Keeping Pace with International Trends & Technology Pays Dividends
Fact on file :
But if we desire to boost this billion dollar exports industry, our focus has to be shifted to exports of jewellery. Not only is India’s share in exports of jewellery very nominal in comparison to the other international operators but even our contribution is not up to the mark in terms of quality and finish which also happens to be the reason for our low market share.
A thorough understanding of international demands, international fashion trends, buying patterns, focused approach, a well defined advertising campaign and support from the government will definitely help boost jewellery exports.
From jewellery manufacturers, GJEPC officials, industry experts to our Minister of Commerce, we have decision makers sharing their views as to what, when and how to increase jewellery exports of the country.
Take off Stage of India’s Jewellery Exports:
The industry started exporting jewellery only 15 years back-around 1991-1992. This is the prime reason why exports of jewellery are minimal as compared to those of diamonds.
“It was only after ‘92 that gold was available to us at international price. The machinery required by traders to undertake mass production was available at lower duty only after liberalization. Every business takes certain length of time to get stabilized and earn higher returns. Nations like Italy, Thailand, China and Turkey have an edge in exports of jewellery since they started fifty years back! Looking at this we have just put in 15 years yet the growth rate of exports is quite decent. Exports are growing at an average of 15-20 per cent each year.”
Sharing this opinion Siddharth Kedia, Vice-President Marketing, Suashish Diamonds says, “Most of the jewellery exporters entered the market around 8-10 years back. This is the basic reason why exports of jewellery from India are low as compared to exports of diamonds. Diamond business started in India decades back. Over the years it has developed its roots; similarly jewellery exports industry will take few more years to reach the maturity level.”
Target Countries for Enhancing Exports:
Besides USA and UK, countries like China, Australia, New Zealand, Japan, South America, CIS nations and Middle-East are being viewed as extremely congenial for enhancing exports.
China Watch:
Presently China seems to be the most attractive option for the traders that is why they are conducting research as to how best to enter that market.
Siddhartha Kedia opines, “China in itself is a big hub for jewellery. We are studying the market to evaluate the most suitable ways of entry.”
Dos and Don’ts to Boost Exports:
Too Much Leaning on USA not Advisable:
Sanjay Kothari, Chairman, GJEPC says, “Overdependence on US market is not going to help always; that is why we have been looking for newer markets. For this purpose we are taking part in 25 international exhibitions. Apart from Middle-East we are seeing growth potential in CIS countries, making efforts to take part in Ukraine exhibition, Kazakhastan exhibition in April. By exhibiting in these expos which may be smaller as compared to IIJS yet they would go a long way in opening new markets.”
Knowledge of International Markets Essential:
An in-depth knowledge of international market acts to the advantage of exporters. Information about their tastes and preferences, culture, festivals, buying pattern, etc. helps in meeting their demands in most effective manner.
Siddhartha Kedia, says, “In order to gaining mileage in the run, we need to keep ourselves updated of international market trends. For this purpose we have a highly competitive designing team that is constantly studying the market and R&D team that looks at creating new offerings for the market. Our strategy is to study the needs of our customers and offer a product mix best suiting to their requirements.”
Ashish Shah of Goldstar says, “We have our marketing arms located in strategic locations overseas. The personnel appointed in these regions assimilate relevant market intelligence for us. We are also subscribers to leading jewellery trade magazines, which also keep us updated on the latest fads and fashion in the industry. Professional designers are also sent abroad during peak seasons to analyze the market.”
Peru: A Ray of Hope:
Peru seeks Indian jewellery imports and is willing to sign commercial pact to boost bilateral trade.
Peru, South America’s third largest country, expects to sign a commercial agreement with India in the near future which will boost trade between the two countries in areas such as mining, steel and iron ore, ships and engines, textiles and pharmaceuticals.
