SO all of this said how does one know they are paying a fair price for a diamond?
Good question. Which unfortunately does not have a unique answer. Part of the answer is price comparison - but especially with fancy colours that is fraught with difficulty, because the market is much thinner, the grades are broader (D to E to F to G to H covers less ground than FLY from just-above-Y-Z to just-below-FY) and the cutting follows different rules - or pursues different goals, which is the same.
Another part of the answer is the level of trust that you can put in the dealer, considering their track record with you and others.
A third aspect to consider is what - if anything - you are getting in addition to the diamond. One of the larger sites - which offers a very limited selection of Fancy colours - offers very little service: no photos on the site, cannot take photos, does not allow comparison shopping (you cannot "buy" three stones, return two), does not offer custom settings. I value all of these things, and am prepared to pay a reasonable premium on the stone to get them. Curiously enough, I don't even need to pay a premium to get all this from DBL, but don't tell David.
There are so many factors to consider, many you might not even be aware of (like how long the diamond has been sitting in the vault and what the dealer paid for it)
I recently bought a set of small FY stones from Israel and when i took them to the jeweler who was a friend of the family he thought I really over paid. I was happy with the price and from what I could see from my research it was a fair price. He admitted i didn't get totally hosed but I sure didn't get a deal. I realize many people don't deal much with fancy stones and therefore it might be his lack of knowledge of what a good price is or what a good price is Wholesale - Since that is how he would buy it and I can't! (although i would love to)
It could be either. Particularly if your friend does not buy yellows frequently, he may be surprised by how much he has to pay now as opposed to a year ago. And it may well be that, even factoring price rises in, you were still overpaying.
Another factor to bear in mind is that with unique goods (as opposed to standardised ones like consumer electronics) every competitor will always claim they could have found you something better, or at a lower price, or both. My experience is they seldom can - much of my jewellery collection has been purchased through four or five dealers, including DBL, because I have found that they keep that promise or strive very hard to.
So even on this DBL website when you see a price how do you know its a good price?
See discussion above. Is DBL always the lowest price? Possibly not, but to me the value of added services, the access to excellent bench jewellers, and the trust I have in David (who has often told me "don't buy this, buy that
") more than compensate the small premium that sometimes is there - and often is not.
Is it completely rude to offer something less and barter on the price of a diamond?
Not any more than it is to do it for any other thing. If done with good grace and within reasonable bounds, the worst that happens is you are told "thanks, but no thanks".
Bazaar-style negotiation starting at 10% of the stated price doesn't work too well in most jewellery selling places, and in those where it does, you still end up losing out. They
know a lot more about the piece they are selling than you do, and sleight of hand (e.g. replacing loose gemstones with loose pieces of cut glass) is not above them.
Is there a rule of thumb to know what the approximate mark up is?
Mark up varies wildly from goods category to goods category and from one store/dealer type to another. Blue Nile has mark up in the region of 20-25% as can be seen from their published accounts; Tiffany goes over 70% on average (and has a broader line - the highest mark up is on things like cutlery and porcelain, not on jewellery). They both end up with a net margin in the low tens. Which one is better value? And since neither will bargain, does it make them bad places to go?
You don't want to be insulting but since the prices of diamonds seem so fluid there has to be some room for negotiation in there?
It's not so much that the price is fluid; it is rather rigid, actually, because the market is very highly competitive and the margins on diamonds themselves for the retailers are not all that great. The problem is that very small differences, imperceptible without precision instruments, controlled observation conditions and training, can make huge differences in price. For example:
1.03 RBC D/IF, EX/EX/EX, No fluorescence: $31,800
0.98 RBC, E/VVS1, EX/EX/EX, Med blue: $15,300
Can you see the difference? Once set, even with a loupe, no-one - and I mean no-one - can, except for the fluorescence or a diameter difference of 0.05 mm which is only measurable with a precision calliper. But the differences are "worth" $16,500. Look at it another way: with one of the D/IF you can buy two E/VVS1. Earrings anyone?
Many of the DBL diamond I see you can't really find comparisons on other sites as many don't sell any thing between an I J color and FY.
There are places to find price comparisons. The issue I have with most listing engines is that with fancy colours and fancy cuts (and even with faint yellows from say M to Y-Z) there are the good, the bad and the ugly. Since the majority of vendors can't be bothered - or their business model doesn't allow - to take multiple good quality pictures and allow me to know what is what, I end up more often wondering "what is wrong with this cheaper stone?" than I end up thinking "wow, what a bargain!"
Thanks again OMC look forward to more insight!
Hope this helps...