stones that are traded in for an upgrade,do vendors price them the same...

[Dancing Fire]

as a new one or do they sell them for less?

 

[Mara]

if it's in the same condition as when they sold it..they may just polish it up again and put it back on..for even MORE than before. esp since diamonds have gone up so much recently, what if someone purchased 2 years ago and upgrades now? that diamond they trade in will be worth more than 2 years ago, and if I were the seller I would take advantage of that, assuming all is kosher with the diamond and it's in as new condition after a polish.

but i don't know what they REALLY do...i would assume they at least sell it for the same amount if not more, i don't really see them selling it for less unless there was a problem with it.

 

[Leila]

This made me wonder, will most vendors still accept a diamond as a trade in, with the price adjusted of course, if it has some minor damage?

 

[mdx]

Leila

Small chips and minor damage can easily be repaired, so those vendors that have an upgrade policy will usually except them taking into consideration the repair cost and weight loss

Johan

 

[Daniela]

The diamond that I bought originally was sent back to the vendor in order for me to upgrade. It was in perfect condition, and was immeditately listed on their site for a few hundred dollars MORE than I paid for it six months before. When I saw this happen I thought this was complete bunk, not because the stone had been pre-owned, but since it still was a NOT eye-clean SI-1 and I couldn''t imagine anyone paying more for it than me. However, that said, someone must have liked it and bought it, because the diamond is not on their site anymore.

 

[Sunni79]

They''ll sell them for more.

 

[WinkHPD]

Date: 3/2/2005 8:26:12 AM
Author: Sunni79
They''ll sell them for more.

Interesting comment.

We will inspect the stone, verify that it has not been damaged and attempt to sell it for market value.

If the value has gone up, then we should get more for it that when it sold originally. Of course that may mean that we gave more for it in trade than we sold it for originally too.

We run businesses, we will attempt to make profits, else we should be out kayaking somewhere...

Wink

 

[yellowfan]

I am glad that this topic was brought up. My question is do the vendors tell the buyers it was a trade in for a upgrade? It may sound weird but I was wondering how the whole trade in and re sale diamond business worked. Do they re cert the diamond, etc?


Thanks,

Lori-yellowfan

 

[Patty]

Date: 3/2/2005 8:33:56 AM
Author: Wink

Date: 3/2/2005 8:26:12 AM
Author: Sunni79
They''ll sell them for more.

Interesting comment.

We will inspect the stone, verify that it has not been damaged and attempt to sell it for market value.

If the value has gone up, then we should get more for it that when it sold originally. Of course that may mean that we gave more for it in trade than we sold it for originally too.

We run businesses, we will attempt to make profits, else we should be out kayaking somewhere...

Wink

Wink, I don''t know of any jewelers that give more for the trade in than the amount for which they originally sold the stone.

Do you do this?

I was interested in trading my 5/8 carat stone for a 3/4 carat stone within a year of my buying it. BUT, this was 1980 and the prices went NUTS then. They were going to give me my purchase price of $900 for the 5/8 carat and the 3/4 carat was priced at $2000. It was going to cost me $1100 more to go up about 12 points!

 

[Dancing Fire]

it''s not too smart to do an upgrade now,with the price of diamond gone up so much in the pass 15 months because vendors only give you credit on what you paid for the stone.the best time to do an upgrade is when the market is going down.

 

[makemepretty]

The diamond I returned is now on the website for $1500 more than I paid. That''s quite a deal for them, sell the diamond..buy it back at 70% then mark it up $1500. It''s a win win situation. My husband offered to replace my diamond but I haven''t convinced myself it''s worth that amount of money for a rock(as pretty as they are). This is probably the wrong place to have someone convince me it''s not worth thousands of dollars to have something shiny on my hand??

