Columnists Chuck Koehler The Retailer’s Perspective: Houston, we have a problem

The Retailer’s Perspective: Houston, we have a problem

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It appears that I’ve struck a nerve with something I’ve written about recently.  My phone and my e-mail have been pretty busy lately on the subject. And, surprisingly, most of the comments and conversations have been in favor of my opinion. Having been a gemologist in this industry for decades and decades, I feel like I’ve earned the right to speak from a position of authority.

I’ve owned a retail jewelry store for the last 22 years. It’s safe to say I’m on every conceivable wholesale diamond inventory mailing list known to man. I can look through any number of diamond price lists that show up in my mailbox every day and there will be thousands of diamonds listed.  And, every single diamond has a certification listed! And, just my personal opinion here, but there are not enough trained and qualified gemologists in the world to accurately certify that many diamonds!

I received my gemological training and certification from The Texas Institute of Jewelry Technology, School of Gemology in 1983. Since that was over 30 years ago, I’d like to think I know a little something something about diamonds and diamond grading.  Throughout the years, I’ve always played a little game to keep my gemology skills sharp. Whenever I would get a diamond in from a wholesaler to show a customer, I would grade the diamond myself before I looked at the grade my supplier assigned to it. And you know what, about 98 out of 100 times we agreed on every aspect.  If my grading was different, it was usually I gave the color an ‘H’ and they gave it an ‘I’, or I graded it a VS2 and they graded it an SI1.  The differences between our grading were very minor and very subtle, and well within acceptable boundaries. But, what’s most important here is we all relied on one another to keep us honest and always provide accurate diamond grading for our customers. Well, that’s gone right out the window now, hasn’t it????

Ten years ago, when I would get in a few diamonds to show a potential customer, they didn’t come with a dozen pieces of laminated paper.  They came in one piece of paper - a diamond paper.  And the grade of the diamond was handwritten in pencil on the outside along with some strange indecipherable cost code like ‘CSACNR’ written on it.  And there were two things that never wavered; I never questioned the grading and I never figured out those damned cost codes.

Nowadays, I’m more surprised if I agree with the grading report. And, it appears that our industry as a whole has completely lost faith in the system as well. Grab the nearest wholesale price guide and thumb through it till you find a bunch of diamonds that are the same cut, color, and carat weight. Here’s what I’m looking at right now: A round, 1.01 ct., G-color, SI2. There are 16 almost identical diamonds and they range in price from $3,555 to $5,185. That’s a difference of $1,630 from the top to the bottom. And you can ascertain which lab grades are at the top and which ones are at the bottom. But here’s my biggest problem with this whole stupid thing. If the diamonds are all really SI2, Gs, shouldn’t they all be within a couple of dollars of $5,185?  So…why the $1,630 difference?

I mean seriously people, this has gotten completely out of control. If it’s an SI2, G, then it’s an SI2, G! If some labs out there are fudging the numbers and the letters, then why are we drinking their Kool-Aid? If a wholesaler is charging less for a diamond because the lab cert is sketchy, then why are we all buying into this madness? And pray tell, somebody please tell me why are we certifying ¼ carats? 

As professionals in the diamond business here in the United States, it’s on us, not some faraway person in a faraway lab whose signature is unrecognizable, to grade what we are selling. If some lab is obviously calling an I1 a VS2, then don’t ever do business with that lab again. I swear, on about half of the diamonds I sell I don’t even introduce those stupid certs in the conversation because nowadays so many of them are completely meaningless. 

Now before you start thinking I’m crazy, let me assure you that I’m not living in a bubble. I’m aware that the majority of the consumers out there want those fancy pieces of laminated paper with their diamonds. They are convinced that those three times folded pieces of paper with letters and numbers (that they don’t understand) somehow justifies the amount of money they just spent. Yes, I’m fully aware that people need to get a warm fuzzy after their purchase to make them feel like they didn’t get ripped off or scammed. But that’s not new, that’s always been the case. 

Before this whole crazy certified diamonds business, the person assigning the grade and writing the appraisal was right there in the store. You could see that person right there sitting at that desk with the microscope on it. They would then sign their name to a legal document called a jewelry appraisal that the consumer would use to insure their purchase. And between you and me, I’ve never needed someone else’s written opinion on a laminated piece of paper for me to form my own opinion and assign a grade and a price to a diamond. I’m the gemologist here! The difference now is that there is no accountability in diamond certifications anymore because there are no legal consequences for lying! 

Are there respectable, qualified gem labs out there? Absolutely. They are not the problem. I almost always agree within reason to their grading. It’s those other ones that are dragging us all into this quagmire and reducing us to used car salesman status. This needs to stop.

For those who don’t understand how this all started let me explain. When people started buying diamonds ‘sight unseen’ over the internet, they could only compare written specs, having never seen the actual diamond until after the purchase. So the internet sellers, in order to compete with one another, started using labs that would ‘fudge the numbers’ so their diamonds on paper looked better than the other scam internet sellers.  And somehow, those certs have infiltrated the real diamond business and it’s time we fix this problem.

The customer, upon receiving their ‘deal of the century’ diamond in the mail, would then bring it to their local jeweler to get that warm fuzzy about what a great deal they got. Personally, I don’t participate.  If they bought it over the internet I won’t even look at it. And honestly, between you and me, it’s always someone you’ve never seen in your life that shows up to get your professional opinion, never one of your regular customers.

So, what needs to happen? Beats the hell out of me, but here’s what I wish would happen. I wish that every professional diamond wholesaler would throw every bad diamond certification (that you know is overstated, thus the $1,639 price difference) in the trash and burn them. Then, as a diamond professional, grade your own damned diamonds and stand behind your grading. Then, all of your 1.01, SI2, G-color, round brilliant diamonds will all cost about $5,185.  Don’t try to sell me an I1 with some worthless paperwork that says it’s an SI1. Shame on all of us for buying into this stupid, stupid behavior. We are the professionals here. Let’s start acting like it.

And, if you think I’ve lost my mind and want to tell me I’m crazy in person, you can do it at the Centurion show in Nashville, TN. I’m speaking at the breakfast on Sunday, Sept. 21st, or you can find me the next weekend at the Kansas Jewelers Association on Sunday the 28th. 

And, if you’ve got an opinion about this topic, write me at This e-mail address is being protected from spambots. You need JavaScript enabled to view it and tell me what you think.


Chuck is the owner of Anthony Jewelers in Nashville, TN. Chuck also owns CMK Co., a wholesale trade shop that specializes in custom jewelry and repair services to the jewelry industry nationwide. If you would like to contact Chuck or need a speaker or instructor for your next conference/event he can be reached at 615-354-6361, www.CMKcompany.com or send e-mail to This e-mail address is being protected from spambots. You need JavaScript enabled to view it .

 
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