The 10th of September was the last day of the Jeweler 2009 Exhibition in Moscow’s Sokolniki area. Rough&Polished probed the mood of some of its exponents.
Peter, the Urals Jewelry Factory:
The crisis hit our enterprise but not hard enough to wipe it out entirely. Our sales went down by about 30%. People buy less diamonds and are more inclined to purchase cheaper jewelry pieces. However, they continue to buy expensive exclusives as before. Those who could afford premium-class jewelry before the crisis are still capable to buy it now. But such people have always been a few.
Formerly, in the high-end segment we used to sell one piece in three months and the same pattern we have now. There occurred a failure in the mass consumption category of goods. People of mid-sized income, those who before the crisis used to purchase things worth from 30,000 to 80,000 roubles now are buying significantly less. Well sold are expensive items and those which are very cheap, below 15,000 roubles.
Now we hear predictions of a bank crisis coming and people are wary and waiting to see which way the cat jumps. The situation differs greatly by provinces. For instance, we have clients in Magadan who say they had no crisis at all. While in Moscow the market is going south all the way and there no end to it. If earlier people used to buy paying straight money, now they ask for consignation – there are no buyers any more entirely.
Natalia, Leiba Trading Company:
The exchange rate went up, people’s income and purchasing capacity went down, the average check amount fell, the euro exchange rate rose 1.5 times, so it’s natural that we are now feeling bad!
Roman, Silver 925, Nizhni Novgorod:
I don’t know what crisis is. If you will explain it to me, may be I will understand. To my mind, this is a devised problem. Those who work do not feel any crisis. Or company has its own production facilities and a trading house and we are dealing in silver jewelry only. Everything is going fine with us and we are not disturbed by any crisis at all.
Alexander, Avangard Trading House, Ivanovo:
Of course, we don’t feel very well in crisis environment like many other companies. And the organizers of this exhibition, in my view, gave very weak advertising, so there are just a few retailers here. Many of them are targeted at the JUNWEX Jewelry Show held at the VDNKh (All-Russian Exhibition of National Economy Achievements) premises, which is better promoted, and people will go there first of all, as I think. Wholesalers in their majority do not want to pay money on the spot and prefer to take everything on a consignment basis. Just think yourself, how much money can we lend to people for God knows how long? What is worse, many of them start to abuse your confidence. Even those who used to behave decently, but the crisis changed them too! They start to delay payments for one month, then for two and three months, while the money we lend are losing its value, whereas gold is getting more expensive every day. During the last 10 years its price shot up almost 20 times! I mean gold scrap. Meanwhile the dollar exchange rate went up less than 6 times. There are few people who give a thought to this. So I my advice to all: buy gold scrap! It is the most moneymaking investment. It is more profitable than real estate and even diamonds. Diamonds stand still and their market is not growing at all.
Larissa, OOO Almaz, Moscow:
We deal only in diamonds and do not sell anything else. We have been hardly hit by the crisis. We operate in Moscow only and here the buying activity has significantly slumped with sales dwindled by 30% for sure. We used this exhibition for marketing purposes and polled wholesale customers who said the recession was evident in all provinces. It will take quite a long time to get back to the level we once were on. Silver is now sold better than before and it may be that those who deal in silver jewelry feel their business is thriving. However, our company which is selling diamonds, had to go way back on prices and virtually now we are selling our goods in retail at wholesale prices.
Ari Binder, R.A.N. GOV, a diamond cutting factory from Israel:
Our business is the same as in the rest of the world – polished sales dropped by 50% and more. It is the first time we came to an exhibition in Russia. We have to learn yet how to work on your market. This is a serious market, but it is quite different from ours. Unfortunately, we had problems with the Russian customs, and this time it so happened that we cannot sell here anything in retail, and have to deal in wholesale only. It is a pity, since there is a potential here; it is not as big as in America, but it exists.
Anna Tishinski, Rough&Polished, Moscow
