I have been asked this question a number of times in my career, and it always makes my heart squeeze a little. There are many different scenarios where people might need to sell jewelry. Maybe the engagement or marriage didn’t work out, sometimes there are financial hardships, or maybe someone inherited Aunt Harriet’s ring and just won’t wear it.
This scenario exposes a dirty little secret of the jewelry industry–there is no secondary market to speak of. The jewelers who work so hard to sell you something in happy times aren’t really set up to help you if things don’t work out. This makes a difficult situation even harder.
The first thing you should know is that YOU WILL NOT GET BACK WHAT YOU PAID FOR YOUR JEWELRY. There are a number of reasons for this. If you sell it to someone in the industry, they can buy it wholesale and are in the business to make a profit. Jewelers can carry large in-house inventories on memorandum, where they only pay the dealer for it if they sell it. If they do buy something, they can get 30, 60, 90 day terms to pay for it. Or they can make a cash purchase for a percentage off the wholesale price. To buy it from an individual, they have to pay you outright, take a fair amount of risk that the item is what they think it is (mountings can hide a lot of flaws), and hope they can turn it in the future. If you sell it yourself to an individual, you need to make the price compelling enough for someone to pay you cash instead of financing it through a jeweler. Keep in mind, too, that you may need to unmount diamonds and gemstones and put them into simple settings that appeal to most people.
In general, there is a direct relationship between the amount of time you are willing to wait and the amount of money you will net for the jewelry. The faster you want to liquidate, the less you will get for the item. I have compiled a list of possible options and the impact this makes on how much you will get. I have listed the following options in the approximate order of least amount of time and effort on the seller’s part to more time/effort, but possibly greater return:
$ Pawn Shop/Jewelry Liquidator:
In general, this is the option of last resort. You will get–maybe–10 to 20 cents on the dollar for what you originally paid if the item has more value in the labor, such as a cluster ring with a lot of gold. You may net more if the item has a solitaire diamond at least 1/3 to 1/2 carat. The pawn shop or liquidator is going to turn it very quickly for a little more than they paid for it (way below market value), which is why the price is so low. But it’s very fast–in the case of a pawn shop you will walk out with cash/check in hand. In the case of an on-line liquidator, such as Thingswebuy.com, you contact them on-line, they Fed Ex you a box/package, and they will let you know as soon as they receive it what their offer is. A company that would be very good for more important jewelry items is CIRCA, they have offices in several major US cities. Not sure how much they sell, but there is also an entertaining little site called exboyfriendjewelry.com to check out. Note: I have not personally vetted this or any other on-line liquidator/buyer, so I cannot fully endorse. Do your homework and proceed with caution.
$$ Consign through a physical jeweler:
This could be through the jeweler you originally purchased it from, or another store in the community. There should be a written agreement about how long they will have it in the case, the price they will try and get for it, the amount you will net from the sale, and the appraised value if anything should happen to it while in their possession. This option can take an extremely long time: how motivated is the jeweler to sell your item, versus their own inventory that represents a major capital investment? But the amount that you net might be closer to what you paid for it, especially if you bought it from that jeweler and they are compassionate about the situation.
$$$ Sell it yourself:
This option probably makes some people’s palms sweaty. It is not for the faint of heart, but this is the way you can get closer to your purchase price.
- The first possible audience is someone you know who might be interested: friends, family, colleagues, etc.
- I do not recommend a newspaper ad. It is expensive, no one reads ads anymore, and it could attract the crazees.
- Craigslist. I am updating this in May 2010, in light of a terrible crime committed against people tying to sell jewelry on Craigslist in Washington State. The big mistake that this family made was meeting someone at their home to possibly sell a 1 carat diamond ring. DO NOT EVER MEET A POTENTIAL BUYER AT YOUR HOME. Always meet someone at a public place, a Starbucks, Insurance agency, a bank. If you do decide to go through Craiglist, be very careful, and never forget that the users are anonymous and could be anyone. Craigslist does has it’s positives: it is easy, it’s free, and it’s local. If you have paperwork, such as a diamond lab grading report or an appraisal, list as many details from it as you can. Try to take a good photo, it’s easy to upload. Price it well–you need to make it enticing to buy it from you versus a jeweler (jewelers offer less risk, return policies, financing, etc.). If you paid $5,000, price it at $3500 or less–it will be a good deal for the buyer and that’s a pretty good price to get back out of it. If you really want to sell it and be done with it, 1/2 of the price you actually paid (NOT a fictitious appraisal value) is very compelling. If you find someone who is interested in seeing it, my recommendation would be to meet at a bank. It’s a public place, security is all around, you can show the item to the potential buyer (hey, you could even pull it from the safety deposit boxes there if the bank has them, further reducing your security risk), and if the interested party decides to buy it, you can verify their certified check funds before they leave with the jewelry.
- eBay: This option is tricky (and worthy of its own blog). Going through the listing process if you’ve never sold on eBay before is not trivial. There are listing and selling fees that can add up. You are also competing against professional dealers with slick offerings. But you can get your item in front of a large potential audience who is actively looking for jewelry. There are 2 options for eBay, auctions and Buy It Now. Auctions are still their bread and butter. They recommend starting the bidding low with no reserve, but if you really can’t go below a certain price, you can set a reserve price (for instance, you paid $5000 for a solitaire diamond ring, you want to get at least $2500 for it, so you can start the auction at $1000 but set a reserve of $2500). Definitely go for a longer auction, 7-10 days. You can also set a Buy It Now price that represents a fair value. There is a TON of fraud on eBay, so what I recommend is using an escrow service to hold the funds until the buyer has a chance to view the jewelry.
$$$$ Trade It In:
If you can trade in your jewelry, you will probably get the most value possible for very little exertion on your part. For instance, if you bought an engagement ring for $5000 and things didn’t work out, maybe you want a Rolex for yourself. Or perhaps you could hold onto it until you decide to get engaged again, and trade it for a larger, finer diamond. You might even get the full amount the jewelry is worth if the item you’re trading for is for more money. Even if you didn’t buy the original item there, if it’s a salable piece, a jeweler has more incentive to do this than the consignment route. Again, you’re taking some loss in that you are not getting full value back in hand, but that is the reality of the situation.
Jewelry DOES have lasting value, it can always be reduced to its precious materials and the value measured out. The unique thing about jewelry is that the emotional significance behind it is harder to calculate. Only you know what your jewelry is really worth.
Have you ever had to sell a piece of jewelry? What was your experience? Please comment and share your story!