GemThoughts

August, which now recedes quickly into the past, was a good month to slow down, step back, and take some time off.  (I hope you all missed my rambling!)  After all, the business side took a distinct downturn, so why not seek some relief.  In our case, we went off to a country that is seeing enough grief of its own - Spain - but it did not seem that Spaniards were awfully upset.  Maybe we can learn something there ..... We spent a few days in Barcelona, then drove up the coast to Aiguablava, a small town on the Costa Brava.  Then went on for a day visiting the old city of Girona before coming home.  We took nearly 800 photos and here is a small sampling, with a few comments as we go along.  I hope you like the impromptu tour! The tour stops at Miro's museum, but I have much more (The Park Guell, the clifftops of the Costa Brava, the 1,000 year old Jewish sector of Girona).  If you want to see more, just comment on this blog, and I will be happ...

I still hear about retailers who think they can bully and threaten suppliers who dare to post their products, in one way or another, on the Internet.  Not only is that a teaspoon against the tide, but it is an astounding failure to understand retail dynamics and the remarkable transition we are seeing. Looked at narrowly - only in respect to the so-called battle between bricks and clicks - the issue is plain to see.  Even if a supplier does not open their own web site, their customers will post images and information about the products on their sites.  It does not matter if the web site is a pure play web retailer or another traditional jeweler.  The effect is the same - another retailer is "invading" the threatening retailer's territory.  Moreover, every evidence indicates that the more a brand or product is shown, the more everyone selling the brand benefits.  That, as I said, is looking at the issue narrowly.  But traditional jewele...

Best Buy has been in the news lately.  Its founder has resigned his position, at least partly because business has been steadily declining over the last few years and a solution has not been found.  It survived the collapse of two big rivals - Circuit City and CompUSA - and the street thought it would benefit greatly as the sole big electronics store. Apparently, that may not be the case.  The Internet has hurt, and comparisons are made to software vendors, bookstores, magazines and newspapers.  The reach, speed and low costs of Internet distribution spares nobody.  How about jewelry retailers? The most common reaction we hear is that consumers want to "feel it, and try it on."  Sounds sensible.  But it is too narrow a view.  Here are some angles to consider. Actually, what happens in electronics may the the exact opposite of what happens in jewelry.  In electronics, a consumer goes into a Best Buy to look over a piece of equipmen...

I have been going to trade shows for nearly 40 years.  That is a mind-bending long time when I stop to think about it, but it does have its advantages.  It allows some stripping away of artifacts, distractions that can mask reality. We all speak of how much the "world" has changed, and it has.  Over those years we have acquired the PC (and lost secretaries?), cell phones,  hi-def TV, digital photography.  The Internet has revolutionized our lives. We have Amazon, Youtube, Ebay and Facebook.  We have a billion sites offering a trillion products and services.  We have blogs - like this one.  The software selling business is going away, and so are many newspapers.  Privacy is a thing of the past. In our industry, whole channels of distribution have disappeared (think traditional distributors, catalog showrooms); others have shrunk in number to a handful of giants (think mall chains, discounters and department stores).  The Internet has ...

In the last week we have been reading about hundreds of man-made diamonds (MMD's) that were submitted to IGI for grading without disclosure.  Various observers tried to delve into the sourcing of the stones.  Rob Bates at JCK considered this a serious problem, as it could affect consumer confidence (rightly so), and expressed the hope that there will be some kind of "black box" solution.  Chaim Even-Zohar went into a full story about the history of Gemesis, which is being mentioned as a possible source of the stones, though they totally deny that presumption. I suggest that the starting point should be a realistic assessment of what has occurred and has been occurring for some time.  And what we need to consider for the future. MMD's (produced by HPHT and CVD processes) and HPHT treated diamonds have been in the market now for years.  In both cases, the essential fact is that the temptation not to disclose is powerful.  The added profits can be huge. ...

I recently appeared at the first conclave for FJATA (Fashion Jewelry and Accessory Trade Association), which was held at Mohegan Sun in Connecticut.  My presentation was on the blurring lines between fine jewelry and costume jewelry, and maybe that is a subject for another post.  But more important is what I heard as I sat in on the morning's session. The attendees, or most of them, are producers of the kind of products I only see when walking into a toy store or gift shop in a resort.  Cheap, and lacking any intrinsic value.  The presenters and listeners were all on the tech side, with a few principals sitting in.  The organization is only a few years old and its mission is to deal with the flood of governmental regulations confronting all manufacturers. From the jewelry point of view, the outlook is very tough, and I am guessing that we on the "fine jewelry" side have only a faint idea of what is going on - and what we are going to have to deal with. All...

We are coming up to the mid-year jewelry shows, and we will be using those events to measure the state of the industry.  At this point, there are enough signs to make us a bit ambivalent on how the rest of the year will go. One one side, the top end seems to be holding up well.  It appears that the affluent (and even the super-affluent) are continuing to buy, though at lower average price points.  Some reports from guild stores say that sales are good, though dollars are down.  That sense of caution seems to be supported by the stock markets, which continue to have declining numbers of trades, leading us to believe that people are sitting on the sidelines and holding on to cash.  Charlie Munger, Warren Buffett's partner at Berkshire Hathaway, says that is a bad idea.  The value of cash, he says, is being steadily eroded by inflation, and that will only get worse. That may be easy for him to say, as he hold billions in assets, but squirreling away cash o...