Do you have a diamond or two in your safe or jewelry box that you’re thinking of liquidating?
If you’re not sure where to begin, you’re not alone. Information that accurately describes how to resell diamonds can be hard to come by.
Luckily, the process isn’t overcomplicated. This article provides all the knowledge you’ll need to get it done while answering some questions you may have.
- Is it Possible to Resell Diamonds?
- What Is the Value of Diamonds?
- Things to Consider When Reselling Diamonds
- Where to Resell Diamonds
- What You’ll Need to Resell Diamonds
- How To Resell Diamonds: Step-By-Step Instructions
- Can You Make Money Flipping Diamonds?
- Frequently Asked Questions
- Similar Tutorials to Check Out
- Wrapping Up
Is it Possible to Resell Diamonds?
Diamonds are one of many great items to resell. There are several places (brick-and-mortar and online) where you can make money selling everything, from second-hand diamond rings to brand-new diamond jewelry.
In some cases, when you sell your diamond possessions to an online buyer, you can complete the transaction in as little as 24 hours. Many online buyers even have Better Business Bureau ratings.
What Kinds of Diamonds Sell Well?
In the diamond resale market, the concept of the four C’s determines which diamonds sell well. It applies whether you’re selling a diamond engagement ring or loose diamonds. The four C’s are:
- Carat Weight: A carat is the standard unit of measurement for a diamond’s weight. It’s different from the karat, which measures the amount of gold in a stone.
- Color: As a rule of thumb, the less color a diamond has, the higher its retail price.
- Cut: A diamond’s cut refers to the way it’s been polished and how it catches the light.
- Clarity: This refers to the diamond’s purity, which is measured on a chart.
Colorless diamonds with a beautiful cut, high clarity, and a large carat size are highly sought after and tend to sell well.
What Is the Value of Diamonds?
According to the Diamond Registry, resold diamonds typically fetch between 25% and 50% of their original retail prices.
For example, if you bought a well-cut diamond for $1500, you can expect it to fetch you around $900. If you’re investing in diamonds, it’s better to buy the larger and rarer ones.
You can use a diamond price calculator to assess the value if you know your diamond’s four C’s, as these tools require that you enter information like the diamond’s cut and carat.
Do Diamonds Lose Value Over Time?
The moment a diamond leaves the jewelry store, it begins to depreciate in value. The difference between a diamond’s retail price and its resale price may come as a shock, but it makes sense when you know why.
When you buy a diamond from the store, you bear the cost added by the various players on the value chain, which can include the cost of the diamond’s labor and design, side stones, and retail experience.
Diamond buyer preferences also affect a diamond’s price when it’s resold. Many buyers are solely after the center stone, meaning the side stones and metal don’t add to its resale value.
Meanwhile, wholesalers who need to make a profit tend to buy your diamond at a low price and sell it higher later.
Things to Consider When Reselling Diamonds
When selling diamonds, you’ll need to consider the following factors:
1. Four C’s
Color, clarity, carat, and cut affect diamond worth, meaning you’ll need to know this information. If you’re unaware of your diamond’s four C’s, it could lead to disappointment.
For example, you could place more value on it than it’s actually worth or, worse, get duped by an unscrupulous buyer.
2. Diamond Resale Value
Unfortunately, there’s no getting around the fact that your diamond won’t sell for anywhere close to how much you originally paid for it.
You’ll need to temper your expectations when going into a transaction. Expect a significant downgrade from its original retail value.
3. Better Business Bureau Rating
If you’re buying online, you’ll need to consider whether the website has a BBB rating. The Better Business Bureau “helps consumers find businesses and charities they can trust” and its rating will signify that you’re selling to a reputable and trustworthy buyer. This will help you avoid getting scammed.
4. Where You Sell
Your diamond’s four C’s aren’t the sole factor that determines its price. Where you sell also matters. You might not get a decent offer when you sell at places like a pawn shop. In contrast, selling via consignment can help your diamond fetch a better price.
