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By Dina ElBoghdady
Washington Post Staff Writer
Thursday, January 1, 2004; Page E01

Joseph L. Schlussel, a diamond wholesaler in New York, thinks a one-on-one relationship is important in diamond sales, but he is hedging his bets. His site, Diamondregistry.com, designed for selling to diamond dealers and brick-and-mortar jewelers, now also sells to individuals.

Schlussel says he does not want to compete with his retailers, but he points out that the traditional diamond pipeline has sprung leaks. In the past, DeBeers, the mining and marketing company that controls about 60 percent of the rough-diamond market, would sell diamonds to about 200 dealers, who would redistribute them to cutters. The cutters sent them to wholesalers, who then would then sell them to retailers, Schlussel said.

But now DeBeers has opened stores in London and Tokyo, selling polished diamonds, and wholesalers like himself have launched retail sites, Schlussel said. Even Wal-Mart Stores Inc. and Costco Wholesale Corp. now sell diamond rings — and sell them online. “I don’t want to throw away business,” he said. The appeal appears strongest for men, most of whom feel uncomfortable in jewelry stores because they don’t understand diamonds, Blue Nile’s Baird said. “They feel that asking questions exposes their ignorance, leaving them at the mercy of commission-driven salespeople.”

Perhaps that’s why 45 percent of men buy a diamond without research, Baird said. “They buy the first thing they get their hands on and afterwards they’re, like, ‘Wow, did I spend too much?’ “

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