U.S. Wholesale Market Report

RAPAPORT... In an industry where trade shows seem to be increasing exponentially, JCK Las Vegas is still considered the main event for the U.S. market. With an event this massive and competition this fierce, attendees are acutely aware that they need a plan.

Months of Work
Finesse Diamonds has been attending the show for a decade, and this year the firm will also be at the JCK Premier Show. Nader Kash, vice president of diamond operations for the Manhattan-based company, recognizes “Both are very costly shows. We started preparations three months ago. We put together invitations for clients and more. It’s a complex process to get the show going. We have very nice incentives and gifts for our clients who do visit us.” Kash feels the investment of time and resources pays off. “We do expect a lot and we usually get a lot of response,” he declared.

Mehran Hakimian, president of American Jewelry Designs (AJD) in New York City, reports that approximately ten big-name independent jewelry stores he usually does business with aren’t attending this year. “I’m surprised. This is the first year I’ve experienced something like this,” he remarked. Based on that, Hakimian expects business to be slower than in the past. “They tell me they might come to JA in New York,” he noted. “I think traffic at JCK will not be as heavy.”

AJD’s strategy for success at the booth involves careful forethought. “We usually don’t promote much because we don’t have the budget. We make sure we have a nice location and work by appointment only. I’m booked up for the luxury show but I still have openings for JCK right now.”

In Sarasota, Florida, David Ramirez, executive director of brand development at Dangler Studios, admitted, “We do think there are too many shows. It gets expensive. But we’re a small niche company and we don’t have salespeople out there on the road. We go to a lot of different shows, and we’ve been going to JCK since it started. It’s worthwhile.” He conceded that the market isn’t at its best right now, but said, “We always go into the shows with a positive attitude.”

Maintaining Contacts
Mike Rabbanian, president of International Diamond Club, Inc, (IDC) in Los Angeles, California, is “very hopeful” about JCK. He believes results from the show are based on how much a company puts into it. “We try to be on top of everything. We do marketing and more advertising and we keep in close contact with our customers. We are very positive about it. If you are negative, nothing will happen.” Rabbanian’s methods include advertising in the JCK guide, sending letters to key clients and talking about the show in IDC’s newsletter.

Others take the opposite tack. Leo Frank & Sons in Troy, Michigan, doesn’t participate. “There are way too many vendors,” Sam Frank, the company’s president, explained. Costs are also a concern. “I wouldn’t be surprised if I would have to spend $20,000 to $25,000.” It’s a decision based on experience. “We were one of the first vendors at JCK. Now, your slice of the pie is so tiny. It’s not worth it. I’d much rather have some call-in customers,” Frank said. “I think we’re pretty atypical. We are getting increasing market share and our year is going to be ahead unless there is some major collapse of the economy.”

Market Uncertainty
Of course, the economy and its effects on buying loom large in everyone’s mind. “There’s no pattern right now to anything. It’s because the markets are so crazy,” said Hakimian. “When the stock market does well, the next week we see the orders come in. People pay attention to the news. Even if they are not affected by it, it still affects their thinking.” Or, as Ramirez points out, “It’s an election year. Then you throw in the subprime mortgage fiasco and the cost of oil. Probably, after the election, it will get better.” Kash sees the beginnings of a turnaround. “In the coming year, there will be an upswing in the market,” he predicted. “Business will increase, and the cash liquidity issue will be relieved to some degree. There has been a little bit of better news recently in the market. Gold prices have decreased a little.”

Marketplace 
   • Marquises are seeing increased interest. 
   • Demand for pears has slowed. 
   • Rounds continue to be the strongest sellers. 
   • Demand for good-quality, 2-carat stones is picking up. 
   • Sales of 4-carat+, high-quality goods remain extremely strong.

Article from the Rapaport Magazine - June 2008. To subscribe click here.