How Do I Go About Selling My Diamonds (professionally)?

[IAmNotColourTreated]

For approx. 10 Years now (since I was 12) I've been collecting coloured gemstones for my own gemstone collection. It is a little weird for a boy at that age, but I truly found my passion in collecting gemstones. Now as I've grown up, I would like to combine my knowledge within software engineering with trading gemstones.

Recently I discovered a source of cheap (far below market price) diamonds. I've been buying these and selling them at different auction houses for a little profit during my studies. Although the prices I would get for my stones were high, I would have to wait anywhere between 30-42 days from the end of the auction until I would get paid.

So I tried selling my stones to different wholesalers; And boy, did that not turn out well for me. I ended up contacting about a dozen of wholesalers on two different continents, two of which offered me exceptionally high estimates for my stones. I end up shipping the stones and suddenly one of them is not interested and the other is only willing to pay 1/3 of the estimate. Because of the long delay of shipping the stones back and forth + the shipping costs I end up accepting.

Now, from my experience in coloured stones, I get it; Sometimes the real thing doesn't live up to the pictures, sometimes it is a sketchy certifier or simply a miscommunication might happen, but I am telling you, 1000USD for a I1 (SI3 on the certificate, although such a grading is debatable), 1.20 carat, H-coloured stone seems like I got taken with my pants down - especially considering the prices he was willing to let go of these stones for.

Once again, based on experience I get that when you start out with these sort of things, you're bound to get the worst end of the stick. Which means you just gotta keep on going; So I did.

Now I've been trying my hand at selling to non-wholesalers on eBay. I am selling a SI2, 1.20 Ct, J coloured stone at 2500 USD on eBay, far below the market price offered on websites such as Bluenile. Problem is, unlike with my smaller stones, I am getting absolutely no traction, no views and no watches.

I checked the eBay market for natural, certified stones of approx. The same size. 99% of these (I am only saying 99% instead of 100%, because I might just have missed one as I was scrolling) were obviously fake stones "certified" by completely unknown gemological labs (I am looking at you, Gemological Institute of Excellence). Essentially, I am afraid that my genuine stone will be lost in the sea of fakes.

Secondly, I am afraid that - no matter how cliché it may sound - my great price is actually driving away customers. That it might seem like a scam, because the price is so low, and the market is filled with fake stones.

So, now that I am done with my rant, I have a few questions:

1. Do any of you who sell stones regularly and professionally sell them on eBay? If you don't mind sharing your knowledge and expertise, what are your experiences with this? What seems to work, and what doesn't? Which "tricks" do you use to differentiate yourself from the sea of fake stones?

2. Those of you who deal with wholesalers; How useful is the Rapaport in these cases? I get that you gotta accept a few % below the Rapaport when dealing with wholesalers, they gotta make a living on the margins too. But 1000 USD was approx. 1/6 of the Rapaport price, if we assume the stone was I1 and not SI3. Was I "cheated"? Would you've accepted this kind of offer?

3. Any other expertise you can let me know to help me on my journey to become a professional gemstone trader, wrt. How to offload the stones, would very much be appreciated.

 

[yssie]

Are you sending your stones to any independent authorities for grading?

Ie. Who is calling these stones the colour/clarity you state?

The “tricks” I look for as a consumer are
1. Clear photos from different angles
2. A report from a reputable grading authority
3. Feedback history
4. Reasonably-defined and clearly-stated return options

Now, I do occasionally buy without all four of the above, but not without mentally preparing myself to potentially lose everything I paid. Which means… I’m never going to spend “real” (to me) money without all four.

 

[IAmNotColourTreated]

Are you sending your stones to any independent authorities for grading?

Ie. Who is calling these stones the colour/clarity you state?

Differs, the 1000 USD one was by AIG - but the buyer agreed that the only difference of the stone between AIG and GIA would've been, that it was a I1 and not an SI3.

But with my other stones, it is usually either GIA, IGI or AIG.

 

[IAmNotColourTreated]

The “tricks” I look for as a consumer are
1. Clear photos from different angles
2. A report from a reputable grading authority
3. Feedback history
4. Reasonably-defined and clearly-stated return options

Now, I do occasionally buy without all four of the above, but not without mentally preparing myself to potentially lose everything I paid. Which means… I’m never going to spend “real” (to me) money without all four.