5. Fees and Commissions
Depending on where and how you sell, you may have to pay fees and commission payments. For example, if you sell your rock via consignment, the auction house will take a percentage of the sale price.
Similarly, if you sell on a platform like eBay, you’ll have to pay its seller fees.
When you consider the above factors, you’ll ensure that you get the best value for your diamond. In addition, you’ll avoid scammers and unpleasant disappointments.
Where to Resell Diamonds
There are three main ways you can resell your diamonds:
1. Online Platforms
Overview
Many websites can help you sell a diamond ring, jewelry, or loose stones. The diamond buyer may be a company with a Better Business Bureau rating that specializes in buying and selling diamonds, one of many jewelry stores online, or a civilian who’s willing to buy on resell websites like eBay.
What Makes This Option Great
Selling engagement rings or other items online offers convenience that driving to the local jeweler doesn’t. You don’t have to drive anywhere until you’ve sold the stone, and some diamond companies handle the delivery process.
- Fees/Commission: The fees or commissions payable depends on the platform you use. You won’t have to pay fees when selling to an online jewelry store or diamond sellers.
- Payment Methods: Online pre-owned jewelry buyers typically pay via electronic funds transfer (EFT), check, or direct deposit.
2. Auction House (Consignment)
Overview
Auction houses can help you sell your diamond item through a process called consignment.
You sign a contract stipulating that the auction house will hold the diamond for a specified time, during which the house will put your diamond up for sale. If it doesn’t sell, you get it back.
This option will work for you if you’re not in a hurry to sell your item, as it typically takes weeks or months.
What Makes This Option Great
Opting for an auction platform or house is excellent because you can sell your diamond for a high price.
- Fees/Commission: The house takes a pre-agreed percentage of the item’s eventual resale price (it varies from house to house).
- Payment Methods: The payment method depends on the auction house (expect check, EFT, or direct deposit).
3. Pawn Shop
Overview
If you’re in a hurry to liquidate a diamond ring or other diamond-based jewelry, consider selling to a pawn shop. There are over 11,000 of them in the US, meaning your city likely has a handful.
The tradeoff with using pawn shops is that they’re notorious for making lowball offers, so expect them to significantly beat down your diamond’s resale value.
What Makes This Option Great
Pawn shops are excellent if you need to sell your diamonds as quickly as possible.
- Fees/Commission: There are no fees or commissions associated with this option.
- Payment Methods: Pawn shops typically pay cash. Some may write you a check or transfer the funds electronically. It varies from business to business.
What You’ll Need to Resell Diamonds
Here’s what you’ll need to begin the process of selling diamonds:
- Finding buyers: Selling your diamond will require a bit of legwork to find the right buyer, no matter which of the above methods you choose. Be prepared to wait a bit to move your diamond and make a profit.
- Knowledge: To get the best price for your diamond, you need to know its four C’s (color, carat weight, clarity, and cut). These C’s affect diamond prices and will determine whether your rock will have a high market demand and fetch a higher price.
- Certificate (Optional): Your diamond certificate has your stone’s info straight from the diamond cutter and can make it easier to sell. However, this isn’t a hard determinant as old diamonds (e.g., inheritances) don’t always have them. Also, some establishments will give you a free appraisal when you take your diamond in.
Other than the above, you’ll need a method of receiving payment where it isn’t possible to take cash. The same is true for when you need to pay commissions and fees (a payment method).
How To Resell Diamonds: Step-By-Step Instructions
Here’s how to resell your diamonds in four steps:
Step 1: Know Your Diamond
The first step to selling a diamond is to know its value. To understand the value of what you have, you need to know your diamond’s four Cs. Having this information on hand is important because your prospective buyers will ask about it and use it to make you an offer.
If your diamond doesn’t have a certificate with this information, you can have it certified by the Gemological Institute of America (GIA). Alternatively, you can get an appraisal from an independent jeweler.
