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What To Expect When Selling A Ring To A Jeweler


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Hello all,

 

I’ve been browsing this forum for a couple weeks now and was wondering if I could get some advice. I’ve been put in charge of an estate, actually it’s just me and my sister. In this estate we have a few rings. We came to an agreement that my sister would take all of them except the ‘big one’. I’m looking for advice on what kind of offers to expect.

 

 

Right now the ring is at a local jeweler getting an appraisal, I have absolutely NO paperwork with it. I plan on taking to at least one more place. I did speak with the owner directly, he briefly looked at the ring and gave me this information (it’s all I have right now). He said..and I’m paraphrasing.. it is a very good ‘color’, not so good clarity, approx 2.8 carats, good cut, round and set in white 14K gold. I did not tell him what my intentions are (which is to sell it) so I’m expecting a fair appraisal.

 

 

I understand that I’m not going to get an actual value from this post but I think I could get an ideal as far as numbers go.

 

 

Let just say for easy math the appraisal comes back at $20,000 (again..I don’t expect that just nice round numbers). What kind of offers should I expect from a Jeweler? I realize that I will be selling at ‘wholesale prices’. I also understand that certain style rings may ‘move’ better thus have a higher value to a jeweler than something he may have to sit on for a while.

 

 

Should I expect to get 30% 40% 60% of the appraised value?

 

 

Thanks!

 

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Hi,

There's absolutely no way to even begin to guess.

First of all, you'll have a very difficult time trying sell it wholesale, unless you are a wholesale diamond dealer. You will need to sell well below wholesale if you are selling into the trade.

If you can find a private individual who wants to buy you could do better.

The appraisal value will have almost no relation at all to the price you might be able to get- other than it's likely to be exponentially higher than you might be able to sell for.

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You’re shooting yourself in the foot here.

 

An appraisal is an informed opinion of what you have and how it might reasonably be expected to relate to a particular marketplace. There’s not a simple conversion from one marketplace to another. For your appraisal to be useful it is essential that the appraiser know what question he/she is answering, in your case, how much should you expect to realize on resale and how can you maximize that.

 

Tell ‘em. Make it clear that one of the rules of the assignment is that you absolutely will NOT sell to the appraiser. You’re paying them for their advice, not for a bid. If they want to buy it, let them bid, but this absolutely precludes them from being your appraiser. This is important.

 

The next thing is to make sure they are answering the question you are asking. Many appraisers use a concept of ‘retail’ pricing that isn’t very well grounded in reality. It’s something on the order of what it would cost to custom make a new one like it at an expensive store in your neighborhood. Sometimes it’s even less specific than that. This sort of ‘appraisal’ is not useful in your situation. Arguably it’s not useful in ANY situation but that’s another issue. It’s sort of like appraising your ‘91 Civic by noting that new Honda’s at the dealership are pretty expensive. Starting with that number and discounting is simply not a valid approach. Part of what you’re paying the appraiser for is to explain their approach to you so that you understand what is going on. Sometimes this is easy but often it’s the hardest part of an appraisal assignment. In fairness to the appraiser, they can’t know what you are trying to learn if you don’t ask.

 

What you’re asking of us is exactly what you should be asking your appraiser. What exactly is it? What are the alternatives for market selection? What should you expect in your chosen market? What is the best strategy for selling this particular item for the most money in a reasonable amount of time and with a minimum amount of risk given my situation?

 

If your appraiser isn’t prepared to answer this sort of question, find a different appraiser, they aren’t doing what you need. Tell them up front what you want to know from your session and ask them flat out if they can provide that. Not all can. Appraise the appraiser.

 

Neil

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So, what you saying is tell the appraiser my intentions of selling the ring? And ask their advice?

