Retail Diamond Margins

[beef]

Does anyone know what the profit margins are for diamond vendors? The reason I''m asking is I''ve been doing some comparative shopping both online and in stores, with online prices being noticeably cheaper. The store vendors and even an appraisor I talked to on the phone have a heavy bias against online diamonds, claiming they are lower quality cuts which is why they are sold online (which I don''t buy into it because the online vendors seem much more willing to give info that quantifies the cut quality.) I have a solid candidate from a store, but in negotiating price the salesman hasn''t come down much, claiming he''s already offering the best price he can give me when in actuality he doesn''t even know what HE paid for the diamond because he got it as a part of a larger pool of diamonds (which makes some sense, but he ought to have some idea of the average cost of each stone I''d think.) He calcs the price based on a spreadsheet that looks a lot like the Rapaport price list. Am I getting a good deal, or is this guy just stubborn?

 

[DEVO]

a diamond is a diamond is a diamond... if you want to believe that a store diamond is better than an online diamond then be my guest... just don't compare the stats or price, otherwise you are going to feel riped off (that has been my experience).

Anyway, without any information on your diamond it's hard to tell whether you got a deal or not. And if he isn't willing to give you info on your diamond... red flags should be going off.

 

[valeria101]

You should ask for the explanation why dimaonds sold online are worse. The difference in price is not only because the margins, but mostly because the larger opperation cost for B&M jewelers. I could not agree more that online as well as off, there are all sorts of shops covering all the quality range in every C. On or offline, cut quality is not to be judged by viewing one or two stones selected by the seller

only. This is why there are cut parameters and direct measurement methods to determine the quality of the cut (symmetry, light return, and whatever other parameters) in absence of a large sample of diamonds to choose from. Seing the diamond is a great way to judge cut quality (and color, and clarity) if you have experience doing this for alot of stones. Otherwise, all diamonds look rather nice if presented right by a salesman, really!

 

[Caratz]

Rich answered this question fairly recently, and I think Cindy chimed in as well, but I cannot remember which thread it was in.

You can piece together some limited information just by looking at the asking prices from various pricescope vendors for the same stone. On quite a few stones I have noticed about a 10% difference (sometimes more, sometimes less) between the lowest asking price and highest asking price. So I figure internet retail markup is probably about 10-20% above actual wholesale.

I think Rich or one of the other appraisers said that B&M retail can range anywhere from 25-100% above actual wholesale.

 

[newenglandgemlab]

I think your B&M retailer is just being stubborn. He has to know what his costs are on any particular stone in inventory. These B&M vendors have to learn to embrace the internet and try to be more competitive. You have become a knowledgeable consumer and it isn't a blind market anymore. Get the specs on the stone and see what the comparable online prices are and then approach the B&M dealer saying you want to buy from him but this is what is available to on line..."Can you compete?" The retailers are better off taking a very small profit margin as compared to years ago and making a client. They shouldn't let you walk. If they do they have lost big time! Cindy