Post on 14-Apr-2018
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AUG 13
Financing
in theDiamond
Indu$tryRetailirks and Mayors:ebranded As Maison Birksignet Jewelers: Posts Drop
n Fiscal Q2 Earningsrossworks: Signs Supplyeal With Chow Taiook Jewellery
PolishedRio Tinto Diamonds: To PlayKey Role In Chinese MarketDe Beers: Buys 25% OfOnline Auction ServiceProviderCurtis FitchIndian Diamond Firms: CallFor Producers To Cut Prices
MiningDominion Diamond Corp:Swings To Loss In Q2Canada: Government RenewsGeo-Mapping ProgramBotswana Diamonds: SignsExploration Deal WithAlrosa Units
Rough
RePoRtEdahn Golan ExplaWhy Banks AndTraders Are TryingTo Bring AboutPrice Reductions
OCT 13
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I just love Tach Diamonds
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To advertise in the magazine contact sales director Ian Francison tel: +44 (0) 20 7613 4445 or email:ian@jewellers-online.org
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IDEX MAGAZINE No. 282 | 21
contents: focus
90 financing in the DiamonD
inDustry
Money makes the world go round, goes the rerain o a
song rom the 1972 musical movie Cabaret. Just as this was
true or Sally Bowles, the character played by Liza Minnelli,
it is also true or the many industries that rely heavily on
bank fnancing. These include the global diamond industry,
especially, the narrow-margined manuacturing sector o the
business.
Despite a long history o close cooperation, it oten seems
that the diamond industry and its bank partners are at odds
with each other. On one side, diamantaires regularly request
more fnancing at lower cost, while on the other side, bankersspecializing in the industry eel that traders are living in the
past. In the fnanciers opinion, the diamond sector does not
understand that conditions that once existed are now gone
and that new realities demand a more measured approach.
Read on to fnd out more as Edahn Golan discovers just what
it is that makes the diamond industry go round.
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22 | IDEX MAGAZINE No. 282
contents
6439
78
86 128
27 Letter from the editorby Danielle Max
31 memo
34 market snapshot
A quick glance at the events of the past month
retaiL et cetera
39 retaiL rendezvous
46 the porte point of view:
recapturing BLack friday saLes
with creative promotion
by James Porte
48 ideX onLine research
Ken Gassman explains why the US jewelry industry is much
larger than previously reported
52 retaiL Bytes
60 facets
64 ceLeBrity choices
poLished67 poLished news
74 poLished diamond prices
78 spinning for spineL
by Mehahem Sevdermish, FGA D.Litt
the ideX diamond report
84 ideX onLine rough report
86 a LittLe gossip aBout pearLs
by Luigi Costantini
mining
123 mining news
128 profiLeGirdharbhai Gajera, Director, Komal Gems NV
129 advertisers List
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w w w . i d e x o n l i n e . c o m
O c t O b e r 2 0 1 3VOL. 29 No. 282
EDITORIAL DEPARTMENT
EDITOR-IN-CHIEF Danielle Max
IDEX ONLINE EDITOR-IN-CHIEF Albert Robinson
IDEX ONLINE RESEARCH Ken Gassman
INTERNATIONAL CORRESPONDENTS Tamar Katzav, Edahn Golan
COPY EDITOR Robin Miller
ART DEPARTMENT
GRAPHIC DESIGN Alexandra Quinn
PRINTING Meiri
MARKETING DEPARTMENT
SALES ADVERTISING MANAGERS Yaron Barzilay, Osnat Davidov,
Anish Kuriakose, Avivit Morhaim,
PRODUCTION & CIRCULATION Helena Dorsht
ACCOUNT MANAGER Ronit Erlich
Founding Editor and Publisher of Mazal UBracha: Chaim Even-Zohar
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Magazine. Reprints of individual articles are obtainable on application to the editor. All rights reserved.No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or
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PUBLISHED BY IDEX ONLINE S.A.
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Fll om onln tradiv o pol mon
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INDIA +91-22-6127-3333 | USA +1-212-382-3
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magazineI N C O R P O R AT I N G M AZ AL U ' B R AC HA
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march 27
april 3, 2014
Brilliance
meets
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IDE X MA GAZ INE No. 282 | 27
In a Purple Haze
by Danielle Max
pring 2014 is a season I eel like I can
relate to already. Tose color geniusesat Pantone have just released theirFashion Color Report or spring o nextyear and my avorite color purple isup there in more than one hue.
Im really looking orward to having a slew o clothes,accessories and other paraphernalia in PANONE18-3224 Radiant Orchid, which is actually purplealthough you might not guess that rom the name,and PANONE 16-3823 Violet ulip, which is verypurple indeed.
Te latest color predictions were made to coincide withNew York Fashion Week and hyped the top-10 colorpicks or men and or women. According to LeatriceEiseman, executive director o the Pantone ColorInstitute, this season consumers are looking or a stateo thoughtul, emotional and artistic equilibrium.
Im not quite sure what that statement means, butthis sort o ashion trend prediction has alwaysascinated me. O course, its a bit o a chicken or eggscenario. Which comes rst, the color report or thecolors? Do we actually have choice when it comesto buying clothes and other goods, or is everything
already planned out or us years in advance?
No matter. I will be stocking up on enough purpleitems to see me through the next ew seasons when,no doubt, mortal enemies such as lime green andbeige will be back to taunt me.
From a jewelry perspective, these color charts canalso be used to tremendous efect and can helpretailers push certain colors o stones.
When I think purple, I automatically think tanzanite,
so anyone selling this gorgeous stone should get onthe color bandwagon, especially as another 2014 hot
color, Dazzling Blue, is also tanzanite riendly.
Bright yellow Freesia is on the color charts, which
puts me in the mind o beautiul canary yellow
diamonds, while Celosia Orange is a perect prompt
or orange sapphire, tourmaline, spessartine garnet
or topaz.
Do you pay attention to things like color prediction
charts? Have you seen a diference in popular gems or
diamond colors when diferent color trends come intoplay? Let me know at danielle.max@idexonline.com.
S
This sort of fashion trend prediction
has always fascinated me. Of course,
its a bit of a chicken or egg scenario.
Which comes rst, the color report or
the colors? Do we actually have choice
when it comes to buying clothes and
other goods, or is everything already
planned out for us years in advance?
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28 | IDEX MAGAZI NE No. 282
Letters to the Editor
was too much eort with no reward. Maybe when I get intojewelry (which is truly B2C), I can start doing this!
Thanks again or inviting us to share our experiences.
Siddhit Sanghavi
Business Development at Esteem Diamonds
Dear Danielle,
You are correct that plying the social media world has somepotential or businesses, but it is essentially a narcissisticendeavor. People like to be recognized and count thenumber o ollowers they have and how oten they are
quoted or re-tweeted. But that is a long way rom havingcommercial impact.
Years ago we were ailures i we did not have a ax number,then it became not having a cell number, then an emailaddress and a web site. Does Facebook, Twitter or Pinteresthave the same necessity? No, in my opinion. They bringwaves o useless chatter, which most serious people ignore.Like yoursel. There is no urgency to them (as yet), as therewas to the communication tools o the past.
Ben Janowski
Janos Consultants
Dear Danielle,
Regarding the online promotion arena, I can share a
perspective rom the diamantaires in India. Marketingmanagers in this not-so-Internet-savvy part o the industryail to realize three things: initial setup, their approach andtheir position in the supply chain.
By initial setup I mean companies getting aboard the socialmedia bandwagon without having the right PR machinery.Do you have actual content to post? Is there a designerwho makes inographics/photos etc? I you're only coveringevents o your frm, like new branches, products, how isthat news presented? Once the customer is enticed enoughto actually click through to your website, does the websiteitsel hold water? Does it give a pleasing interace to theonline shopper?
