Show cause notice to Surat's diamond merchant by GJEPC

The merchant was accused of selling synthetic diamonds as natural diamonds

Post By : IJ News Service On 23 March 2015 5:26 PM
|*Recent weeks have brought wave after wave of good news for the Indian jewellery industry, comprehensively washing away that last lingering dark shadows that had been cast by the global recession of 2008-2009.%% Whether it is the nine per cent GDP growth reported by the Annual Economic Survey of the Government of India, or the huge 70 per cent leap in sales of gold in the Indian market during 2010 put forward in a recent statement issued by the World Gold Council, the numbers are all beginning to add up boosting the ‘feel good’ sentiment that is widely prevalent throughout the Indian jewellery industry. %% And now, the first-ever year ending survey of the Indian jewellery industry conducted by{{ Indian Jeweller}} through an online poll, offers a clear statistical picture of the mood among jewellers across the country. It not only validates the strong growth rates reported by trade bodies during 2010, but also confirms the very bullish sentiment that prevails among the trade in the first quarter of this year. %% A two-part cover story takes a look at the big picture that is emerging through all these numbers; beginning with an overview by {{Stephen Rego}} of the year that was and the one that lies ahead, and moving on to a presentation of the{{ IJ Year End Survey}} by{{ Arpit Kala}} who collated the statistics and did all the number crunching.
rawat jewels
{{It’s All Adding Up}} |*A strong economy has boosted consumer confidence to such an extent that even the rising prices of gold and diamonds have not deterred the Indian consumer from spending large amounts on jewellery according to macro-level figures from different sources. Stephen Rego presents an overview of the India story in 2010.*|%% While the rest of the world was reeling from the economic shocks of 2008, and limped through 2009, India was one of the large economies to buck the trend and register positive growth in what many describe as one of the worst years for business in recent memory. So it is little wonder that as most of the other major economies limped back to near-zero growth, India galloped ahead in 2010, possibly emerging as the fastest growing large economy in the world during this time. %%
Pranda Jewellers
In his recent budget speech, India’s Finance Minister, Pranab Mukherjee has given a tentative figure of 9 per cent for expected GDP growth, and this may even put the country marginally ahead of its neighbour and other Asian giant, China as per current provisional estimates of Chinese GDP growth. Together the two countries are clearly important drivers of world economic growth. %% What is possibly true of the economy as a whole is clearly true of the gold market and has already been confirmed by the release of the World Gold Council’s Gold Demand Trends 2010 in mid-February. India and China together accounted for 51 per cent of total jewellery and investment demand during the year. Interestingly, while jewellery demand was up 69 per cent in India, in China it was investment demand that rose by an amazing 70 per cent. %% According to this study, India was the largest consumer of gold worldwide with a record-breaking consumption of 963.1 tonnes, a huge 66 per cent leap over 2009, and accounting for almost 25 per cent of the global demand. In value terms this translates into an amount of US$ 38 billion. %% To better understand just how strong the Indian market was, let us take a brief look at the worldwide picture. Globally, the decade closed on a highly positive note for gold, despite the sizable 40 per cent increase in the annual average price level between 2008 and 2010. The year saw demand hitting a 10-year record of 3,812.2 tonnes, driven by demand for jewellery, which rose 17 per cent to 2059.6 tonnes for the year and by 13 per cent (575.2 tonnes) in the fourth quarter, which coincides with the festive season in many parts of the world. In value terms, this resulted in record annual jewellery demand of US$ 81 billion.
This positive global performance was clearly driven by India. The WGC report notes that “At 745.7 tonnes, annual jewellery demand was 13% above the previous peak in 1998. In local currency terms, Indian jewellery demand more than doubled in 2010; a 20 per cent rise in the rupee price of gold combined with a 69 per cent rise in the volume of demand pushed up the value of gold demand by 101 per cent to Rs.1,342 bn. This compares with 2009 demand equal to Rs.669 bn.” %% Of course, these figures are extrapolated mainly from data of gold imports and inputs from the trade, as jewellery sales are not monitored by any government agency. Moreover in a huge and largely unorganised market like India, and in a sector where financial data is not easily shared, actual jewellery consumption can only be estimated. But, while there could be some questions about the finer details, the broad trend that the WGC figures represent – of a booming jewellery sector – are clearly valid.
