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Adding Value Through Personal Relationships
Q&A with Amit Dhamani, CEO of Dhamani
May 8, 2015 2:52 AM
By Ronen Shnidman
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RAPAPORT... Dhamani is a vertically-integrated company that specializes in the manufacture, wholesale and retail of colored gemstones and diamond jewelry. The company is headquartered in Dubai but has procurement and manufacturing operations in Thailand and Europe. Amit Dhamani, CEO and managing director of Dhamani, spoke with Rapaport News about the family-owned company’s rapid growth and its plans to become a globally-recognized brand in the jewelry industry.
Rapaport News: How did you and your family become involved in the diamond industry?
 AD: My father, L.N. Dhamani, started the company in 1969 in Jaipur, India where I was born and raised. Jaipur is known for being a center of the colored gemstone trade and we started out in colored gemstones, specifically emeralds.
My father was a young entrepreneur who made trips around the world as early as the mid-1970s selling colored gemstones. His business evolved toward developing good, solid relationships with some big brands in Europe, the U.S. and the Far East, procuring polished gemstones for them.
My father was a one-man show until I joined the business in 1990. He took me to visit his clients around the world and when I was 18 years old, he asked me where I thought we should set up shop.
I chose Thailand as the location for our home office, rather than somewhere in the U.S. or Europe, because it was a major procurement center for us.
Within two or three years, we diversified from supplying predominantly emeralds to also dealing in rubies and sapphires. Our customers were happy that we were providing them with a greater selection of stones and they knew we were trustworthy.
One of the ways we built trust with our clients, even in the early 1990s, was that we always made sure to certify every gemstone we bought and sold.
By the mid-1990s, my younger brothers Rohit and Manish joined to help the family business expand. We would ship gemstone parcels to customers and our clients sitting in a small town in Europe or the U.S. were content knowing that they would receive exactly what they wanted.
The mutual trust we enjoyed also led us into polished diamonds. Our clients also wanted us to provide them with diamonds because even after we took our profit they were still making more money from our gemstones.
Every corner of the industry in which we operate we entered because our customers wanted it.
With diamonds, we started with white and colorless diamonds, traveling to Surat and buying thousands of carats at a time.
RN: How did Dhamani end up in Dubai?
AD: During our trip around the world in 1991, I came to Dubai and the United Arab Emirates (UAE) with my father, who had already been active here since the late 1980s. We had two or three regular private customers here.
In 1997, when the Asian financial crisis hit, and the Thai baht and most other regional currencies plummeted, we re-evaluated our operations. As a family, we realized that our business was truly global, but we were sitting in Thailand where our wealth was exposed to local currency risk. We decided that we should be based in a neutral market, and in 1997 I moved permanently from Bangkok to Dubai.
Our Middle East business grew rapidly after we moved to Dubai and diamonds helped dramatically increase our level of trade. We were able to become a one-stop supplier of gems and diamonds to a large customer base in the region. Today, we still polish emeralds in India, but we also trade in rubies, sapphires and diamonds, mainly supplying to other jewelers.
RN: How did Dhamani get into retail?
AD: When we moved to Dubai, we were selling gemstones and diamonds at a wholesale level, but we also explored what this region had to offer us. In the late 1990s, we heard the vision of Sheikh Mohammed, ruler of Dubai and vice president of the UAE, to make this city into a world tourism destination.
As a family, we thought that if we went into retail in an established market it would upset our wholesale customers, but Dubai at that time was still developing as a market. Everything was open. In 2000, we opened our first retail store in the Deira Gold Souk in Dubai.
I think that was the transformational point for Dhamani as a brand. Since we opened our first store, we have grown our retail operations organically. It has been a real learning experience. We developed a company DNA of providing greater value to customers without directly competing with other jewelers.
Our jewelry has always been unique. When we opened our first store, it wasn’t like the other stores around us because it had a wide mix of gems, diamonds and jewelry. Even the store itself looked different.
When jewelers couldn’t supply their customers with what they wanted, they would ask us to sell them a piece of jewelry wholesale so they could sell it to their client. Wholesale still constitutes 50 percent of our business today.
