Ban jewellery valuations!
By Coleby Nicholson
How can a new diamond ring be purchased today for, say, $700 be valued tomorrow for $4,000? Valuations for new jewellery are nonsense, argues Coleby Nicholson.
I was once told that Australian men spend up to nine months researching and choosing a watch before they buy because they want a watch to last a long time. Obviously that’s when purchasing a quality watch rather than an everyday model, but I can relate to that.
Being a guy, I don’t care too much for shopping. It’s something I have to do, rather than something I enjoy doing and, for example, I would rather buy four pairs of pants at once than go shopping four separate times.
In recent weeks, I have found the time to make some purchases I had been planning for quite a while but hadn’t yet gotten around to making. I bought a car, some home entertainment equipment and a small piece of furniture.
The interesting thing is that I was not given a valuation certificate for any of these items. As a joke, I asked the car salesman if he could give me a valuation certificate for “retail replacement” purposes. Have you ever seen a car salesman lost for words?
Why is it that jewellery is the only everyday consumer product that is sold with a valuation certificate? I mean, a watch is not sold with a “val”, nor is a TV or furniture.
A house does not come with a valuation certificate – and on my last look, houses cost a lot of money. Presumably, houses do not need valuation certificates because the valuation is considered to be the price paid on the day. But that’s another issue.
For some reason, some (not all) jewellery is promoted and advertised with valuation certificates. It’s common to see vals for diamond rings but why do you never see a $400 opal sold with a valuation certificate saying, “Valued at $4,000”?
This practice should be banned. In fact, it should be outlawed – it’s a rort and a con. Now, before my valuer-colleagues start jumping up-and-down and issuing fatwahs, let me say that I have no problem with valuation certificates. They serve a useful purpose when they are used legitimately – people need to be able to prove to an insurance company that they owned something and there needs to be a description of that item so it can be replaced – but how can something that was purchased for $400 have a value of $4,000?
Indeed, how can something be valued today for a loss some time in the future when the prices of gold and diamonds fluctuate? To try and value something today that might be lost in five years time is nonsense because some things appreciate in value and others don’t.
Of course, that’s not how and why many valuations are being used – they are often being illegitimately used to suggest that a consumer is getting a “steal” by purchasing a $10,000 diamond ring for $1,000. Unfortunately, the only thing being “stolen” is the industry’s reputation. If something sounds to good to be true ... !
I believe that valuations certificates should be banned at the point of purchase.
No jewellery should be promoted or sold with a val; it should be the responsibility of the person who purchases the item to obtain a certificate for proof of ownership. Further, the certificate should be obtained from an independent, third party, not from the person who sold the item. The certificate should have an accurate description of the product and should not be recognised unless it has an attached receipt of sale showing the price when purchased.
It should be illegal for anyone to promote the sale of a product using a valuation certificate that identifies a price. And that’s another thing; have you ever seen a valuation certificate that shows a price less than the purchase price? That, alone, should set the alarm bells ringing! Did I mention it’s a rort and a con?
It’s the retailer’s responsibility to offer and sell a product at a fair price. What happens after that has nothing to do with the retailer and that’s why valuation certificates should not be used at the point of sale and the practice should be outlawed.
Posted August 27, 2009