Goenka Diamonds
"The jewellery sector enjoyed a very strong recovery in 2010," said Eily Ong, investment research manager at the WGC. "This is very encouraging... it seems consumers, particularly the largest consumers, India and China, have adjusted to higher price levels." %% Other segments of the Indian jewellery market are not monitored by any apex body, so figures, even if they are estimates, are not easy to come by. However, it appears that the demand in diamond studded, platinum and other categories of jewellery have also been fairly robust. %% Information compiled in early December for a report on the sales during the Diwali festive season and the pre-wedding purchases published in the previous issue of Indian Jeweller, revealed that on an average, diamond jewellers had reported a massive 40% increase in sales compared to the previous year. %% The festive season apparently fuelled strong growth, and while those high levels could not be sustained through the year, sales of diamond jewellery in 2010 were definitely strong. In early 2011, Varda Shine, CEO, DTC told mediapersons in London, that in China and India, the fastest growing countries for diamond jewellery, albeit from a relatively smaller base than the US, sales probably rose as much as 20 per cent during 2010. %% Similarly, {{Vaishali Banerjee,}} Manager, Platinum Guild International, India had told Indian Jeweller last December, “We have seen nearly 50 per cent increase in the sale of platinum jewellery from last year.” %% The data from these different segments, combined with inputs received from jewellers across the country in informal conversations, add up to one clear conclusion – 2010 can truly be described as the year of ‘India Shining’.
Dipti Amisha
{{IJ Year-End Survey 2010}}%% {{Through the ‘Stat’oscope}}%% |*Buoyed by a very positive performance in 2010, the Indian jewellery industry is extremely bullish on the prospects for 2011. Arpit Kala presents the findings of the first-ever year-end survey of the Indian jewellery industry conducted by Indian Jeweller through an online poll.*|%% T he retail jewellery industry in India has traditionally been scattered and unorganised, and only in the last decade or so has a small segment of this vast business begun to move into relatively more modern and contemporary forms of retailing. %% Given this scenario, there has been little systematic data available about the industry. Leave aside annual trends related to sales, volumes, profi ts, margins etc, even the actual number of jewellers across the country remains a matter of guesstimates! %% This was the context in which {{Indian Jeweller}} decided to conduct this fi rst-ever IJ Year-End Survey 2010, organised via Internet in late January. This is not the fi rst time that an attempt has been made to gather data on the Indian jewellery industry. What makes it unique however is that it studies and tries to quantify business trends for the allimportant festival–wedding season of October to December against the background of the year gone by, AND will continue to do so every year from now on. %% {{Profile of the Sample}}%% Jewellers from all across the country received an invitation by email to participate in the Survey. Over 100 responded and fi lled in their responses with a click of the mouse. Though the number may seem small when compared to the overall numbers involved in the industry, there was a fair cross sampling of types of retailers and their locations. %% As was to be expected, given the actual concentration of the industry, nearly 50 per cent of those who responded were from the West – i.e. Gujarat and Maharashtra. The remaining were divided with 22 per cent being from the North, 20 per cent from the South and just under 10 per cent from the East. A couple of those who answered had locations across regions.
The vast majority – above 88 per cent were independent jewellers, with the remaining being spread across those who retail through jewellery chains or department stores. A few were from a very new category for the Indian market – the online only retailer! %% In terms of number of physical stores too, the distribution of responses is a fairly accurate refl ection of the retail industry. A clear majority – just under 55 per cent – are single-store retailers, which was the most common industry standard for many decades, while another 25 per cent belong to a relatively new category, those who have added another outlet or two to their original business, as they attempt to keep pace with the rapidly evolving modern retail transformation. %% In terms of size too, 50 per cent of the retailers have an average of Rs 1-3 crore turnover per store, about 20 per cent are in the Rs 3-7 crore per store bracket, 5 per cent each are in the Rs 7-10 crore and Rs 10-20 crore segment and just under 10 per cent from the above Rs 50 crore category. %% {{Key Findings}}%% The Survey confi rms what observers have been seeing and reporting – 2010 has been a boom year for the trade in India, with jewellery sales surging despite the high gold prices, and a spike in diamond prices too. More than 40 per cent of the respondents reported above 20 per cent rise in sales of jewellery both for the festive season and the year as a whole. %% {{Product Categories}}%% Two major categories — gold and diamond-studded – were the major sales drivers, with over 60 per cent of the respondents reporting higher sales, but silver seems to have lost some of its sheen, partly due to record high prices of the metal itself, and probably partly as a result of consumers who had opted for silver ornaments in the slowdown of 2009, moving back to the older categories as equilibrium returned to the economy, and consumer confi dence rose. %% Investment demand for gold – in the form of coins and bars, was also up with over 50 per cent stating that sales were up. Interestingly, none of those who stock gold coins and bars reported a decline, but equally signifi cantly nearly 35 per cent of retailers do not stock what has become a relatively fast moving item in recent years.
