policy (if they have one), knowing how sneaky they were about this?

they handled this situation very poorly, and i''d like to know which vendor it was, so please post later if you are okay with that. IMO, you should go with another one of the wonderful PS vendors out there.

 

[Regular Guy]

Everyone has their own question and statement (sometimes more or less oozing with self interest) to make.

My question du jour is to David...why did you choose this vendor to work with (I don''t care if you name them) in the first place?

 

[dww777]

I might disclose who the vendor is later, but only if things don''t work out. I''m going to talk to them today and see what can be done about the situation. I don''t want to burn bridges and harm their reputation unless things really go south.

I''m a newbie at this whole thing, so my decision early on to work with this particular vendor was very simple: they had a ring setting that I liked. That''s all.

 

[dbsdiamonds]

Of course I believe the person/business who did all the work is worth whatever they are asking for the gem of choice, whether the price difference is $100, $400 or $1500 or more.

But irregardless of trade in or buy back policies or any other "extra" feature that a vendor may offer I''ll bet 99% of customers here or anywhere else will take much offense to the "working" vendor NOT matching the price or offering something tangible as a compensation to earn the shopper''s business.

Trade in policies and the sort are only good as a company is around to honor it. Bottom line is if this economy tanks bigtime (ie depression style, nothing we''ve seen or faced much in our lifetime) , and if all the gains the diamond prices have made over the past year goes down the drain because of a massive run/selloff the way real estate and other industries have done, if values suddenly take massive hits, you''ll see doors shutting immediately and these policies will get shut down with it. Plus probably less than 1% of 1% would actually look to utlize these "extra" policies in reality.

A 1ct D flawless diamond in 1980 peaked at $66k, in January 1986 it was down to $12,600. Fact is there are very few people (statistically speaking) who will utilize these other policies and it is a great "feel good" policy" to justify higher pricing. Just like changing a return policy from a 7 day to a 30 day return policy. I''m sure soon one of the big boy onliners will go to 60 days if it hasn''t happened already, a play more on emotional relief than anything else.

So I''d be curious to know the real issue here, price matching, price reduction, or the vendor who might get exposed here for trying protecting their work interest in a backhanded way by locking down the diamond of choice. Both sides are right or wrong, just like everyone''s opinion on this, it''ll be interesting to follow this and see what happens...

Marty
CEO/Pres
Diamond Brokerage Service, Inc
www.dbsdiamonds.com

 

[lovegem]

Date: 9/16/2008 1:56:49 PM
Author: jellycat



That is what i have issue with. the fact that they could have just said, 'no, sorry we cannot price match' instead, what they did was call in the stone to essentially hold it hostage, then say 'no we cannot price match. if you don't want it, we'll find someone else to buy it.' It's not about the $300, it's about the way they handled this potential purchase.

they handled this situation very poorly, and i'd like to know which vendor it was, so please post later if you are okay with that. IMO, you should go with another one of the wonderful PS vendors out there.

big DITTO!

Upgrade policy as well as type of reports avaialbe to the customers can be accounted for the price difference. The vendor didn't have to price match, but they shouldn't have held the stone hostage. I would personally say goodbye to this stone, unfortunately.

 

[diamondseeker2006]

I really don''t consider that they are holding the stone hostage. They''ll likely send it back if it is not sold.

I just wanted to say that when I was shopping for my diamonds, I knew I could get a cheaper price from a drop shipper. But I purposely chose to go with Good Old Gold and WhiteFlash because of their extra services...assurance of getting true H&A and a very favorable trade-in policy. I would never expect them to price match a drop shipper. If you buy from a drop shipper, you''re pretty much stuck with the stone, and if you do ever desire to trade, you have to likely sell the stone yourself at a loss. That wasn''t worth the risk to me.

 

[Sharon101]

Date: 9/16/2008 12:34:41 PM
Author: Allison D.

Date: 9/16/2008 11:33:35 AM
Author: Sharon101
The thing is, customers today do expect prices to be matched. Infact, if a customer comes to you and says we want you to have our business but will you do the same price as xyz....well they are doing you a favour. To say no is very insulting and odd imo.

I''m sorry, but I have to disagree with this.

Price-match would be a reasonable concept if it truly meant ''same price for same service''.....i.e. price-match AND service-match. Then I could see it.

That rarely happens in a diamond purchase. The overwhelming majority of customers don''t feel confident making a purchase decision on a diamond with only the scant information provided on brokered stones. That means a vendor has to become involved to collect information (i.e. grading reports, Sarin data, etc. etc.) that ultimately bring the customer to a point of comfort in saying ''yes, that''s the stone I want.''

During the 2-3 weeks that Vendor #1 has been doing this work investing time/energy (labor expense), what has Vendor #2 been doing to help the customer become confident that this is a good stone for him? Has he been asked to gather that data, too? If so, did he say ''sorry, I can''t get that''? Why would the customer been working with Vendor #1 for 2-3 weeks if Vendor #2 (the lower priced vendor) was able or willing to do the same homework?

If Vendor #1 has spent 2-3 weeks gathering homework and Vendor #2 has done nothing to date, why should Vendor #1 match his price? He''s provided a service that Vendor #2 hasn''t (and therefore borne a labor cost that Vendor #2 hasn''t), and the information from that service has influenced the customer''s comfort level to proceed with a purchase.

I don''t think it''s reasonable to expect a price match in that scenario. It''s fine to negotiate on what you think those services might have been worth, but I don''t see the logic in expecting a price-match when there clearly wasn''t a service-match.

