Jump to content

Future Of Diamond Industry


cescyblue
 Share

Recommended Posts

I'm graduating from IT Engineering this year, and have decided to become a diamond trader. Coming from Mumbai, India, the only diamond market I've seen is local market where people are just trading with each other. 

 

My main concern is that every time I meet few people who are already into this business, they say that I should avoid this industry. But deep inside I believe that diamond industry is much more sophisticated overall globally. With the recent market situation, they have just big NO for me to enter. 

 

The question is what are your views for someone who wants to enter into this business? Is there good future? Do you encourage young people to enter this business? 

 

Note that 'these' people who are telling me not to enter are bunch of uneducated people who are just telling me with their experience from their view in local market itself. 

 

Link to comment
Share on other sites

I can't say much about India but the TRADING business in the US is terrible and getting worse.  Buying stuff from one guy and selling it to another used to be a nice stable gig, but it's basically gone.  Why?  Big players have concentrated.  Mine-to-finger companies with billion dollar budgets have no need for traders, and the little guys are focusing on narrower and narrower niches.  If you're not adding value, you're going to fail.  It's not just diamonds by the way.  Clothing, food, electronics and pretty much everything else has the same issue.  Diamonds actually have an advantage.  At least they aren't perishable. 

 

That said, there are successful people and there are people who can and do add value at a variety of places in the chain.  The total diamond market is growing and mine production is faltering.  Chinese demand is driving up prices and people who have been holding inventory for a while are making bank out of it.  The whole concept of the 'bridal tradition' seems to be solid and if brides want diamonds, grooms are going to buy them. 

 

 

Would I recommend it for a young person starting out?  Probably not, unless you're plugged in, seriously well connected, have serious personal expertise, and are endowed with serious money.  That is to say, you're part of one of those families that's been doing it for generations. 

 

I would look for a tiny niche.  Security services for companies.  Equipment for photography.  Software for tracking things.  Financial services.  Legal services.  That sort of thing.  Places where you're not actually taking possession of the goods but still have your fingers in it.

Edited by denverappraiser
  • Like 1
Link to comment
Share on other sites

Thanks Neil for the detail. 

 

Mine-to-finger companies with billion dollar budgets have no need for traders, and the little guys are focusing on narrower and narrower niches.  If you're not adding value, you're going to fail.  It's not just diamonds by the way.  Clothing, food, electronics and pretty much everything else has the same issue.  Diamonds actually have an advantage.  At least they aren't perishable. 

 

Could you elaborate more on this, please? I genuinely didn't understand. What do you mean by mine-to-finger companies?

 

Yes, I do have contact. I have a family running business and its not like running through generations, but it all started from my father. I do have contacts with other DTC sightholder companies where I could be trained too. Contacts are not at all problem. What's your opinion in that? Would you then encourage to get into business? Thanks in advance. 

Link to comment
Share on other sites

I'm less suggesting it's helpful to know someone at a sightholder as it helps to BE a sightholder. 

 

 

The diamond chain involves a great variety of steps that range from exploration to mining to shipping to cutting to jewelry manufacturing to advertising to financing.  Traditionally these have been done by a great variety of specialized companies and this provided a niche for small players.  In the last few decades we've seen a rise in large companies who do all or most of it.  Rosy Blue comes to mind from India.  Venus Jewel is another.  The difference here is that the the mine, the cutting house, the jewelry manufacture, the retail store, even the bank are all the same outfit.

 

 

These companies need good people and it's entirely possible that working for them is a good life so in that sense I have no problem with 'getting into the business'.  Perhaps I'm answering the wrong question.  30 years ago, when your father and I got into this, the diamond business (outside of mining) was dominated by small operations with 1 to 50 employees.   Little stores.  Small time manufacturers.  Small time cutters.  Traders who would buy things in quantity and sell them one at a time or buy things in one place and sell them for more in another.  On my side of the ocean we had importers and on your side you had exporters.  Relationships were very personal.   This is what has changed.  It's under the same roof now.  The importing company is a subsidiary of the exporting company which is owned by the cutting house which owns the advertising agency and so on.

 

'Mine-to-finger' means that the same company does everything from mining the stone to putting it on the final customers finger. 

Edited by denverappraiser
Link to comment
Share on other sites

  • 1 month later...

I can surely tell you one thing, these forums are watched by the big players, they are aware that the internet and selling via, is a vast growing market. I started buying and importing diamonds into the USA and began by asking questions on other forums, received nothing but negative replies that my diamonds are not good, that I will not be able to sell, that unless you know someone or have lots of money or experience, you will not be able to sell, well, i can tell you from experience, that I have been selling my diamonds locally and thru my website,

 

I found a niche - colored diamonds...  It helps if you have internet marketing experience. I was in the web design/marketing business for the last 15 years and also have programmers working for me all over.

 

Its fun for me, I buy the diamonds overseas, bring them home, next door to me in Carlsbad, is the GIA where i personally go and get them graded, they are nice there, when i go I take my 2 little kids, since I'm a stay at home dad now.. and they are very nice to me and my kids there. we have fun for a few hours while we are there checking in the goods, and pickup when they are ready. overall a great trip we do every so often.

 

I guess the bottom line is, you need to begin the process and see if it works for you. get your goods you plan on selling, setup a website with Godaddy or your own team, take images in detail, and place them on web. I like to get my diamonds Laser inscribed so I can offer a full refund if the client is not happy and return the diamond, I can ID it.

 

my two cents, good luck. its a big market out there, especially in Asia.

Link to comment
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
 Share

×
  • Create New...