 

[strmrdr]

Date: 3/3/2005 8:39:29 AM
Author: makemepretty
The diamond I returned is now on the website for $1500 more than I paid. That''s quite a deal for them, sell the diamond..buy it back at 70% then mark it up $1500. It''s a win win situation. My husband offered to replace my diamond but I haven''t convinced myself it''s worth that amount of money for a rock(as pretty as they are). This is probably the wrong place to have someone convince me it''s not worth thousands of dollars to have something shiny on my hand??

If you can find something better to do with the money or something you would enjoy more than it isnt smart to put money in another rock is it?

 

[strmrdr]

Date: 3/2/2005 1:13:35 PM
Author: yellowfan
I am glad that this topic was brought up. My question is do the vendors tell the buyers it was a trade in for a upgrade? It may sound weird but I was wondering how the whole trade in and re sale diamond business worked. Do they re cert the diamond, etc?



Thanks,

Lori-yellowfan

some do some dont.
If they wholesale it then it never gets disclosed.
It is hard to say for sure but I wouldnt be suprised if 10%-%15 of diamonds sold as new each year were actualy pre-owned.
Some recut some just cleaned and recerted some just use the line oh its been in my safe for the last 10 years.

 

[WinkHPD]

Date: 3/2/2005 1:59:45 PM
Author: Patty

Wink, I don''t know of any jewelers that give more for the trade in than the amount for which they originally sold the stone.

Do you do this?

For many years I have offered to trade in for stones that I have sold at current market towards current market. In over twenty years of being in business exactly one person has ever traded in their engagement diamond with me. Every single lady save one has prefered to put the original engagement ring into a pendant to wear near her heart rather than trade it in. Of course this does not apply to divorce stones which are often wanted to be sold or traded towards something to which the negative feelings are not attached. On stones that I did not sell I price it according to my desire to own the stone. Since I specialize in better cut stones I often have incredibly little desire to own the stone being traded in.

I vaguely remember talking with Sheila about this when we were developing policies for www.winkjones.com, but honestly do not remember if we came to a decision or not. (I suppose I had better go see, I will do it later, some day, when I have time...) At internet pricing there is not a lot of room for me to do trade ins unless you have a stone I really want. In the old days, when a diamond costing $1,000 sold retail for $2,000 or more it was easy to do a trade up. If you wanted to buy a diamond for $3,000 and I gave you a $2,000 trade in I only had to be out of pocket about $500 until I sold your stone. In stores using higher markups the vendor might be at breakeven or even a slight in pocket position after the trade. In today''s internet market when markups on diamonds hover around the 10% range and consumers are clamoring for 3-5% it makes very little sense to do a trade in at all.

I could make less than $200 on a $2000 sale then later give you $2,000 trade in on a $3,000 sale. I would end up out of pocket more than $2,700 until I sold your diamond. Take in eight or ten trades this month without reselling the stones in a hurry, and you better have a REAL friendly banker or very deep pockets. (at a 10% add on margin a $3000 stone would cost $2,727.28 leaving a margin of $272.72.) Then the interest on your loan would completely erase the little profit being made unless you sell the stone in a hurry. And that is assuming that prices have not gone up since you purchased, so I might have given you $2100 or more for your diamond, which would put me even further out of pocket.

So given current economic realities of internet vending, I probably would not give an internet buyer a bigger trade than they paid. So far it has not been an issue as none of my internet buyers have wanted to trade up and those who have inquired about trading in stones elsewhere have never had a stone that I wanted bad enough to do a trade for. Profit margins that are less than the cost of doing business in a B&M store do not leave much room for trade ins, and they will become less and less attractive to business owners as time goes on.

Oh, and yes, I do disclose to my clients when I am reselling someone''s previously owned diamond, and this does make them harder to sell, which also makes them less desireable which should also have a bearing on the price. I know that many vendors/retailors do not feel it necessary since after all a diamond is billions of years old blah blah blah, but I feel the need to share all of the information with my prospective clients so I do.