{{Margins}}%% Massive turnovers were not achieved at the cost of margins. As many as 48.5 per cent of those surveyed reported increased margins, and 20 percent said that they had remained at the earlier levels. But 30 per cent faced a squeeze, reporting an actual decline. However, in a survey like this it is virtually impossible to correlate declining margins with other variables studied, thus preventing us from identifying why many were pleased, but a not insignifi cant number not so happy with the year gone by. %% {{Marketing and Communications}}%% Decades ago the main method by which a jeweller got known was ‘word-of-mouth’ marketing. You visited a jeweller only if earlier generations of your family or of someone whom you knew recommended him. %% The world has changed, and so have Indian jewellers, but they have clearly not yet entered the world of modern retailing, so completely dominated by marketing and branding. %% Despite the huge boom in sales, nearly 80 per cent of jewellers’ marketing spends remained the same or just ‘slightly more’ than last year. A mere 6 per cent said their budgets rose signifi cantly; the same number as those who reported a decline in their expenses on this account. %% On the Internet front, the picture is even more revealing. Even in 2011, as many as 40 per cent of retailers do not have their own website; the fi gure is all the more relevant, because these are all people who use email and are familiar enough with the Internet to participate in an online survey! On the other hand, there are signs of change -- nearly 10 per cent have ventured into some form of ecommerce, and over 35 per cent did online advertising in different ways. %% Perhaps this is related to the way retailers perceive the impact of the web on their businesses – while 50 per cent of jewellers polled believe that the impact of the Internet on fi ne jewellery retailing is growing, 27.3 per cent said that the internet effect is diminishing and 21.2 per cent that the impact has levelled out! %% {{Future Prospects}}%% Optimism prevails in virtually all corners of the country with nearly 55 per cent of jewellers very bullish about growth prospects during the current year, and another 27.3 per cent more guarded, but ‘somewhat optimistic’. Less than 10 per cent are pessimistic and about the same number are uncertain. %% Look out for our Year-End 2011 Survey to see who read the prevailing market conditions correctly!
|*{{Please purchase or subscribe the magazine for the actual survey in graphs fomat with some bullet points to summarise the main findings.}}*|
|*Recent weeks have brought wave after wave of good news for the Indian jewellery industry, comprehensively washing away that last lingering dark shadows that had been cast by the global recession of 2008-2009.%% Whether it is the nine per cent GDP growth reported by the Annual Economic Survey of the Government of India, or the huge 70 per cent leap in sales of gold in the Indian market during 2010 put forward in a recent statement issued by the World Gold Council, the numbers are all beginning to add up boosting the ‘feel good’ sentiment that is widely prevalent throughout the Indian jewellery industry. %% And now, the first-ever year ending survey of the Indian jewellery industry conducted by{{ Indian Jeweller}} through an online poll, offers a clear statistical picture of the mood among jewellers across the country. It not only validates the strong growth rates reported by trade bodies during 2010, but also confirms the very bullish sentiment that prevails among the trade in the first quarter of this year. %% A two-part cover story takes a look at the big picture that is emerging through all these numbers; beginning with an overview by {{Stephen Rego}} of the year that was and the one that lies ahead, and moving on to a presentation of the{{ IJ Year End Survey}} by{{ Arpit Kala}} who collated the statistics and did all the number crunching.