A. Ramesh, the Indian Ambassador designate to Peru and Bolivia revealed, “Peru would like to import information technology, skill development, jewellery and jewellery designing from India. India currently exports a wide range of goods to Peru like drugs and pharmaceuticals, two-wheelers, automobile parts, rubber tyres, textiles, readymade garments, iron and steel products.”
Peru is a good investment destination for India because the Free Trade Agreement (FTA) it has with the US provides a platform for Indian investors to export to the US. Under the FTA, Peru exports several products to the US at zero per cent duty. The US is one of its largest investors.
Crucial Role of IT:
Information is the key to success today. With a view to get the benefit of nations’ top brains, Sanjay Bhai Kothari has voiced the need for the IITs to contribute to the jewellery industry.
Kothari says, “Instead of banking upon other countries to provide us the know-how we should try and get maximum technological assistance from our country itself. For the same I would like IITs to work on projects which would be beneficial for the gems and jewellery industry.”
Golden Rules for Jewellery Exports - FINE FINISHING, TIME, COST:
Asish Shah of Goldstar says, “Indian Jewellery Industry is almost a century old; yet we are perceived as providers of inexpensive labour. Thus the focus should now be to change this general perception. We must take inspiration from the Hong Kong and Chinese manufacturers who do not compromise on quality or the price. In order to maximize our business share, we Indians tend to undercut the price and thus it affects our craftsmanship also. At the same time we are forced to give longer credit terms. In a nut-shell, we should be innovative in our products, be competitive on the prices and focus on better craftsmanship.”
Siddharth Kedia, confirms the fact. He says, “Price, Quality and Time are three factors which are extremely crucial while meeting foreign demands and they must be taken care of.”
Importance of Jewellery Exhibitions & Trade Fairs:
Jewellery exhibitions and trade fairs are gateways to finalizing vital business deals. They provide a platform to showcase the products, to interact with buyers and sellers, to know the market pulse to develop contacts. It is very important to take part in most of the national and international exhibitions.
Ashish Shah, MD, Goldstar says, “We participate in all the major international jewellery shows across the globe. These shows are our windows to the new developments that are taking place in various markets. Our designers form the part of the delegation that attends the Jewellery Shows. These designers are professionals and have wide trade experience to judge the swing of the market.”
Advertising — Great Catalyst:
These days advertising plays a very crucial role in creating demand for a product.
Navin Mehta, opines that Indian exporters need to focus on their advertising campaigns. “Since the trend of celebrating Mother’s Day, Father’s Day Valentine Day, Friendship Day is more prevalent in Western culture, it is very important for the traders to market their appropriate goods accordingly.”
Government Liberalization:
GJEPC is discussing with the government about modification of certain norms in EXIM policy 2007.
They include:
Navin D. Mehta, President, Mumbai Diamond Traders’ Association and Chairman SEEPZ association says, “We are trying our best to make the government understand that by relaxing certain norms exports can be increased to a great extent. For instance role of custom should be minimized.”
The Minister said the sector had been neglected in the past and needed to move more rapidly towards exports, noting that a medium-term strategy evolved by the government for the gold jewellery industry had several components.
Among them are Hallmarking of jewellery to popularize the Indian brand in the global jewellery market, integration of the supply chain, joint ventures with leading suppliers, and developing intelligence on key markets.
GJEPC Prowess:
The Gem and Jewellery Export Promotion Council has always been helpful in searching for new markets for the jewellery exporters.
Precious Galleries Proposed:
The Council will be exploring new markets in different parts of the world wherein a GJEPC Precious Gallery will be organized. These galleries will have only show windows in the Council’s promotional booth. The number of show windows will depend on the size of the booth available to Council at the respective exhibition. Some of these markets where Council is having only a promotional booth with show windows are Hungry, Poland, Ukraine, Czech Republic, IJL London, France, Spain, Australia and China.
These show windows will be offered to the Council members at a reasonable rate for displaying their goods and to establish important contacts in the respective markets.
