Pricing most products is
quite easy. Determine how much it costs to make the item, how much it
costs to market that item, and then mark it up by 15 – 30% or more.
Simple, right? Well, pricing diamonds isn’t quite that simple. There are
many factors that are considered when diamonds are priced.
Diamond
prices are determined first by adding the cost of the rough diamond,
the cost of cutting the diamond, and all other costs necessary to turn
the rough diamond into a marketable diamond. Depending on the importance
of the diamond, an independent company may be called in to certify the
grade of the diamond based on color, cut, clarity, and weight.
At
this point, the diamond becomes more expensive each time it changes
hands, until it finally reaches a retailer, where the price is raised a
bit more. Before reaching the retailer, however, the diamond must travel
from the mine, to the cutter and polisher, to the independent grading
company, and then to the Primary market. Once it has reached the primary
market, it will be purchased by diamond dealers and wholesalers, and
from there it will be sold to retailers.
As you can see, the
earlier you can purchase a diamond in the process, the lower the cost of
the diamond will be – but not the value. The value is based on what the
diamond will sell for in the market place – through a retailer.
If
you own a diamond, and you have no idea how much it is worth, you can
have it appraised, but the appraisal may not be accurate. You will be
better off obtaining a certificate through GIA – Gemological Institute
of America. With the information on this certificate, you can use a
cutter’s guide to accurately determine what your diamond is worth.
There
are also many diamond price calculators available. These can be found
on the Internet, and many diamond dealers use these as well. You must
realize, however, that before you can accurately price a diamond,
without a Diamond Grade Report, you need to know quite a bit about
diamonds, such as different cuts, clarity, color, and weight – and how
each of those aspects adds to the value of a diamond, or decreases the
value of the diamond as the case may be.
Again, you will be
better off if you get a Diamond Grading Report on the diamond, and use
that information to look up the price in one of the guides that the
diamond cutting industry uses. This will give you the most accurate
value of the diamond in your possession, or of the diamond you are
considering purchasing.