Approach is how we engage them. Theres tons o distractionsso a once in a year update such as we're opening a newstore at ABC or a random diamond photo doesn't entice areader much. Only when you've been really eeding him/hercontent he/she really loves on a consistent basis will it makethat person get up and come to that inauguration.
By position I mean are you B2B or B2C? I work at a diamondmanuacturing company. You'll see Facebook pages o manybig manuacturers. We also wanted to extend our presence
online in our own small way. For us, it was only to givepeople a confrmation that we are a valid, ully unctioningcompany because people tend to search you beore buyingrom you. But when I started opening Twitter/Facebookaccounts, I realized, hey, no one buys loose diamonds roma manuacturer! The people who buy rom us (traders,jewelers) don't need social media engagement and thosewho do (ordinary web surers) do not end up actually buyingrom us. A ew people did compliment me on our onlinepresence but like you, my interest in posting stu waned. It
The jury may still be out, but IDEX Online'sFacebook page is up and running. Like us tokeep up with all the news, views and opinions atwww.acebook.com/IDEXOnline
I received a number of responses to my recent letter aboutsocial media. Judging
from the responses, readers seem to be split on the question of whether it is
necessary to spend time on developing social media strategies.
Here are a couple of responses:
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IDE X MA GAZ INE No. 282 | 31
very single day we take chances.Some small, some dangerous butinevitably, making decisions meanstaking risks. It is a basic part o doingbusiness and growing.
At present, the diamond market is in a delicate state,and the decisions it makes in the coming monthswill inuence it or years to come. Previously, thiscolumn has detailed the new and perilous situationthe market is currently acing: Rough prices areuneconomically high, diamond polishers marginsare narrow and now cut to nothing because polishedprices are practically at, and all the while consumersare buying, albeit not aggressively.
E
Opportunity, Corner of
Wild Gamble
by Edahn Golan
Compounding this dicult situation is the act thatthe banks that fnance the industry, at least therough-to-polished wholesale part o the pipeline, are
increasing their charges and lowering the availabilityo fnancing. Tis is making business developmentdicult and expansion a growing challenge.
We have also discussed the diculties in generatinggrowing sales at the consumer level. In the US,consumers are buying a lot more jewelry, but thediamond jewelry sub-category is not growing atthe same rate. Tereore, diamond jewelry is losingmarket share.
In China, the big bright hope or consumer growth,diamond jewelry sales are increasing; however,
Chinese jewelry buyers are still largely conservative.Tis means that gold jewelry is still preerred becauseo the investment qualities it represents. Aboveall, however, jade remains much more desirable toChinese consumers than diamonds.
Compounding this, the banks that
nance the industry, at least the
rough-to-polished wholesale partof the pipeline, are increasing their
charges and lowering the availability
of nancing. This is making business
development difcult and expansion a
growing challenge.
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32 | IDEX MAGAZINE No. 282
| memo|
Tis does not mean that there is no room or diamondjewelry to grow, but the expectation that jewelry setwith diamonds in a wide range o qualities and colorswill be snapped up rom the display cases has provedto be overly optimistic.
In Japan, ater a great three-year run, imports o loose
polished diamonds are starting to weaken, and dontget me started on India and its economic woes. It isenough to mention that gold prices have declined andthat many consumers preer to take advantage o theopportunity and buy gold jewelry.
Making matters worse, diamond manuacturers aresitting on a huge stock o polished diamonds. Tisis the output o the rough diamond overhang thattraders bought in the past year even though theyknew it was not entirely economical. Eventually, thesegoods were polished and are now waiting or buyers.
However, it is not all gloom and doom. I the industrycontinues to do business in the same old way, no
improvement should be expected, and that is adangerous route.
On the other hand, this is an excellent opportunity torethink the old model, and chart a resh course. Tereis so much to do, including improving eciencies,investing in smart marketing, bringing reporting
standards into the 21st century, addressing ethicsissues and blocking the continued ood o undisclosedlab-made diamonds into parcels o natural goods.
Te challenges are many, but acing them is a necessity.It will give rise to many new opportunities, especiallyor those seeking to re-invent themselves in an era oeasily accessible data and infnite memory.
Not addressing the issues is taking a wild gamblewith the uture o the industry. Ignoring the problemsis like sticking your head in the sand. As I am oten
reminded, in that position, your rear end is stickingout, and anyone can give it a good kick. Tat is not agood way to move orward. IDEX
Taxation
Inventories
Auctions of
bankruptcies
JoriscoOnline Auctions
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Beyonddoubt.
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34 | IDEX MAGAZINE No. 282
market
snapshotby Albert robinson
the month in review
Although demand or jewelr in the United States remained rm in June, the rise
was lower than that seen in recent months. Anecdotal and other evidence points to
increasing condence among shoppers as the econom improves, aleit slowl.
Figures were likel hit a 4-percent rise in the consumer price index or jewelr, its
largest increase or 16 months. For most o this ear, American jewelr consumers
had een taking advantage o dropping infation. Infation or the rst hal o the eardeclined slightl under 1 percent.
JEWELRY
Retail jewelry prices in the US market rose moderately
in June, the result o a seasonal jump that has beenseen or at least the past our years. In contrast, jewelry
wholesale prices ell or the frst time in 13 years. Tis
is to be largely expected because retail jewelry prices
in the United States usually climb in August andSeptember. Tis is because retailers typically raise
prices in the summer to get consumers used to them
beore the critical holiday selling season when theytraditionally make their annual proft.
PERFORMANCE
Posting their weakest perormance so ar this year,
jewelry sales totaled just $2.3 billion in June. For the
January-June period, sales are estimated to have risen
by 9.1 percent over the same period last year.
Te fnancial results o major jewelry retail chains
released in late August provided a good snapshot o the
state o the markets. Zale Corp. reported a narrower
loss in its fscal ourth-quarter and a proft or the ull
year or the frst time in six years. Same-store sales, a
critical indicator or the retail sector,
continued to rise sharply up 5.6
percent in the ourth quarter but
slower than the 8.3 percent increase
posted a year earlier.
Meanwhile Signet, another mass-
market retailer, reported slightly
lower proft compared to the year
beore in its fscal second-quarter.
Revenue climbed by just 3.1 percent,
alling $30 million short o analysts
expectations o $910 million. Same-
store sales rose 3.6 percent, compared
with the frms expectations o a rise
in the low-to-mid single-digit range.Source: IDEX Online Research
350
300
250
200
150
100
201220112010 2013
Gold
Silver
Platinum
Diamonds
Index of Diamond & Precious Metals Prices
June 2010 June 2013 by month
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IDEX MAGAZINE No. 282 | 35
14000
13000
11000
12000
100009000
Jewelry Share Index U.S.
Sep 2012 Sep 2013 by month
Blue Nile [NILE], Charles & Colvard [CTHR], Movado Group [MOV], Signet Jewelers Limited[SIG], Tiffany & Co. [TIF], Zale Corporation [ZLC]
100009500
10500
9000
11000
11500
Jewelry Share Index Europe
Sep 2012 Sep 2013 by month
Bulgari [BUL], Damiani [DMN], LVMH [LVMH], PPR [PP], Richemont SA [CFR], Theo Fennell [TFL]
11000
12000
10000
9000
Jewelry Share Index India
Sep 2012 Sep 2013 by month
Classic Diamond [BOM:523200], Gitanjali Gems [BOM:532715], Goldiam International[BOM:526729], Rajesh Exports [BOM:531500], Su-Raj Diamonds [BOM:507892],Suashish Diamonds [BOM:526733]
11000
9000
9500
10500
10000
Mining Share Index
Sep 2012 Sep 2013 by month
African Diamonds, Anglo American [LON:AAL], BHP Billiton [NYSE:BHP], Firestone Diamonds[LON:FDI], Gem Diamonds [LON:GEMD], Harry Winston [NYSE:HWD], Petra Diamonds[LON:PDL], Rio Tinto plc [NYSE:RIO], Rockwell Diamonds [TSE:RDI]
+4748.07 (47.48%)
+1608.67 (16.09%)
-2635.79 (-31.63%)
-368.23 (-3.68%)
8000
7000
6000
2012 2013
S SO N D M MJ JF A AJ
2012 2013
S SO N D M MJ JF A AJ
2012 2013
S SO N D M MJ JF A AJ
2012 2013
S SO N D M MJ JF A AJ
| MARkEt sNAPshOt |
In the luxury sector, iany & Co. posted
a rise in revenues and net prots in
its scal second quarter. Global sales
jumped 4.4 percent on the year to $925.9
million in the second quarter, while
net income rose to $106.8 million rom
$91.8 million. Te retailer said protwas higher than expected due to lower
diamond and gold prices. Interestingly,
the upscale jeweler said its price rises
had not deterred shoppers. Sales at stores
open at least a year, or same-store sales,
increased 5 percent globally.
