How to Buy Diamonds in Hong Kong
How to Buy Diamonds in Hong Kong
Posted by Sharif Khan on 28th Aug 2021
It is almost impossible to discuss diamonds in Hong Kong without mentioning DFHK, an acronym for the Diamond Federation of Hong Kong. Its primary role is to protect diamond buyers and sellers from dishonest business practices. The federation has a regulatory framework that ensures that you get value for your money each time. With such a robust system in place, shopping for diamonds in Hong Kong is always fulfilling.
As your safe pair of hands, this organization aims to foster better business practices. To do so, it standardizes all business activities, including those touching on the jewelry trade. However, DFHK is not the only association that works in the interest of diamond shoppers; we have other concerned state authorities.
Collectively, these associations work to maintain the reputation of Hong Kong as the World Diamond Center. Though they serve both sellers and buyers, they tend to be more inclined towards consumers, which is good news to anyone who wants to buy diamonds in Hong Kong. Having a functional consumer protection body is the first step in fostering ethical business practices.
How Does DFHK Protect Consumers?
First off, DFHK works with a scheme known as the Integrity Pledge Scheme., which must be followed by all diamond traders that are members of this association. The program aims at protecting the professional and ethical image of the diamond trade. Under this scheme, a trader must give an undertaking that their business practices will always be above board. The traders should make this commitment in word and demonstrate it in action.
For instance, the scheme mandates members to give a factual description of their sales. Such a report should appear in the sales invoices and applies to purchases above 0.3 carats. Therefore, when buying diamonds in Hong Kong, it is safer that you deal with a duly-enlisted DFHK member. It is the only way you can buy freely without the nagging concerns of getting duped.
Another way DFHK protects consumers is by regulating diamond quality. Diamond quality has always been a contentious issue, especially for lab-grown diamonds, which is why there has always been a need for a proper grading system. But even with adequate grading systems in place, some sellers have still managed to game the system. In light of these developments, the DFHK furthered a Natural Diamond Quality-Assurance Mark [NDQAM]. With the NDQAM mark, you are sure every diamond you buy is of top quality.
Apart from these two major roles, DFHK plays many other consumer-facing roles. For instance, it strives to educate consumers on the mandate of the Trade Description Ordinance. One such area, among others, is emphasizing that the term "diamond" implies "natural diamond." As a buyer, you can presume every jewelry packaged as "diamond" to be a natural diamond, which also means that the diamond should be conflict-free.
With all these measures, shopping for diamonds in Hong Kong should be a hassle-free experience. Regardless of the color, carat weight, or clarity you are looking for, DFHK has your back. From simple diamond shapes to glamorous cuts, quality assurance is guaranteed.
Why Shop for Diamonds in Hong Kong?
Hong Kong is arguably the Diamond Center of Asia--several reasons have earned the region this tag.
First, and as already seen, Hong Kong has serious consumer protection authorities in place. Diamond buyers troop into the port from as far as Australia and Europe due to the assurance that their consumer rights will be guaranteed. Both the government and independent institutions guarantee consumer protection. We have already highlighted the role of independent organizations like the DFHK. If you find it easier to trust the government, there are numerous agencies you can check out, such as the Customs and Excise Department and the Hong Kong Tourism Board. Other agencies include the Diamond Federation of Hong Kong and the Consumer Council.
Another benefit of shopping for diamonds in Hong Kong is its robust infrastructure. A notable mention is the transport network linking Hong Kong to the vast China market. Besides, there is also a free port. With such a broad market and attractive trade incentives, Hong Kong became a favorite destination for diamond traders, which led to massive competition among the sellers--the outcome was a very competitive diamond industry. As a buyer, you can leverage this competition to get quality diamonds at reasonable prices.
Hong Kong is also the region with the highest rate of jewelry-aware shoppers. According to this article, Hong Kong registered the highest number of women buying diamonds for themselves in 2016. At 55%, it was way higher than other global markets like the US, China, and India. Such figures imply that there is something desirable about shopping for diamonds here.
If you are looking for ethical business practices, look no further than Hong Kong, where most diamond traders are service-oriented. To them, integrity matters more than the mere profit motive. Indeed, commerce is mainly a cultural affair among these traders. It also has to do with the robust regulations in place.
You might also look to Hong Kong for high-end diamond quality and variety. Excellent quality and exceptional craft characterize most jewelry dealers here, and given that it is Asia's diamond trading hub, you can get a diverse range of the gem. Any diamond engagement ring you can think of is available here.
