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How Would You Solve “The Case of the Disappearing Diamond”?

A store manager closes a sale, only to find that the wholesaler has already sold the diamond to someone else.

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LUCAS AND CHARLOTTE had decided it was time to take their relationship to the next level. Excited about their upcoming engagement, they began searching for the perfect ring. Lucas, a graphic designer with a keen eye, thought he’d found the answer online: a 1-carat emerald-cut diamond. The price and quality fit what they were looking for, but the idea of buying such a significant piece of jewelry without a physical salesperson felt daunting. They craved the expertise and guidance of a trustworthy professional.

ABOUT REAL DEAL

Real Deal is a fictional scenario designed to read like real-life business events. The businesses and people mentioned in this story should not be confused with actual jewelry businesses and people.

ABOUT THE AUTHOR

Megan Crabtree is the founder and CEO of Crabtree Consulting. Before founding Crabtree Consulting, Megan had a successful professional career in the jewelry industry, which culminated with high-level positions at several of the top firms in the retail and manufacturing sectors. Reach her at mcrabtree@crabtreeadvisory.com or visit us at www.crabtreeadvisory.com where you can set up a live chat or a 30-minute free consultation.

 

With this in mind, they decided to visit Diamond Haus Jewelers, a local store renowned for exceptional service and quality diamonds. Armed with the photo of the online diamond, they explained their situation to Sophia, the store manager.

Sophia got to work leveraging her network of wholesalers and managed to locate a diamond similar to what they wanted. Even better, she presented them with a selection of beautiful settings to create the perfect ring. Lucas and Charlotte were thrilled. This more personalized approach gave them peace of mind and confidence in their selection. They found a setting they loved and everything seemed to be on track.

Sophia explained that she would order the diamond, and once it arrived, the in-house jeweler would then set the stone. They could expect their completed engagement ring in about a week. She placed the order and completed the transaction. Lucas and Charlotte left, excited to return when the ring was ready.

However, a snag arose the following day. When the inventory team placed the order for the diamond, the wholesaler informed them it had already been sold. Disbelief washed over Sophia. They’d had the couple’s hearts set on that particular diamond, and here they were, potentially losing a customer because they couldn’t compete with the instantaneous nature of e-commerce.

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Like many other brick-and-mortar stores, Diamond Haus Jewelers relied on platforms like RapNet Diamond Trading Network to search for diamonds from wholesalers around the world. However, e-commerce websites and other independent jewelers also listed the same wholesalers’ diamonds on their sites, creating the illusion of a vast inventory without actually owning the stones. This strategy minimizes the initial investment on diamond inventory and reduces the risk of dead stock, but it also creates the risk that a store will not be able to provide its client with the diamond they want.

Sophia would have liked to have placed a temporary hold on the diamond with the wholesaler, but not all wholesalers will hold inventory, and sometimes they require a final sale that cannot be returned.

Knowing their excitement had been genuine, Sophia decided to take a chance. She called Lucas, explaining the unexpected turn of events and expressing her sincere apologies. She emphasized her understanding of their disappointment and offered to personally search for a similar stone that met their needs. To her delight, Lucas and Charlotte agreed to return to the store, willing to give Diamond Haus Jewelers another shot.

Upon the couple’s return, Sophia presented them with some new diamond options. While Sophia found a few diamonds with similar characteristics, they just didn’t capture the magic of the original stone for Lucas and Charlotte. Charlotte’s face crumpled and Lucas felt defeated. They’d invested significant time and emotional energy into their visits to Diamond Haus Jewelers only to leave empty-handed.

Sophia was disappointed in the lost opportunity to create a special memory for the couple. All she could do now was try to salvage the situation, but how?

The Big Questions

  • Should brick-and-mortar jewelry stores request temporary holds on diamonds from wholesalers after a customer expresses strong interest but before finalizing the sale?
  • How can jewelry stores build stronger relationships with wholesalers to secure temporary holds on diamonds or prioritize orders for in-store customers?
  • What strategies can brick-and-mortar jewelry stores implement to elevate the customer experience and compete effectively with online retailers?