OUtLOOk
Global diamond industry leaders are
condent o a strong holiday sales season
based on growing demand or goods,while many smaller diamond companies
and brokers say the industry is largely at a
standstill. Nonetheless, the rising trend o
sales in the critical American market this
year cannot be ignored, and would appear
to suggest a relatively rosy sales outlook.
POLIshED PRICEs
Polished diamond prices continued to
soten in August, according to the IDEX
Online Polished Diamond Index. TeIndex averaged 131.3 in August, a decline
o 1.9 percent year-over-year and 0.8
percent below July.
Te decline was the second consecutive
drop and ollowed two months o price
increases, providing a urther seesaw
eect to the Index since the beginning
o last year. Te Index has climbed eight
times since the start o 2012, and posted
decreases 12 times. Te overall eect is a
5.4-percent all since January 2012, and a1.2-percent decline in 2013 so ar.
Te reasons or the decrease in the Index
in August range rom traders and other
members o the diamond business being
away rom their ofces due to summer
vacation, to supplies o polished goods on
the market handily outstripping demand.
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In addition, rough diamond prices are too high tobe economically easible to manuacture, while
manuacturers are keeping prices irm in a bid
to maintain polished diamond prices in order to
avoid losses.
WINNERs AND LOsERs
On a year-over-year basis, the price Index or round
goods dropped or all the main sizes during August.
One-carat rounds lost an average o 1.9-percent
compared to the overall price a year ago, the average
price o 2-carat rounds were 3.7 percent lower and4-carat rounds were 9 percent below their prices a
year ago. Following a small recovery in June, the price
Indexes o 1-, 1.5- and 2-carat
princess-shape diamonds ell
again in August on a month-over-
month basis.
OUtLOOk
Te US market appears to be
relatively strong, as shown
by good results or Americanretailers in the rst hal o this
year. Meanwhile, the all in growth
in China this year could be at an
end with moderate growth to
ollow. Te Japanese economy is
also showing signs o recovery as
the new government shakes up
the long-moribund economy. Te
only trouble spot appears to be India, where the alling
rupee is hitting consumer demand by making diamond
jewelry more expensive.
ROUGh DIAMONDs
As or most o this year, the rough trading environment
remains a difcult one. Producers have done little to
temper price rises, thereby making the purchase o
rough goods an economically difcult decision to justiy.
While rough prices have risen, the price o polished
goods has either declined or, at best, stood still. Te
global economy is still brittle, as seen by spiking oil
prices whenever the possibility o US air strikes on
Syria is mentioned. And in India, with the rupee in
reeall against the US dollar, the price o rough goods is
prohibitively high.
WORth kNOWING
Curi Fic: Curtis Fitch is the De Beers Groupsrough diamond online auction service provider. Theminer announced in September that it had bought a25-percent equity stake in the frm. De Beers, whichsells approximately 10 percent o its global roughdiamond supply through auctions, anticipates that theinvestment will deepen the partnership between thetwo companies, strengthen the conditions or urther
innovation and position it to meet the evolving needso a growing auction customer base.
Source: IDEX Online Research
150
140
130
120
110
20122011 2013
IDEX Online Polished Diamond Price Index
PEAK
July 2011146.7
August 2013
131.2
2011 Avg
135.8
2013 Avg to date133.6
2012 Avg
136.8
| MARkEt sNAPshOt |
Our goal is to address proper business practice inthe very broadest sense, and together, CIBJO andRJC are able to provide comprehensive solutions. Theprime benefciaries o this agreement need to be the
greater jewelry industry, jewelry consumers and allo our stakeholders to the very grass-roots level.
Gaetano Cavalieri, president of CIBJO, the WorldJewellery Confederation, speaking after the signing ofa Memorandum of Understanding with the ResponsibleJewellery Council (RJC), whereby the two associations willwork together to advance responsible business practicesamong all sectors of the jewelry supply chain.
qUOtE
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IDEX MAGAZINE No. 282 | 37
The summer edition o the US & International Diamond Week, held in Israel rom August 26 to 29, recorded thebusiest week ever on the trading foor o the Israel Diamond Exchange (IDE). More than 1,200 traders, buyersand sellers packed into the IDEs trading halls, according to organizers o the event. There were positive salesreports rom the 400 Israeli diamond rms who had booths at the event, particularly among traders dealing inlarger stones.
OUR OUtLOOk
Te start o the vital holiday sales season will be
anticipated with more ervor than usual this year, as
manuacturers wait to see i consumer demand is going
to be high enough to create a satisactory margin o
proft between rough and polished prices.
Image: Israel Diamond Exchange
| MARkEt sNAPshOt |
LINGO
Brand Diluion The risk o over extension can leadto brand dilution where the brand loses its strongassociations with a market segment, product area,or quality or price.
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Contact us today for a Free Consultation:
+972 (3) 613-4486or email us at:
info@accadiasoftware.com
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IDEX MAGAZINE No. 282 | 39
Retail
Rendezvous:
F F
MyryTe My Little Mystery collection from Meissen comprisesrings, earrings, bracelets and pendants in three product lines.Diamond, Glamour and Jewels use a mix of diamonds andwhite or rose gold with pastel-colored gemstones made fromMeissen porcelain.
1
OCT2013 reTail, eT CeTera
1
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2
5
2
lab WorkIn a collaboration between Oroarica and Rand Renery, the new, ethically mined Absolute Jewelrybrand is crated in its entirety rom pure, certied, responsible gold. Designed byTe LAB, the newlylaunchedHeart of Gold Engagement Ringcollection or the Absolute brand comprises rings that are
complete, holistic and balanced; mirroring what every happy marriage needs.
3
Perfect Combination
Estelle and Lita by Royal Asscher is a partnership between Grammy winnerEstelle andLita Asscher.Te collection consists o several pendants, some incorporating Royal Asschers Stars concept withoating diamonds and amethysts, rings that reach over the length o the nger and bracelets andearrings with purple amethyst and black and white diamond details.
4
Creative ForceTree talented designers Vah Ghazarian, Esin Guler and Mihran Guler, have come together as thecreative orce behind G&G Creations. Te Stacks collection eatures smaller earrings, stackable
rings and bracelets in polished and oxidized silver, as well as tri-color gold set with rubies, sapphiresand diamonds.
5
Braziian souTeLooping Shine collection rom Brumani wants to connect the many bonds people have in lie:riends, relationships, experiences Its a tribute to love, to afection, to companionship, to riendshipand to ellowship. All these emotions are expressed in the warmness o the rose gold while the beautyo the double-aceted translucent quartz, polished with diamond powder, makes these pieces shineeven more.
