Waldman Diamond Company

'Single basket market' continues to deliver, says WDC's Waldman, but toward X-mas, polished diamonds market is already saturated
October 2000

RAMAT GAN, ISRAEL - The September figures of Israel's diamond imports and exports reflect the general trend that industry analysts had been waiting for, i.e. a noted decrease in sales of rough diamond supplies to the Israel diamond industry, by De Beers' Diamond Trading Company, and by the open market suppliers.

"Clearly, De Beers has sold off significant quantities of its buffer stocks during the past year-and-a-half," said Simeon Lee Loon, a senior marketing manager at Waldman Diamond Company (WDC) Group. "And if the current slowdown of rough diamond sales continues, the total sum of rough diamonds sold to Israel during 2000, may not exceed the 1999 figure."

September registered much higher export figures in the polished department—$841 million gross and $561 million after returns—compared to the same month of 1998. However, Loon warned that this figure does not indicate the industry is growing explosively. A year ago, the Jewish High Holidays eliminated many of September's business days, reducing the Israel diamond industry's polished exports to $431 million. This year however, the Jewish holidays fall mostly in October and mainly on Fridays and Saturdays, which are not business days in Israel.

"I expect polished sales will continue to slow down," Loon stated, "as the market in the United States-the 'single basket' Israel continues to rely on—is getting saturated toward Christmas."

WDC Group is a member of Israel's new generation of large diamond manufacturers who have succeeded in establishing a multi-channel marketing system for their polished goods. The company sold $60 million worth of goods in 1999. While wholesalers, retail chains and individual retailers are all important to WDC's loose diamond sales, Waldman also manufactures and markets its own finished jewelry lines, through its jewelry division—Waldman Diamonds Complete LLC—that contributes an ever growing share to WDC's overall sales in the jewelry industry.

The importance of such a manufacturing and marketing mechanism was emphasized recently during a presentation held at the Israel Diamond Exchange (IDE) in the exchange complex, where the polished diamonds price list guru Martin Rapaport warned manufacturers that just manufacturing well made goods "wouldn't cut it anymore." To remain a player in the field, manufacturers need not only have a market plan, but also know how to execute it. This "market or perish" scenario was being installed by De Beers for its sightholders, Rapaport said.