rawat jewels
{{It’s All Adding Up}} |*A strong economy has boosted consumer confidence to such an extent that even the rising prices of gold and diamonds have not deterred the Indian consumer from spending large amounts on jewellery according to macro-level figures from different sources. Stephen Rego presents an overview of the India story in 2010.*|%% While the rest of the world was reeling from the economic shocks of 2008, and limped through 2009, India was one of the large economies to buck the trend and register positive growth in what many describe as one of the worst years for business in recent memory. So it is little wonder that as most of the other major economies limped back to near-zero growth, India galloped ahead in 2010, possibly emerging as the fastest growing large economy in the world during this time. %%
Pranda Jewellers
In his recent budget speech, India’s Finance Minister, Pranab Mukherjee has given a tentative figure of 9 per cent for expected GDP growth, and this may even put the country marginally ahead of its neighbour and other Asian giant, China as per current provisional estimates of Chinese GDP growth. Together the two countries are clearly important drivers of world economic growth. %% What is possibly true of the economy as a whole is clearly true of the gold market and has already been confirmed by the release of the World Gold Council’s Gold Demand Trends 2010 in mid-February. India and China together accounted for 51 per cent of total jewellery and investment demand during the year. Interestingly, while jewellery demand was up 69 per cent in India, in China it was investment demand that rose by an amazing 70 per cent. %% According to this study, India was the largest consumer of gold worldwide with a record-breaking consumption of 963.1 tonnes, a huge 66 per cent leap over 2009, and accounting for almost 25 per cent of the global demand. In value terms this translates into an amount of US$ 38 billion. %% To better understand just how strong the Indian market was, let us take a brief look at the worldwide picture. Globally, the decade closed on a highly positive note for gold, despite the sizable 40 per cent increase in the annual average price level between 2008 and 2010. The year saw demand hitting a 10-year record of 3,812.2 tonnes, driven by demand for jewellery, which rose 17 per cent to 2059.6 tonnes for the year and by 13 per cent (575.2 tonnes) in the fourth quarter, which coincides with the festive season in many parts of the world. In value terms, this resulted in record annual jewellery demand of US$ 81 billion.
This positive global performance was clearly driven by India. The WGC report notes that “At 745.7 tonnes, annual jewellery demand was 13% above the previous peak in 1998. In local currency terms, Indian jewellery demand more than doubled in 2010; a 20 per cent rise in the rupee price of gold combined with a 69 per cent rise in the volume of demand pushed up the value of gold demand by 101 per cent to Rs.1,342 bn. This compares with 2009 demand equal to Rs.669 bn.” %% Of course, these figures are extrapolated mainly from data of gold imports and inputs from the trade, as jewellery sales are not monitored by any government agency. Moreover in a huge and largely unorganised market like India, and in a sector where financial data is not easily shared, actual jewellery consumption can only be estimated. But, while there could be some questions about the finer details, the broad trend that the WGC figures represent – of a booming jewellery sector – are clearly valid.
Goenka Diamonds
"The jewellery sector enjoyed a very strong recovery in 2010," said Eily Ong, investment research manager at the WGC. "This is very encouraging... it seems consumers, particularly the largest consumers, India and China, have adjusted to higher price levels." %% Other segments of the Indian jewellery market are not monitored by any apex body, so figures, even if they are estimates, are not easy to come by. However, it appears that the demand in diamond studded, platinum and other categories of jewellery have also been fairly robust. %% Information compiled in early December for a report on the sales during the Diwali festive season and the pre-wedding purchases published in the previous issue of Indian Jeweller, revealed that on an average, diamond jewellers had reported a massive 40% increase in sales compared to the previous year. %% The festive season apparently fuelled strong growth, and while those high levels could not be sustained through the year, sales of diamond jewellery in 2010 were definitely strong. In early 2011, Varda Shine, CEO, DTC told mediapersons in London, that in China and India, the fastest growing countries for diamond jewellery, albeit from a relatively smaller base than the US, sales probably rose as much as 20 per cent during 2010. %% Similarly, {{Vaishali Banerjee,}} Manager, Platinum Guild International, India had told Indian Jeweller last December, “We have seen nearly 50 per cent increase in the sale of platinum jewellery from last year.” %% The data from these different segments, combined with inputs received from jewellers across the country in informal conversations, add up to one clear conclusion – 2010 can truly be described as the year of ‘India Shining’.
