Columnists

On Data: A Closer Look at Loose Diamonds

ColumnistsMar 17, 2020

On Data: A Closer Look at Loose Diamonds

Sherry Smith looks at sales and gross margins on loose diamonds in her latest deep-dive into industry data.

On Data: A Closer Look at Loose Diamonds
Sherry Smith is director of business development for data and consulting company The Edge Retail Academy. She can be reached at sherry@edgeretailacademy.com.
Hello, I hope this finds you staying well, both physically and mentally, amid all the uncertainty surrounding the spread of COVID-19. 

In this month’s column, we’re going to examine the performance of independent jewelers in the 12-month rolling period ended Jan. 30, and then dive into their performance in a category that’s become more challenging in recent years—loose diamonds. 

Overall, jewelers showed an increase of 4.8 percent in gross sales year-over-year. This follows a strong January 2019, which had an 11 percent increase in gross sales. 

Gross profit dollars were also up, climbing 4.8 percent.

The number of units sold slipped 5 percent, while gross margin held steady at 46.1 percent and the average retail sale grew 10 percent, from $304 to $335.

Meanwhile, loose diamonds showed a 2.1 percent increase in gross sales, a 2 percent increase in gross profit dollars and a 4.9 percent increase in average retail sale in the 12-month rolling period. 

Of the $2 billion in total aggregated sales data from the independent channel collected by The Edge Retail Academy, the loose diamond category represents 13 percent of total revenues and 10 percent of total annual gross profit dollars. 

This makes loose diamonds the single most important category for independents.

I’ve saved the best on loose diamonds for last—the gross margin. This is such a hot topic and, no doubt, I am opening Pandora’s box by mentioning it. 

I must admit, it is very interesting to see retailers’ and vendors’ reactions to the actual gross margin being achieved. 

Vendors tend to be surprised by how low the actual gross margin is, while retailers are surprised that retailers are getting that high of a margin. It’s all about perspective.

Let’s break down loose diamond gross margin by region: Midwest – 38.8 percent; Northeast – 32.7 percent; South – 37 percent; Southeast – 35.9 percent; and the West – 38 percent.

It’s not surprising to see the Midwest with the highest gross margin, given that the region tends to be more rural, just as it’s not a shock to see the Northeast, where it’s more densely populated and there is more competition, with the lowest.

Nonetheless, there are lots of contributing factors to the gross margin of loose diamonds: attempting to match online pricing, selling loose as a commodity, removing the emotional part of the purchase, the entry of lab-grown diamonds into the market in larger quantities, etc. 
In any case, it’s worth noting that most research continues to show it’s all about the experience. 

After all, the purchase of a loose diamonds is, in most cases, made to mark a momentous occasion in customers’ lives that should be celebrated. 
Sherry Smithis director of business development for data and consulting company The Edge Retail Academy.
tags:

The Latest

Watch: How Is the Industry Doing When It Comes to Diversity?
Recorded WebinarsMar 31, 2023
Watch: How Is the Industry Doing When It Comes to Diversity?

Annie Doresca and Michelle Graff welcome Reggie Johnson and Sheryl Jones for a frank conversation on the state of DEI in fine jewelry.

Macy’s Longtime CEO to Retire Next Year
MajorsMar 31, 2023
Macy’s Longtime CEO to Retire Next Year

Jeff Gennette will step down in February 2024, passing the torch to the CEO of another notable retailer.

Piece of the Week: The Extraterrestrial Lunar Necklace
AuctionsMar 31, 2023
Piece of the Week: The Extraterrestrial Lunar Necklace

Artisan Martin Roberts fashioned lunar meteorites into 48 beads to create this out-of-this-world necklace.

Full Disclosure at Your Fingertips
Brought to you by
Full Disclosure at Your Fingertips

Distinguishing natural diamonds from laboratory-grown stones – now more available than ever – has been difficult for jewelers. Until now.

JBT Re-Elects Richard Katz as Board Chairman
MajorsMar 31, 2023
JBT Re-Elects Richard Katz as Board Chairman

As for new members, the organization welcomed Jewelers of America’s Annie Doresca and Parag Jain of Parag Diamonds.

Weekly QuizMar 31, 2023
This Week’s Quiz
Test your jewelry news knowledge with this short test.
Take the Quiz
At Watches & Wonders, a $20M Watch Makes Its Debut
WatchesMar 30, 2023
At Watches & Wonders, a $20M Watch Makes Its Debut

Jacob & Co.’s new “Billionaire” timepiece features more than 200 carats of yellow diamonds.

See the Jewelry Collection Expected to Top Elizabeth Taylor’s at Auction
AuctionsMar 30, 2023
See the Jewelry Collection Expected to Top Elizabeth Taylor’s at Auction

Heidi Horten, wife of department store magnate Helmut Horten, collected jewelry from Bulgari, Cartier, Harry Winston and Van Cleef & Arpels.

Bringing Over 130 Years of Diamond Expertise to Modern Grading
Brought to you by
Bringing Over 130 Years of Diamond Expertise to Modern Grading

De Beers Institute of Diamonds provides the very best in diamond verification, education and diamond services.

