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“Diamonds Can Withstand Uncertainty” Says Varda Shine
With the diamond industry in the grip of severe recession, Varda Shine is confident about the strengths of the industry
By: Diamond World News Service
Apr 30 2009 11:52AM
Reference: 3758  

Varda Shine has had an eventful past. The career of the managing director of Diamond Trading corporation has not followed the usual stodgy linear progression of a business executive from a business school to corporate life. Born in Israel where she spent the first three decades of her life before moving to London 11 years ago, Shine did a compulsory two-year military stint in the Israeli army. After her release from the army, the young military conscript focused on a medical career and was accepted as a student by a university medical school.

To mark time during the eight months before the commencement of the medical course, Shine worked as a sales assistant in Diamdel Israel, a supplier of rough diamonds. The idea may have seemed barmy then, but soon the young aspirant was hooked on diamonds and had jettisoned all ambitions of being a doctor. Twenty-five years later she has reached the pole position of MD, DTC, and guides not only the destiny of her company but also facilitates the growth of the diamond industry globally. On the way she has acquired degrees in management from Oxford and Cranfield universities, UK and Insead in France. With the diamond industry in turmoil globally, Shine dispenses nuggets of guiding information on the industry and its future.

Diamond World : The diamond industry in India has been hit very hard by the global economic crisis. Can you provide us with some insight from the De Beers perspective?

Varda Shine: Most sectors are experiencing a decline in sales during the global economic crisis as consumers spend less and liquidity constraints force retailers and wholesalers to adjust their purchasing levels. Luxury products, including diamonds, have not been immune from the effect of this dynamic, and as a result consumers are reducing discretionary expenditure, impacting retail sales. Retailers will likely focus on reducing inventory levels in 2009. From our perspective, we are expecting smaller than normal Sights as wholesale clients (Sightholders) correct inventory levels and manage their liquidity.

Diamond World: According to the report on luxury released by De Beers in December 2008, there is going to be a shift in the concept of luxury. How will this affect DTC and its diamond consumers? Will this shift occur in India too? If so, how and when?

Varda Shine: The luxury report highlights a marked shift from conspicuous to discerning consumption in luxury in the current global economic climate. While the most affluent individuals in emerging markets are still driven primarily by conspicuous consumption – i.e. status and prestige – they are increasingly being influenced by their Western counterparts and their purchasing patterns are transforming rapidly. There is no doubt that in uncertain times, consumers gravitate toward quality, fewer but better things that represent genuine value, and deliver on a promise that endures over a lifetime. This fact was further corroborated by further consumer confidence research conducted in December in India, where 85% of a nationally representative study of 1000 consumers in SEC groups A and B agreed “‘I’ve become more selective about what I buy lately, focusing on fewer, better quality items’.

This dynamic shift will have a lasting impact on the way luxury companies do business. This is particularly relevant to the De Beers Group because we believe diamonds play a unique role in this new reality. The value of diamonds endures - they are crafted with skills acquired over generations, are savoured over a lifetime and can be worn and enjoyed season after season. Nine out of ten Indian consumers in the upper income groups agree that diamond jewellery is both something ‘that can be passed down to our children and grandchildren’ and ‘will last forever’.

Diamond World: Why was a production slowdown announced at Snap Lake mine in Canada? Won’t this push even more the slowdown?

Varda Shine : De Beers has reduced production levels across the Group since the beginning of 2009 in line with demand from DTC’s clients. This, of course, includes Canada which shut down operations for two weeks over Christmas 2008 and is planning a six week shut down at Snap Lake and Victor mines in the summer and a further two weeks at Christmas 2009.

To read detailed interview of Varda Shine,MD,DTC, Buy your copy now, Call +91 23866641, Email: mumbai@diamondworld.net

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