In the United States, wholesale diamonds have been sold in the mainly in the New York and Los Angeles jewelry districts. Diamonds would trickle down to the consumer who would usually go purchase a diamond in a local mall. But that was then and this is now. The diamond industry has rapidly evolved since the dot com era first began in the late 90’s.
It wasn’t too long ago that diamond wholesalers would import rough and polished diamonds from overseas from places like Antwerp, Israel and Africa. They would then sell those diamonds to wholesalers in New York and Los Angeles, and those wholesalers would then sell to other smaller regional wholesalers in major cities all over the US. Retailers would borrow these diamonds on “memo” to show their customers and would fill their showcases with diamonds from other dealers they regularly did business with. A trust was built between the retailer and the local wholesaler.
From the time a diamond is dug out of the earth to the time it was sold to the consumer, a diamond would change hands 8-9 times between middle men. These included cutters, polishers, diamond graders, several levels of wholesalers, diamond traders and ultimately get to the retailer and then to the consumer.
It wasn’t even uncommon for diamonds to be graded by several labs, being passed from one to another in hopes of getting the best grade. Diamonds would be bought by one diamond wholesaler that had more influence with a certain lab and would get a higher color or clarity grade, thus would instantly get 10-20% more profit on their investment. Everyone in the industry knew EGL certified diamonds were not up to par with GIA graded diamonds with the same apparent color and clarity. That didn’t stop diamond dealers, however, from exploiting the public with massive profits involved. It was a shady game that over the years the consumer had little choice but to participate in.
The internet came along and changed the game forever. Consumers could now go online, search thousands of diamonds in the shape, size and specifications they were looking for, sort by price and simply buy the cheapest. And if they weren’t comfortable with shopping online, all they had to do was print out that list and shop around at their local malls. The mall retailers of course would try to sell their IGI or EGL graded diamond for the same price as the online seller’s GIA graded diamond at first, but that game didn’t last long either. Consumers have become more aware that GIA is the industry standard and no other lab comes close to their reliability and prestige.
The result? Many retailers have had their business model turned upside down. They have shuttered their doors in the malls as more and more people opt to buy online. All the middle men that were typically involved in the wholesale market have also closed up shop. The diamond wholesalers in Los Angeles and New York now buy directly from the source, and some of them even sell directly to the public. Where is the diamond market going? We don’t know. But we do know that the consumer can not be deceived and you must sell an honest product for a competitive price. That is why Luxe Wholesale Diamonds is committed to brokering the best diamonds for our customers.
Sunday, August 22, 2010
Wholesale Diamonds and the On-Going Changes within the Diamond Trade
Thursday, May 21, 2009
Robbins Brothers Files Chapter 11 Bankruptcy - Why They Failed?
Robbins Brothers, a Los Angeles jewelry store chain that primarily focuses on the sale of engagement rings, recently filed for Chapter 11 Bankruptcy Protection in early March of 2009. But we're left wondering what exactly went wrong? According to court documents, the Azusa-based jeweler's financial situation deteriorated in 2007 and got worse in 2008 and ultimately led to their bankruptcy in early 2009. Robbins Brothers operated 16 stores in several states including Caliornia, Texas and Illinois. Robbins Brothers has formed a new corporation and intends to sell it's California stores to itself, and sell off their Texas and Illinois stores and assets.
The company's books showed assets of $66 million, but debts totalling more then $77 million. Among its top unsecured creditors, the chain lists in court documents some notable diamond and jewelry companies, including Leo Schachter Diamonds LLC based in New York (owed $2.71 million), Leo Schachter Ltd. in Ramat Gan, Israel (owed $1.82 million), Moshe and Namdar (USA) Inc. (owed $1.4 million), R and R Grosbard (owed $597,851) and Simon G. Jewelry Inc. (owed $554,455).