 

Linda F.
Lexington, KY

Personally, since the customer was so enthusiastic about this particular diamond, I would have placed the buy-order then and there. Yes, e-commerce makes securing gems from sources harder. If your customer wants it, just go ahead and get it. I know most wholesalers will not take back diamonds or other gems once purchased, but that’s the trade in general. I personally only deal with sources that allow you to show a gemstone in person to a client, and if the client doesn’t purchase it, I can return it to my source and receive my deposit back to my account once they acknowledge receiving the gem.

Bob W.
Chicago, IL

Sophia should have never promised the stone without confirming with the wholesaler, and she also should have brought the stones in before closing a sale because a diamond’s video is not the best way to view a diamond. It needs to be shown in person. This is 100% Sophia’s fault. The wholesaler has to take a sale immediately and cannot wait for anything, especially in this weak market and difficult time for diamond wholesalers. I think Sophia needs sales training and a store should never just use RapNet or Polygon. A jeweler should always have a personal relationship with a dealer they work with because customer-friendly wholesalers take care of preferred customers. Yes, there are some wholesalers who only think of jewelers as money, but good customer friendly dealers take care of their jewelry stores and customers.

Gloria H.
Topeka, KS

It is very surprising a jewelry store would wait until the following day to order a diamond. The sale is not complete until the diamond is ordered. Either order it while the customer is sitting there, or IMMEDIATELY after they leave. Do not move to any other task until the diamond is ordered, because everyone knows a diamond can be gone in five minutes. Why do you need an inventory team that can’t manage to order a diamond even the same day? This is just a bad way of doing business. Fire the inventory team and have the salespeople get the job done in a timely manner.

Becky B.
Peabody, MA

I think it’s important to work with wholesalers that allow you to memo their diamonds for a certain period of time, and that way you have the diamond physically in hand before making any promises to customers. There are so many wonderful wholesalers out there that will work with you on that.

Jo G.
Oconomowoc, WI

Deep sigh. Why do we have to impose rules on wholesalers? Remember the olden days where you showed a client the merchandise, and they bought it? I would never do a “done deal” with a client without stone in hand. I can quote on the weekends, but no one ships on the weekend, so I put a caveat on it “if it is still available.” I have found folks are quite comfortable buying diamonds online (they don’t want to be ripped off or talked into anything), but then the tricky part of setting comes into play. We can’t compete with the speed of the internet and delivery, but we can give our clients confidence that they are in capable hands when they enter our stores. Overpromising and underdelivering have never been appreciated. We don’t need to burden wholesalers; we need to deal with reality.

Stuart T.
Summerville, SC

I just don’t get it!! Maybe 40 years ago, a diamond wholesaler wouldn’t hold a stone when asked, BUT in the last 25 years at least, I have NEVER found a diamond dealer who wouldn’t put a hold on a diamond, if not for just a day. I think if you have a relationship with a dealer (and not just call him once every five years), they will ALL hold the stone for you. If you find one who won’t, then it’s time for another dealer! I find it hard to believe, especially with the internet, that they couldn’t find a similar stone to the first one. If they did find one a little more money than the first one, then cut your profit to make the sale.

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Mitchell D.
New Iberia, LA

The couple knew that the store would have to order the stone, so the manager should have called the wholesaler while the couple was still in the store and verified that the diamond was available. At that point, she could have told them that she needed a deposit and could have had the diamond shipped in, thus avoiding any heartache.

Cindi H.
Foxborough, MA

We order stones while clients are in the store to secure them. And often, we will order a backup stone, something usually of nicer quality just in case. It’s always better to view the diamonds in person. Relying on what it describes online is always subjective. Adding the personal touch in person with a nice conversation with the couple about themselves, how they met and future plans will form the relationship for future sales as well!

Sandi B.
Ocala, FL

First, we never complete a transaction until the customer sees the diamond in person. Typically, if we do not have the diamond in stock, we search to find a diamond that fits their budget and criteria, then request the diamond from the vendor to have it sent on memo and make an appointment to come back and finalize everything. I understand that hindsight is 20/20. However, I would think that seeing the diamond in person would be the smart way to ensure no problems in the future for unavailable stones.

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