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U.S. Wholesale
By Shuan Sim
Although many wholesalers feel that the slow months are a continuing issue, more and more sellers have reported business picking up. While many diamantaires still blame the drought in sales on the atmosphere of uncertainty cast by the presidential elections, others wonder if the industry lull has simply been caused by an entirely new consumer climate. “It seems that the young generation is simply not interested in buying diamond jewelry any more,” said Kushal Sacheti, CEO of Galaxy USA, Inc., a diamond wholesaler specializing in colored diamonds in New York City. “Business is almost dead,” he noted. However, those lucky enough to pull through the stagnant period with some sales say that clients who are buying are opting for bigger and better-quality stones.
Traders were unsure why their bigger and better-quality stones fared well but they definitely welcomed the change. “It’s not like there’s a trend or something,” commented Steve Eisen, secretary at Nat Eisen & Sons, a wholesaler in New York City. “There’s not really enough business to be able to say that it is a trend.” While Eisen is not particularly concerned yet, he anticipated a future tightness in supply of slightly larger stones as manufacturing has cooled down during 2016. “There is a depression all across the industry,” Sacheti commented, adding that to improve his business his company has shifted its focus to very high-end diamonds — sales are more sporadic but the margins are better. “There is less competition in this sector,” Sacheti pointed out. He felt that many traders have been buying less and are currently relying on old inventory, hoping to clear it out a little. Sacheti also said that a slightly increased caution over lab-grown diamonds has also shaken buyer’s confidence a little. Thankfully, many sellers have been able to achieve their requested prices without too much resistance. “The days of keystoning are mostly over. By being fair and pricing things reasonably, people understand you have to make a living,” said Jimmy Pesis, owner of Continental Diamond, based in St. Louis Park, Minnesota. Pesis noted that his business had been good, even selling diamonds in the 4-carat to 5-carat range occasionally. Sacheti feels that the key to achieving asking prices is also simply having the right goods when demand strikes. “If I have the right stone, I get my prices,” he said.
Diamantaires commented that the unexpected results of the elections so far have battered purchasers’ confidence. “A lot of people were expecting one thing from the elections so far and the outcome has many unsure. There is low optimism in the market right now,” Eisen said. He added that while his buyers have returned from their vacations, their buying mood still seemed to be off. Others felt that the future was at least not going to deteriorate. “I think the next two months should be okay,” Sacheti speculated, expecting the ramp up to the holiday season to kick in. Mark Miller, owner of Diamond Vault Reno, a diamond dealer in Reno, Nevada, said that judging by how his business has been up in the past two months, the sales should be good indicators for the industry. “You never know but I’m sure hoping for better days ahead,” Miller remarked. The key to good business, some feel, is to have sound sales practices and strong collections. “Give people a lot of time to think about the purchases and put no pressure,” Pesis said, adding that the strong support of his staff and the recognition of his diamonds have helped his business grow each year. “I am very optimistic about this holiday season,” Pesis concluded. Article from the Rapaport Magazine - September 2016. To subscribe click here.
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