Helping a Large Diamond Wholesaler in NYC source the best value diamonds with the highest turn.
A large diamond wholesaler in NYC approached Liquid Diamonds when they were doing a bulk deal with a diamond manufacturer in India. They were looking for ways to reduce inventory cost and increase liquidity of their diamond inventory.
With over 6000+ diamonds of over 1 carat in the supplier's inventory file, the challenge was to identify the diamonds that offered the highest margin, and the diamonds that were turning the fastest in the markets that the client serves.
Best Value- We identified diamonds that offered the best value of money by comparing them to prices of similar diamonds available in the market. Our recommendation engine uses proprietary technology to enable comparison of diamonds apples-to-apples using 20+ parameters. We assigned an "LD Spec" value to each diamond in the market using not just the 4Cs, polish and symmetry but also measurements, position of the inclusions (center vs side), type of inclusions (Key To Symbols), shade and milky values. By doing a detailed comparison of each diamond in the supplier's inventory, we were able to identify the diamonds that offered the the highest "Bid/Ask Spread" i.e. the biggest margin.
Highest Turn - We also identified the diamonds that are turning the fastest in the markets that our client serves. We used our proprietary "Liquidity Meter" that incorporates categories of diamonds that are trending in the market using historical vs recent demand for each category as well as how much inventory is available in the market. In addition to market trends, we looked at how quickly our client is able to turn each category of diamond and how many items they have in each category to identify items with the highest potential turn
By identifying the best value and the highest turning items, we helped shortlist 150 stones out of 6000 stones with the highest potential GMROI i.e. profitability
By buying the right categories of diamonds, our client was able to increase their inventory turn by 29%. They were able to sell the items that they purchased in an average of 4.1 months instead of an average of 5.3 months for the rest of their inventory within the same period.
In addition, buying the best value items resulted in an increase in margin from 6.5% to 8.2%, representing a 26% increase in margin. Overall, the 29% increase in turn and 26% increase in margin resulted in an increase in GMROI from $1.15 to $1.24 representing a 64% increase in GMROI.
At Liquid Diamonds, we are proud to have helped our client achieve such impressive results and look forward to helping other diamond and jewelry businesses achieve similar success in the future. Our data-driven solutions can not only help with sourcing the right categories of diamonds, but also pricing inventory, sales recommendations and inventory analysis.
Our diamond vendors send us excel files with 1000s of stones in their inventory. We always find it cumbersome to go through large files. Liquid Diamonds helped reduce blind spots and spot opportunities that might otherwise be missed.
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