Dipti Amisha
{{IJ Year-End Survey 2010}}%% {{Through the ‘Stat’oscope}}%% |*Buoyed by a very positive performance in 2010, the Indian jewellery industry is extremely bullish on the prospects for 2011. Arpit Kala presents the findings of the first-ever year-end survey of the Indian jewellery industry conducted by Indian Jeweller through an online poll.*|%% T he retail jewellery industry in India has traditionally been scattered and unorganised, and only in the last decade or so has a small segment of this vast business begun to move into relatively more modern and contemporary forms of retailing. %% Given this scenario, there has been little systematic data available about the industry. Leave aside annual trends related to sales, volumes, profi ts, margins etc, even the actual number of jewellers across the country remains a matter of guesstimates! %% This was the context in which {{Indian Jeweller}} decided to conduct this fi rst-ever IJ Year-End Survey 2010, organised via Internet in late January. This is not the fi rst time that an attempt has been made to gather data on the Indian jewellery industry. What makes it unique however is that it studies and tries to quantify business trends for the allimportant festival–wedding season of October to December against the background of the year gone by, AND will continue to do so every year from now on. %% {{Profile of the Sample}}%% Jewellers from all across the country received an invitation by email to participate in the Survey. Over 100 responded and fi lled in their responses with a click of the mouse. Though the number may seem small when compared to the overall numbers involved in the industry, there was a fair cross sampling of types of retailers and their locations. %% As was to be expected, given the actual concentration of the industry, nearly 50 per cent of those who responded were from the West – i.e. Gujarat and Maharashtra. The remaining were divided with 22 per cent being from the North, 20 per cent from the South and just under 10 per cent from the East. A couple of those who answered had locations across regions.
The vast majority – above 88 per cent were independent jewellers, with the remaining being spread across those who retail through jewellery chains or department stores. A few were from a very new category for the Indian market – the online only retailer! %% In terms of number of physical stores too, the distribution of responses is a fairly accurate refl ection of the retail industry. A clear majority – just under 55 per cent – are single-store retailers, which was the most common industry standard for many decades, while another 25 per cent belong to a relatively new category, those who have added another outlet or two to their original business, as they attempt to keep pace with the rapidly evolving modern retail transformation. %% In terms of size too, 50 per cent of the retailers have an average of Rs 1-3 crore turnover per store, about 20 per cent are in the Rs 3-7 crore per store bracket, 5 per cent each are in the Rs 7-10 crore and Rs 10-20 crore segment and just under 10 per cent from the above Rs 50 crore category. %% {{Key Findings}}%% The Survey confi rms what observers have been seeing and reporting – 2010 has been a boom year for the trade in India, with jewellery sales surging despite the high gold prices, and a spike in diamond prices too. More than 40 per cent of the respondents reported above 20 per cent rise in sales of jewellery both for the festive season and the year as a whole. %% {{Product Categories}}%% Two major categories — gold and diamond-studded – were the major sales drivers, with over 60 per cent of the respondents reporting higher sales, but silver seems to have lost some of its sheen, partly due to record high prices of the metal itself, and probably partly as a result of consumers who had opted for silver ornaments in the slowdown of 2009, moving back to the older categories as equilibrium returned to the economy, and consumer confi dence rose. %% Investment demand for gold – in the form of coins and bars, was also up with over 50 per cent stating that sales were up. Interestingly, none of those who stock gold coins and bars reported a decline, but equally signifi cantly nearly 35 per cent of retailers do not stock what has become a relatively fast moving item in recent years.
