- The diamond industry is going through its natural ‘period’. Consumers are more interested in other types of luxury goods and if the trend continues then diamonds won’t be their first choice.
- The so-called diamond banks in Europe, US and elsewhere have started tightening credit facilities for diamantaires, which may directly/indirectly affect the dealers/retailers business one way or the other.
- The Internet is becoming a major challenge/player for new-comers as well as the established ones. High volume, taxes, low margin, and name-recognition are both good/bad news for the business, and the only way to survive in this dog-eat-dog world is to specialize in unique products, improved/innovative customer services, and finding new ways to cut costs to maintain cash flow and profitability.
- Synthetic diamonds are getting more visible, affordable and identifiable.
- It’s believed that De Beer’s market share is roughly forty percent and there will more restructuring in the coming months. The company is also under lot of pressure from the African governments to facilitate/process diamonds locally in order to create more employment for the locals. De Beers may not have that many choices and the real losers will be ‘middle market’ players.
- Even though the Kimberley Process was initiated with good intent, its effective execution may not be up to the mark due to various factors. It is estimated that ten percent of the world’s diamonds are produced in bad conditions for low wages.
- We are going to see more active involvement by human rights groups in various formats.
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