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Dispelling the myths and misconceptions about jewellery valuations

RIKKI MCANDREW explores how jewellery valuations have evolved over time and what jewellers and consumers can expect from a modern valuation.

As with most industries, jewellery valuation has been affected by the advances in technology in recent years and valuers have had to learn a host of new skills – to the benefit of jewellers and their customers alike.

In days now long gone, producing valuations was a very different proposition. We didn’t have access to the technology we do today – including computers and digital cameras – so many older valuations are simply written documents without images.

What’s more, the descriptions in these older valuations often lack detail, leaving too much room for misinterpretation and guesswork.

The terminology used could be quite confusing to the layman, if not the trade; an old valuation might include a diamond colour described as ‘Jager’, ‘river’, ‘(top) Wesselton’ or ‘(top) cape’, rather than the alphabetical system in use today.

However, since the foundation of the National Council of Jewellery Valuers (NCJV), a system of standardisation is in place and continuously being improved.

Valuations of the same piece by different valuers almost certainly won’t have the same dollar value.

All jewellery valuations today must have a photograph and a full description, including weights and measurements – which are also frequently missing from old valuations!

In terms of implementing these standards, the NCJV was the first jewellery valuer organisation in the world to develop its own accredited valuer course.

Valuations are a critical source of information when it comes to identifying lost and stolen jewellery, especially when there is a dispute of provenance or ownership, or a police investigation.

It is hard to argue against anything unique to an item such as a hallmark, an engraving, a chip, or anything else that the valuer observes and notes in the valuation.

Of course, while valuations have come a long way, there are still limitations; for example, a set diamond can’t be graded higher than a G colour, therefore it may be necessary to remove the diamond for a more accurate grading as this could significantly impact the value of the overall piece.

For this reason, it is necessary to educate consumers on this point and advocate for it to be done routinely.

As retailers are often the ‘middleman’ between consumers and valuers, the trade should also take these factors into account when advising their customers.

There are a few other misconceptions that aren’t immediately obvious, but should be.

Firstly, a valuer can’t simply look at a piece of jewellery and give a dollar value – nor can a professional valuation determine a piece’s previous retail value or its guaranteed second-hand/resale value.

Valuations act as a reliable source of information which can then be interpreted as the basis for determining a second-hand value. Put simply, a seller must know and understand the market for the piece; the valuation simply tells them exactly what it is they are selling!

A retail price can then be developed that includes a standard mark-up – something that is not taken into account in a valuation.

Valuations of the same piece by different valuers almost certainly won’t have the same dollar value.

Another important point is that valuers rarely have an advertised price list. One of the main reasons for this is variation – each valuation is unique, and while an average valuation takes one hour to complete, some can take eight hours or more!

For more complex valuations, a piece of jewellery may also need to be shown to other valuers, wholesalers or antiques dealers for a second opinion.

As a result, the NCJV does not monitor prices nor recommend a price range to its registered valuers.

Still, it’s a question often asked, by jewellers and consumers alike: how much should a valuation cost? It’s similar to asking, how long is a piece of string?

When developing their price structure, valuers will take into account the cost of purchasing and maintaining their gemmological equipment, indemnity insurance, continuing professional development, subscriptions to price guides and sales realisations, and NCJV membership fees.

NCJV-registered valuers are professionally trained, and they deal in facts, not hopes or wishes. At the end of the day, the valuer signs a document which can be admitted to court; they can’t take into account what the client believes to be true, or what they were told when they bought a jewellery piece.

There are still some in the jewellery industry who lack knowledge or experience with valuations, and this is where problems regularly arise. But there is no excuse for ignorance – and that’s what jewellery valuations are designed to prevent.

Name: Rikki McAndrew FGAA Dip DT
Company: McAndrew Jewellery, and Australian Jewellery Valuers
Position: Director
Location: Melbourne, VIC
Years in Industry: 48

 

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