January 27, 16
(IDEX Online News) – IDEX editor Danielle Max puts some questions to newly elected Israel Diamond Exchange (IDE) president Yoram Dvash and discovers his thoughts on a range of subjects pertaining to the Israeli industry.
Danielle Max: What can the Israeli industry do to be more proactive in promoting itself and strengthening its position in the near and long term?
Yoram Dvash: Our strength is in our resilience. We need to concentrate on what we are and have proven to be good at. In manufacturing, we are now a lean industry, but we are recognized worldwide as manufacturers and traders of large fancy-shaped and fancy colored diamonds. While that often headlines our promotional efforts, we also remain one of the leading trading centers for a wide variety of polished goods. Buyers know that when they come to Israel or buy from Israeli traders, they are offered not only an excellent product, but can also rely on top quality service. The Israeli diamond business community has a solid reputation for developing long-term, valuable relationships with their buyers, going the extra mile.
In the long term, I see our industry developing more vertically integrated products. By teaming up with leading jewelry manufacturers, houses and designers, our members will become better integrated and more aware of what trends and developments are current and about to emerge. This is not an easy task. Diversify your goods and multiply your sales – that could very well be our motto.
Trade events, such as the upcoming International Diamond Week in Israel (IDWI) are successful, but how much international trade takes place and how much is local dealers trading with each other?
With regard to the IDWI, the next one taking place in mid-February, we need to keep our eyes on the ball. That means that first and foremost, the IDWI needs to be a platform to attract buyers for those goods that we manufacture here in Israel. Of course, while we endeavor to be a one-stop-shop for all diamonds, we also need to be realistic. Israel is recognized as the source for fancy-shaped and fancy colored diamonds. That is our forte. At the same time, we excel in high quality polished round diamonds in larger sizes, often in the commercial qualities that do well in the Americas.
IDWI takes place on the trading floor, where it indeed also has important value for the local market. In a center comprised of four towers, with more than 1,200 offices and with up to 20,000 people coming through the doors on a daily basis, it is not easy to know everybody or know what is out there on the local market, in spite of all technological and online access. During the five days of the IDWI, the floor gives traders the opportunity to take stock of and network with others whom they may not ordinarily meet and greet.
Having said that, the chief goal is to generate international sales and business.
Next month, we will decide if we are staying with the biannual model or will make it an annual event. While the costs of the IDWI are much lower than that of a full-fledged trade show, we’ll need to review the costs and the benefits. We’ll also look into how to bring the show to the next level. With a new and dynamic board that is highly motivated to make a significant contribution, I am confident that we will come up with a number of initiatives that will make the International Diamond Week the most exclusive diamond platform in the market.
Can you speak to the importance of these local events for small and medium-sized enterprises that may not have the money to travel to bigger events worldwide? How much has it changed the way they do business – how could it change in the future?
This is definitely one of the arguments in favor of the IDWI. Since I am a strong supporter of the smaller manufacturers… I am intent on assuring that they will continue to have a platform such as IDWI that they can use to gain international exposure.
But I also am encouraging the smaller manufacturers to think out of the box and to look how they can work with partners abroad, using the Internet and social media. Even as a one-man or one-woman operation, you are not bound by your geographical location, especially if you are producing singular and special pieces. At the bourse, we are aware of these needs and offer instruction courses and help in opening up new worlds and venues of communications to all of our members.
Can you say something about the Presidents Consultative Council that you have set up? How come nothing like this has been established before?
Those who have been at the helm of the IDE in the past, in different times and different circumstances, have accumulated a lot of experience. I would be daft not to draw on their knowledge, ideas and analysis of the current situation and I am happy they agreed to come onboard.
Of course, I will make the final calls with the board and together we will steer the bourse in the right direction. But I will take any help I can get, as the interests of the members and the wellbeing and success of their businesses is the reason I have been elected to this job.
You were quoted as saying “In the coming years, our industry will be going through many changes and will be facing a very different landscape in the markets in which we source, manufacture and sell our diamonds,” can you speak about the changes that you foresee and the way the Israeli industry can adapt to them
I’ve already spoken about manufacturing, but we all know that to be a successful manufacturer, one needs reliable and sustainable sources of rough diamonds. Unlike the past, there are multiple suppliers of rough who use a variety of sales methods. That poses a serious challenge to manufacturers. Therefore, to remain competitive and efficient in manufacturing, it is obvious that we need to attract more direct rough diamond supplies to Israel. During the past years, we’ve seen several efforts to attract more tenders and auctions to Israel, which have taken place during two editions of the Israel Rough Diamond Week.
It’s a tall order, but then this board has not been elected to sit on its hands and we will therefore do our utmost to increase rough diamond supplies to our industry and trade.
With regard to sales, we all know that to sustain the entire diamond supply pipeline, from miner to retailer, we need to rekindle the global consumer’s desire for diamonds and diamond jewelry. For almost a decade and a half, since De Beers stopped funding generic diamond promotion and canceled its Diamond Promotion Services worldwide, we have, as an industry, not stepped into the void. A few years ago, the World Federation of Diamond Bourses established the World Diamond Mark Foundation (WDM). The WDM is founded on the premise that diamonds and diamond jewelry can and must perform significantly better in the luxury product consumer market. To reach that goal, the industry – from diamond producers to retail jewelers – needs to act, in unison, to promote, advertise and market diamonds and diamond jewelry more effectively and visibly to the end-consumer.
Bourses will be asked to step up to the plate and support the WDM’s work in the retail market. A few months ago, I was asked to join the WDM board and I have agreed to do so.
We live not only in the “new normal economy,” but also in a new consumer world. Jewelers are competing with a very wide range of consumer products. In past June, WFDB president Ernest Blom said in a speech that he had yet “to see a young person queuing up all night to be the first in line to buy a jewelry item in the same way that youngsters do for the latest smartphone or tablet.” It exemplifies the need for promotion and advertising of diamonds. While the WDM’s activities are aimed at the retailer, we must take a vivid interest and, when asked, give our shoulders in support.
At the upcoming International Diamond Week, we will hold a Diamond Marketing Panel with the participation of the chairman of the Diamond Producers Association; Alex Popov, WDM chair; the renowned British jewelry designer Stephen Webster and the managing director of the World Diamond Council, where we will hear what progress is being made in generic promotion and advertising.
I know one of your main goals is to promote Ramat Gan as a strong manufacturing base once again. How feasible is this and what plans are in the pipeline to achieve this goal?
I think there is general agreement that a diamond center like ours is not complete without a solid manufacturing base. During the past few years, I have been deeply involved in the creation of the Modern Manufacturing Center (MMC), a new training and service center for diamond polishing. The new 400-square-meter manufacturing center provides a subsidized work environment for up to 100 polishers, access to an abundance of advanced technological systems, laser cutting and automatic round polishing, with teaching staff on site. The idea is to offer IDE members, especially small and medium sized companies, the ability to polish their rough diamonds in Israel, at prices competitive with or even cheaper than offshore locations. The facility has been in operation over a year and it is a great success. We are now planning to open an additional facility especially geared to the needs of manufacturers of large stones.
I believe that we need to preserve and further develop our manufacturing base. It’s no secret that Israeli polishers have a high level of expertise and craftsmanship. We need to build on the skills and experience we have accumulated over the past decades and these facilities are doing just that. I have committed myself to expand this project and broaden our manufacturing base.