Leia Mais…
There were many contributing factors to their demise. The first and chief reason was their rapid expansion. Robbins Brothers was recapitalized in 2004 partly by the private investment firm Weston Presidio, and then went on to expand from 7 to 16 stores in only 4 years opening new markets both in Dallas, TX and Chicago, IL. Ultimately the goal was to have a 50-store chain. The rapid expansion was planned in part because they did not want competitors to steal their format of pitching "engagement ring stores" and wanted to entrench their brand as the premier "World's Largest Engagement Ring Store". While the plan may have been successful in better times, the rapid decline in the Southern California economy both with housing losses and jobs losses, and a very mixed welcome into the Chicago market made for tough times for the chain.
Also with the proliferation of sales of diamonds online, it has drastically cut into Robbins Brothers margins. How can one sell a 1 carat diamond for $8500 when the same exact diamond is being sold for $6500 online instead? When shopping at Robbins Brothers, you often aren't really told what you're getting right up to the point where they're ready to take the money out of your hands. Robbins Brothers also operates vastly large showrooms with dozens of employees. However when economic times are tough, these exorbitant stores can be sparsely filled with customers making for very high overhead expenses that are difficult to remain profitable.
Thursday, April 30, 2009
Don't Chip That Diamond!
Here's a recent diamond we got from a customer in a trade. They bought the 0.75ct princess shape diamond and it was mounted in 4 post prong mounting not really designed for princess shape diamonds. When the ring was knocked really hard she lost 1 prong and it took a chunch of her diamond out at the corner as well.
Diamonds in general are very hard and can take a lot of compressive loads, just like, say, concrete. But they are still brittle like concrete and so if you take a hammer and chizel to them they will chip if struck at the right angle with the right amount of force.
This diamond is now 0.69cts and after it's re-cut into a radiant shape it will only yield about 0.55ct size. So be sure to get a v-prong mounting for your princess shape diamond, or semi-bezel or full bezel or just make sure it's well protected against chipping!
Leia Mais…
Sunday, December 28, 2008
Amazon Bucks Traditional Retail Sales Trend This Holiday Season
Amazon’s latest press release boasts some pretty good numbers this holiday season, despite a very tough economy and sales with traditional retailers. According to Amazon, 2008 was its best year ever and sales peaked highest on December 15th, with a sale of a gigantic sum of 6.3 million orders placed on that day alone!
Adylon is also a seller on Amazon.com where we currently list hundreds of wedding bands and some sliver jewelry items, we noticed the same trend. Sales were sharply up compared to last year, the number of units (items sold) were also up however larger ticket item prices for us were down.
Amazon did not provide sales figures or give any indication of percentage growth for the season so I am pretty much assuming they have had noticed the same trend we have, which is the number of items sold is up, however the average ticket price is probably down.According to Amazon, the top selling jewelry items were a 14K white gold Journey Curve pendant (0.5 carats, H color, I1 clarity), a pair of diamond stud earrings set in platinum (1 carat, G-H color, VS2 clarity) and a sterling silver marcasite & garnet glass heart pendant.
Leia Mais…
No Recession for Rare Diamonds
On December 10th, Christie’s International in London sold a colored diamond for a whopping $24.3 million dollars! The diamond was once owned by King Philip IV of Spain. Christie's annouced this sale was a new record for the sale of any loose gem.
The diamond sold was a 35.56 carat fancy greyish-blue diamond. It has been owned by the same private collector since 1964 and was only expected to fetch bids of around 9 million pounds, but when the auction ended, the final sale price was 14.6 million pounds instead.
Francois Graff, the new owner and of Graff Diamonds intends to re-cut the gem in order to get the slightly chipped gem a flawless clarity grade and more depth in order to give the stone an appearance of a deeper face up color. “We’ll lose a few carats, but nothing too substantial,” said Graff.
King Philip (1605-1665) gave the stone to his daughter, the Infanta Margarita Teresa, as part of the dowry of her marriage in 1667 to the Emperor Leopold I of Austria. In the 18th century, it entered the crown jewels of the Bavarian royal family, and has been known as the “Wittelsbach Diamond” ever since, Christie’s said.
Saturday, December 27, 2008
An introduction to "LA Diamond Guy" and Adylon Diamonds
Hello, and welcome to my new blog, "LA Diamond Guy". My name is Joe and I've been in the jewelry trade since 1999.
Subscribe to:
Posts (Atom)