 

So basicly..if I try to move this ring to a jeweler this appriasel will mean nothing. I would image if I found someone that wanted to buy it outright from me that appraisel MAY help

 

Would you reccomend paying the $250 and getting the ring GIA'ed? Obviously I would assume that the GUA would only be if I tried to sell to the 'general public'

 

Ya think an add in the local paper would yield anything. We're not in a big hurry to get rid of it but with xmas than Valentimes day coming up I would guess this is a decent selling time

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Many appraisers use a concept of ‘retail’ pricing that isn’t very well grounded in reality. It’s something on the order of what it would cost to custom make a new one like it at an expensive store in your neighborhood. Sometimes it’s even less specific than that. This sort of ‘appraisal’ is not useful in your situation. Arguably it’s not useful in ANY situation but that’s another issue.

Neil, that's a fantastic analysis of the appraisal question.

 

HelpPlease- Let's hear what the appraiser call the color and clarity...... that will make a difference in answering if the stone should go to GIA.

If you do want to send it to GIA, it will need to be removed from the ring.

 

If you did get a GIA it would be useful to either a private party, or a dealer.

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Bingo- this is going to show exactly what we're talking about.

We're currently offering a 3.30 carat cushion that I graded F/I1-2 on our site for $16k

http://rockdiamond.com/index.php?crn=207&a...ion=show_detail

 

Now yours could be worth more- or less.

But the chances of it being worth anywhere near $28500 are very slim indeed...

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Great. The first step of the appraisal assignment is now complete. Get it in writing and get a full and complete explanation. In particular, what you really need to know is how did he come by those grades and, even more importantly, how did he come by that value conclusion? To whom, when and under what circumstances is it worth $28,500? If that answer is something other than you, now, and a set of circumstances that you can arrange, explain to them that this isn’t answering what you need to know. If the answer is yes, ask them how you get your $28k. So far, this appraiser has given you nothing of value for his fees but I’ll give him the benefit of the doubt and it's not done yet. You didn’t tell him what you wanted to know so it’s at least partially your fault. If, in the course of your conversation you discover that he’s answered the wrong question, be as clear as you can about what you’re trying to learn and ask again.

 

While you’re there, ask them your questions about advertising in the newspaper and what your other choices are for market selection. Ask them if getting GIA grading would help in selling in the recommended market. Why or why not?

 

Neil

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Wow..

Talk about a coencidence..being your selling at 16 loose would it be safe to say I could 'dump' it to a jeweler for $10,000? Or is that expecting to much?

 

Again.. just looking for ball park ideas

 

You keep on asking questions that should be asked of your appraiser. They've seen the stone, they supposedly are an expert in both diamonds and the diamond market, they know your situation and you're PAYING them for their expert opinion. If you don't trust them, you need to find a better expert. If you do they are in a far better position than any of us to give you good council. Let us know what you say and we might be able to add something or even confirm or discredit something they said but start by asking finishing the appraisal. Even if it turns out to be correct, the right answer to the wrong question is no help.

 

Neil

Edited by denverappraiser
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Wow..

Talk about a coencidence..being your selling at 16 loose would it be safe to say I could 'dump' it to a jeweler for $10,000? Or is that expecting to much?

 

Again.. just looking for ball park ideas

 

Just to give you a rough idea, I give ballpark offers all the time from my website cashfordiamonds.com....

 

Round Brilliant

F/I1

3.30 ct

 

assumptions: Nice I1, premium cut (not ideal, not poor), no treatments, no chips..... my "blind offer" on that would be about $6000.00. My final offer would require you shipping in the stone for me to inspect it, if my assumptions were correct that's what my final offer would be.

 

If you want $10k+++ you'll have to sell it on ebay or figure out some way to get it in the hands of a consumer who would be happy to pay that price. I'm afraid no jeweler would ever pay that much for it. The real killer is the I1 clarity. If it was SI2 instead it might be worth double easy. Maybe the person who graded your diamond was a little hard on it. I would really suggest sending it into GIA like others mentioned. This is a case when having a GIA paper would help you a lot when trying to sell it.

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Just to give you a rough idea, I give ballpark offers all the time from my website cashfordiamonds.com....

 

Round Brilliant

F/I1

3.30 ct

 

assumptions: Nice I1, premium cut (not ideal, not poor), no treatments, no chips..... my "blind offer" on that would be about $6000.00. My final offer would require you shipping in the stone for me to inspect it, if my assumptions were correct that's what my final offer would be.