Lastly, you get value for your money each time you shop for diamonds in Hong Kong because it is a tax-free port.
Additionally, there is no VAT or sales tax. Such favorable tax policies mean that the diamond you buy comes with almost no markup. Also, since there are fewer taxation procedures, it is easier to import and export diamonds. Therefore, each one of the incentives as mentioned above bears positively on the average diamond buyer.
But Hong Kong has not always been Asia's preferred diamond trading center. Its journey towards becoming a diamond trading hub started in the 1950s when the region began developing as a critical economic center. Visitors from the West and Japan spurred economic growth in the area. They favored Hong Kong due to its trade policies and a mildly capitalistic tendency. It is noteworthy that China was a major communist country at the time, and therefore, trading in merchandise like jewelry was not lucrative. Besides, cheap labor was also readily available in Hong Kong.
With time, many international corporations set up their bases in the region. Trade shifted from low-cost and basic items to high-end jewelry. In 1959, local traders formed a non-profit association known as the Diamond Importers Association. Much like the DFHK, the DIA endeavored to promote the region as a diamond hub.
China was the first to tap into Hong Kong's rising status as a diamond center. It established industrial zones around its border with Hong Kong, which spurred economic growth even further. In 1985, diamond traders established another regulator, the Hong Kong Diamond Bourse. When the UK finally transferred Hong Kong's sovereignty to China in 1997, diamond polishing shifted from Hong Kong to China. It dealt a considerable blow to the port's economy as diamond manufacturing moved to mainland China. The diamond industry in Hong Kong appeared to be on its deathbed. However, things changed when the DFHK came into existence around the 2000s.
Today, Hong Kong prides itself as the world's largest diamond re-exporter center. As we have already explained, it is mainly due to the region's low taxation and free trade. Hong Kong now boasts the world's busiest jewelry trade fairs, such as the Hong Kong International Jewellery Show and the Hong Kong Jewellery & Gem Fair. As of December 2014, Hong Kong had over 400 diamond manufacturing companies.
Large diamond auctions also contributed to Hong Kong's popularity as a diamond center, a notable mention being the Star of China‘s auction. The 75.36 D/IF Briolette diamond went for $11.15 million to an Asian collector. Another big sale was a D/FL Oval-shaped diamond weighing 118.28 carat, which went for $30.6 million. These auctions were world record breakers in their rights. You can check here for more record breakers.
Popular Places to Buy Diamonds in Hong Kong
The most popular place to buy diamonds in Hong Kong is the Kowloon. Located along Nathan Road, Kowloon is also known as the Golden Mile due to the wide assortment of jewelry you can find here. It is the only place in Hong Kong where you can find many jewelry shops crammed into a small area. Furthermore, you will get big jewelry companies like Chow Tai Fook.
As the most prominent jewelry company in Asia, Chow Tai Fook has at least a dozen shops in Kowloon. Across Asia, this company boasts over 1000 retail outlets. Chow Tai Fook is famous not only among locals but tourists as well. This results in noticeable drawbacks like overcrowding and substantial price variations. According to anecdotal reports, diamonds in Chow Tai Fook are up to 40% costlier than in other reputable companies, which also applies to most diamond shops in Kowloon. Apart from Chow Tai Fook, many other big jewelry shops are located in Kowloon, including Luk Fook, Tse Sui Luen Jewel, Chow Sang Sang, and Prince Diamonds.
One advantage of shopping at any of these shops is that they are well-spread across Hong Kong. Hence, instead of visiting Nathan Road, you can always shop at a store near you. But it could be a possibility that you do not love the vibe of large diamond stores. Do not worry because Hong Kong also boasts many smaller independent jewelry outlets.
However, be wary of such outlets, especially those that are only starting up. Independent outlets offer a personalized and undeniable shopping experience. However, some of them are not very reputed like their established counterparts. Thus, it is harder to get a refund from smaller diamond outlets than in more established stores. Also, remember that most of these small stores may be struggling to stay afloat. As such, they could opt to deal in diamonds graded by shady laboratories. Worse, these independent stores may not offer diamonds from renowned brands. Therefore, if you are looking for the best experience shopping on branded diamonds, insist on a well-reputed store.