{{Margins}}%% Massive turnovers were not achieved at the cost of margins. As many as 48.5 per cent of those surveyed reported increased margins, and 20 percent said that they had remained at the earlier levels. But 30 per cent faced a squeeze, reporting an actual decline. However, in a survey like this it is virtually impossible to correlate declining margins with other variables studied, thus preventing us from identifying why many were pleased, but a not insignifi cant number not so happy with the year gone by. %% {{Marketing and Communications}}%% Decades ago the main method by which a jeweller got known was ‘word-of-mouth’ marketing. You visited a jeweller only if earlier generations of your family or of someone whom you knew recommended him. %% The world has changed, and so have Indian jewellers, but they have clearly not yet entered the world of modern retailing, so completely dominated by marketing and branding. %% Despite the huge boom in sales, nearly 80 per cent of jewellers’ marketing spends remained the same or just ‘slightly more’ than last year. A mere 6 per cent said their budgets rose signifi cantly; the same number as those who reported a decline in their expenses on this account. %% On the Internet front, the picture is even more revealing. Even in 2011, as many as 40 per cent of retailers do not have their own website; the fi gure is all the more relevant, because these are all people who use email and are familiar enough with the Internet to participate in an online survey! On the other hand, there are signs of change -- nearly 10 per cent have ventured into some form of ecommerce, and over 35 per cent did online advertising in different ways. %% Perhaps this is related to the way retailers perceive the impact of the web on their businesses – while 50 per cent of jewellers polled believe that the impact of the Internet on fi ne jewellery retailing is growing, 27.3 per cent said that the internet effect is diminishing and 21.2 per cent that the impact has levelled out! %% {{Future Prospects}}%% Optimism prevails in virtually all corners of the country with nearly 55 per cent of jewellers very bullish about growth prospects during the current year, and another 27.3 per cent more guarded, but ‘somewhat optimistic’. Less than 10 per cent are pessimistic and about the same number are uncertain. %% Look out for our Year-End 2011 Survey to see who read the prevailing market conditions correctly!
|*{{Please purchase or subscribe the magazine for the actual survey in graphs fomat with some bullet points to summarise the main findings.}}*|
|*Recent weeks have brought wave after wave of good news for the Indian jewellery industry, comprehensively washing away that last lingering dark shadows that had been cast by the global recession of 2008-2009.%% Whether it is the nine per cent GDP growth reported by the Annual Economic Survey of the Government of India, or the huge 70 per cent leap in sales of gold in the Indian market during 2010 put forward in a recent statement issued by the World Gold Council, the numbers are all beginning to add up boosting the ‘feel good’ sentiment that is widely prevalent throughout the Indian jewellery industry. %% And now, the first-ever year ending survey of the Indian jewellery industry conducted by{{ Indian Jeweller}} through an online poll, offers a clear statistical picture of the mood among jewellers across the country. It not only validates the strong growth rates reported by trade bodies during 2010, but also confirms the very bullish sentiment that prevails among the trade in the first quarter of this year. %% A two-part cover story takes a look at the big picture that is emerging through all these numbers; beginning with an overview by {{Stephen Rego}} of the year that was and the one that lies ahead, and moving on to a presentation of the{{ IJ Year End Survey}} by{{ Arpit Kala}} who collated the statistics and did all the number crunching.
rawat jewels
{{It’s All Adding Up}} |*A strong economy has boosted consumer confidence to such an extent that even the rising prices of gold and diamonds have not deterred the Indian consumer from spending large amounts on jewellery according to macro-level figures from different sources. Stephen Rego presents an overview of the India story in 2010.*|%% While the rest of the world was reeling from the economic shocks of 2008, and limped through 2009, India was one of the large economies to buck the trend and register positive growth in what many describe as one of the worst years for business in recent memory. So it is little wonder that as most of the other major economies limped back to near-zero growth, India galloped ahead in 2010, possibly emerging as the fastest growing large economy in the world during this time. %%
Pranda Jewellers
In his recent budget speech, India’s Finance Minister, Pranab Mukherjee has given a tentative figure of 9 per cent for expected GDP growth, and this may even put the country marginally ahead of its neighbour and other Asian giant, China as per current provisional estimates of Chinese GDP growth. Together the two countries are clearly important drivers of world economic growth. %% What is possibly true of the economy as a whole is clearly true of the gold market and has already been confirmed by the release of the World Gold Council’s Gold Demand Trends 2010 in mid-February. India and China together accounted for 51 per cent of total jewellery and investment demand during the year. Interestingly, while jewellery demand was up 69 per cent in India, in China it was investment demand that rose by an amazing 70 per cent. %% According to this study, India was the largest consumer of gold worldwide with a record-breaking consumption of 963.1 tonnes, a huge 66 per cent leap over 2009, and accounting for almost 25 per cent of the global demand. In value terms this translates into an amount of US$ 38 billion. %% To better understand just how strong the Indian market was, let us take a brief look at the worldwide picture. Globally, the decade closed on a highly positive note for gold, despite the sizable 40 per cent increase in the annual average price level between 2008 and 2010. The year saw demand hitting a 10-year record of 3,812.2 tonnes, driven by demand for jewellery, which rose 17 per cent to 2059.6 tonnes for the year and by 13 per cent (575.2 tonnes) in the fourth quarter, which coincides with the festive season in many parts of the world. In value terms, this resulted in record annual jewellery demand of US$ 81 billion.