 

If you want $10k+++ you'll have to sell it on ebay or figure out some way to get it in the hands of a consumer who would be happy to pay that price. I'm afraid no jeweler would ever pay that much for it. The real killer is the I1 clarity. If it was SI2 instead it might be worth double easy. Maybe the person who graded your diamond was a little hard on it. I would really suggest sending it into GIA like others mentioned. This is a case when having a GIA paper would help you a lot when trying to sell it.

 

Yosef,

 

Would your ‘blind offer’ have been any different if it had a GIA report that agreed with all of your assumptions (3.30/I-1/ F/F-VG make, untreated and undamaged)?

 

Neil

Edited by denverappraiser
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Just to give you a rough idea, I give ballpark offers all the time from my website cashfordiamonds.com....

 

Round Brilliant

F/I1

3.30 ct

 

assumptions: Nice I1, premium cut (not ideal, not poor), no treatments, no chips..... my "blind offer" on that would be about $6000.00. My final offer would require you shipping in the stone for me to inspect it, if my assumptions were correct that's what my final offer would be.

 

If you want $10k+++ you'll have to sell it on ebay or figure out some way to get it in the hands of a consumer who would be happy to pay that price. I'm afraid no jeweler would ever pay that much for it. The real killer is the I1 clarity. If it was SI2 instead it might be worth double easy. Maybe the person who graded your diamond was a little hard on it. I would really suggest sending it into GIA like others mentioned. This is a case when having a GIA paper would help you a lot when trying to sell it.

 

Yosef,

 

Would your ‘blind offer’ have been any different if it had a GIA report that agreed with all of your assumptions (3.30/I-1/ F/F-VG make, untreated and undamaged)?

 

Neil

 

Well I'm assuming it's a nice I1. If GIA said it was I1 that would meet my assumption for the most part. But it would help, yes, if it came with a GIA report. Grading of imperfections on larger diamonds is not something you want to be off by 1 grade. Plus with a GIA report I could be assured it was not enhanced in any way, where as if I were buying that diamond and someone sent it in, I'd have to inspect it very well, and probably still take it to a few other people for their opinions just to be assured it has not been altered in any way. So yes if it came with a GIA report saying I1 I'd probably increase my blind offer to say $6500, and if I liked it when seeing it and agreed with the grading that's probably what I would pay.

 

I'm not really advising him to get the GIA report for my sake or even his sake if he trusts his appraiser. More so if he wants to get something closer to market value for it from a consumer. If you list it on ebay as a GIA I1/F, VG make, and proven by the GIA lab to be untreated, it would go a long way for instilling confidence in the buyer. It would also help to take a lot of pictures face up, face down, etc of the diamond's flaws since that is going to be the main factor people will be concerned about when buying it.

Edited by Adylon
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Yosef,

 

That’s why the market selection is such a big deal. Getting GIA paperwork is a significant expense and eats up a fair amount of time. On a 3.30 we’re talking $400 or so after all the shipping and 4-6 weeks. If the market is selling to a dealer, for example you, I could not with a straight face suggest that it’s worth it. You’re going to grade it yourself anyway. If you think the grader was harsh and it should have been SI2, you’ll pay higher than if you think they were generous and it really belonged at I2. Even if the grader is GIA. There’s nothing wrong with this but the real beneficiary of the paperwork would be you, not the seller. If he were planning on selling to you, he would be better off leaving it alone, driving a hard bargain based on information learned from their own expert and letting you deal with the lab, especially since speed is apparently an issue.

 

This is the case with sales to most 2nd hand dealers, one of two market choices he’s asked about. On ebay I absolutely agree, the right GIA pedigree makes a stone much more marketable. Ebay has other issues for sellers though. The seller’s feedback and product history are important as is their skill at writing good prose, taking good pictures and responding to emails. It’s not that these things will make your stone any better or worse but it sure helps it sell and, if you’re not prepared to do the work, ebay rarely ends in happiness for private sellers, even when armed with GIA paperwork. Skillful ebay selling isn’t nearly as easy as the folks at ebay would like you to assume. Similarly, the effectiveness of the newspaper route will vary wildly depending on what paper and where you are. There are towns where it’s a serious personal risk to do this, there are others where it simply doesn’t work and others still where this is an entirely sensible approach. Once again, this is a question that the appraiser should be addressing.