Jewelers Mutual Marks a Major Milestone
MajorsMar 30, 2023
Jewelers Mutual Marks a Major Milestone

The jewelry industry insurer and solutions provider is celebrating 110 years in business this month.

NRF Says Brick-and-Mortar Stores Remain ‘Primary Point of Purchase’
SurveysMar 30, 2023
NRF Says Brick-and-Mortar Stores Remain ‘Primary Point of Purchase’

The statement came as the National Retail Federation released its retail sales forecast for 2023.

10.57-Carat Purplish Pink Diamond Expected to Sell for $35M+
AuctionsMar 29, 2023
10.57-Carat Purplish Pink Diamond Expected to Sell for $35M+

Sotheby’s will auction the diamond, which it says is “arguably the most significant pink diamond to ever appear at auction,” in June.

Blue Nile to Close Fulfillment Center, Lay Off Workers
MajorsMar 29, 2023
Blue Nile to Close Fulfillment Center, Lay Off Workers

The retailer, recently acquired by Signet Jewelers, will lay off 119 employees in July.

See All the New Patek Philippe Watches for 2023
WatchesMar 29, 2023
See All the New Patek Philippe Watches for 2023

The Swiss watchmaker introduced 17 new models at Watches & Wonders Geneva.

Mark Henry Jewelry Offering Complimentary ‘Masterclass’ on Sales from Peter Smith
MajorsMar 29, 2023
Mark Henry Jewelry Offering Complimentary ‘Masterclass’ on Sales from Peter Smith

As part of the promotion, Smith will share his sales expertise during a 90-minute training session.

I’m Enchanted With Parmigiani Fleurier’s Perfect Travel Watch
EditorsMar 28, 2023
I’m Enchanted With Parmigiani Fleurier’s Perfect Travel Watch

At Watches & Wonders, the Swiss brand unveiled a follow-up to last year’s Tonda PF GMT Rattrapante.

Helzberg’s New Lab-Grown Diamond Collection Earns SCS Certification
CollectionsMar 28, 2023
Helzberg’s New Lab-Grown Diamond Collection Earns SCS Certification

The “rêve” collection’s engagement rings and wedding bands are geared toward “sustainability minded customers.”

This New Rolex Day-Date Tells Time … and Affirmations
EditorsMar 28, 2023
This New Rolex Day-Date Tells Time … and Affirmations

A new word appears on the dial each day of the week.

D.C. Jeweler That Honored 50-Year-Old Gift Certificate Closes
IndependentsMar 28, 2023
D.C. Jeweler That Honored 50-Year-Old Gift Certificate Closes

Bensons Jewelers closed for good Feb. 24, impacted in part by the decline in foot traffic downtown since the onset of the pandemic.

Swarovski Names New GM of North America
MajorsMar 28, 2023
Swarovski Names New GM of North America

Kolja Kiofsky has been with the crystal and jewelry company since 2010.

Jewels to Shine in Upcoming ‘Golden Age’ of Hollywood Auction
AuctionsMar 27, 2023
Jewels to Shine in Upcoming ‘Golden Age’ of Hollywood Auction

The Kruse GWS Auctions sale will include the replica “Taj Mahal” necklace Elizabeth Taylor made with Avon as well as a costume piece Marilyn Monroe wore.

Pandora Promotes GM to Chief of Retail Operations
MajorsMar 27, 2023
Pandora Promotes GM to Chief of Retail Operations

Massimo Basei is moving up, while Chief Commercial Officer Martino Pessina is stepping down.

Registration Is Open for the HardRock Summit
Events & AwardsMar 27, 2023
Registration Is Open for the HardRock Summit

AGTA GemFair and the Denver Gem & Mineral Show also will have a presence on the show floor.

Piece of the Week: The $5.8M Patek Philippe ‘Sky Moon Tourbillon’
AuctionsMar 24, 2023
Piece of the Week: The $5.8M Patek Philippe ‘Sky Moon Tourbillon’

Sold by Christie’s Hong Kong, this masterwork of complications now holds the record for most expensive watch ever auctioned online.

Movado Predicts Declining Sales Amid ‘Volatile’ Retail Environment
FinancialsMar 24, 2023
Movado Predicts Declining Sales Amid ‘Volatile’ Retail Environment

The watch company expects first-quarter sales to fall as much as 15 percent due to inflation and tough comps.

Lightbox Promotes General Manager to COO
Lab-GrownMar 24, 2023
Lightbox Promotes General Manager to COO

Adam O’Grady, general manager of the Lightbox Lab, has taken on the new role and will report directly to Lightbox CEO Antoine Borde.

Which Brands Do Watch Enthusiasts Love Most? Chrono24 Takes a Look
WatchesMar 23, 2023
Which Brands Do Watch Enthusiasts Love Most? Chrono24 Takes a Look

The watch marketplace gathered data from 1.3 million collectors, highlighting the most popular timepieces and exploring value appreciation.

Burgundy Diamond Backing Out of Ellendale Mine Deal
SourcingMar 23, 2023
Burgundy Diamond Backing Out of Ellendale Mine Deal

Burgundy has opted not to exercise its option to buy the mining claims Gibb River Diamonds currently owns.

×

This site uses cookies to give you the best online experience. By continuing to use & browse this site, we assume you agree to our Privacy Policy