Alright, I never thought about asking the actual customer, so I am very thankful for the insights you've already given me!

Wrt. To the first point, most (if not all) of my stones come in the little certificate box, which makes it quite impossible to take pictures from different sides. What would you prefer; A stone taken from different angles outside the certificate box or one inside the box, but then only taken from the top at different angles?

Secondly, which grading authorities do you consider to be reputable? Do you have a "gold standard" grading authority?

Finally, if I may ask, how often do you buy stones on a yearly basis? Do you have any special sites you use often? Do you ever use eBay, if so, how do you usually find the stones you end up buying?

I hope, that you can answer some of these questions, otherwise I thank you for the help you've already given me

 

[yssie]

No problem.

So here are my thoughts. Again, as a consumer.

With eBay and the like, you’ve got primarily two types of buyers:
A) People who don’t know anything about diamonds and are looking for a great deal. These people look at price first and foremost and probably not much else.
B) People who know a ton about diamonds and are looking for a great deal. These people aren’t so worried about the report or the return policy - in fact they may actively look for ungraded/less-reputable reports because that’s usually where the deals are, not with stones with GIAs; they’re looking for photos first and foremost.
What you’re not getting on eBay is the people in-between. You’re not getting the people who know enough to red flag lack of photos and reputable grading authority, but who aren’t confident enough to buy with their eyes. Those buyers worry that eBay is scary and full of scams. I think Etsy and even Insta are more forgiving, reputation-wise.

PS is a niche consumer forum. On PS you’ve got people at the more educated end of that “middle ground” I described earlier, and you’ve also got people who fall into that “know a ton” bucket.
A) The more educated middle ground folks who frequent PS aren’t going to buy without reports from GIA or AGS, and aren’t going to spend “real to them” money without return policies. Hard sell without lots of photos and video as well, but good face-ups may be enough. Depends on price and their comfort with the vendor’s return policy.
B) The know-a-ton folks who frequent PS… Depends on pics and price, mostly.

To answer your specific questions -
1. Gold standards for diamonds are GIA and AGS. GIA first. IGI works for certain types of stones (esp. lab stones). AIG - I’ve not run into for a diamond, it wouldn’t be anyone in the US’s first choice for obvious reasons.
2. The group that knows nothing will be fine with some photos from any angles. As long as they show something recognizably “ring”, or “diamond”. Maybe with some sparkle/glitter/flash special effects. The middle group will want very clear photos from all angles feasible, but at minimum excellent face-ups. The know-a-tons can deal with blurry photos, photos from one angle, etc. for something that sparks promise (for the right price).
3. I might buy a couple of pieces a year. Some involve diamonds, not necessarily centerpiece diamonds. I buy from all manner of vendor and am generally open to trying new vendors.

My recommendation would be to first identify a target audience. Do you want to sell mostly to the people who don’t know anything and don’t care? The middle ground buyers? The know-a-tons? Selling to each group has pros and cons, and success will have different requirements.

 

[Karl_K]

a: Take some general business, accounting and marketing courses.

#1 Have clear and easy to understand written policies prominently displayed that explains every part of the deal.
This includes but not limited to: purchase, payments, shipping, returns, refund, return shipping, trade ins, sizing and anything else that may apply.
If you will not sell to certain areas that also needs to be spelled out.
Then finally your liability statement.

 

[Rockdiamond]

Recently I discovered a source of cheap (far below market price) diamonds.

Hi,
welcome to PS!
Theres a lot to chew on here. Let’s just take this statement. It’s a problem.
When diamonds are being offered below the market price by dealers, theres always a reason. Generally it’s because the goods are worth less. There are many potential issues that a less experienced user will miss.
Why do you think a dealer would sell desirable stones for less than a true wholesale market value?
Cheap diamonds are cheap for a reason. Again, we’re taking about diamonds offered by dealers.
This has been my experience over many years.
As far as all the rest…it’s a complex, unforgiving business in many ways.
First recommendation is to spend a lot of time reading threads here on PS. See what buyers are looking for and the advice they get. The seasoned members here are more knowledgeable than most retail salespeople . .
Of particular interest to me are the the threads where issues crop up. See how both buyers and sellers respond.
Good luck!