 

Neil

Edited by denverappraiser
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Yosef,

 

That’s why the market selection is such a big deal. Getting GIA paperwork is a significant expense and eats up a fair amount of time. On a 3.30 we’re talking $400 or so after all the shipping and 4-6 weeks. If the market is selling to a dealer, for example you, I could not with a straight face suggest that it’s worth it. You’re going to grade it yourself anyway. If you think the grader was harsh and it should have been SI2, you’ll pay higher than if you think they were generous and it really belonged at I2. Even if the grader is GIA. There’s nothing wrong with this but the real beneficiary of the paperwork would be you, not the seller. If he were planning on selling to you, he would be better off leaving it alone, driving a hard bargain based on information learned from their own expert and letting you deal with the lab, especially since speed is apparently an issue.

 

This is the case with sales to most 2nd hand dealers, one of two market choices he’s asked about. On ebay I absolutely agree, the right GIA pedigree makes a stone much more marketable. Ebay has other issues for sellers though. The seller’s feedback and product history are important as is their skill at writing good prose, taking good pictures and responding to emails. It’s not that these things will make your stone any better or worse but it sure helps it sell and, if you’re not prepared to do the work, ebay rarely ends in happiness for private sellers, even when armed with GIA paperwork. Skillful ebay selling isn’t nearly as easy as the folks at ebay would like you to assume. Similarly, the effectiveness of the newspaper route will vary wildly depending on what paper and where you are. There are towns where it’s a serious personal risk to do this, there are others where it simply doesn’t work and others still where this is an entirely sensible approach. Once again, this is a question that the appraiser should be addressing.

 

Neil

 

$400 and 4-6 weeks for a GIA report not worth it? Don't tell David that haha .... hey I agree with you. You're right if he's selling the diamond to a wholesaler or someone in the trade, a GIA report won't make much of a difference. It will help boost the price basically by what he paid for the report and that's about it. But I do think it helps a lot if he's trying to sell to a consumer. Maybe he should send it to EGL-USA instead and hope for a SI3 grade. Worst case scenario it comes back I1 and he's out $250 or so and only lost a week at most. An EGL-USA report would still help a lot trying to sell on ebay, and with an SI3 grade he might get an extra $1000 for it. You and I both know that an EGL-USA SI3 is the same as a GIA I1. But at least a consumer would see the SI3 grade and know it's a nice I1 and that helps a lot rather then just getting an I1 grade from an unknown lab.

 

If he sent it to EGL-USA and it came back as an SI3 and I thought it was a nice I1, I'd offer him $7,000 for it :rolleyes:

 

If I were him I'd ask his appraiser if he thinks EGL-USA would grade it as SI3 or I1, that would be something very good to know... as far as opinions go.

Edited by Adylon
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EGL SI3 is decidedly not the worst case scenario. EGL I2, for example, would be significantly worse.

 

The primary purpose of a grading report is to serve as an advertisement. It gives the seller something to point to in their sales presentation to help answer some important questions by the buyer. They’re helpful. They’re even helpful for buyers. But they’re not useful in all situations, they aren’t all the same, they don’t all cost the same and they aren’t all useful in the same ways.

 

The primary purpose of an appraisal is to provide the client with useful information. The appraisal report is just that, a report. The appraisal is the process by which this report is generated. A successful appraisal is one that results in the client understanding the merchandise and the situation. This is why I won’t do appraisals for dealers. They don’t want understanding, they want an advertisement. The person really seeking information is some unidentified 3rd party buyer and this is being filtered through the dealer. Even with the best appraisers it’s filtered by the dealer’s selection of the appraiser in the first place. It’s filtered by the dealer choosing to include the report in their sales presentation. It’s filtered by the marketplace and methodology chosen and it may be filtered by a conflict of interest.

