2007

What is More Profitable: Diamonds or Moissanite?

March 2007

Their market share may be going down, but the Diamond Trading Company, the diamond marketing arm of the De Beers Group of companies, posted sales figures of US$ 6.15 billion for the year 2006 – its second highest performance on record, although it was dealing with diminished intake from Russia. Its net profits were $732 million, a 26% increase. So basically over 10% of their sales were profits.

However, a financial report from Charles and Covard, manufacturers of synthetic moissanite, found that its net income for the fourth quarter increased to $1.3 million, off of $12.1 million in sales. So they also have a profit margin of over 10%.

It is worth noting that the gross profit from manufacturing moissanite is $9.28 million. Their largest expense — $6.2 million — comes from marketing and sales. Unlike diamonds, moissanite is cheap to produce. Getting people to buy it costs a lot more.