3
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42 | IDEX MAGAZINE No. 282
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Get KnottedInternationally acclaimed British jewelry designer Stephen Webster has added bold new piecesto his Forget me Knot sterling silver collection. Te line is characterized by the unmistakableusion o luxury with an edge, which epitomizes Stephen Webster designs. Cocktail rings andcu s eaturing the iconic barb moti take center stage in this modern collection
7
Space StyleTe pendant and rings in the Galaxy line rom Isabelle Langlois transport wearers light yearsrom our planet. Set with shimmering stones that evoke the stars and bound by a fne cobweb-like ribbon set with white diamonds reminiscent o the Milky Way, the line includes a white goldpendant pavd with 14.09 carats o colored gemstones and 0.45 carats o diamonds. Te yellowgold rings eature various colored gemstones and diamonds or a twinkling look.
8
Fall RomanceRomance is just one o the inspirations or the designs in the newTi SentoMilano collection. Teother is the authentic urban city liestyle o Florence, especially the Renaissance details ound inthe citys many beautiul buildings and bridges. Black stones are used in several shapes, oten incombination with rose gold plated details.
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10
9
Full CommitmentWhen it comes to jewelry, ew pieces are as signicant as those given during a proposal orexchanged at a wedding. Sandy Leongs Commitmentcollection is crated in 18-karat gold withdiamond accents and has a natural earth-like texture, which demonstrates an important valuethat she seeks to inuse into every piece: giving back to the planet.
10
Naturally PinkTe Naturally Pink collection rom Bombay Jewelry Manufacturers has an even productassortment o both bridal and ashion pieces. Tese unique designs incorporate natural pink andwhite diamonds to ofset cost and give depth to the designs. Te collection is available in both14-karat and 18-karat gold and has a choice o two diferent diamond qualities.
11
Viva ItaliaLeo Pizzo jewelry is created in the heart o Valenza, Italy, and this Italian style shines through inevery piece. Te 18-karat gold is skillully processed by expert goldsmiths and urther embellishedwith selected diamonds and precious stones. Te company says that each jewel, even the mostsimple, is characterized by high standards o excellence and quality.
10
11
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hy should jewelers give up the
biggest shopping day o the year,
Black Friday, November 29 to
consumer electronic stores, Big Box
retailers and the Internet?
In 2012, retail sales or Black Friday were $11.2
billion, and that doesnt even count the Black
Weekend. With an improving economy, sales areexpected to rise in 2013.
Fiteen to 20 years ago, jewelers were excited
to welcome the Tanksgiving weekend since it
represented a healthy dose o store trac, layaway
sales and a ringing cash register. Now, jewelers
normally have to wait anywhere between three to 10
days beore Christmas to experience their sales jolt.
So whats the takeaway? Give up, or ght back with a
smart marketing plan and a lot o creativity.
Jewelers can now reclaim a piece o the TanksgivingWeekend pie by ofering employees o local businesses via their employer a reason to come into their store
with a unique Black Friday Tanksgiving git card.
So, hereS the plan:
Many o your customers own businesses. Meetwith them and suggest that you can provide HappyTanksgiving Cards that include a $50 git voucher
(that can expire on Cyber Monday) rom your storethat can be distributed to all their employees oneor two days beore Tanksgiving, which alls on
Tursday, November 28.
retail et cetera
The Porte Point of View:
Jewelers Recapture
Black Friday Sales
with Creative PromotionBy James Porte
W
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| retail et cetera > THE PorTE PoINT oF VIEW|
Porte Marketing Group is a leader in providing turnkey
manufacturing solutions to jewelry retailers and manufacturers.
Founded by James S. Porte in 1989, the company provides
research, consulting, seminars, printing, photography and
graphic design services for the jewelry industry. For further
information, contact James Porte at jporte01@aol.com or go towww.portemarketing.com
Teres no cost to the employer or local business, andthere is even the chance that they might appreciatethe efort so much that they ofer to pay a portion orthe redeemed git cards. o increase the connectionwith the employer, the presentation should bepersonalized with their name to urther emphasizethe third-party endorsement o your store.
o boost the potential trac even more, use yourcontacts rom the Rotary Club, Country Club, etc.,and meet with some employers that you know in yourtrade area.
Getting people into the store early to buy and look atwhat you have to ofer is important since you dontwant the available disposable income consumershave to spend on jewelry to be already spent whenthey come into your storeget them early!
At rst glance, however, it might seem that the
consumers getting up at 3 a.m. in the morning to waiton line or hours to get the deal o a lietime are notyour customers. But they can be, i you could target
the right prospects based on where they work and thecompany they work or.
So, look around your local area which is sure to includelaw rms, sotware companies, small actories,hospitals and the like.
And, i it all goes to plan, you may be starting theHoliday Season with 100-200 new customers talkingabout your store. IDEX
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nnual US fne jewelry and watch sales
between 2005 and 2012 were almost $2
billion higher than initial estimates,
according to newly revised data rom
the governments Bureau o Economic
Analysis (BEA). Tis eight-year period includes the
Great Recession, when many jewelers struggled to
sell merchandise.
otal jewelry sales, based on restated government data,
were a record $73.7 billion in 2012, up rom a previously
reported level o $71.5 billion. Based on an estimated global
jewelry sales level o near $150 billion, this means that theAmerican market generated roughly hal o all global fne
jewelry and watch sales, and is by ar the largest market inthe world.
Te BEAs annual data revision was ar larger this year thanin prior periods: 10 years o jewelry sales, beginning in 2003,
were restated. Normally, the BEA revises just a ew prioryears when it publishes its annual revision.
Minor upward revisions were made to jewelry sales in 2003and 2004, ollowed by signifcant increases in jewelry salesbetween 2005 and 2012. Most years jewelry sales levels
A
retail et cetera
IDEX Online Research:
US Jewelry Industry LargerThan Previously ReportedBy Ken Gassman
taBle 11
US Fine Jewelry & Watch Sales (in US$ billions)Comparison of Restated Figures to Earlier Data
Year
RestatedFine Jewelry & Watch
SalesPreviously Reported
Fine Jewelry & Watch Sales$ BillionsDifference
Percent Change"Restated" versus
"Previously Reported" Sales
2001 $47.6 $47.6 No chg No chg
2002 $49.1 $49.1 No chg No chg
2003 $51.9 $51.4 $0.6 1.1%
2004 $56.6 $55.3 $1.2 2.2%
2005 $59.8 $58.1 $1.6 2.8%
2006 $64.2 $62.3 $1.9 3.0%2007 $67.2 $65.3 $1.9 2.9%
2008 $65.3 $63.4 $1.8 2.9%
2009 $60.3 $58.4 $1.8 3.1%
2010 $62.6 $60.8 $1.8 2.9%
2011 $69.4 $67.3 $2.0 3.0%
2012 $73.7 $71.5 $2.2 3.1%
Source: BEA & IDEX Online Research
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were raised by $1.8 billion to $2.2 billion. On average, the
increase represented a 3-percent gain in total sales, as
able 1 illustrates.
Here are highlights rom the revised BEA data regarding US
ne jewelry and watch sales:
US jewelry sales or 2012 were restated upward to $73.5
billion; prior data pegged 2012s American jewelry salesat $71.5 billion. Tis was a gain o 3.1 percent.
Jewelry sales were revised upward beginning with
2003 data, with signicant revisions to more recent
years. While jewelry sales were revised upward or the
past 10 years, each years sales level generally ollowed
economic activity during the Great Recession, which
had a negative impact on jewelry sales during 2008, 2009
and 2010, as Figure 1 illustrates.
During the Great Recession in the last hal o the prior
decade (ofcially December 2007 through June 2009), USne jewelry sales ell less than 11 percent peak-to-valley.
Tis period occurred between 2007, when pre-recession
jewelry sales peaked at $67.2 billion, and 2010, when
jewelry sales bottomed at 60.3 billion or the year.
On a monthly basis, jewelry sales ell by 16 percent in
December 2008. Tis was a particularly difcult period or
the American jewelry industry, since roughly 20 percent
o annual sales are generated in the month o December.
Figure 2 illustrates percent change in annual ne jewelryand ne watch sales trends since the year 2000.