This is probably too much information, but it does directly go to the question of what is fair to the consumer, and what is fair to the vendor. At this time I see very little probablility that margins will ever go back up much, although they may have to go back up a little or many will be forced from the market. With very low margins, I think you can expect reduced values for your trade ins, and for vendors to sell them at current market when they can. Current market for a traded in stone that is revealed as a traded in stone is currently 5-10% less than for a new stone, so how can the vendor be expected to offer full "new" market on that stone. While it seems fair that he should, a careful analysis of the economic realities probably dictates that he can not afford to do this and expect to prosper.

Wink

 

[Patty]

Thank you, Wink.

You are one of the jewelers here whom I would buy from in a heartbeat because you are so trustworthy and honest.

 

[yellowfan]

Patty is right. I personally would want to know if I was buying a diamond that was traded in.

 

[Lynn B]

Interesting thread.

So how do the other vendors here feel about taking another vendor''s stones in on a trade? I understand totally what Wink is saying about a mediocre stone... but say a person has a super-ideal cut H & A and wants to upgrade, but their particular vendor doesn''t have what they want -- but another vendor does. Will most vendors offer the customer a (full purchase-price) trade-in?

Lynn

 

[strmrdr]

Date: 3/3/2005 3:17:54 PM
Author: Lynn B
Interesting thread.


So how do the other vendors here feel about taking another vendor's stones in on a trade? I understand totally what Wink is saying about a mediocre stone... but say a person has a super-ideal cut H & A and wants to upgrade, but their particular vendor doesn't have what they want -- but another vendor does. Will most vendors offer the customer a (full purchase-price) trade-in?


Lynn

Most wont.
Some will on a case by case basis.
Some will offer to sell it on consignment for you. (niceice is one such)
It really depnds on what it is also and how far your moving up. A nice G vs2 1.10ct they might be more willing too than a I si2 .98 ct but if your moving to a 4ct diamond they would likely take either one but on a 1.5ct neither.
It will also depend on how long ago you bought it because the most they are likely to go is todays wholesale cost which might be less than the retail price you paid.

 

[WinkHPD]

Storm Rider hits many good points. I recently discussed (numbers changed to conceal any possibility of identity) a trade in from a 3.5 ct to a 3.68ct. The difference she was offered from the store where she bought it was nearly 20k. She felt she was being taken advantage of. I agreed and offered to sell her stone on consignment as there is no way I want to stock a 3.5ct in Boise, where it might be several years before I sold it. I would quite likely sell it here on Pricescope but not at the prices that her retail jeweler would be asking for it.

Had she been going for a 7 or 8ct I would have found a way to stock that stone. For me to become her banker by working a trade which should have been in the 5 - 6k difference for the actual stones we were talking about, not the nearly 20k she was quoted is financial suicide for me. She understood this very well and we had a great conversation. Sometimes the potential tradee is not so pleasant at being told no.

This is and will be a sore point for many, but it is a realistic and forseeable event given the directions that margins have taken in the past ten years. At least the trade in is better than I can get for my old computers...

Wink

 

[Dancing Fire]

is just not the right time to do an upgrade.for example lets say you bought a 2 ct h vs2 stone 15 months ago for 15k now you want to upgrade, so the vendor gives you a credit of 15k towards the next stone but that 15k is only going to buy you a I si1 2 ct base on todays market condition.

now IF..... the diamond market went down 20% in the last 15 months,with the 15k in credit you can buy a 2.25 ct or the same size stone in a higher grade.

 

[Rhino]

Interesting thread and interesting to see you Wink going through the whole thought process as you were typing. Hehe... you began with the thought of offering more than the person paid but saw the economic reality of NOT being able to do it. I''ve went through the scenario 100x in my mind. The economic reality is if a company is going to offer this policy they MUST do what they can to get current market value. If that means repairing/polishing the stone, getting it recerted etc. Otherwise they could be out of biz in a *wink*. There have been times however that we''ve taken in a stone on a trade and turned it over quickly at the price it was traded in for if we want to move it fast. Ie. we just took back a stone on a trade that was a 1.7xct H SI clarity enhanced stone. It was purchased for a song from us back in the 90''s and since we do not stock clarity enhanced diamonds I''ll be glad to get what was given on the trade to move the stone.

