Clarify Your Merchandise

Establishing consumer trust is the cornerstone of success in the jewelry business. This includes fully disclosing all synthetics, simulants and treated stones within your inventory. Not only is such disclosure the key to earning customer confidence, but the Federal Trade Commission (FTC) requires it.

Label Your Merchandise

It is critical to label your inventory to avoid staff confusion and ensure that consumers have complete understanding of what they are buying.

  • Organize merchandise according to logical product categories and themes
  • Tag all merchandise with correct prices
  • Ensure that products are clearly described on all signage and other in-store materials

These steps are particularly important if you sell treated or synthetic stones. It is always best to group and label synthetics and treated stones separately, lest your salespeople mistakenly sell them as natural, untreated diamonds.

Disclose, Disclose, Disclose

Disclosing synthetics, simulants and treated diamonds, isn't just an ethical business practice - it's the law. If you are found selling such products without proper disclosure, the FTC can bring enforcement actions against you for deceptive business practices.

The FTC guidelines for the Jewelry Industry protect consumers by disclosing diamond and gemstone treatments. They also define tolerances for precious metal content and the proper language to fairly and accurately promote products. The World Jewellery Confederation (CIBJO) through the "Blue Book" also outlines international classifications and ethical standards for colored gemstones, diamonds and pearls. Both the FTC and CIBJO guidelines require that all treatments be disclosed. Disclosure should include elements such as:

  • Is the treatment permanent or non-permanent?
  • Does the treatment require special care?
  • Does the treatment significantly affect the stone's value?

The Jewelers Vigilance Committee's (JVC) Retailer's Legal Handbook states that if a gemstone treatment is not permanent or creates special care requirements, it should be disclosed to customers. This includes coating, impregnation, irradiation and heating, as well as nuclear bombardment, surface diffusion or dyeing. Any treatment that significantly affects the value of a gemstone, such as laser drilling or fracture filling, should also be disclosed.

While heating and irradiation are normally permanent treatments and require no special care, JVC recommends disclosing them anyway. You also should disclose applications of colored or colorless oil or epoxy-like resins, wax, plastic or glass.

Before the sale, your associates must explain exactly how the stone was treated and any special care instructions it may require. For stones sold through direct mail or online, disclosure and care requirements should be part of the solicitation.

Train Your Salespeople on Treatments and Disclosure

It is vital that your salespeople be fully trained on disclosure requirements, including the differences between diamonds, treated stones, simulants and synthetics.

Here are some key concepts that salespeople must understand:

  • Diamond – A diamond formed by nature without human intervention.
  • Treated Diamond – A diamond that has been subjected to one of several processes to alter its color and clarity. Such processes include: Laser Drilling to minimize the effect of inclusions; Fracture Filling of cracks and drill holes with non-diamond substances; Irradiation to change color and produce so-called “fancy-colored” diamonds; and High-Pressure High-Temperature, which change a stone's color.
  • Simulant – Any natural or manmade product produced to resemble a diamond, such as Cubic Zirconia and Moissanite.
  • Synthetic - A product that has been crystallized by artificial or human intervention. These stones can be identified easily by examining their growth structures with the right equipment.

Access to Proper Detection Equipment

A gemological laboratory can easily detect synthetics, treatments and simulants. If you are unsure whether a stone is natural, submit it to a reputable laboratory for testing to protect your reputation and your customers. It's also a good idea to periodically test random stock to be certain you are getting what you paid for. There is a range of detection devices available from industry suppliers for use in your store.

For more information on FTC disclosure guidelines, please visit http://www.ftc.gov/bcp/guides/jewel-gd.shtm

To obtain a Sales Associate Training Guide from the Jewelers Vigilance Committee, please visit http://www.jvclegal.org/

For more information on the CIBJO Blue Book, please visit http://www.cibjo.org

Summary

  • Full disclosure of all merchandise isn't just good business, it's the law.
  • Accurate labeling of inventory is critical to ensuring that your customers know what they are buying, and that your staff knows what it is selling.
  • Make certain your staff is familiar with the types of simulants, synthetics or treatments, each of which must be disclosed to customers before a sale using accurate terminology.
  • Use detection equipment and laboratories to confirm that your diamond jewelry is exactly what you purchased. Investigate any suspicious gemstone and initiate random checks to confirm your inventory.

Disclosing gemstone treatments and synthetics isn't just an ethical business practice – it's the law.


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