Here are three inquiries I’ve received this month through my website:
“I am interested in getting some of my jewelry appraised so that I can sell it.”
“I own a diamond ring and wish to sell it; first, an appraisal is needed.”
“I have a platinum and diamond wedding ring that I wish to have appraised for the purpose of selling it.”
Well, do you really need an appraisal? A central problem is: there is no one single value. No matter what you own, there is almost always more than one way to sell it: through private sale, garage/estate sale, consignment to a guy like me, or outright sale to someone in the business (who might be anything from a retail jewelry store to a pawnshop, with stops in between at small “hip-pocket” dealers or brokers). Even, sometimes, auction, live or online. Depending on which of these markets you enter and the time you allow them to work, the difference can certainly be double, maybe more.
Even within any one of these markets, a range of possible prices exists. Sales of some kinds of jewelry are too hard to document in some markets to yield an easy answer to the question, “what’s it worth?” A good appraiser will make intelligent adjustments for size and quality to the information about comparable items he or she can find and give the likely selling price of your item in as wide or narrow range as the data about the item dictate.
Think for a moment about how people actually price privately pre-owned (or just call it used) jewelry for sale, especially to another private individual. Needless to say, it is not a pure science. One factor is the occasional nature of selling most jewelry: one engagement ring per lifetime, or two or three at most. This influences how open to negotiating with your prospective buyer, a bird freshly flown in from the other one in the bush and about to alight near your hand, you will decide to be. In turn, we enter the subjective realm of sales psychology, which asks: when you quote a price, and you look at the jewelry itself sitting in front of you, what sounds about right for what you see? Remember that you’re not a store, or in a store, and your buyer knows that the item isn’t new. That’s his or her market comparison, so you’ve got to create a sense of better value than retail. At the same time, both of you might consider that you’re getting more than someone buying it for re-sale will pay. So when you think together collaboratively, what is the range in between? As seller, you also think about whether there is any money in the designer’s name, and if you can keep the dollars below a psychological threshold. (The old thing about $999.99.)
In the resale situation, some people want an appraisal document for Retail Replacement Value. This expression is drawn from the world of insurance. I have found that it is highly subject to doubt and confusion, at best, and, sometimes, contempt. These feelings may dictate the outcome if the appraisal is used as an opening gambit in a negotiation to set the proper re-sale market price for your jewelry item.
There was a jewelry consignment shop here in Oklahoma City a few years ago that worked this way, working with an appraiser (having no advertised appraisal training) who provided an insurance document. The shop simply cut the number in half to arrive at the price. Assuming no negotiating, why not just appraise item's value in that shop at that number, if it were the one for which it actually sold? And if that number was only a starting point, perhaps after style and condition resulted in too slow a sale, why not use the real selling price as the item's real value?
This means that utilizing Retail Replacement Value for re-sale appraisals is taking the long way home. Professional jewelry appraisal groups do not allow it, because they require us to learn how an appraisal document will be used; and then to present a value or range of values, that matches that use. We use such language as Marketable Cash Value for this use, defining the kinds of buyers and sellers (in other words, the type of market) and an estimate of the time required. Usually we must report a range of values for a particular market.
Sound too complicated? The way out is consultation, which I have described in detail elsewhere. This gives you an idea of the range of the most likely selling prices for your jewelry in different scenarios. We strategize together the best way for you to sell it. Virtually always, it's all you need to decide what's best for you to do. Over the years, I've helped hundreds of people with it. Please give me a call if you have any questions or want to make an appointment.
Posted on August 21, 2010
by Scott Gordon filed under