Regarding the subject of tradein''s here''s the reality.

Firstly we''ve been around for 25 years and have only been introduced to super ideals around 2000. So ... most of our trade-in''s are from stones purchased prior to that date. Before then we were selling non-H&A ideals but back then noone knew how to tranlate Sarin''s into optics so there were plenty of stones with well ... more leakage than we care to know and had optical symmetry that could best be described as *chaotic*. HAHA!!! Let''s just say that what I purchased 6 years ago and prior I currently wouldn''t touch with a 10 foot pole.

So, what happens to the stones those clients trade in? One of 4 things depending upon the decision of Mom, my sister Amy and myself. We will either ...

a. Leave the stone alone and sell it as an estate diamond at wholesale market value.
b. Post it up in our clearance section.
c. My sister might mount it in a estate setting we have that will accommodate it and sell it as an estate ring.
d. Recut it, recert it and sell it. If I want to turn it over real fast I''ll wholesale it otherwise I''ll sit on it and wait till someone''s interested.

There are some posters here on the forum who have purchased estate stones from us at deals that were less than what they sell for on the wholesale market.

Lynn brings up this question.

Date: 3/3/2005 3:17:54 PM
Author: Lynn B
Interesting thread.

So how do the other vendors here feel about taking another vendor''s stones in on a trade? I understand totally what Wink is saying about a mediocre stone... but say a person has a super-ideal cut H & A and wants to upgrade, but their particular vendor doesn''t have what they want -- but another vendor does. Will most vendors offer the customer a (full purchase-price) trade-in?

Lynn

Most vendors that do take tradein''s do not take trade-ins that were not purchased from them including us. Our reason: I do not know of any diamond purchasers on the retail level that scrutinize their stones to the degree that we do. However, if a person desires to do business with us we offer other solutions.

1. We will take in their diamond on consignment and sell it for them via our site. Once sold we get our commission and they get their credit or cash, whichever they want.
2. When we take in a clients diamond on consignment, the sale of our diamond to them is not contingent on the sale of their diamond. They are 2 seperate transactions. The reason for this is the diamond you are giving us on consignment may really be a dud of a cut and may take months or years before it sells.
3. If I were to consider taking in their diamond as a trade (such as an H&A) I would of course have to know what it is they paid for it and then determine if I was going to offer that as the trade allowance. This would have to be discussed with my family members.

Some real world examples that come to mind....

Some clients have left stones with us on consignment that have sat for over a year with no interest. When a person grows impatient we may start offering suggestions of perhaps recutting it to change it''s appearance. Some people do and it sells much faster (as quickly as within the first week of having it recut) but then there are others who, after considering the expense of recutting do not since there are no H&A cutting facilities in the states (except for perhaps 8*) and it''s not exactly cheap to have done. If it''s an inexpensive stone sometimes its not worth recutting.

Then we''ve had clients who have given us stones on consignment that have sold within 24 hours of us posting it. Generally those will be stones that have been purchased in the farily recent future that are H&A''s.

When a diamond is given to us on consignment or has been traded in we will let any person interested in that stone know it.

Dancing Fire ... I know you''re thinking about how excellent it would be to trade in when the market goes down , thing is ... when was the last time you''ve seen any drop like that? I wouldn''t get my hopes up waiting cause we''ll see the dark side of the moon before it happens.

 

[Dancing Fire]

Rhino

Dancing Fire ... I know you''re thinking about how excellent it would be to trade in when the market goes down , thing is ... when was the last time you''ve seen any drop like that? I wouldn''t get my hopes up waiting cause we''ll see the dark side of the moon before it happens.


the good news is i bought the 3ct from you last yr.before the big price increase

the bad news is i''m thinking about buying a 2.5ct

i know diamonds not going to drop 20% in the next 12 months