I am going back to Sierra Leone on the 25th of this month. I have two companies that have hired me to source rough diamonds for them. I am working with one group, immediately followed by the second group. The second group, is experienced in many countries in Africa and understand all that is involved. They know you have to have a diamond dealer’s license (buyer’s license), they know how to do the banking, they recognize that my security is sound and they know they have to get out of Freetown to buy well.
The first group is entering upon a new venture. They own a mining company for a different mineral, not diamond, but after extensive research, they wish to develop a business in rough diamonds. Because of their experience in international business, they too have overcome the banking issues and understand from their and my experience the best way to succeed. Because they have never done this before, they are relying on me to make sure everything is verified and verified again. They know the risks, and have the courage to engage in a new business.
Both of these companies are run by educated men with international experience. They understand business, and the associated risks. They also understand how to minimize those risks to have the highest chance of success. Herein lies the difference between most rough diamond buyers and rough diamond suppliers.
Yesterday, an unknown supplier wrote to me on LinkedIn. He informs me he is a miner and has rough diamonds for sale. He offers me a commission to bring him a “real” buyer. I wrote back and told him I cannot recommend my clients deal with him because I have no idea if he is legitimate and I have no idea if the diamonds he purports to have are of value. I ask him: how can you expect me to bring a customer to you in Africa without this knowledge? The buyer has to pay all my fees, his and my travel, hotel, meals, transportation, and other costs all in the hope that when we get there, you have diamonds and they are of value.
Today he wrote me back and told me I will make money when my customer buys the diamonds. Not a word about the expenses to my customer. Not a word to prove to me he is real. No proof he has diamonds, nothing. If this happened to me once or twice, I would write it off to this particular individual not having a business education. Unfortunately, this is the response I receive, with minor variations repeatedly from African suppliers.
I have told African suppliers that unless you remove as much risk as possible for the buyer and the seller, you have little chance of success in doing business with genuine buyers. My buyers are willing to go to Africa and take the risks, but they rely upon me to make it successful. Do African sellers ever call me and offer to prove up at their own expense? Do African sellers ever offer to share the costs with the buyer? Do African sellers ever offer to help with the banking and the safe transportation of the diamonds?
I am not saying all African suppliers are unable to work with real buyers. After all, I am already working with some great African suppliers. But these guys are business men and act and have the necessary knowledge and skills to work with customers successfully.
If you are an African supplier, and you are having a difficult time bringing in new customers, then you have two choices: Learn how to do your business where new clients will feel secure, or hire a rough diamond gemologist who already has the knowledge, skills and customers you need.
Louis Pearl G.G.
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