Apart from Kowloon on Nathan Road, another famous diamond trading center is in Causeway Bay, located on Hennessy Road. Compared to Kowloon, Causeway Bay has fewer jewelry outlets, though visitors prefer it for its diverse shopping experience. Besides diamonds and other jewelry, you can also shop for souvenirs and food. Hence, it is your go-to center if you are looking to spend your entire day shopping in the same spot. One significant drawback of Causeway Bay is the limited variety of diamonds. Since jewelry shops are fewer here, you are likely to pay higher than usual for a diamond. However, you get a more personalized shopping experience compared to Kowloon.
Lastly, we have Central on Queen's Road that shoppers love for its calm and relaxing vibes. It is an ideal place to shop for diamonds if you prefer a quiet shopping experience. You will hardly experience pressure selling at Central in Queen's Road. As you may expect, it comes with an extra advantage of the clarity of thought. The center also hosts more business people than tourists, meaning diamond sellers are not capitalizing on the massive influx of tourists. Therefore, you are more likely to get better bargains here than in Kowloon or Causeway Bay. The only challenge is that the shops are not very close to each other, and so you may require some time to get from one shop to another. It can either be a plus or a drawback, depending on how you look at it.
The Best Tips on How to Buy Diamonds in Hong Kong
Jewelry crime statistics are lower in Hong Kong than in other major world trading centers. However, it does not mean that the port is entirely safe. Buyers and store owners have fallen victim to robberies from time to time. One such theft left a trader HK $1.56 million poorer. When criminals come calling, they find shoppers easy prey because it is easier to waylay a shopper in the backstreet areas with low-security surveillance. Therefore, we recommend buying all your diamonds in Hong Kong online: from pendants to bracelets and earrings, you will always find a reputable online dealer.
But should you prefer to shop at a brick-and-mortar store, there are a few precautions to take. First, arm yourself with some background information, mostly touching on the quality of the gem. Ensure that you fully understand the Four Cs and how they determine diamond quality. You may have limited knowledge here, but you do not need to fret as you can always enlist the services of a jewelry consultant.
A jewelry consultant will charge you a small fee depending on a few factors, though the most important one is the amount of information you require. For instance, the price could be lower if you only need assistance verifying the grading certifications. On the other hand, you will be paying more if you require services across the entire spectrum. Such services include determining all the Four Cs, locating a reputable store, and even diamond appraisals.
When sourcing for a diamond consultant, insist on those who work independently. Some stores may have in-house consultants. It saves you the time you would otherwise spend trying to locate a consultant. However, in-house consultants may offer unfair diamond appraisals, which they usually do for their employers' kickbacks. Besides, they will almost always recommend the stores where they work. Another thing to avoid is consultants that charge based on the value of the diamond you wish to buy.
Once you have all the information you need, visit the stores at the right time. Many tourists visit Hong Kong between October and December because the weather is most favorable around this time. If you are keen on saving a few bucks, these are not the best months to shop for diamonds in Hong Kong. If you are a tourist, you may travel to the port around the same time. So, it is a catch-22 right there.
For locals, any time is excellent as long as they prepare themselves adequately. Busy shopping centers like Kowloon offer variety, although traders here are also known for pressure selling. You will notice them by their cliches and hard selling tactics. For instance, why would a seller claim that "this is the right diamond for you"? Why you and not the next customer, you may wonder? In such cases, you must not get too excited to make a hasty decision. Instead, weigh your options and compare offers across several shops. After ascertaining the quality and price, now proceed to make your purchase. While at it, ensure that the diamond comes with proper certification. If in doubt, look out for GIA diamonds.
Are There Benefits to Buying Diamonds Online in Hong Kong?
It is easier to buy diamonds online in Hong Kong. Besides, it is also cheaper to shop online than in physical diamond outlets. You get a wide variety of jewelry, all in one place. The best part is that comparing prices online is easier because there is no pressure to sell, and you can shop at your own pace.
After locating a reputable store, proceed to their displays and thoroughly sample their offers. Try to hunker down on your preferred jewelry. While you do so, do not shy away from asking critical questions: Does the store offer refunds? What is their shipping policy?
After doing your due diligence, proceed to the next store and compare prices. Try to settle on a store that ticks all the boxes and then place your order.
Buying diamonds in Hong Kong is an experience like no other. With lots of diamond centers at your disposal, you will always find fair bargains. However, we would recommend shopping for all your diamonds online. There, you do not only get variety, but by buying online from a reputable store, you also save up to 30% on the diamond.