Selling Your Diamond

Suppose you sell your diamond to a typical professional buyer. What happens to it next? The buyer then turns around and sells the diamond to a broker. Brokers pay far less than retail price (as we saw on the previous page). So a professional buyer keeps this in mind when offering to buy your diamond.

Let's go back to our $10,000 diamond example. Let's imagine that you found a buyer, Dirk's Diamond House, to buy your diamond for $5,000. Now Dirk tries to sell the diamond to a broker for $5,500, a meager 10% profit. Well, the broker will laugh in Dirk's face, because brokers pay less than $5,000 for this sort of stone. Dirk eventually goes out of business.

More realistically, a buyer like Dirk would pay you about $4,000 for the stone, so he can sell it to the broker for $4,400. In order to stay in business, a professional buyer has to offer you about 10% less than the broker's price.

But... not all diamond-buyers are the same!