New data shows that ne jewelry represents just over88 percent o total ne jewelry and ne watch sales in
2001
Source: BEA
10
20
30
40
50
60
70
80
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Restated Sales
Prior Sales Data
FIGURE 1
Comparison of Restated US Jewelry Sales To Previously Reported DataIn US$ billions
Source: BEA
-2
-4
-6
-8
0
2
4
6
8
10
12
5.5
-3.1
3.2
5.7
4.6
-2.9
-7.7
6.3
8.9
5.6
7.5
3.8
10.8
FIGURE 2
US Fine Jewelry & Watch Sales TrendsPercent Change Year-Over-Year
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the US, with fne watches accounting or the balanceo just under 12 percent o sales, as Figure 3 illustratesor 2012. Prior to this years restatement, the BEA datashowed that fne jewelry sales were 87 percent ototal industry sales, and fne watches represented 13
percent o total revenues. Over the past two decades,
fne watch sales have slowly been losing market shareto fne jewelry.
Specialty jewelers lost more market share than originallyreported. In 2012, specialty jewelers sold only about42.7 percent o all jewelry in the US market, down roma market share o nearly 75 percent in the early 1970s.Multi-line retailers such as Wal-Mart, Costco and J.C.Penney have been taking signifcant market share romspecialty jewelers, especially independent (non-chain)amily-operated jewelry merchants.
Figure 4 summarizes the long-term loss o market
share by specialty jewelers, defned as retail merchantswho generate a majority o their revenue rom jewelrysales. IDEX
Source: BEA
Fine Jewelry
Fine Watches
11.7%88.3%
FIGURE 3
Sales Mix - Fine Jewelryvs. Fine WatchesUS Market - 2012
Source: NBER, BLS, JIRI, Dept of Commerce
FIGURE 4
Specialty Jewelers' Market Share
30%
40%
50%
60%
70%
80%
19681970
19801990
20002010
2012
Recession
Low point42.7%in 2012
Peak72.9%
in 1971
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Whats somthing most popl dont know abot yor job? Its the only business in the world conducted on trust. You sell 1 to 5million dollars just on the telephone, without even a signature.
A diamond dalrs most valabl asst? Reputation. Yes, you need a sense o artistic value and a knack or design, but the mostessential part is integrity. You cant survive without it.
What has doing bsinss in Hong Kong taght yo abot th Asian markt? Its one o the strongest in the world. Every day, thereare new millionaires and new businesses. Asians are very investment-conscious. Diamonds are saer and more proftable than money in a bank.
All-tim favorit prchas? Most recently, a 100+ ct. D FL. Incredible brilliance and scintillation. Such a beauty. People ell down whenthey saw it.
Did it arriv with a grading rport? Ha, ha. GIA, o course. What responsible businessman, with a good reputation and name, would sella diamond without a GIA report?
Why is a GIA valation so important to ons rptation? Its the most reliable, authentic, dependable gem institute in the world.People know that, especially in the Far East. Remember what I said about reputation? A GIA report is crucial.
Bsinss words to th wis? Selling is an idea game. The more knowledge you have, the more confdence you eel.
GIA gratefully acknowledges those who use our resources to further world
expertise in gems. Invest in your success at WWW.GIA.eDu
ephraim zionof Dhrs Limitd handls
mor diamonds in a day than most popl s in a liftim.
Hr h discsss th powr of rptation, global diamond invstmnt
and why a GIA rport is vital to any bsinss bilt on intgrity.
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Luxury Institute
Survey Reveals Risk
of Brand DilutionA recent survey by the Luxury
Institute discovered that while many
afuent shoppers those with a
household income o $150,000 or more
welcome brand partnerships, hal
o these afuent consumers believe
that partnering with another brand
luxury or mainstream could damage
the brands image or reputation.
According to the survey, the industries
where partnerships are seen as most
ruitul are hotels and resorts, travel,
ashion and airlines.
Te survey revealed that women are
ar more likely than men to applaud
ashion partnerships, as well as those
involving jewelry and beauty.
Perhaps unsurprisingly, men are
most enthusiastic about partnerships
involving automobile companies,
while afuent shoppers older than 50
are especially interested in airline and
cruise collaborations.
Luxury brand collaborations wealthy
shoppers would like to see include
Michael Kors and Apple, Chanel and
Air France and Lexus and Te Ritz-
Carlton.
However, brands need to be careul
about the sort o partnerships they
create. Brands should partner with
companies with similar values and
service standards to avoid potential
risks o collaboration, said Luxury
Institute CEO Milton Pedraza, adding,
Tis maintains credibility and helps
to ensure a consistently positive
customer experience.
Sterling Jewelers,Zale Corp. ReachAgreement OverLawsuitSterling Jewelers Inc. and Zale
Corporation announced they have
reached an agreement with respect
retail et cetera
Retail
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to the lawsuit pending in Te United
States District Court or the Northern
District o Ohio.
Te case centered on advertising
produced by Zales stating that its
Celebration Fire diamond was the
most brilliant diamond in the world.Sterling Jewelers led the lawsuit
last November just as the holiday
shopping season was getting started.
Te parties said they have agreed to
a negotiated resolution o the case,
which will go into ull orce and efect
as o March 1, 2014.
Te details regarding the settlement
are not being disclosed.
Pandora BuysJewelry DistributionRights in BrazilGlobal jewelry retailer Pandora has
signed an agreement with City ime,
S.L. to acquire City ime do Brazil
Comrcio e Importao Ltda. in a
cash deal or the distribution rights to
Pandora jewelry in Brazil.
Te acquisition will give Pandora theopportunity to enter the Brazilian
market directly and to add to its nine-
shop strong retail chain Pandora
Concept. Te retailer currently has ve
stores in Sao Paulo, two in Rio de Janeiro,
one in Brasilia and one in Curitiba.
City ime Brazil generated revenues
o almost $6.5 million in 2012 and $8.2
million in the rst seven months o
2013. Pandora jewelry has been sold in
Brazil since 2009.
Pandora CEO Allan Leighton said
the agreement gives the company, a
stronger presence in a country which
we believe holds great potential. He
said that City ime has established
a presence or Pandora in Brazil
and that the agreement was in line
with the rms strategy o expanding
geographically as well as maintaining
control over the brand.
Under the terms o the agreement,
Pandora will pay a one-time,
undisclosed amount to City ime or
acquiring City ime Brazil.
City ime, which is located in Spain,
has been a Pandora distribution
partner since 2005. Following the
agreement, it will continue to be the
distributor o Pandora jewelry in
Spain and Israel.
Signet JewelersPosts Drop in FiscalQ2 Earnings, ProftSignet Jewelers Ltd. reported that
scal second-quarter earnings slipped
4.7 percent as the retailer continued to
see weak sales in the UK, while higher
costs pressured margins.
For the current quarter, Signet said it
expects same-store sales to rise in the
low-single-digit percentage range.
Signet, which owns the mall-based
Kay Jewelers chain and the higher-
end Jared the Galleria o Jewelry,
has seen its revenue improve in
recent quarters. Tis is due to strong
domestic sales largely helping to ofsetweaker demand rom Europe.
Te company acquired Ultra Stores
Inc. or $57 million in November in a
bid to broaden its customer base with
the help o the outlet-center chain.
For the quarter ended August 3, Signet
reported a prot o $67.4 million
versus prot o $70.7 million a year
ago.
Revenue increased 3.1 percent to
$880.2 million. Analysts had recently
orecast revenue o $910 million.
Same-store sales rose 3.6 percent,
while Signet had expected a rise in the
low-to-mid single-digit range.
Te US division generated a same-store
sales increase o 4.9 percent, led by a5.8 percent rise at Kay and an increase
o 5.5 percent at Jared. Overall revenue
Image: Pandora
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rom the division, which makes up
the majority o Signets sales, rose 5.6
percent to $741.1 million, driven by
particular strength in bridal, colored
diamonds and watches.
E-Commerce sales rose 29 percent to
$31.2 million.