Co-operation With Angola:
An Angolan delegation visited India in October 2006. Council’s proposal of forming working groups between Angola and India for sourcing of rough diamonds, setting up of jewellery units, and facilitating trade between the jewellers was accepted by the delegation. This meeting ended on a positive note that string trade relations can be developed amongst the two countries.
Reaching Out to CIS Countries:
Recently GJEPC led an eight member delegation to CIS countries. The CIS nations included Armenia, Georgia, Azerbaijan, Ukraine and Kazakhastan. The delegation had representation of leading manufacturers from different sectors like diamonds, colored gemstones, jewellery and silver.
The objective of the delegation was to develop bilateral trade between CIS nations and India. The delegation played a significant role in exploring new markets for developing the trade.
Useful Openings for the Jewellery Industry:
Kazakhastan:
Azerbaijan:
Georgia:
Vital Facts of Australian Jewellery Market:
FICCI Support:
Recently FICCI sent its delegation to Italy from November 6 to 8. The team discussed jewellery in Vicenza.
The delegation noted that while Italy leads globally in the exports of jewellery, India is the biggest exporter of diamonds and emeralds in the world.
India is also the largest consumer of gold in the world with approximately 20 per cent share of the world production, followed by Italy and Turkey.
“The two countries share many firsts in this sector and can complement each other to retain their supremacy in the world trade in this sector,” the study states.
It suggests that joint ventures can shape up with the Indian companies outsourcing their high-end jewellery manufacturing to their Italian partners and then market it through their offices worldwide. A few Italian firms are already experimenting by exporting mountings and findings from Italy and getting them studded in India to serve the local Indian market.
“By doing so, there are substantial savings in the procurement of gemstones, as India is one of the most competitive source of diamonds and color stones in the world,” according to the reports.
Apart from exporting regular studded jewellery, many exporters are marketing their patented diamond cuts.
Siddhartha Kedia, VP, marketing Suashish says, “Well as far as exploring new sectors for exports of jewellery concerned, we are looking at promoting our proprietary cuts with 129 and 145 facets.”
Alike Suashish diamonds, Goldstar also has its 19 patented cuts which it skillfully markets through its jewellery in foreign markets. “We have about 19-patented cuts under our belt and approximately 10-patented designs products”. Goldstar caters to all kinds of client base namely the Afro-American Clientele, jewellery for the Caucasians, Spanish, Mexicans.
Although not many traders have opened up their brands in foreign markets but in the years to come a number of players would set foot in foreign markets by venturing into their exclusive stores.
Sanjay Kothari, Chairman GJEPC says, “Opening branded outlets outside India is not that easy. But in the coming years we will see a number of players coming up with their exclusive stores aboard which would definitely help marketing of Indian jewellery hence improving exports.”
Designers Exchange Program:
In order to provide a better idea about the international designs, GJEPC has initiated a ‘Designers Exchange Program’ wherein designers of various countries would be invited to conduct designing workshops and seminars to elucidate brief on the details of the international designs.
Sanjay Kothari, says, “As Italians are pioneers in jewellery so we are trying to invite Italian designers to India to conduct training seminars. Having theoretical knowledge is not enough, it is only when a professional teaches you the fundamentals of something then you actually understand the concept.”
Newer Metals & Experiments Desirable:
Since fashion trends keep changing with time, it is always welcome to experiment with newer and innovative designs, techniques and marketing as well as metals!
For instance Goldstar makes jewellery not only in the conventional metals such as gold and platinum, but palladium, titanium, rubber and stainless steel are also used to make jewellery.
Entrepreneurship to be Developed:
Union Commerce Minister Kamal Nath speaking at the 33rd annual awards function of the Gem and Jewellery Export Promotion Council, emphasized the need for gems and jewellery exporters to move out of the family domain to professionalize and adopt branding for strengthening their talent-base and global competitiveness.
While the family would remain the ‘bedrock’ of the industry, it would have to work out a strategy of branding and adopting working conditions that are up to the mark to attract top talents.