This positive global performance was clearly driven by India. The WGC report notes that “At 745.7 tonnes, annual jewellery demand was 13% above the previous peak in 1998. In local currency terms, Indian jewellery demand more than doubled in 2010; a 20 per cent rise in the rupee price of gold combined with a 69 per cent rise in the volume of demand pushed up the value of gold demand by 101 per cent to Rs.1,342 bn. This compares with 2009 demand equal to Rs.669 bn.” %% Of course, these figures are extrapolated mainly from data of gold imports and inputs from the trade, as jewellery sales are not monitored by any government agency. Moreover in a huge and largely unorganised market like India, and in a sector where financial data is not easily shared, actual jewellery consumption can only be estimated. But, while there could be some questions about the finer details, the broad trend that the WGC figures represent – of a booming jewellery sector – are clearly valid.
Goenka Diamonds
"The jewellery sector enjoyed a very strong recovery in 2010," said Eily Ong, investment research manager at the WGC. "This is very encouraging... it seems consumers, particularly the largest consumers, India and China, have adjusted to higher price levels." %% Other segments of the Indian jewellery market are not monitored by any apex body, so figures, even if they are estimates, are not easy to come by. However, it appears that the demand in diamond studded, platinum and other categories of jewellery have also been fairly robust. %% Information compiled in early December for a report on the sales during the Diwali festive season and the pre-wedding purchases published in the previous issue of Indian Jeweller, revealed that on an average, diamond jewellers had reported a massive 40% increase in sales compared to the previous year. %% The festive season apparently fuelled strong growth, and while those high levels could not be sustained through the year, sales of diamond jewellery in 2010 were definitely strong. In early 2011, Varda Shine, CEO, DTC told mediapersons in London, that in China and India, the fastest growing countries for diamond jewellery, albeit from a relatively smaller base than the US, sales probably rose as much as 20 per cent during 2010. %% Similarly, {{Vaishali Banerjee,}} Manager, Platinum Guild International, India had told Indian Jeweller last December, “We have seen nearly 50 per cent increase in the sale of platinum jewellery from last year.” %% The data from these different segments, combined with inputs received from jewellers across the country in informal conversations, add up to one clear conclusion – 2010 can truly be described as the year of ‘India Shining’.
Dipti Amisha
{{IJ Year-End Survey 2010}}%% {{Through the ‘Stat’oscope}}%% |*Buoyed by a very positive performance in 2010, the Indian jewellery industry is extremely bullish on the prospects for 2011. Arpit Kala presents the findings of the first-ever year-end survey of the Indian jewellery industry conducted by Indian Jeweller through an online poll.*|%% T he retail jewellery industry in India has traditionally been scattered and unorganised, and only in the last decade or so has a small segment of this vast business begun to move into relatively more modern and contemporary forms of retailing. %% Given this scenario, there has been little systematic data available about the industry. Leave aside annual trends related to sales, volumes, profi ts, margins etc, even the actual number of jewellers across the country remains a matter of guesstimates! %% This was the context in which {{Indian Jeweller}} decided to conduct this fi rst-ever IJ Year-End Survey 2010, organised via Internet in late January. This is not the fi rst time that an attempt has been made to gather data on the Indian jewellery industry. What makes it unique however is that it studies and tries to quantify business trends for the allimportant festival–wedding season of October to December against the background of the year gone by, AND will continue to do so every year from now on. %% {{Profile of the Sample}}%% Jewellers from all across the country received an invitation by email to participate in the Survey. Over 100 responded and fi lled in their responses with a click of the mouse. Though the number may seem small when compared to the overall numbers involved in the industry, there was a fair cross sampling of types of retailers and their locations. %% As was to be expected, given the actual concentration of the industry, nearly 50 per cent of those who responded were from the West – i.e. Gujarat and Maharashtra. The remaining were divided with 22 per cent being from the North, 20 per cent from the South and just under 10 per cent from the East. A couple of those who answered had locations across regions.
