RAPAPORT... Founded in 1983 by J.B. Shah, J.B. And Brothers is a diamond manufacturer with offices in India, Belgium, Israel, Hong Kong, Dubai, New York and Canada.
 Name: Vijay Shah
From: India
Company: J.B. And Brothers Pvt. Ltd. – Director
Rapaport News: What prompted you to pursue a career in the diamond industry?
VS: I joined the family business to help my brother Jitubhai expand the company and manage the challenges of the business. The vision behind our company relies on vigorously adhering to honest and transparent business practices, while offering our clients better products and prices than our competitors.
Rapaport News: What is the biggest change you have witnessed in the diamond industry and what is the biggest challenge facing the industry today?
VS: The gem and jewelry industry has evolved toward becoming more professional and is being driven by conglomerates. There has also been a move to use new technology and consequently to develop greater know-how. Today, one of the biggest challenges is confirming the authenticity of natural diamonds and the issue of disclosure for synthetic diamonds.
Rapaport News: Indian diamond manufacturers had a tough year in 2013 due to difficult market conditions. How did J.B. And Brothers navigate these challenges?
VS: Overall, 2013 was a good year for the company. More than 85 percent of our business is based on exports, which are priced in dollars. Consequently, the rupee currency volatility had a marginal impact on our business. Other factors were more significant for us, such as concerns regarding whether diamonds being sold were natural or synthetic, the availability and price of rough and tighter bank lending. These market forces taught us to be more cautious and the benefits of moving toward leaner business operations.
At the moment, the market is steady and showing signs of good growth potential for the rest of 2014. Upward corrections are expected in overall polished demand from the third quarter onward.
Rapaport News: Your company recently received a De Beers sight through your Belgium office, Yael Star. How will having a sight impact your business?
VS: The ability to engage in primary sourcing of rough will directly impact our input costs and help us achieve a better bottom line. At the same time, it ensures for our company steady input for manufacturing so that we can offer our customers a steady supply of polished goods, which should boost customer loyalty.
Becoming a sightholder also brings a good deal of respect from the rest of the industry.
Rapaport News: What trends do you see in the rough market currently?
VS: The amount of rough available from the mines is being depleted, so prices are rising. However, the increase in polished prices is not directly correlated with rough prices due to a variety of other market forces. Therefore, we have more or less seen a steady trend in rough prices during the last few quarters. Rough has already increased quite a bit in recent months so I expect that prices will be very steady in the next few quarters.
Another problem in the rough market is the spillover from the polished goods stuck in the Gemological Institute of America (GIA). The GIA turnaround time is now almost 3 months on average, which is affecting business throughout the pipeline.
What that means is that everyone’s buying capacity has been reduced because, in effect, their money is stuck in the GIA. I don't think this problem will be improved in the short term, especially since we have heard from the GIA that they are receiving 20 percent to 25 percent more goods for certification than they are turning out. So the delay times will probably grow. This tie-up carries over into what companies can afford to pay for rough, so I don’t expect that rough prices will continue to rise.
Rapaport News: What are some of the concerns facing the industry in India and what should be done to ensure India’s position as the largest manufacturing and trading center?
VS: Greater political stability and better government policy would help increase polished manufacturing output. New projects to improve the infrastructure in India and to develop more efficient tariff and import-export procedures would facilitate the expansion of the trade. If India’s export customs authorities adopted newer technology, for example, it would help reduce the shipping turnaround time and enable a tighter delivery schedule.
Rapaport News: What advice would you give to someone starting out in the diamond and jewelry industry?
VS: Stay lean, work to decrease your turnaround time and always optimize your inventory. Make sure to limit your debts and focus on providing excellent products and excellent customer service.
Rapaport News: How do you envision your business 10 years from now?
VS: We will bring the next generation of the family into the business. They will implement new and better technologies to make the next decade outshine the last.
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