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Real Deal

Real Deal: The Case of the Inadvertent Bargain

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THE CASE OF THE

INADVERTENT BARGAIN

A valued customer leaves with a diamond more valuable than the one purchased. When the store discovers the discrepancy, it creates an awkward situation for all.

This article originally appeared in the May 2016 edition of INSTORE.

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Jeffrey Priest and his family have been customers of Martin & Martin Jewelers for three generations. But his wife, Valerie, finds the Martin style too traditional for her taste. She prefers M. Page — an upscale, contemporary boutique just a block away from the Martin & Martin store.

On the occasion of their 25th anniversary, Jeffrey decided to give Valerie a diamond ring with a fine quality cushion-shape diamond larger than 2 carats.
Details and printouts in hand, at his father’s urging, he went to visit Martin & Martin. After comparing several diamonds, Jeffrey chose a 2.37-carat F/SI1 diamond that came with a GIA report, for which he paid $26,250. Jeffrey kept the diamond unmounted with the expectation that Valerie would ask M. Page to help her create the perfect design.

EDITOR’S NOTE

Real Deal scenarios are inspired by true stories, but are changed to sharpen the dilemmas involved. The names of the characters and stores have been changed and should not be confused with real people or places.

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Valerie loved her diamond and wasted no time in having M. Page create the ring of her dreams. Anxious to wear her new ring home, Valerie asked that the appraiser at M. Page simply give her a valuation that covered the cost of the diamond and the mounting so she could get her ring insured. She promised to bring it back for a detailed appraisal at a later date. He created the document using the information on the GIA report and the details on the mounting created by the store.

After nearly two months of enjoying her ring, Valerie received a call from the Martin & Martin representative who handled Jeffrey’s diamond purchase. With a bit of an apology, he explained that a mistake had been made during the original transaction and had just been discovered during a routine inventory.

While Jeffrey had paid for the 2.37-carat diamond he had chosen, he was inadvertently given one of the other diamonds that he’d looked at — a 2.46-carat E/VS1 diamond that would have sold for $31,700. He asked that Valerie bring her diamond back to exchange it for the correct one.

Valerie was understandably upset. She explained that she had a mounting custom-made for the diamond, and that she would have to talk with her husband about the whole situation. She was told she could keep the more expensive diamond if she and Jeffrey were willing to pay the $5,450 difference.

The following day, Valerie got a call from the Martin & Martin store manager, checking to see when she would be in to resolve the issue. When she said that she was uncomfortable with the whole situation and had not yet determined how best to handle it, the store manager became less friendly and more demanding, implying that legal action could ensue if she did not either return the more expensive diamond or pay the difference.

Reluctant to upset Jeffrey, who was out of town, Valerie went to M. Page and asked the store owner, Andrew Page, what she should do. Andrew was very hesitant to get in the middle of the situation, but felt that he owed Valerie at least some suggestion for how to proceed.

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He began by apologizing for not catching the discrepancy himself when he took the diamond in for setting. (He had relied on the validity of the report, his relationship with Valerie and the reputation of his competitor without double-checking the diamond).

Andrew told Valerie that he was not in a position to dictate policy for any other store, but that if M. Page had made such a mistake, he felt he would have no other choice but to absorb the cost differential himself. He would contact his customer, explain the mistake and simply ask that she exchange the certificate in her possession for the one that matches the diamond she owns.


THE BIG QUESTIONS

1. How should Valerie and Jeffrey proceed
at this point?

2. How well did Andrew handle this? How can he avoid further involvement while still providing the best service?

3. How should the
owners of Martin & Martin deal with the
situation going forward?


EXPANDED RETAILER RESPONSES

Saro A.

Chevy Chase, MD

Let’s say that the customers had paid the price of expensive diamond by mistake and found out later, wouldn’t they ask for a refund for the difference? Then, “what’s good for the goose is good for the gander!”! I’m sure the $5,000 is pocket change for Mr. Surgeon. He’s been a customer for a long time I’m sure he will understand. Let’s call him … Case closed!


Jack W.

Houston, TX

The solution: “We are sorry about our mistake. Here is the GIA report on the stone in your ring. Thank you again for the many years you have been our client.” Next problem.


Stephanie H.

Hinsdale, IL

Sounds like this jeweler needs to reevaluate diamond showing pratices. Diamonds should always be weighed before going back into the paper.


Tony M.

Wheat Ridge, CO

This is completely on Martin & Martin. They made the mistake. A $5,000 error is horrible, but nowhere near as horrible as losing a high-ticket customer that loves to buy his wife jewelry. Did they actually lose money on the deal? Or maybe just did not make as much profit? They should just suck it up and be gracious about their mistake and keep a good customer.


Sandra S.

St. Paul, MN

The diamond belongs to Valerie. No if, ands or buts. The the store that sold the diamond asked her to return it is unbelievable. You made a mistake. Eat it.


Bruce A.

Sherwood Park, Alberta, Canada

After two months! She gets to keep it. Though the damage is done, they should immediately exchange her certificate with a dozen roses and a note saying “The beauty of your diamond serves to match the LOVE of your husband. Congratulations on your 25th.”


Robert S.

Southold, NY

Situations such as this have happened to ALL of us. It was MY mistake, not theirs, and they had put the trust in me KNOWING my profession. Here’s what I would say: “Mrs. X, it just goes to show we are all fallible, but here at X Jewelers we always try to look for the times that we are less than we should be.” Do all of this with a GENUINE smile. NO bad can be said for overcompensating, and no defense is needed.