In the UK, sales ell 8.5 percent to
$139.1 million, while same-store sales
slipped 2.4 percent.
White PineLaunches JewelryConsulting ServiceRecycled diamond company White
Pine rading LLC is launching anew division providing consulting
and other services to retailers,
manuacturers and wholesalers, and
the industrys asset-based lenders.
White Pine Jewelry Solutions, which
will be headed by Michael Lebowitz,
will also design and manuacture
pieces created rom White Pines
recycled diamonds.
Its services include inventory
evaluation and appraisals; evaluation
o business options rom store closing,
consolidation or promotional sales
to overstock sales events; guidance
on running special on-premises sales
events or hands-on management o
events and the development o event
auction and quick sale programs using
White Pines platorm.
Te company said these core services
will be augmented by the divisions
diamond jewelry manuacturing
operations as well as an upcoming
program to supply retailers with
consigned close-out inventory drawn
rom White Pines vendors.
Lebowitz, who has more than 42 years
o experience in jewelry retailing,
wholesaling and consulting, was most
recently executive vice president
o Buxbaum Jewelry Advisors.
Previously, he served as a consultant
to manuacturer M. Fabrikant & Sons
and held positions as a ne jewelry
merchandise manager or Boston
jeweler Shreve Crump & Low and as a
close-out buyer and asset appraiser at
Gordon Brothers Corp.
CIBJO and RJCSign Deal to WorkTogether onBusiness PracticesCIBJO, the World Jewellery
Conederation, and the Responsible
Jewellery Council (RJC) recently signed
a Memorandum o Understanding(MoU) at the International Jewellery
London Show.
Te MoU will work to urther advance
responsible business practices among
all sectors o the jewelry supply chain,
and will include the use o CSR education
programs developed by CIBJO, in
collaboration with the United Nations,
and chain o custody certicationprograms developed by RJC.
Te MoU refects the willingness o
both organizations to collaborate oneorts to build a solid understanding
and commitment rom the jewelry
industry to improve its perormancein the crucial areas o human rights,
social and environmental perormanceand ethical business practices.
Among the key components o theMoU is the establishment o an
MoU Working Group to oversee the
execution o the agreement. Te groupwill be headed by Gaetano Cavalieri,
CIBJO president, and James Courage,
RJC chairman. Tey will appoint two
industry representatives rom theirrespective organizations to address the
synergies inherent in the cooperationbetween these two global groups.
Our goal is to address proper businesspractise in the very broadest sense,
and together CIBJO and RJC are able to
provide comprehensive solutions, saidCavalieri. Te prime beneciaries o
this agreement need to be the greater
jewelry industry, jewelry consumersand all o our stakeholders to the very
grass-roots level.
I am personally very pleased to be
working with CIBJO and its president
Gaetano Cavalieri and to be part o theMoU working group. I am sure there
will be positive outcomes rom thiscollaboration or the jewelry industry,
said Courage.
Stuller, Inc. and
Gemvision ReleaseCounterSketchStudio Update
With the growing desire or unique
jewelry, Stuller and Gemvision have
released CounterSketch Studio 4.0,which is an extensive update to the
existing 3D jewelry design sotware.
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haRd woRk pays off.manufacturer import - export p o l i s h e d d i a m o n d s i n a l l s i z e s a n d q u a l i t i e s
m a n u f a c t u r e r o f l a r g e s i z e s , r o u n d s a n d f a n c i e s , u p t o 2 5 . 00 c t s
schupstra at 1/7 2018 antwerpen belgium tel + 32 3 231 21 47 info@pinchasi.com www.pinchasi .com
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Crossworks SignsSupply Deal WithChow Tai FookJewellery
Canadian diamond manuacturerCrossworks Manuacturing Ltd.
has signed a long-term supply and
licensing agreement or its patented
Hearts and Arrows ideal cut square
diamond with Chow ai Fook Jewellery
Group Ltd.
Crossworks will supply the diamonds
and Chow ai Fook, a leading jewelry
retailer in China, will have the
exclusive distribution rights to sell
them through its extensive retail
network in Greater China.
Crossworks square-cut Hearts and
Arrows diamond has achieved the
grade o ideal or light perormance
rom leading gem labs, and oers an
eight-sided square-cut diamond that
exhibits eight hearts and eight arrows.
Te launch o this diamond in
Greater China through Chow ai Fook,
one o the worlds most iconic jewelry
retailers, achieves our vision to bringbeautiul diamonds to consumers,
said Crossworks president Uri Ariel.
Te hearts and arrows ideal square
cut diamonds will be exclusively
sold through Chow ai Fooks points
o sale and marketed under the De
Beers Groups Forevermark brand in
Mainland China, Hong Kong, Macau
and aiwan.
Birks and MayorsRebranded asMaison BirksCanadian jeweler Birks and Mayors
has been rebranded as Maison Birks.
Te rebrand includes a modifed
logo and a brand new advertising
campaign that the company says
retains its 135-year-old history, but
also expresses the modern experience
it oers to its clients.
Te new logo retains the companys
emblematic blue box, but it now
also includes a diamond shape,
which reerences both the companys
expertise in diamonds, and 1897, the
year in which it was ounded.
Te new advertising campaign also
highlights the companys Canadian
heritage.
Birks has been a household name in
Montreal and in the rest o Canada
or nearly 135 years, and it remains
the reerence in terms o quality
and prestige or consumers and
connoisseurs across the country, said
Jean-Christophe Bdos, president and
CEO o Birks & Mayors Inc.
While attesting to our rich history,
the new corporate identity rejuvenates
Maison Birks brand proposition, and
allows Canadians to discover Maison
Birks in all its purity. Tis is a historicmoment or our company,
Te launch coincided with the
opening o Maison Birks frst mono-
brand store, located in the Mapleview
shopping centre in Burlington,
Ontario. A second mono-brand store is
due to open in the Square o Quartier
DIX30 in Montreal, Quebec. IDEX
|retail et cetera > retail bytes|
Image: Maison Birks
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Scent of the Past
Te Museum o London is gearing up
or the opening o Te Cheapside
Hoard: Londons Lost Jewels, which
is due to open on October 11. As part
o the preparations, the museum
has commissioned British master
perumer Roja Dove to reimagine the
scent o Londons vanished past.
Te perume, which will be spliced
with ingredients popular in the 17th
century, will combine lavender,
rankincense, civet and other notes
to create an evocative sensory
installation, transporting visitors
back to the opulent perumes o
Elizabethan and Early Stuart London.
Te scent will be displayed alongside
one o the star pieces o the Cheapside
Hoard a gold, enamel, diamond and
opal-set scent bottle.
Te Cheapside Hoard is the worlds
largest cache o Elizabethan and
Early Stuart jewelry. Discovered by
chance in a cellar deep underground
in Londons Cheapside in 1912, theupcoming exhibition is the frst time
that the Hoard has been displayed in
its entirety since its discovery more
than 100 years ago.
Te collection includes jewels rom
the emerald mines o Colombia, the
diamond gravels o India and the pearl
banks o Bahrain.
retail et cetera
Facets
According to the museum, Te jewels
and gemstones within the Cheapside
Hoard hail rom all corners o the
world, showcasing Londons role in the
international gem trade in an age o
global conquest and exploration. Each
piece tells a tantalizing story, rom git
giving at the Elizabethan court to tales
o international trade and discovery
and vignettes on ashion, wealth andpower.
Te Cheapside Hoard will be displayed
alongside multimedia installations,
objects rom the Museum o Londons
collection and rarely seen portraits,
creating a picture o the ashions and
culture at play in Elizabethan and
Early Stuart London.
The Gold, Enamel, Diamond andOpal-Set Scent Bottle
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|retail et Cetera > facets|
Tacori Unveils TheServing Tray andThe Lock AdsCaliornian jewelry brand acori has
unveiled the latest installments o itsIconic Passion ad campaign with two
bold new images, Te Serving rayand Te Lock.
