Abaran Jewellers, Kundapura, Mangalore
The second wave of COVID-19, which hit India in April-May this year, was the country’s worst tragedy since the Partition, says a report prepared by the Washington-based Center for Global Development. This alarming statement puts in perspective the devastation caused by the pandemic in its second appearance.
The deadly wave impacted lives, livelihoods, individual corporates and the entire economy. The gems and jewellery sector was no exception, but when Unlock 2.0 was announced, and the industry opened up, the situation turned out to be different from Unlock 1.0.
Different states faced different challenges, but Karnataka had a unique distinction – it was the only state to have a complete lockdown when the second wave hit. That negative notwithstanding, Karnataka’s gems and jewellery industry has faced the challenges with grit and determination, and things are returning to near normalcy.
“People and business have been back to normal faster than the first unlock. We can see a lot of eagerness to invest in gold, and save for future uncertainties. The general public has realized that only gold can come to their rescue in times of uncertainties,” says Ramesh Davanam, CEO, Davanam Jewellers, Bangalore.
Agrees Adarsh Murthy, MD, A Shankara Chetty & Sons, Mysore, “This time, there is less of fear and more of frustration. People are tired of the pandemic, and much of the shopping is still need-based.”
Gurmukh Singh, CEO, Neelkanth Jewellers, Bangalore, says, “People are scared to step out even now, and looking for other options, like video calling, to check out jewellery. They are hesitating to come to stores like before.”
However, most industry players agree that that Unlock 2.0 has been easier and business has picked up faster than during Unlock 1.0.
One thing is for sure -- Unlock 2.0 has forced the industry to adapt to new practices, and explore new avenues. But customer tastes in jewellery have not seen much of a change.
Says Subhas Kamath, Proprietor, Abaran Jewellers, Udupi, “We operate in Tier II and Tier III cities, where much of the population belongs to the middle class. They don’t like to experiment with fancy stuff, and their tastes tend to remain unchanged.”
The downturn in incomes resulting from the pandemic has taken its toll. “While our customers are still asking for pretty much the same stuff, the rising prices of gold have caused us to reduce the amount of gold we use in our jewellery. The designs are the same, the look is the same, it is just that the weight is lesser. For instance, if earlier we were using 200 gm to make a piece, we are now using only 160 gm. We have had to make a 15 per cent reduction in the weight of our gold ornaments. This makes it easier on the pocket of the customer,” says Vishal Bohra, CEO, Aabushan Jewellers, Bangalore.
Kamath makes an interesting observation. “We are seeing revenge spending by affluent classes. What this means is that those who are well-off are buying jewellery with a vengeance, going for stuff they wouldn’t have bought earlier. Not having had avenues of spending, the rich are splurging on jewellery like never before,” he says.
Overall Impact on Industry
Unlock 2.0 has also seen the industry make a bigger push for digitalization. Says Bohra, “The future is online. Companies will go for digitalization in a big way. Industry players are realizing that instead of investing Rs 10-Rs 15 crore in a retail outlet, it is better to expand the online presence and make it easier for customers to buy online.”
Plus, the industry has had to make some changes in the way it operates, post Unlock 2.0. “What we see now is that the entire industry has changed; it is becoming more organized, more innovative, more transparent,” opines Davanam.
But industry players are definitely apprehensive about an impending third wave, or even the fourth wave. “People are hesitant to spend unnecessarily. Causal jewellery buying has taken a bit of a backseat, but occasion-based buying goes on,” observes Murthy.
Overall, Unlock 2.0 has been much smoother than Unlock 1.0, and the gems and jewellery industry players are keeping their fingers crossed, hoping for total normalcy to return soon.