Melinda N.

St. Charles, MO

This is a perfect example of why details are so important in this industry. Weighing and louping diamonds is one of those details that we really can’t afford to skip. The fact is, we all make mistakes. Covering the details in every step of the process helps us to minimize the chances of these costly errors. Whenever possible, though, we should not allow our customer to feel the anxiety of our in-house mistakes.


Richard K.

San Diego CA

A mistake was made by M. Page by not doing their due diligence for the appraisal, and the apology was a good first step.


Marcus M.

Midland, TX

Had Martin & Martin found the discrepancy within a week then I could understand reaching out and trying to get Valerie to make the switch to the proper stone. But two months is way too long to demand they bring the ring in to switch out the stone.


Leonard D.

Avon, CT

I feel that the great advertising and word of mouth that will come from the NOT asking for more money will make up for Martin & Martin’s loss.


James B.

Hopewell Junction, NY

We are a trusted profession with great customers, but we need to pay more attention to details when we take in a customer’s jewelry. “Trust but verify” is a good motto to live by. We thermal test, measure and take pictures of diamonds with a Gemax LCD microscope equipped with an SD card.


Joe C.

Midlothian, VA

The owner of Martin & Martin should have dealt only with Jeffrey, not Valerie. The store manager should not have been involved at all! Martin & Martin should apologize all over the place, ask for the GIA report back and give Jeffrey the correct one.


Lou T.

Cleveland, OH

Martin & Martin should call Valerie and Jeffrey back, say it was a huge, unfortunate misunderstanding, have them keep the larger diamond and give them a generous gift certificate with hopes they may decide to not post a negative review explaining Martin & Martin’s boorish behavior. Martin & Martin has the chance to save these long time customers … and their reputation.


Ernie L.

Cleveland, OH

As the old saying goes, “You can never win an argument with a customer, because if you win the argument, you lose the customer.” Martin & Martin has got to put better checks and balances on their inventory control. How many other times have they made such a bad error?


Amy C.

Tulsa, OK

Martin & Martin must shut up and swallow the expense. It was their fault. Lesson learned. New procedures should be installed to prevent this from happening again. The manage was wrong. They should apologize profusely to the customer for his rude behavior and offer to fix the appraisal to reflect the upgrade.


Stuart T.

Bel Air, MD

When the manager of Martin & Martin called and spoke to Valerie, that was a mistake. Jeffrey purchased the diamond, not Valerie. If I were Jeffrey and the store had handled my wife in this manner, I would have told them to sue me for THEIR mistake.


Jo G.

Oconomowoc WI

Our staff would never write a receipt at take in for a large diamond from the documentation. Everything gets weighed and measured. If we had made such a foolish mistake as Martin & Martin, we would eat the loss rather than risk the bad publicity this would cause. We would even go so far as to give her the correct certification, and just have another one printed and mailed on the lesser stone.


Dennis P.

Johnstown, PA

Because the parties have an established rapport, I would call and advise the customer of the inadvertent oversight, explain that if the issue involved a lesser valued diamond instead, they would have called to make it right. Include offering to pay for all resetting costs, and then just pause … and wait to see if they offer do the right thing. If the customer doesn’t offer to either exchange for the original diamond or pay the difference on the more valuable one, I would walk away and leave it at that.


Brian M.

Eatontown NJ

First thing I’d do as the M Page jeweler would be to check the measurements of the diamonds and see if it they would be interchangeable. If not, I would explain to my customer that whatever happens with the other jeweler, I would be here telp her accommodate the new diamond as best as possible or possible get the other jeweler to help pay for adjusting the new mounting for the new diamond. I feel it’s important to show my customer I’m here to help her as best I can while showing respect to the other jeweler.


Daniel S.

Cambridge, MA

I had a customer once who bought a magnificent 3-carat ruby from another store. The salesgirl misread the price as $5,000 for the stone. It was actually $5,000 a carat. (This was about 20 years ago.) The store called my customer and asked for more money. He just laughed at them. The store sold the stone. The deal is done. There was no deception on his part. Story over. Same thing in this case.


Albert D.

Fords, NJ

You have alienated a customer whose wife prefers to go to a different jeweler anyway … The call should have been that you made an error, and of course Jeffrey and Valerie would not be responsible for the mixup, but you wanted them to have the correct paperwork.


Ralph H.

Richmond, IN

The complication is the involvement of the second store. If this went to court, the second merchant might be held at least partially liable, because they could have so easily have found the discrepancy.


Kim H.

Sumter, SC

I would never call a customer in this situation and ask them to return the diamond or pay the difference. MAYBE, if it had been caught immediately, before the diamond was presented, I would have called the purchaser and told them the mistake. But never, weeks later, and NEVER would I have threatened the customer with legal action!


Greg W.

Windermere, FL

The diamond should have been verified at the time of purchase and before leaving the store, not when reconciling inventory. Congratulate the customer for being the benefactor of your mistake and give them the proper certificate. It is not worth your reputation to fight with this customer over a relatively small amount of money.


Kevin L.

Naperville, IL

If the manager was responsible for these things I would make him pay with his year-end bonus. If it’s the owner fault, he takes the hit and sets a rule. (They should have had one anyhow.)


Cay H.

Lahaina, HI

What an unfortunate mistake, but I would have to agree with Andrew: The store where the diamond was purchased would have to eat the loss.


Kate Peterson is president and CEO of Performance Concepts, a management consultancy for jewelers. Email her at [email protected].

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