Te Lock was inspired by the romantic
love locks phenomena in which loversattach locks to bridges and then toss
the key into the water. Te rings,says the company, are the symbol oa acori couple locked in a bond o
eternal love, and represent the key tounlocking your beloveds heart.
Meanwhile, the Serving ray eatures
the vivid hues o red, blue and blackrom aocoris City Lights Collection.
Presented on a luxurious sterlingsilver tray, the unveiling o glamorous
new designs rom acori exposesa modern passion or old-worldglamour.
Te new ads have already beeneatured in the September issues o
Harpers Bazaar, Essence, InStyle, Marie
Claire, W, Womens Health and Vogue.
HOF launchesPerfect MomentsSocial MediaPlatform
Hearts On Fire has launched itsPerect Moments social media
platorm. Te company says it is asocial storytelling community that
allows people to share experiencesthey deem perect moments in
an environment ocused solely onpositive happenings.
Users share their moment on a global
map, pinpointing its location with animage and short description. Tey canalso search by keyword or location to
explore moments in specifc areas andget ideas or events such as marriage
proposals, date nights and vacations.
Perect Moments provides integrationwith Facebook, allowing users to
create a profle and connect withFacebook riends, scrapbook their
personal moments and comment onmoments. It also allows integration
with other social media platorms,
such as witter and Pinterest, as wellas working with Instagram.
Hearts On Fire has also released
an iPhone app that allows users tocapture and upload moments on-
the-go with seamless integration andquick, simple steps.
Te Hearts On Fire DNA has always
been about helping our customerscelebrate lies perect moments, said
Caryl Capeci, VP o Marketing. Bygiving everyone a digital platormto document and share their best
experiences with riends and amily,we are simply helping them to
embrace these moments in a timeless,enjoyable manner.
TanzaniteOneLaunches OnlineJewelry Boutiqueanzanite mining companyanzaniteOne has made the move
online with the opening o a jewelry
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| retail et Cet era > facets|
and loose stone boutique. Tis is the
rst time the company has directly
oered its gemstones to consumers.
anzaniteOne said that being able
to retail tanzanite directly to global
consumers means the company is
now involved in every step o the route
rom mine to market, thereby allowing
it to guarantee the provenance, quality
and ethical status o its stones.
Te tanzanite oered on our online
boutique is more than just a collectiono rare and beautiul gemstones
and jewelry said Linda Kennedy o
anzaniteOne Online, Our tanzanite
is the only tanzanite that is ethically
mined - guaranteeing peace o mind,
something which is increasingly
important to educated and socially
conscious consumers.
All anzaniteOne Online pieces come
with the anzanite Foundations
Mark o Rarity and a anzaniteOne
certicate o authenticity and origin,
guaranteeing the tanzanites ethical
status, authenticity and confict ree
origin. Te online boutique is also a
member o the World Responsible
Jewellery Council.
anzanite is ound only at the oothills
o Mount Kilimanjaro in anzania,
Arica. It was rst discovered in 1967
Bll Clnton to Spak
at Cnturon
Former US president Bill Clinton
has been announced as the keynote
speaker at the Centurion Scottsdale
show next year.
Remarks by President Bill Clinton
will take place on February 4 at the
invitation-only show.
Ater leaving the White House,
President Clinton established the
Clinton Foundation, which has the
mission to improve global health,
strengthen economies, promote
healthier childhoods, and protect the
environment by ostering partnerships
among governments, businesses,
NGOs and private citizens.
So ar, more than 2,100 Clinton
Global Initiative commitments have
improved the lives o 400 million
people in 180 nations.
Te Centurion Scottsdale show runs
rom January 31 (early arrivals) to
February 5. idex
Tanzanite Mine ShaftImage: Tanzanite Foundation
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Lily Collins wore a Pluma
Italia necklace to the Te MortalInstruments: City of Bones Germanypremiere at Sony Centre on August20 in Berlin, Germany.
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retail et cetera
Celebrity Choices
Actress Michelle Rodriguez chose a Le Vianring as her accessory for the 2013 Teen ChoiceAwards at Gibson Amphitheatre in August inUniversal City, California.
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Rio Tinto Diamonds
to Play Key Role in
Chinese Market
Rio intos diamonds will play an
important role in the growing Chinese
diamond jewelry market, its Diamonds
and Minerals chie executive, Alan
Davies, said recently in Hong Kong.
Speaking on the eve o exclusive
viewings o the prestigious Argyle
Pink Diamonds ender, Davies said,
Te demand or diamond jewelry in
China is expected to grow strongly
into the next decade, underpinned by
an increase in wealth and a growing
middle class.
He also said the companys Argyle
underground mine will help meet
Chinas growing demand or diamonds
and will ensure the uture supply o
a diamond production prole that is
uniquely placed to develop new types
o jewelry or the Chinese market.
Rio into said that in addition to rare
pink diamonds, Argyle also produces
large volumes o afordable diamondsthat are ideally suited to creating
ashion accessories or the emerging
middle class in China.
raditionally, the Chinese jewelry
market has been dominated by large
white diamonds used on bridal
occasions, a trend imported rom the
west, but there has been a structural
change in the China market, according
to Rio into
Chinese consumers are increasingly
seeking diamond jewelry as a daily
ashion accessory. o tap into this new
category o diamond purchasing, one
o Rio intos key initiatives has been
to partner with Chinese diamond
jewelry manuacturer and retailer
Chow ai Fook, to promote Argyle
diamonds in the jewelry giants stores.
Te resulting Australian Colours
collection has surpassed all
expectations and is now available
in more than 1,000 Chow ai Fook
stores throughout greater China, said
Davies.
OCT
2013 POLISHED
Image:
Brown Diamonds from the Argyle Mine
Image: Rio Tinto Diamonds
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OrganizersPositive About US& InternationalDiamond WeekTe summer edition o the US &
International Diamond Week in Israel
saw the Israel Diamond Exchanges
(IDE) busiest week ever, with more
than 1,200 traders, buyers and sellers
crowding the IDEs trading halls,
organizers reported in a summary othe event.
Tere were positive sales reports rom
the 400 Israeli diamond rms that
had booths at the event, particularly
among traders dealing in larger stones.
From an organizational point o view,
this was a major eort, IDE general
manager Moti Besser said. Te logistic
requirements and arrangements were
huge: screening registered buyers,
nding 600 hotel rooms, receiving,
hosting and getting the visitors into
the buildings, the business matching
breakasts, the educational program
and the social events and, o course,
the complicated but airtight security
arrangements, Besser explained.
Marketing itsel as the most secure, but
also the most user-riendly diamondexchange in the world. Te exchanges
head o security Israel Vantsovski
said, We literally had hundreds
o additional security ofcers on
call during the US & International
Diamond Week. Most o our security
team members were not noticed by
the visitors.
De Beers Buys 25%of Online Auction
Service Provider
Curtis FitchDe Beers has announced an investment
in its rough diamond online auction
sales platorm with the acquisition
o a 25-percent equity stake in online
auction service provider, Curtis Fitch.
De Beers, which sells approximately10 percent o its global rough diamond
supply through auctions, anticipates
that the investment will deepen
the partnership between the two
companies, strengthen the conditions
or urther innovation, and position
De Beers to meet the evolving needs
o a growing auctions customer base.
The US & International Diamond Weekat the Israel Diamond Exchange
Image: Israel Diamond Exchange
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Building more exibility or
rough diamond purchasers
strengthens the value o
De Beers oering, the frm
said in a statement. De
Beers is the rough diamond
online auction leader, having
launched the frst online
auction with Curtis Fitch
in 2008, and having worked
with the company over the
past fve years to introduce
innovations that add value to
to customers businesses. De
Beers has introduced rank
auction events, multiple unit
auctions and is on schedule
to launch Forward Contract
Sales, innovations whichenhance customers ability to
tailor their supply needs.
