I can already hear all the retailers saying, “Don’t deal with them,” and all the trainers saying, “He isn’t your customer.” But here it is, people: When a young guy comes into your store and wants a diamond, you want the sale. Then he pulls out the online pricing comparison but also hints that he would pay a bit more for something special if the store could bring it in.
That is when all the crap starts. I call my regular guys and ask if they have a diamond with certain specs, and they quote me a decent price. Then the hammer falls. The diamond is also on Blue Nile. Anyone can source it online, and the client expects my price to be the same or very close. Then these wonderful dealers tell me they have to push their inventory.
Sorry, but there is a lot of hypocrisy going on in this business model. These vendors want to sell to anyone and just move things out, with no regard for the overall health of the industry.
“My guys” want me to sell a diamond that costs me $5,800 for $6,400. That is the price shown online.
As a brick and mortar operation, that is not a sustainable profit margin. On one particular diamond search, I checked with four vendors that are my “go to” people and then three more fringe players that keep asking me to try them out. Every single one had their diamonds listed online with a reseller. In one case, the diamond was offered to me for $5,650 if I paid by wire in 10 days, and shipping was extra.
This same diamond was offered by an online seller for $6,150. The online seller would also include shipping, which is about $75 to my location, and I could pay with my VISA card. I also get 30 days free to review and free return shipping if necessary. That nets out to be about a $300 difference from what my vendor was offering.
So I asked my vendor, why would I buy from him instead of the online source? I was amazed at the answer, which was the same answer I got from most of the other vendors. He repeated his price for a wire and left it at that. No empathy or further consideration offered. In one case when I pre-qualified a new vendor and found out they sell to jamesallen.com, I called them out for their hypocrisy. He responded with this:
“I understand. Thank you. If it was worthwhile for me, I would be then happy to deal only with stores.”
I guess brick and mortar stores are no longer worthwhile partners.
Diamond vendors are cutting into our end of the market and then complaining about the lack of sales when they are a contributing factor to this predicament.
Again, I can hear all of the coaches and trainers telling me this client wasn’t properly handled. Great advice, but this scenario is becoming more and more prevalent; it’s no longer just a “once in a while” thing. When there are no diamonds to offer or no margin you can make, all the coaching and all the retailers telling you, “don’t deal with the guy” won’t help you pay the ongoing costs of a physical location.
David Blitt is the owner of Troy Shoppe Jewellers in Calgary, Canada.
This article is an online extra for INSTORE Online.