 

When selling something that you’re unfamiliar with, especially if you’re selling to a professional buyer, it’s critical to understand what you have and what you can expect or you will be entirely at the mercy of the buyer. They do not have your best interest at heart. Sometimes it works out ok anyway -You choose the right guy, he makes the right offer and you go your merry way but usually it doesn’t go that way. You need to make some decisions about which offers to accept and which to decline. Should you buy an ad in the paper? Should you pay for a lab exam and, if so, which lab? When a buyer tells you that it’s an I-2, or a crappy cut, or damaged and that this is the reason for their bid, should you believe them, should you argue or should you move on to the next buyer? What about consignment offers? How can you evaluate them? All of these are valid appraisal questions and none of them are lab questions. Most don’t have decisive, one-word answers and most will not be included in a ‘standard’ appraisal report.

 

This thread nicely outlines the problem. We’ve got all kinds of numbers, grades and prices being bandied about. There’s an unidentified appraiser that says it’s worth $28,500. David is trying to sell one that seems to be relatively comparable or maybe even a little worse for $16,000. Yosef thinks he might be willing to buy it for $6,000-$7000, and he won’t even do that without inspecting it personally in California. I haven’t given any numbers at all. HelpPlease want’s a short answer to how much he can get for his rock and who to sell it to and he’s not getting it. That’s because there is no short answer. What’s required is a long answer, and the place to get it is from a capable and independent appraiser.

 

Neil

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Guys..

 

I really do appreciate all the advice and help. I think I have a pretty good idea now of what to expect and of course I learned a bunch

 

 

Neil pretty much summed it up…I’m in a market I know nothing about trying to get a fair price for a ‘used’ item.

 

 

I really wasn’t coming here saying ‘how much is it worth?’ Mostly because I had no information, for all I knew it was a pieces of glass.

 

 

I did come here looking for answers on what to expect and you guys did exactly that.

 

 

I’ll be discussing our options with my sis tonight. We’re in no hurry to move it and to be honest…if we will only get 6k for it.. we’ll probably just keep it

 

 

Thanks again!

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Guys..

 

I really do appreciate all the advice and help. I think I have a pretty good idea now of what to expect and of course I learned a bunch

 

 

Neil pretty much summed it up…I’m in a market I know nothing about trying to get a fair price for a ‘used’ item.

 

 

I really wasn’t coming here saying ‘how much is it worth?’ Mostly because I had no information, for all I knew it was a pieces of glass.

 

 

I did come here looking for answers on what to expect and you guys did exactly that.

 

 

I’ll be discussing our options with my sis tonight. We’re in no hurry to move it and to be honest…if we will only get 6k for it.. we’ll probably just keep it

 

 

Thanks again!

 

Neil is right on the money. There is no short answer here.... for example you could give the stone on consignment to a jeweler, who can put it in his showcase for $16,000 and give $10,000 when it sells but that could take a year. You could sell it on ebay or locally in the classifieds any maybe get $10k for it, possibly more because you're selling direct to a consumer. If you took that to a pawn shop, I don't think they'd give you more then $3k for it, most of those guys are real low-ballers, but it's possible you might find one shop owner who really likes it and will offer $5-6k for it.

 

 

You have to remember people in the trade are in it to make money (of course) and most have access to millions of diamonds on very favorable terms where they can pay in 30-days or more and even send back if they don't like it, or their customer that they sent it in for choses not to buy it. If I pay a consumer cash on the spot for it, I can't call him back in a month and tell him I can't sell it and I want my money back. When you're buying from the public you also have some risk that must be factored in a reduced price. Will it sell? If I send it to EGLUSA or GIA will they agree with my grading? Is there something wrong with it? Maybe it's treated, etc? It could even be stolen. So it's not easy buying from the public.

 

 

This is why I say it's more cost effective for people with QUALITY diamonds to sell on ebay with a quality report. There is an art to selling on ebay like Neil says, but if you hit all the fundamentals like good pricing, good description, good photos and good disclosure (reliable grading report) you should do well. You could always hire a third party company that specializes in ebay sales.

Edited by Adylon
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