Curtis Fitch will remain an
independently managed business. As
a 25-percent shareholder, De Beers
will occupy two seats on the Curtis
Fitch board.
GJEPC and Signet
Accept Dubai Goldfor Import to IndiaTe Dubai Multi Commodities
Centre Authority (DMCC) announced
recently that the Export Promotion
Council (GJEPC) o India supports
the inclusion o imports o gold rom
Dubai Good Delivery Standard (DGD)
compliant refners into India.
Simultaneously, Signet Jewelers Ltd.
(Signet) confrmed that based on
independent evaluation, the DGD
standard is compliant with the Signet
Responsible Sourcing Protocol (SRSP)
or gold.
hese recognitions will allow
manuacturers in India to acceptgold rom reineries on the DGD list,
as well as re-assure others in the
supply chain that gold rom DGD
reineries is responsibly sourced.
DGD refneries are all required to
adhere to DMCCs Practical Sourcing
Guidance and Review Protocols.
Indian DiamondFirms Call ForProducers to CutPricesIndian diamantaires running smalland medium-sized frms that have
been hit by a declining rupee againstthe US dollar, which is making imports
expensive and increasing rough prices,are calling on diamond producers to
reduce the price o rough goods.
Diamond manuacturers are alsosuering due to static or even
declining polished prices, whichmakes expensive rough unproftableto purchase.
A drastic reduction is needed in the
prices o rough diamonds oered bythe diamond miners, Surat Diamond
Association president Dinesh Navadiatold Te imes of India. Small and
medium players are not able to buyrough diamonds, as the rupee is
trading at 68 to the dollar.
Rough diamond prices have increasedby 15-20 percent in the past year,
Image: De Beers
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while polished diamond prices havedecreased by 6 percent since January
2013, according to the report.
Naresh Patel, a rough diamond dealer,told the newspaper, Tere is no
protability let or the manuacturers
in buying rough diamonds atexorbitantly high prices. Te small
manuacturers will not buy roughdiamonds till the diamond miners
reduce prices, and the rupee easesagainst the dollar.
As a result, Indian rms are calling
on producers, including De Beers,Alrosa and Rio into, to reduce roughdiamond prices.
Major US TradeBodies SupportWorld Diamond MarkTe leaders o the major US diamond
industry organizations, the DiamondDealers Club o New York (DDC)
and the Diamond Manuacturers &Importers Association o America
(DMIA), have pledged their supportor the goals o the World Diamond
Mark (WDM).
Alex Popov, the chairman o theWorld Diamond Mark Foundation(WDMF), met with DDC president
Reuven Kauman, and DMIApresident Ronnie VanderLinden
during a visit to New York and brieedthem on the WDMs progress. BothKauman and VanderLinden pledged
their organizations support or theWDMs objectives.
Te American diamond and diamondjewelry industry caters to the worldslargest, most sophisticated and most
demanding consumer market, Popovsaid.
We are convinced that the WDM
program and in particular theAuthorized Diamond Dealer conceptwill be instrumental in boosting
consumer condence in diamonds
and diamond jewelry, and, just as
important, improve our industrys
competitive position in the luxury
consumer product market.
Kauman was positive about the
WDMs chances o success. Weve seena urry o eforts to install alternative,
generic diamond advertising and
marketing campaigns that all have
ailed. Te World Diamond Mark, we
believe, will succeed.
Meanwhile, VanderLinden talked
about the need or an across-the-board
consensus on an all-encompassing
generic marketing and advertising
campaign or diamond jewelry in the
major consumer markets. Here in the
USA, we certainly have elt the lack
o a generic, coordinated, consensual
consumer campaign or diamond
jewelry. We are certain that the WDM
program, including the Authorized
Diamond Dealer concept, constitutes
a solid business plan, he said.
Te World Diamond Mark aims to help
the diamond and jewelry industry to
grow. It is based on three undamental
principles: the education o the
jewelry retail business community
about diamonds, condence building
with the consumer public with the
WDM accreditation program and
the creation o a generic marketing
program to promote diamonds and
diamond jewelry.
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POLISHED
Polished Diamond Prices
Summer Slump: Prices Drop1.9% in Augustby Edahn Golan
150
140
130
120
110
20112010200920082007 2012 2013
PEAK
July 2011146.7
August 2013131.3
2011 Avg
135.8
2012 Avg
136.8
2013 Avg to date
133.5
Source: IDEX Online Research
Figure 1
IDEX Online Polished Diamond Price Index
2007-2013
rices o polished diamonds continued to
soten in August. Te IDEX Online Polished
Diamond Index averaged 131.3 in August,
down 1.9 percent year-over-year and 0.8
percent compared to July
August was the second month in a row o overall month-
over-month price declines, which ollowed two months o
increasing prices, resulting in a seesaw efect in month-to-
month prices since the beginning o 2012.
Overall, there has been a 5.4-percent decline since January
2012 and a 1.2-percent decline since January 2013. Te IDEXOnlinePolished Diamond Indexhas risen eight times in the20-month period and declined 12 times.
P
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The DTC logo is a trademark used under licence from DTC
Trusted by the Worlds Most Prestigious Watch & Jewellery Brands.
The beauty of mother nature stays unsurpassed. No wonder
she is the paragon of perfection, Eurostars muse. Thrilled by
her beauty, our ambition is to cut the perfect diamond, ourpride is to guarantee you nothing but the best on this planet.
True masterpieces designed so that you can deliver sparkling
success. Discover how our values shape our diamonds at
www.eurostardiamond.com.
Visit us at Taiwan Jewellery & Gem FairTaipei World Trade Center, Hall 3From November 15 - 18, 2013, booth H18-H20-J17-J19
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Bticketso
fromSeptem
ber
www.gemworldmunich.com
October 25 27, 2013Photo:AtelierTomMunsteiner
Meet the international
Gemworld in Munich !
Where the global industry meets the european market. Join one of
Europes most important gem & jewellery exhibitions in autumn.
Get in contact with industry leaders and new clients from one of the
biggest jewellery markets worldwide. The Gemworld is part ofthe Munich Show - the leading show for rough stones and minerals
in Europe. For more information visit www.gemworldmunich.com
and stay updated with the monthly newsletter.
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Financing
in the
DiamonD
inDu$try
by Edahn Golan
90 | Financing in the Diamond Industry
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Financing in the Diamond Industry | 91
m
oney makes the world go round,goes the rerain o a song rom the1972 musical movie Cabaret. Just
as this was true or Sally Bowles,the character played by Liza Minnelli, it is also true orthe many industries that rely heavily on bank fnancing.These include the global diamond industry, especially, thenarrow-margined manuacturing sector o the business.
Despite a long history o close cooperation, it oten seemsthat the diamond industry and its banking partners
are at odds with each other. On one side, diamantairesregularly request more fnancing at lower cost, whileon the other side, bankers specializing in the industryeel that traders are living in the past. In the fnanciersopinion, the diamond sector does not understand thatconditions that once existed are now gone and that newrealities demand a more measured approach.
Talking to both sides traders and bankers reveals
that the heavy dependency on fnancing is creating acertain level o unease among traders. Some are evenexpressing bitterness towards the banks. Bankers, a armore reserved crowd by nature, are viewing many otheir clients with a combination o criticism over the waymany companies are operating and hope that diamondfrms will adopt new corporate standards.
Every banker we spoke to is in agreement on two
matters: change is needed, mostly in terms o corporatetransparency, and there is actually too much fnancing,especially when it comes to the Indian banks.
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92 | Financing in the Diamond Industry
What WaS iS gone
With a history o some 150 years, the diamond industrycould not have come into existence without the support obankers. Te frst wide-scale diamond mine, Kimberley inSouth Arica, was dug by small operators working on smallclaims. As basic as their tools may seem to us today, manyo the early miners depended on bank loans to pay or theirlicenses and equipment.