The vast majority – above 88 per cent were independent jewellers, with the remaining being spread across those who retail through jewellery chains or department stores. A few were from a very new category for the Indian market – the online only retailer! %% In terms of number of physical stores too, the distribution of responses is a fairly accurate refl ection of the retail industry. A clear majority – just under 55 per cent – are single-store retailers, which was the most common industry standard for many decades, while another 25 per cent belong to a relatively new category, those who have added another outlet or two to their original business, as they attempt to keep pace with the rapidly evolving modern retail transformation. %% In terms of size too, 50 per cent of the retailers have an average of Rs 1-3 crore turnover per store, about 20 per cent are in the Rs 3-7 crore per store bracket, 5 per cent each are in the Rs 7-10 crore and Rs 10-20 crore segment and just under 10 per cent from the above Rs 50 crore category. %% {{Key Findings}}%% The Survey confi rms what observers have been seeing and reporting – 2010 has been a boom year for the trade in India, with jewellery sales surging despite the high gold prices, and a spike in diamond prices too. More than 40 per cent of the respondents reported above 20 per cent rise in sales of jewellery both for the festive season and the year as a whole. %% {{Product Categories}}%% Two major categories — gold and diamond-studded – were the major sales drivers, with over 60 per cent of the respondents reporting higher sales, but silver seems to have lost some of its sheen, partly due to record high prices of the metal itself, and probably partly as a result of consumers who had opted for silver ornaments in the slowdown of 2009, moving back to the older categories as equilibrium returned to the economy, and consumer confi dence rose. %% Investment demand for gold – in the form of coins and bars, was also up with over 50 per cent stating that sales were up. Interestingly, none of those who stock gold coins and bars reported a decline, but equally signifi cantly nearly 35 per cent of retailers do not stock what has become a relatively fast moving item in recent years.
{{Margins}}%% Massive turnovers were not achieved at the cost of margins. As many as 48.5 per cent of those surveyed reported increased margins, and 20 percent said that they had remained at the earlier levels. But 30 per cent faced a squeeze, reporting an actual decline. However, in a survey like this it is virtually impossible to correlate declining margins with other variables studied, thus preventing us from identifying why many were pleased, but a not insignifi cant number not so happy with the year gone by. %% {{Marketing and Communications}}%% Decades ago the main method by which a jeweller got known was ‘word-of-mouth’ marketing. You visited a jeweller only if earlier generations of your family or of someone whom you knew recommended him. %% The world has changed, and so have Indian jewellers, but they have clearly not yet entered the world of modern retailing, so completely dominated by marketing and branding. %% Despite the huge boom in sales, nearly 80 per cent of jewellers’ marketing spends remained the same or just ‘slightly more’ than last year. A mere 6 per cent said their budgets rose signifi cantly; the same number as those who reported a decline in their expenses on this account. %% On the Internet front, the picture is even more revealing. Even in 2011, as many as 40 per cent of retailers do not have their own website; the fi gure is all the more relevant, because these are all people who use email and are familiar enough with the Internet to participate in an online survey! On the other hand, there are signs of change -- nearly 10 per cent have ventured into some form of ecommerce, and over 35 per cent did online advertising in different ways. %% Perhaps this is related to the way retailers perceive the impact of the web on their businesses – while 50 per cent of jewellers polled believe that the impact of the Internet on fi ne jewellery retailing is growing, 27.3 per cent said that the internet effect is diminishing and 21.2 per cent that the impact has levelled out! %% {{Future Prospects}}%% Optimism prevails in virtually all corners of the country with nearly 55 per cent of jewellers very bullish about growth prospects during the current year, and another 27.3 per cent more guarded, but ‘somewhat optimistic’. Less than 10 per cent are pessimistic and about the same number are uncertain. %% Look out for our Year-End 2011 Survey to see who read the prevailing market conditions correctly!
|*{{Please purchase or subscribe the magazine for the actual survey in graphs fomat with some bullet points to summarise the main findings.}}*|

Be the first to comment

Leave a comment

Related News

Email Alerts

WhatsApp Alerts