Trend Forecasting Cell: As a major step towards boosting gem and jewellery industry, a Trend Forecasting Cell has been established in Gemmological Institute of India, with the objective of giving complete overview of what influences and inspires the world’s leading designers and how customers respond to social changes.
This would be really beneficial for the exporters since design is a major factor of deciding whether or not the product would be accepted by the international market.
Nirupa Bhatt, Marketing Manager, Rio Tinto Diamonds, in her address was emphatic that adopting best corporate governance practices in the operations of firms working for the gems and jewellery industry, maintaining high standards of excellence by putting up better systems and processes would drive the industry to greater heights of glory. She claimed that Rio Tinto was able to meet ISO-9000, ISO:14000 and other international quality standards due to the introduction and adoption of Business Excellence Model from 2003 onwards.
Yogesh Dixit, Head SME Ratings, CRISIL Ltd., cautioned that India which is a world leader in diamond cutting and polishing may face fresh competition from countries like China eroding India’s stronghold in diamond processing over the long term. He also pointed out that the jewellery industry in India needs professional designers to create innovative designs for the modern, trendy international market.
Jewellery Exports in Future:
Well, the exporters and industry experts say in unison that jewellery industry will grow by leaps and bounds in the years ahead! It is with this strong belief the industry takes up all the challenges to emerge as a winner.
Navin D. Mehta, President, Mumbai Diamond Merchants Association says, “In the years to come, jewellery industry will flourish tremendously. The branded items available these days for instance clothings, pens, electronic items, watches etc. are extremely expensive as compared to jewellery. There will be a major shift to jewellery since it has a buy-back value.”
Mehta added, "Recent data revealed that in a given month there was sales of US$ 600 worth jewellery, in comparison to sale of pens worth US$300 and US$ 1000 watches in foreign markets, so I guess jewellery has a very wide scope keeping in view purchasing capacity of people.”
Siddhartha Kedia, opines, “Jewellery is a business to be in for the reason that there is tremendous scope for increasing operations. The jewellery industry in India is still in the growth stage and has a long way to go.”
Relevant Quotes:
Sanjay Kothari, Chairman, Gem and Jewellery Export promotion Council, “We want to convert our country from largest manufacturing centre into the largest trading centre therefore there is need to explore new markets and revive old ones like Japan. A national council is also needed to coordinate both domestic and overseas players in this sector.”
Navin D. Mehta, President, Mumbai Diamond Merchant Association, Chairman SEEPZ Jewellery Manufacturers Association “Time, Quality and Price are three factors on which exporters should never compromise. Exporters should focus to a greater extent on advertising campaigns abroad since they play a major role in developing demand for a particular product.”
Govind Bhai Kakadia, founder Sheetal Group:
“We pay a lot of attention to the designs and quality of the product. For the purpose we have a team of professional designers and a well trained Research & Development personnel. I guess knowledge of fashion, charm and confidence which is generated after wearing quality stuff will take time to develop in our country. Efforts should be made to design stuff keeping in view the changing fashion trends.”
Ashish Goenka, Director, Suashish Diamonds:
“We specialize in mid to lower end of casted jewellery. We have almost doubled our operations in the last few years. Besides USA, UK and UAE, we are looking for trading opportunities in European and Eastern European countries, Japan, the Far-east, Australia, etc. I hope to perform better, the exporters must have an in-depth knowledge and understanding of their customers.”
Our customer can have jewellery with a retail tag of $99 upto $ 20,000. We market aggressively in USA and Europe. US comprises 70% of our business share and balance 30% is from Europe. In both these market segments our products are available through major retail chains, Catalogue House, Tele Shopping Networks, Dot coms, Independents, Wholesalers and Cruise Liners. We have practically established networks in most of these avenues. We have been awarded as the Best Exporter from SEEPZ in the Studded Jewellery section by GJEPC for achieving INR 450 crore in 2005-2006. During our 16 years in this industry, we have been rewarded 15 times for outstanding performance in exports. We have almost doubled our achievements with the each passing year.“
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