The true value of diamonds has been dropping for months. Everyone hears about the economy tanking, the mortgage crisis, imminent auto manufacturer bankruptcies, factories closing down, and more.
Then why when you call suppliers for a stone, do they only give you a nominal discount?
It’s not so simple to explain what I think happened, but it is important to understand the situation. So here goes…
The crisis led to the greatest single drop in the demand for diamonds in decades. Supplies hit record highs. Factories stopped cutting. Suppliers sold off their most attractive stones quickly to generate cash to run their businesses. Without the replenishment of new goods, they got left with off-sizes, odd cuts, and unattractive qualities.
This led to very low inventories of the most attractive stones, but very high inventories of the ones that sell slowly or not at all.
Most calls retailers make are for the more attractive product and that’s why they give a price that isn’t so very exciting.
When you call for a diamond, don’t ask for the specific stone you want immediately. Ask your supplier what they are trying to get rid of. Let them send you a list. Search Rapnet, Blue Nile, IDEX and every other resource you can to get a reading on each stone. Then fight, fight, fight.
Now here’s the hard part…I know it’s hard because I do it with retailers all day long. And eventually they thank me for it.
You have to sell your customer on what you can get and not on what he or she wants. Explain to them that the best way to get the biggest, cleanest, most colorless stone is to keep an open mind. That instead of selling them an impulse stone, you want to sell them an investment stone. Save them money, give them a better stone, and make some extra for yourself. Everybody wins and you have a customer for life.
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