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Profile: Neil Ventura
Dec 22, 2013 9:40 AM
By Rapaport News
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RAPAPORT... De Beers Auction Sales is a global business involved in negotiating the sale of rough diamonds to manufacturing, retailing and trading business buyers using innovative online auctions. Originally established in Antwerp in 1964, De Beers Auction Sales is located in the world's leading diamond centers in Tel Aviv, Hong Kong, and Dubai with its corporate office in Singapore.
Name: Neil Ventura
From: Singapore
Company: De Beers Auction Sales Singapore Pte Ltd. – Senior Vice President
Rapaport News: What prompted you to pursue a career in the diamond industry?
NV: My grandfather had his own jewelry business in London, so I was exposed to the trade at an early age. Unfortunately, he passed away when I was too young to contemplate taking over the business, but the early exposure sparked my interest. I later studied geology and entered the diamond industry by joining De Beers. After joining, I began to learn how to value rough diamonds.
Rapaport News: Do you have a business philosophy that guides you in your work?
NV: I think a key part of my role is to establish and communicate the company’s direction, as well as to prioritize and assign challenging work. I ensure that the path for my team is clear and provide guidance and support by encouraging an open culture in the office, where all views are valid and welcome.
When it comes to strategic decision-making, I always ask myself if our initiatives are market-driven and, most importantly, whether they are customer-centric. It is imperative as industry professionals to remain curious and possess a sense of discovery as this contributes to continuous improvements to existing processes and standards. I believe a company can quickly get stuck when it stops challenging the assumptions under which it operates.
This approach was central to the development of the team that changed the course of De Beers Auction Sales, formerly known as Diamdel, launching and developing the current business model. The same approach is at work now as we build a different team to deliver the next chapter to take our business to greater heights.
Rapaport News: What has been the most notable change in the diamond industry over the course of your career?
NV: I think the shift from an industry mostly focused on the supply side to a much more demand-driven orientation is the biggest change. It was in recognition of this change that we pioneered the use of auctions to sell our rough, migrating away from the traditional selling approach we had been using in De Beers Auction Sales since 1964, which provided relatively few customers with access to our rough. The move opened the purchasing opportunity to all rough purchasers, and its success has acted as a catalyst for change in how rough diamonds are sold. Since 2008, we have witnessed widespread adoption of this approach amongst existing sellers of rough diamonds as well as new entrants.
De Beers Auction Sales is operating one of the most demand-driven business models in the industry today. This is exemplified by our recent innovation, Forward Contract Sales, which enables our customers to have greater control over their order requirements. This takes our philosophy of being demand-driven to the next level.
Rapaport News: What is the toughest professional challenge that you have faced?
NV: Repositioning Diamdel to be relevant and successful has been my greatest professional challenge so far.
During the repositioning, one of my first actions was to reduce headcount significantly in the third quarter of 2007, either closing down or scaling our offices around the world. It’s unpleasant work having to downsize a business and dismantle a team I previously played a role in expanding in prior years. The experience taught me that you always have to make the decisions that are right for the business, no matter how difficult personally. As I look back on what we have achieved as a team over the past several years, it reinforces the decisions I made then, as challenging as they were. I look forward to celebrating many more successes together with my team in the new year.
Rapaport News: How has the rough market evolved in 2013 in terms of the trends you have seen on the De Beers auction platform?
NV: 2013 has been a challenging year. The first half of the year saw a steady demand for our products. In the third quarter, however, we saw a cyclical slowdown aggravated by the decline in purchasing power among Indian-based businesses, driven by tighter lending controls and a relatively weaker and more volatile rupee. We witnessed a significant retraction of demand during this period. However, as the fourth quarter has progressed, demand has picked up. We have also made improvements to our products in order to meet the needs of our clients better, and this is helping to fast track the recovery in demand for our products at auction.
Rapaport News: What is the relationship between De Beers Auction Sales and De Beers Sightholder Sales in terms of supply, pricing and customer base?
NV: De Beers Auction Sales is allocated 10 percent of the company’s run-of-mine production and sells this through online auctions, while De Beers Global Sightholder Sales is allocated 90 percent. Global Sightholder Sales allocates rough diamonds by selecting customers known as sightholders, who purchase in accordance with a term contract. Auction Sales products are available to both sightholders and non-sightholders.
We have in place a process called the Dynamic Distribution System. Customers that demonstrate consistently strong demand at De Beers auctions are given the opportunity annually to apply to De Beers Global Sightholder Sales for a term contract via the annual Supplier of Choice ITO re-planning process. This enables our customers to have a chance to purchase longer-term supply from Global Sightholder Sales in addition to the spot and now short-term supply opportunities at Auction Sales.
Auction Sales operates in many of the world’s major diamond markets. Through constant interaction with customers across the world, its business model generates a detailed understanding of market dynamics and price trends that are available to De Beers.
Rapaport News: What is the motivation behind the recent introduction of De Beers forward contracts to the auction platform?
NV: Forward Contract Sales (FCS) has been a direct response to customer feedback regarding the challenges of securing regular supply at the spot sale events that we have been using to date. FCS contracts are ground-breaking in their flexibility – customers have the opportunity to purchase the Auction Sales products they require in the quantities they require. They also secure that supply for future delivery periods that match their unique requirements. For the first time, customers can literally construct their own bespoke supply contracts. For example, customers may wish to buy a steady volume in each monthly contract or flex volumes up or down each month. The combinations are limitless, and customers winning Forward Contracts at an auction today can secure the supply they require months ahead. The product content, volumes and maturities of the contracts are all customer driven.
We intend to roll FCS out in the new year across a broader range of products, spanning multiple contract maturities and we may experiment with different pricing methods in response to evolving customer feedback.
Rapaport News: What role does innovation and technology play in driving De Beers Auction sales? How does your recent investment in Curtis Fitch add value to your business?
NV: We constantly strive to innovate and transform the way diamonds are sold, acting as a catalyst for change towards a more efficient diamond market.
We launched our first online auction with Curtis Fitch in 2008. Since then, we have introduced rank auction events and multiple unit auctions. We recently launched Forward Contract Sales in December 2013 and sold out all contracts offered until March 2014. Technology is the enabler – it brings a carefully crafted customer proposition to life.
Our investment in Curtis Fitch underpins our long-term commitment to rough diamond auctions and allows the strong partnership that has developed between De Beers and Curtis Fitch to be taken to the next level. Doing so will help ensure that we maintain our position as a leading global marketer of rough diamonds, constantly at the forefront in the auction sales arena.
Rapaport News: What are your expectations for the rough market in 2014?
NV: Most forecasts seem to point to supply and demand being generally in balance next year. Notwithstanding any supply or demand side shocks, I anticipate another year of solid demand. The end of year selling season will forecast what’s to come in 2014, but much will also depend on midstream developments in India, an area we will be watching closely.
Rapaport News: What advice would you give to someone starting out in the diamond sector?
NV: Study the key themes that will determine how the industry evolves and try to position yourself at the junctures where change is likely to be profound and where you can best play a role in influencing that change. No matter where you start, always try and leave your area of responsibility in much better shape than what you inherited.
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