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107046265422184515 December 3, 2003

Posted by Lee Cherry in Uncategorized.

A Diamond In The Rough

Borrowing tactics from gem dealers for use in negotiating and selling of services…

Every gem trader has his or her own preferred bargaining tactics. Skillful application of such stratagems often translates into business success.
Studied indifference is one common ploy, but difficult to maintain when one’s eyes are afire with the sight of a great jewel. In such cases, it helps to use an intermediary. Because intermediaries do not have emotional attachment to the purchase (or sale), they typically achieve better results, which is why brokers are a common feature of the gem business.

Try to camouflage your intentions. When selecting from lots, an effective tactic is the “bait-and-switch.” Rather than drooling over the object of your desire, disguise your true objective by asking the prices of other items first. Put the gem you want in with a group of others, ask the price of the group, remove a couple pieces you don’t want, again inquire about the price, remove others, add additional pieces, and finally “settle” for the piece you wanted all along.

One of the keys to any negotiation is to get the other party to make the first offer. This is particularly important when haggling over something for which you are unsure of the true market price (there is nothing more deflating than making an offer and hearing a lightning-quick ‘yes’ issue from the seller’s lips). Similarly, if you are selling and the buyer makes an offer you will accept, ponder it a bit before replying.

Among the most unusual bits of advice I’ve ever been offered was that provided by an old Japanese dealer (Mr. Fujita, r.i.p.) who had spent most of his life buying gems in Asia. After negotiating several flasks of saké in Bangkok’s Soi Ginza, he leaned over to me and slurred in heavily-accented English: “Deeek, ze secrets of ze beeziness eez to buy a leettle high, and sell a leettle low.” Only the next morning, after my mind had cleared, did I grasp the logic of this statement. By purchasing a little higher than the competition, sellers will approach you first. Thus you obtain the all-important first look. By selling a little lower than the competition, customers will also come to you first.

There is a common tendency when bargaining over a stone to denigrate it, thinking that telling the seller you don’t like it will produce a lower price. While it does no harm to gently point out a gem’s defects, this should be done in a graceful and subtle manner. Telling someone that their stone resembles “the slime on a lizard’s back” not only anger’s the seller, making any price reduction less likely, but it begs the question of why you want to buy something that bad.

In the end, as Bangkok dealer Gerry Rogers has repeatedly lectured me, buying is like selling. When selling, the last thing you want is to upset your customer. And so it is with buying. Complimenting the seller on his good taste in gems is far more likely to produce the desired price than the reverse. If you have to complain about something to the seller, complain that, while you recognize the high quality of the seller’s gems, your customers lack the ability to understand subtle differences in quality. Thus you have to be careful how you spend your money.


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