Online Diamond Tender vs Auction

The diamond industry, traditionally reliant on physical tenders, is now embracing digital solutions. Online diamond tenders allow sellers to showcase diamonds and buyers to bid securely from anywhere, maintaining transparency, trust, and efficiency.

BidMyStones bridges traditional tendering with modern technology to deliver a seamless global diamond trading experience.

What is a Diamond Tender?

In the diamond industry, a tender typically means a seller invites qualified buyers to submit sealed bids (or written offers) by a deadline. After the bidding window closes, the seller reviews the offers and awards the lot(s) to the winning bidder(s).
Key features:

• Bids submitted in a “quiet” or sealed fashion—bidders don’t see each other’s offers until results are published.

• Seller retains discretion: could accept the highest bid or reject all bids.

• Timeline is defined: upload of lots → bidder inspection period → bid submission deadline → award announcement.

Pros of tender

• Good control for the seller: pre-qualified buyers, fixed timeframe.

• For buyers: less visible competition during bidding, which can reduce bidding frenzy.

• Well suited for bulk lots or for producers who want stable, controlled sales.

Cons of tender

• Good control for the seller: pre-qualified buyers, fixed timeframe.

• For buyers: less visible competition during bidding, which can reduce bidding frenzy.

• Well suited for bulk lots or for producers who want stable, controlled sales.

What is a Diamond Auction?

An auction (particularly online or live) allows bidders to compete in real time (or near real time) for lots. The highest bidder wins (subject to any reserve price). In diamonds, this model is increasingly used for rough and special lots.
Key features:

• Transparent bidding where participants can observe competition (depending on format).

• Time-sensitive: once auction opens, bidding proceeds until close.

• Typically more dynamic, sometimes higher risk/higher reward for both buyer and seller.

Pros of auction

• Creates competitive pressure: bidders raise until closing—can drive higher prices for the seller.

• Good price discovery: reflects current market demand more directly.

• Accessible to a broader buyer base (depending on access rules) rather than only pre-qualified big clients.

Cons of auction

• For buyers: can get caught in bidding wars; risk of overpaying or buying without enough inspection.

• For sellers: possibility of low turnout or insufficient bids; price volatility.

• Requires strong platform, trustworthy inspection, and robust rules (especially for online auctions).

Comparison at a glance

Feature	Tender	Auction
Bid format	Sealed / written offers	Live or timed-bidding competition
Visibility of other bids	Low (hidden)	High (often visible)
Buyer control	Buyers bid “blind”	Buyers can see competition and react
Seller control	High (can pick or reject)	Less control once bidding begins
Price discovery	Moderate	Stronger market signalling
Risk/volatility	Lower for bidders	Higher potential upside + risk

How does this apply to rough & polished diamonds?

In the rough diamond sector, traditional fixed-price sales (“sights”) have gradually been supplemented or replaced by tenders and auctions. A study by Gemological Institute of America (GIA) notes that increasing use of tender/auction sales has led to more volatile rough diamond prices. GIA For polished diamonds or finished jewellery, auctions (especially for rare, named stones or investment‐grade gems) are a known channel.

Thus, when you’re sourcing or selling diamonds on a digital platform like BidMyStones, choosing the appropriate method—tender vs auction—will depend on your objective (control vs price discovery), your risk tolerance, and your buyer/seller base.

When to choose Tender on BidMyStones?

Consider tender if you are:

• A seller with multiple lots and you want controlled bidding from pre-qualified buyers.

• A buyer who prefers to place a considered bid rather than engage in rapid competitive bidding.

• Working with volumes or regular business where predictability is important.

• Concerned with inspection period logistics and want time for due-diligence before bid submission.

When to choose Auction?

• A seller aiming to maximize price through competition among many buyers.

• A buyer ready to act quickly, with funds and confidence in inspection/supply chain.

• Handling special lots (rare stones, unique parcels) where demand might drive up the price.

• Looking for price‐transparency and to tap into a wider global buyer base.

Tips for participants (buyers & sellers)

• Inspect thoroughly: Whether tender or auction, you should analyse the stones, ask for full data (cut, colour, clarity, carat, provenance) and understand logistics.

• Pre-qualify yourself: Sellers should vet buyers; buyers should ensure they meet the terms (payment, certification, shipping).

• Set limits: Buyers should set a maximum bid/budget before bidding; don’t get carried away in the moment.

• Understand fees & terms: Review any platform fees, buyer’s premiums, shipping/insurance costs, bidding requirements.

• Choose the method aligned to your strategy: If you want control and predictability → tender. If you want possibility of higher price via competition → auction.

• Use a reliable platform: Ensuring transparency, security, and trust is critical—especially for valuable diamond lots.

Why BidMyStones?

At BidMyStones we integrate both tender and auction models into one unified digital platform tailored for the diamond supply chain: upload lots, invite bidders, choose tender or live auction, run the event, and publish results. This flexibility allows you (as a seller or buyer) to optimise your process depending on the lot, market conditions and your strategy.