If you forgot to buy your loved one a birthday present and spent a week sleeping on the sofa, eating canned food, and cleaning out the cat box, you now have a chance to redeem yourself.
A revolutionary new website exists called Mazal Diamond, which promises to turn the online jewelry business upside down. I went to the privately held company’s website at http://www.mazaldiamond.com and found an entertaining assortment of free tools.
You can design your own jewelry, and even order a custom cut, which Mazal will supply out of their massive 100,000 stone inventory. You can also figure out if the jeweler down the street is trying to rip you off.
Just for fun, I appraised the diamond I bought for my late wife, which I bought from a Hasidic Jew in an alley off of Manhattan’s West 47th street. He kept his inventory hidden in an envelope in his sock. How times have changed! The two carat, VVS1, round cut, yellow diamond that I paid $3,000 for in 1977, would fetch $39,800 today. Great trade!
Mazal Diamond’s game changing advantage is that they cut, design, and manufacture their own jewelry, enabling them to undercut prices offered by established industry leaders. In fact, the $30 billion a year diamond industry is undergoing radical change by moving online, much the same way as the book, music and travel industry have gone. Your local neighborhood jewelry store is about to get wiped out or become a quaint relic.
Blue Nile (NILE) pioneered the way and instantly became the 800-pound gorilla. The company cut costs by keeping inventories low, relying instead on a secretive web of anonymous suppliers.
Now, second generation entrants are snapping at its heels and eating its lunch with polished websites, better service, and lower prices, seducing potential customers with free diamond blogs. Mazal Diamond even offers a year of free insurance.
They are getting a boost from a 30% price gain a woman’s best friend has seen since the March, 2009 stock market bottom, taking them back to pre crash levels.
The US accounts for about half the world market, so the new frugality will be a challenge. That will be offset by flight to safety purchases by inflation wary Americans and new demand from the emerging market middle class.
Investment grade diamonds have been steady earners, gaining an average 5% a year over the last three decades. To avoid another week on the sofa, you might even think about buying next year’s Valentine’s surprise early.