Gemfields announces Mila Kunis as Global Brand Ambassador

Mila was chosen for her natural beauty, versatility, intelligence and love of rare coloured gems, making her natural fit for Gemfields.

Post By : IJ News Service On 20 February 2013 7:05 PM
Avi Paz, President of the World Federation of Diamond Bourses posted the following message on the WFDB website recently. His message urged the industry to look at the current market slowdown as an opportunity to identify and implement change. Following are his views. %% "With the onset of June, we soon will be closing out the second quarter of 2009 and a full three quarters since the onset of the global financial crisis. Slowly, prices and sales appear to be stabilising, as consumers realise that the sky has not fallen in and life continues. We are an experienced and resilient industry, and like with early crises we will survive this one. That is certain. It is now important that we look ahead and consider our business in a recovering market. Will we revert to what we were doing prior to September 2008? What have we learned? What can we do to ensure that we are less vulnerable to the occasional but inevitable downturns in the cyclical diamond jewellery market? %% Times of upheaval, while clearly complicated, also present opportunities for positive change. This current crisis is no exception. For the first time in many years, we have a golden chance of correcting two standard operating procedures in our industry, which individually have placed a tremendous burden on our members and together have had a devastating effect on profitability. I am referring to memo sales and the practice of extending inordinately lengthy payment terms to our clients. %% Memo is not a new phenomenon, but our reliance upon it has been blown completely out of proportion. Twenty years ago, such sales represented a few percentage points of our total business, but today it frequently is the norm rather than the exception. Clients have gotten used to receiving goods on consignment, without have to make any financial commitment. Today, more than 50 percent of the polished diamonds imported into the United States are later returned unsold to the suppliers. And while they sit in our clients' safes, they are out of circulation and financed, at no extra cost by us. %% Rough diamond producers demand cash for what they sell us, and we pay up as expected. But our retail clients ask for generous terms of payment, and we agree - 60 days, 90 days, 120 days and more. Add to that the fact that the goods were supplied on memo, and you will realise that a year could pass before you actually see a return on the investment you made when you purchased the rough diamond. There was a time when the diamond industry was characterised by a rapid turnover of stock. That clearly is no longer the case. Over a two decade period we effectively have been transformed into the jewellery sector's primary financier. It was not a role that we sought for ourselves, but circumstance and an inability to say "no" thrust it upon us. But, now, as the markets are in upheaval and as the banks reconsider their credit strategies, the time is right for us to demand change. The burden of financing the diamond pipeline needs to be more evenly distributed. Both the rough producers and the jewellery trade must play a more active role. %% According to figures supplied by ABN Amro, after increases in our industry's bank debt of 14 percent and 5 percent, respectively, in 2007 and 2008, our indebtedness fell between 8 percent and 18 percent during the first quarter of 2009. It is clear that we will emerge from the current crisis owing less money than we did going in, and that is a positive thing. What we must do now is discuss what needs to be done in order that it stays this way."

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