Step 2: Get an Estimation (Or Several)
Most physical businesses that are into diamonds can help with assessing the value of these precious stones. Consider getting assessments from multiple places to get a sense of how much it’ll fetch you when you’re ready to sell.
Getting an estimate from an online business is more challenging, as it can’t see your diamond until you send it through the mail. The process takes longer, and it can also be risky if you don’t vet the company before to ensure it’s legitimate.
Step 3: Research Places You Can Sell
If you’re planning to sell through a physical business, visiting the place will suffice. For example, an auction house representative can provide information about any fees or commissions you’ll pay.
However, if you want to sell on an online marketplace or to an online company, you’ll need to dig deeper.
Your first order of business will be looking into whether each platform has a decent BBB rating. It also helps to look at user reviews to check whether other sellers have experienced issues.
Finally, check the platform’s fees and commissions, as they can eat into your profit.
Step 4: Sell Your Diamond
Once you’ve done all your homework and ascertained your rock’s value, sell it. This step may entail signing a consignment contract with an auction house, selling at your local pawn shop, or registering on an online marketplace and listing it for sale.
Can You Make Money Flipping Diamonds?
Diamonds and jewelry are great things to flip for a profit.
If you buy from other diamond owners, you can sell these items to others online. The caveat is you need to know what you’re doing and to understand that diamonds don’t appreciate in value the way other assets like gold do. As such, your margins won’t be significant.
The gulf between a diamond’s retail price and its resale price can be astronomical. While you can find a decent deal, your prospective buyers may be more aware that they’re purchasing a second-hand rock from you, limiting how much you can add on when you resell.
What Is a Diamonds Resale Business?
A diamond resale business is one that buys pre-owned diamonds and sells them to other people to make a profit.
These business owners shop on sites like eBay, hold the diamonds for a time, and then resell them on the same platform or different platforms at a profit.
Even though this business isn’t as lucrative as flipping houses, the money can add up depending on the volume and frequency of transactions you handle.
Is Reselling Diamonds a Good Way to Make Money?
It can be. Like all businesses, it has its pros and cons.
The pros of reselling diamonds are that you can get the diamonds at a low price, thanks to how these items depreciate. Diamonds are also in high demand in the US, as in 2021 alone, the market for polished diamonds was valued at $15 billion. That statistic entails that you’ll find buyers when you’re ready to resell your acquisitions.
The cons of this business are that, like the people you buy from, there’s no escaping depreciation. You’ll need to trade at volume to make up for the shortfall in profit margins.
Frequently Asked Questions
Do Jewelers Buy Back Diamonds?
Businesses like Smyth Jewelers buy back diamonds, jewelry rings, platinum, gold, and so on. You can walk in with your diamonds (sometimes without booking an appointment), and the company will assess the item and make you an offer. Some jewelers will pay via a check or store credit.
Are Diamonds Easy to Sell?
There are plenty of places where you can sell diamonds in exchange for cash. In some cases, you can sell within an hour or a day, and you won’t have to pay any fees or commissions. The challenge lies in making a profit when selling second-hand diamonds.
Similar Tutorials to Check Out
Looking for other resale ideas? Check out one of the below-listed tutorials:
- Resell Jewelry: Diamonds aren’t the only precious stones you can sell. Gold and silver jewelry and arrangements with gemstones also fetch a decent price when resold.
- Resell Art: You can make money reselling all types of art. The value of pieces by renowned artists appreciates over time, making art an excellent investment.
- Resell Watches: Reselling your second-hand timepieces can be an excellent way to earn cash when you need it.
Wrapping Up
Reselling your diamonds will be easier when you know its four Cs and the places it’s likely to fetch a fairer price. If you get estimates from multiple sources and do your research, you may walk away with a decent resale price.
Contrary to popular belief, diamonds aren’t forever. Knowing how much they devalue over time will help you manage your expectations when reselling your stone.
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