Hey, I didnt say everything is going to be fair in business!!!! LOL

My husband has a business too so I can see both sides. But in `this` circumstance I believe it should have been price matched. Afterall, the selling effort & time had already been spent. Its not about whats fair, sometimes you do what is the most benefit to you as a vendor.....and I think it would have been a win win to price match. (Or at least explain in full all the benefits you are providing that prevent a price match eg. life time upgrade etc?). And there are costs of not price matching as we have heard here....bad pr, freight of the stone back, loss of money in the bank `today`, future purchases from this customer etc

Its the same with B&M shops often being used to `see` the designs, gain info and a bit of a play with the stock only to have the customer order online because its cheaper. Well, thats just the way it is. Businesses have to compete with the playing field they are in. And the fact is, the net has made info easier to obtain.... and consumers will use the info to their best interests including price matching.

Now thats not to say that every sale will have this delemour of being price matched.

But, I think you will be surprised in this economy for a request to be denied and for something that is drop shipped to both vendors as neither had the stone before the customer inquired about it.

 

[Allison D.]

Date: 9/16/2008 7:25:40 PM
Author: Sharon101

Hey, I didnt say everything is going to be fair in business!!!! LOL

My husband has a business too so I can see both sides. But in `this` circumstance I believe it should have been price matched. Afterall, the selling effort & time had already been spent. Its not about whats fair, sometimes you do what is the most benefit to you as a vendor.....and I think it would have been a win win to price match. (Or at least explain in full all the benefits you are providing that prevent a price match eg. life time upgrade etc?). And there are costs of not price matching as we have heard here....bad pr, freight of the stone back, loss of money in the bank `today`, future purchases from this customer etc

Its the same with B&M shops often being used to `see` the designs, gain info and a bit of a play with the stock only to have the customer order online because its cheaper. Well, thats just the way it is. Businesses have to compete with the playing field they are in. And the fact is, the net has made info easier to obtain.... and consumers will use the info to their best interests including price matching.

I think we just have different opinions on this one....neither is right or wrong, they are just divergent.

I disagree that price-matching is the only way to make a consumer happy or the only way to compete. Anyone can numbers-match, but not all can represent the value of their services. Cheapest is not always best, as many here can attest.

I agree with you that the net is a wonderful thing and has made info easier to obtain on some products.....but not on all. I can get 68 different technical pieces of data about my digital camera online with virtually no meaningful info missing. In most cases, the same can't be said for diamonds.
Many times, folks can't even get basic info like crown/pavilion angles on brokered stones because it isn't provided. That often requires a vendor to procure that extra information.

Diamonds are individually unique; not all SI1s are the same. Some are eyeclean, some aren't. You aren't likely to get that info either without involving a vendor.

As far as being competitive, I think the most likely to succeed are those who listen to what their customers want/need and provide it at a fair price with exceptional service. To me, that's a bit more involved than just price-matching.

 

[Sharon101]

Date: 9/16/2008 9:30:50 PM
Author: Allison D.

Date: 9/16/2008 7:25:40 PM
Author: Sharon101

Hey, I didnt say everything is going to be fair in business!!!! LOL

My husband has a business too so I can see both sides. But in `this` circumstance I believe it should have been price matched. Afterall, the selling effort & time had already been spent. Its not about whats fair, sometimes you do what is the most benefit to you as a vendor.....and I think it would have been a win win to price match. (Or at least explain in full all the benefits you are providing that prevent a price match eg. life time upgrade etc?). And there are costs of not price matching as we have heard here....bad pr, freight of the stone back, loss of money in the bank `today`, future purchases from this customer etc

Its the same with B&M shops often being used to `see` the designs, gain info and a bit of a play with the stock only to have the customer order online because its cheaper. Well, thats just the way it is. Businesses have to compete with the playing field they are in. And the fact is, the net has made info easier to obtain.... and consumers will use the info to their best interests including price matching.

I think we just have different opinions on this one....neither is right or wrong, they are just divergent.

I disagree that price-matching is the only way to make a consumer happy or the only way to compete. Anyone can numbers-match, but not all can represent the value of their services. Cheapest is not always best, as many here can attest.

I agree with you that the net is a wonderful thing and has made info easier to obtain on some products.....but not on all. I can get 68 different technical pieces of data about my digital camera online with virtually no meaningful info missing. In most cases, the same can''t be said for diamonds.
Many times, folks can''t even get basic info like crown/pavilion angles on brokered stones because it isn''t provided. That often requires a vendor to procure that extra information.

Diamonds are individually unique; not all SI1s are the same. Some are eyeclean, some aren''t. You aren''t likely to get that info either without involving a vendor.

As far as being competitive, I think the most likely to succeed are those who listen to what their customers want/need and provide it at a fair price with exceptional service. To me, that''s a bit more involved than just price-matching.

Alison, we actually agree on everything you have said!!!!

 

[Maisie]

Date: 9/16/2008 7:25:23 PM
Author: diamondseeker2006
I really don''t consider that they are holding the stone hostage. They''ll likely send it back if it is not sold.

I just wanted to say that when I was shopping for my diamonds, I knew I could get a cheaper price from a drop shipper. But I purposely chose to go with Good Old Gold and WhiteFlash because of their extra services...assurance of getting true H&A and a very favorable trade-in policy. I would never expect them to price match a drop shipper. If you buy from a drop shipper, you''re pretty much stuck with the stone, and if you do ever desire to trade, you have to likely sell the stone yourself at a loss. That wasn''t worth the risk to me.

I agree with everything DS said.

I think the only hostage being taken here is the vendor. They won''t price match therefore they are going to be ''exposed'' on here as a ''bad'' vendor unless they change their mind.