In the Gemstone & Jewellery business, there seems to be a lot of confusion over many terms. In many areas of the business there isn’t enough clarification, standardization, consensus, as it’s all the opinion of thousands of small dealers coming together to come to a conclusion about a topic. 

Today, we will clear for you readers, the true, really true definition of “Wholesale Gemstones”. 

Is it buying wholesale from a dealer and selling online at “wholesale” prices? Is it buying from a factory and selling to wholesalers in your country? Or what is it? Actually it depends on who you are. If you are a jeweller, wholeseller, manufacturer, or an individual consumer, the definition can change accordingly, but you are not getting the true wholesale prices online, on any website, unless it’s a B2B password protected website.

For sure the true definition in 2024 is buying from a factory. Most manufacturers of Loose gemstones position themselves to sell to wholesalers and also jewellers around the world, depending on how they see themselves in the Jewelry cycle. If you are a mass jewellery manufacturer that buys parcels, lots and productions, then you will eventually buy from a manufacturer based on the location where it is produced depending on your size, shape and quality requirements, unless you have lucrative terms and conditions for your buying habits. In the case of Gems; Thailand, India, or Srilanka produce most of the Loose gems; at least the cutting part.  

Why should you buy from a factory?

In 2024, as we speak US elections just finished with a strong market sentiment but profits have shrunk as most people try to source directly from the place it’s being made. The whole cycle has been disturbed it seems but there is always a silent cycle that fundamentally makes sense, if you think of it from a business point of view.

Buying wholesale today means buying a production, if someone isn’t doing that from a factory then they aren’t buying wholesale, they are buying partially retail. If they are selecting from a manufacturer’s production, then that is partially wholesale and this may mean that they are paying prices that are not wholesale or retail or if they are lucky to pay prices that are truly wholesale, the manufacturer is making a mistake by not developing a cycle. This is what we referred to as “cycle has been disturbed” since covid where most gemstone suppliers working with loose gems are struggling to make their space in the cycle due to the business model being misunderstood and internet/online market places offering a lot more to the public (retail) than needed.

Let us now take you back to 1995, the reason we take you back here is that’s the year when we got into production of topaz. Black and white Bangkok; Navneet was 5 and Shubham was just born, the way things work there is the true definition of traditional wholesale that still exists in many businesses. Mr Suresh would buy rough from Brazil and Nigeria and make the whole white topaz production there with approximately 20,000 carats of finished Sky blue topaz (radiation treated) and ready to be sold to a dealer in Bangkok at a very nominal profit. The dealer who bought these 20,000 carats would sell 500-2000 cts at a time, this time could be per customer per month or per customer per week; regardless the dealer would take at least 3 months to make profit from the 20,000 carats bought from Mr Suresh. Mr Suresh would repeat this process every month but since he had 5-7 customers every month, his goods would never stay in hand. His strength was production and was selling at low profits because he could rotate 10 or 12 times a year while the dealer would get more profits due to time and slower movement of products.

Back to 2024, Bangkok is competing itself with the auction prices of companies like Fura Gems, Gem Rock, Gemfields going up by the auction, not even the year. Now in this case the key is which company is making production nicely, optimized and selling at a price the other company cannot sell. How can you get more price; by doing a memo on Gemstones – yes RETAIL!