 

[Bron357]

Hi, one of the most important aspects of selling gemstones is consumer trust.
Most consumers only feel “safe” dealing with well known, highly regarded brands or companies.
Gemstones are a discretionary item and most consumers are naive and that’s why they prefer to go with a ”safe” option.
ebay is a minefield.
i have been buying on eBay nearly 20 years and many loose gemstone listings are fraught with misleading information and fraud so called “lab certificates”.
Consumers try and learn so they learn that a lab report is important and helps add credibility to the listing, however, there is a WHOLE market in fake lab certificates. It becomes very quickly all too hard and risky and it’s back to the Mall jeweller that the buyer goes.
As with most businesses you need to look at the “value add” aspects. Most people buying a diamond ring are buying a diamond ring. They like it “all complete”, less input or effort on their part. Not many consumers (PSers are an exception ha ha) are looking for a loose gemstone only.
Perhaps you should look into partnership with local jewellery designers, your “cut” will be less but you will get more business.

 

[broaria]

Have you ever considered becoming the "auction house" yourself? If you have enough stock to get people interested in a sale, even if it's only once a year it's something you could do and I know it's something a lot of independent jewelry stores and estate buyers do to move their stock. They also don't want to wait the 30-60 days to get paid and pay a percentage to the auction houses. Depending on your location you may or may not need to get an auctioneers license which usually only takes a week or 2 plus registration fees and then register yourself on a site like Live auctioneers or Invaluable and pay their much smaller hosting and payment processing fee.

 

[LilAlex]

Is this for real? Or a solicitation for business?

To me this sounds like someone who can get in on the ground floor and get you 24K gold at a discount. There is no such thing. It's like all those people trying to get you rich by having you invest in something. If it were that great an investment, they would just shut up about it and get rich all by themselves. As @Rockdiamond says above, everything that's cheap is cheap for a reason. Short of being trapped at a border crossing or in a war zone or fencing stolen goods, I can't think of a circumstance where anyone would (repeatedly) sell gold, diamonds, or dollars for a discount.

 

[kenny]

Sorry, but IMO you're wasting your time.
I see the industry as secretive and very closed to outsiders.

Wanna make a real living buying and selling diamonds on the wholesale market?
Have your father raise you in his diamond wholesaling business, which he inherited from your grandfather, who got it from your great grandfather, etc. etc.
Your family must make all the essential introductions.

Tough love, to save you time and money.

 

[yssie]

Is this for real? Or a solicitation for business?

To me this sounds like someone who can get in on the ground floor and get you 24K gold at a discount. There is no such thing. It's like all those people trying to get you rich by having you invest in something. If it were that great an investment, they would just shut up about it and get rich all by themselves. As @Rockdiamond says above, everything that's cheap is cheap for a reason. Short of being trapped at a border crossing or in a war zone or fencing stolen goods, I can't think of a circumstance where anyone would (repeatedly) sell gold, diamonds, or dollars for a discount.

This.

Would personally not buy from anyone who claimed to have found an unexpectedly cheap source because I’d wonder just how much blood might actually be on those stones. There are no not-unscrupulous cheap diamond sources when you’re not already firmly established in the trade, outside of one-off preloved deals.

That said, this thread might be useful for someone whose “cheap source” genuinely is actually just a random accumulation of one-off preloved deals collected over time. That’s actually how I read the OP.

 

[Rfisher]

Assuming the stone you mention that is currently for sale is the one that’s easily found on EBay:

What seems to work, and what doesn't? Which "tricks" do you use to differentiate yourself from the sea of fake stones?

Your sales pitch in your description reads no better, no more honest or trustworthy than the sales pitches of the ‘seas of fake stone’ sellers do.

Just my opinion. As a buyer. For diamonds.

 

[Karl_K]

I treated it as legit because if one dealer or future dealer reads it and adopts it then it was worth taking the time to answer.

 

[lovedogs]

Assuming the stone you mention that is currently for sale is the one that’s easily found on EBay:



Your sales pitch in your description reads no better, no more honest or trustworthy than the sales pitches of the ‘seas of fake stone’ sellers do.

