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THE “JEANSING” EFFECT OF MEGA ORDERS ON TODAY’S DEALER, RETAILER AND CONSUMER 
Oct 01, 2005 - For many years diamond jewelry was considered to be unique pieces of art for which each designer or jeweler had his own line of jewelry, artistically created by jewelry designers. Jewelry pieces were as diverse as the jeweler who created them. Although even then casting jewelry existed, there were never more than a few dozen or a few hundred of the same design.

Chains of jewelry shops were scarce and at most included only a few shops. Thus, the orders to fulfill such jewelry designs never included more than a few dozen stones, or a few hundred stones of the same size, which were fairly easily bought through the existing dealers. With the appearance of jewelry mega chain shops, however, consisting of hundreds or thousands of shops and the appearance of TV selling channels, the jewelry world has gone through a major change, affecting all levels of suppliers deep into the pipeline, mainly the cheaper stone pipeline, hence the Indian pipeline.

The possibility of a single piece of jewelry, consisting of 30 diamonds of 3 points each, being shown on television, and selling 1,000 pieces within one hour has imposed orders in the range of 30,000-100,000 pieces of the same size and quality. No single dealer was capable of supplying such vast quantities of uniform material. Thus, a new position was created in the jewelry pipeline, called the Mega Accumulators. Since no single factory could produce such quantities of uniform size of diamonds, these Mega Accumulators had the right connections with many diamond suppliers and cutters, and were able to fulfill such orders in a relatively short time. The small suppliers found themselves, in many cases, unable to join the party and they had to either expand considerably and cater for such orders or specialize in a special niche in the diamond world or remove themselves from the game.

Such uniform, vast quantities of orders had a strong effect on the diamond pipeline. Producers, in order to keep up their position in the supply, sometimes have intentionally cut diamonds to the size required, although they were losing on the yield. Many suppliers have supplied higher quality goods to accomplish the number they were committed to just so that they could keep their commitments. These have created abnormalities in dealers and manufacturers’ stock since only certain sizes were in demand, and the excess, odd to this order sizes or qualities, remain unsold in the stock.

The Mega accumulators only purchased the sizes that were suitable for their mega orders. At certain times, it seems as if the whole market was looking for the same size and type of stone. This abnormally uniform demand, although met with an adequate supply, has deformed the stock remaining in the hands of the manufacturers and dealers. In many cases, when an order for, say 5 points of KLM color, was thrown into the market at a certain price point, it affected the price of same size, higher quality goods which were not required.

THE EFFECT ON THE JEWELRY DESIGNS

Certainly, the jewelry design world has undertaken a tremendous change, too. Since these TV Mega sales had to cater for the taste of the very many, the designs had to be to the liking of as many as possible people. Unique pieces became obsolete. The only gauge for beauty and uniqueness was the number of pieces of jewelry sold within a certain period of time.

We call it the “Jeansing” effect where a simple design is to the liking of the many. Such designs have to be relatively simple, mediocre in beauty. Another point to bear in mind is that very few designers working for a Mega jeweler, can affect a considerable portion of the jewelry sold, creating some kind of homogeneity where the non-unique is the desired uniqueness.

Virtually the same affect was apparent in the Mega jewelry chains, where hundreds of shops carry identical pieces of jewelry and for which the orders usually came in hundreds or thousands of pieces of jewelry.



Since this jewelry was all made in vast quantities, their cost of production was relatively low - leading to a relatively low cost, very attractive to the consumers.

The direct TV sales have ignored the traditional position of the retailer and directed the jewelry to the cheap to very cheap market end. The small, local shops had to fight in order to survive. In many cases their customers have required jewelry similar to those on TV and also similar prices. Hence, many of them were forced to include within their display TV-like pieces of jewelry.

Soon a new position of jewelry suppliers was created. Such a supplier has specialized in TV-like pieces of jewelry which he supplied to the many small shops which didn’t belong to the Mega chain but needed such jewelry.

All in all, the effect on the world of jewelry has been not very different from that on the clothing and fashion industry, where the effect of a single designer could determine what would be bought in thousands of shops.

Regards The GemEwizard Copyright © IDEX

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