In 2005, we opened our first store inside the Mall of the Emirates in Dubai and we also received sole rights to sell the Dubai cut diamond. This year we opened our first store in Oman and today we have 17 stores throughout the UAE.
RN: What is the Dubai cut?
AD: We received the rights from the Dubai Multi Commodities Centre (DMCC), which came up with the idea of a 99-facet diamond. They were looking for a company that could retail it and we pitched them a unique jewelry design with the Dubai cut. The concept was that every piece of jewelry with a Dubai-cut diamond would have a unique D insignia. For example, the band has a D, the links have a D, the bags have a D, etc. They liked the idea and awarded us the rights.
The 99 facets in the cut actually symbolizes the holy name of Allah in the Quran. It’s an amazingly long, radiant cut, so the 99 facets actually give a good luster. It is a unique looking stone that can serve as a special souvenir or gift from Dubai.
We are very proud that we are the only jeweler that sells the Dubai cut. It has differentiated Dhamani from other jewelers. We even invested in getting a brand strategist from London to help us develop our brand and avoid becoming a generic jeweler.
RN: What distinguishes the UAE from other jewelry markets?
AD: I think the biggest difference is that it’s a tourist destination as customers from all over the world come to the UAE. I think that one of the biggest contributors to growth in the UAE jewelry market has been Emirates Airlines, which flies to every continent and most major cities around the world. This means that a lot people are coming here to visit or for just a short stopover before heading to another destination.
As a result, we have a very diverse mix of customers in the UAE and that is why there are a lot of different types of jewelry available in Dubai. You can find 18-karat, 21-karat, 22-karat and 24-karat gold, as well as diamonds, colored gemstones and pearls. It also means that most retailers focus on a specific customer group or audience.
RN: Do you think that Dubai can serve as a diamond trading hub for the Middle East or will it take a backseat to Turkey?
AD: Dubai has certainly become a global diamond trading hub, which supplies diamonds to the rest of the Middle East.
I think that Turkey has a complimentary role to play. The people over there are very clear about wanting to increase Turkey’s competence in the manufacturing segment to become a jewelry manufacturing hub.
At the same time, we are not necessarily serving the same consumers on the retail side. Turkish jewelers typically cater to Eastern European or Russian customers. At Dhamani, we cater to all nationalities. Given the region we are in, I would say that about 50 percent of our clients are Arab, but the remaining 50 percent are from all over the world.
RN: Does Dhamani see itself mainly competing with Indian or Western brands?
AD: As a family we are proud Indians, but our business is based in the UAE and stylistically we are most similar to the European brands. We actually manufacture in an atelier in Paris and a majority of our jewelry today is made in Europe. The rest is made at our factory in Thailand.
In terms of design, we compete with high-end Western brands.
RN: Where do you see Dhamani in the next five years?
AD: A majority of our jewelry had diamonds certified by the Gemological Institute of America (GIA) already six or seven years ago. Today, we’re at a level of quality where the majority of our jewelry contains triple EX diamonds.
Looking ahead, we are moving in the direction of fixed-price stores, as opposed to traditional store sales where the price is negotiated.
Right now, we are focused on ways to grow the brand and refine it. Our retail operation is very young as it is less than 10 years old. We are trying to take the best principles and practices from all of the different companies out there and create a great personalized experience that provides added value to our customers. Dhamani is trying to be a personalized jeweler for high-end customers.
I think that within the next five years we will have two or three high-end retail locations elsewhere in the globe. We are open to any top retail destination if the right opportunity comes along.
RN: What advice would you give to someone seeking to enter the retail jewelry market in the UAE today?
AD: The UAE is a market that is very open to embracing new trends and styles. This country embraces all kinds of nationalities, jewelry styles and products in general.
I think a company’s success in this market depends on what strengths they can draw on to bring something interesting to the table for the customer. If they have something to offer that others don’t, they can adapt their strengths to customers here and succeed. I think that is different from most other markets. You can find your own niche here if you have something to offer.
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Tags:
bangkok, Colored Gemstone, Dhamani, Dubai, Dubai Cut, emerald, jaipur, Ronen Shnidman, thailand
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