Just my opinion. As a buyer. For diamonds.

I just found your stones for sale on Ebay. As a buyer of diamonds, I wouldnt pay the prices you are asking. The 1.20 J looks milky and, frankly, not good at all. It looks much lower in color than a J, and very included. Theres no way anyone who is knowledgable about diamonds would pay 2500 for that stone. Just trying to be honest, not mean. But I think you should re evaluate your "source" because I dont think you're getting any kind of deal.

 

[IAmNotColourTreated]

Assuming the stone you mention that is currently for sale is the one that’s easily found on EBay:



Your sales pitch in your description reads no better, no more honest or trustworthy than the sales pitches of the ‘seas of fake stone’ sellers do.

Just my opinion. As a buyer. For diamonds.

No, that is fair enough, I would like to know how it is percieved. Do you have any suggestions in order to improve it while still getting the message across that this is a legit stone?

I just found your stones for sale on Ebay. As a buyer of diamonds, I wouldnt pay the prices you are asking. The 1.20 J looks milky and, frankly, not good at all. It looks much lower in color than a J, and very included. Theres no way anyone who is knowledgable about diamonds would pay 2500 for that stone. Just trying to be honest, not mean. But I think you should re evaluate your "source" because I dont think you're getting any kind of deal.

Once again, I am much happier to hear this honest feedback than hurt. I don't disagree that the stone could be better, but the price I got it for still seems good. Would 2000 USD seem like a fair price in general?

 

[IAmNotColourTreated]

Have you ever considered becoming the "auction house" yourself? If you have enough stock to get people interested in a sale, even if it's only once a year it's something you could do and I know it's something a lot of independent jewelry stores and estate buyers do to move their stock. They also don't want to wait the 30-60 days to get paid and pay a percentage to the auction houses. Depending on your location you may or may not need to get an auctioneers license which usually only takes a week or 2 plus registration fees and then register yourself on a site like Live auctioneers or Invaluable and pay their much smaller hosting and payment processing fee.

I didn't know this was an option. I will definitely check it out. Although as of yet, my inventory only consists of 6-7 stones. But I will keep it in mind and look at the website for now.

 

[IAmNotColourTreated]

Hi, one of the most important aspects of selling gemstones is consumer trust.
Most consumers only feel “safe” dealing with well known, highly regarded brands or companies.
Gemstones are a discretionary item and most consumers are naive and that’s why they prefer to go with a ”safe” option.
ebay is a minefield.
i have been buying on eBay nearly 20 years and many loose gemstone listings are fraught with misleading information and fraud so called “lab certificates”.
Consumers try and learn so they learn that a lab report is important and helps add credibility to the listing, however, there is a WHOLE market in fake lab certificates. It becomes very quickly all too hard and risky and it’s back to the Mall jeweller that the buyer goes.
As with most businesses you need to look at the “value add” aspects. Most people buying a diamond ring are buying a diamond ring. They like it “all complete”, less input or effort on their part. Not many consumers (PSers are an exception ha ha) are looking for a loose gemstone only.
Perhaps you should look into partnership with local jewellery designers, your “cut” will be less but you will get more business.

I think selling to my local jeweller might be the best option for me for now, actually. I will try that and then see how it goes. I suppose I should just walk up to one and see if my stones and prices are of any interest to them?

 

[MillieLou]

I've been buying these and selling them at different auction houses for a little profit during my studies. Although the prices I would get for my stones were high, I would have to wait anywhere between 30-42 days from the end of the auction until I would get paid.

It sounds like you've already got a way of getting the prices you want through safe and reliable means. Waiting a couple of months after an auction to be paid doesn't sound like an issue, unless you are relying on it as your primary income source (which I very much hope you aren't...?)

 

[Alybetter]

Lower your prices. Allow people to make offers. Hire someone for photography or learn how to shoot the stones yourself. Clean up your copy, or let someone else write it. In your description first describe the exact product, and at the bottom give general information about your policies and who you are.

Do comparative market analysis on your chosen platform. It takes time but it’s worth it. Etsy is another platform you may want to look at if you haven’t already.

I don’t know if you auction or buy it now, but if you’ve never tried an auction with reserve, might be a good idea.