Prices Jewelry doubled in a year. To survive the crisis, chains are reducing purchases of imported goods, increasing the amount of silver on shelves and closing outlets. The Secret found out how the conservative market changes during a crisis.
Loss of clients
According to the Guild of Jewelers of Russia, prices for jewelry increased by 50% over the year. In July of this year, the analytical company Watcom estimated that traffic in the capital's shopping centers decreased over the year by an average of 6%. The worst situation is in medium and small shopping centers, where traffic fell by almost 17%. In such conditions, players have to reconsider their assortment and close their outlets.
“Now everything depends on the company’s ability to work with low traffic,” says Dmitry Baranov, operating director of the Adamas network. In May, the company managed to return to a slight increase in sales thanks to a targeted loyalty program. “We select the assortment and price offer depending on the location of each specific store. For example, our store on Maroseyka has a completely different inventory from the one on Tverskaya,” explains Baranov.
During 2015, the number of jewelry stores in the country decreased by 25%. Some players have decided to go completely online. Thus, the Russian jewelry brand Alchemia Jewelery closed two of its monobrand stores at the end of 2014 and focused on sales through partner online stores. “Such stores have their own sophisticated audience, which comes just for unusual products, like ours. Refusal from retail outlets and promotion on the Internet played into our hands - now our sales are growing,” admits brand co-founder Igor Komov.
Photo: Artem Geodakyan/TASS
Import substitution
Against the backdrop of falling demand for jewelry, production volumes also decreased. According to estimates by the analytical company BusinesStat, since 2010, production volumes in the country have grown by 27% every year, and in 2014 this figure decreased to 8.4%.
“Everyone has reduced production,” says the first vice president jewelry house“Esthete” Andrey Panferov. - Some twice, some by 10–15%, some by 30%. If we talk about us, we have reduced it by about 20% in actual size.”
At the same time, imports of jewelry also decreased significantly. In the first quarter of this year, its volume was two and a half times less than in the same period in 2014. “Before the crisis, more than 60% of the products in stores were of imported origin - a lot was brought from Southeast Asia, both officially and unofficially. Today, due to the exchange rate, it has become unprofitable to buy imports. I think that by winter there will be an equal share of our and imported products on the market,” continues Panferov. He is confident that those left without imports large networks will turn to domestic producers.
Adamas decided to refuse to cooperate with foreign partners in the network after the cost of $1 exceeded 50 rubles. You can still find imported jewelry on the shelves of retail stores, but their share tends to zero.
“The demand for jewelry in general fell by 45%, and, in particular, for imported products - by 70%,” explains Eduard Utkin, general director of the Guild of Russian Jewelers. - Chains are purchasing more and more from Russian manufacturers - according to my estimates, imports on the market now account for no more than 20%. Imported producers will return to the market when the ruble strengthens. However, so far there are no forecasts for the strengthening of the ruble. I believe import substitution will continue in the next 10-12 years.”
According to Utkin, thanks to the reduction in the cost of work in dollar terms, Russian manufacturers should strengthen their position in foreign markets. If metals and stones all over the world are pegged to the dollar, then the work of the master is pegged to the local currency.
Bet on cheap materials
The ruble began to fall back in 2013, and at the same time the preferences of Russians began to change. Two years ago, silver products became leaders in popularity and have not lost their position since then. Gold products remain in second place. “Of course, silver has also become more expensive, but in silver designer jewelry the price of the material is dissolved in the cost of the work, so an increase in price by one and a half or even two times cannot seriously increase the price of the finished silver product,” says the founder of the brand jewelry Natalia Bryantseva Natalia Bryantseva.
The main share of the jewelry market falls on the middle and low price segment, while luxury products account for only 10%. Market participants predict a decline in the quality of products in inexpensive stores. “Manufacturers in the mass segment will more often make jewelry from gold of the lowest standard, reduce the number of diamonds in products and reduce other characteristics of jewelry that the buyer is not very knowledgeable about,” says Kuzma Kuzmichev, founder of the Yekaterinburg jewelry brand Kozmas.
"Sugar". According to the founder of the company, Svetlana Efremova, the prospects for the niche are obvious: “A lot has changed over the year - if before I had difficulty finding new brands, now I receive messages from young designers consistently once a day.”
However, many market participants are pessimistic. The real market contraction will happen next year. "It's no secret that New Year- the best period for the jewelry industry. Everyone wants to capture him. According to the conversations we hear at exhibitions, many are planning to close down their jewelry business already after the holidays,” concludes Dmitry Baranov.
Cover photo: Artem Geodakyan/TASS
Conscious consumption has also reached the luxury market. Jewelry is bought not only because “it’s beautiful and you want it” - they become an object of investment. Nadya Mendelevich, gemologist, editor of vogue.ru and curator of private jewelry collections, gives advice on how to properly invest in jewelry.
Let's not lie: the jewelry industry has always developed thanks to the desire of people to demonstrate their own well-being. No matter how wonderful the stone itself may be, the desire to own it is determined not only by its beauty, but also by the price, which emphasizes the status of the owner. What happens to the price of the stone after purchase: does it fall or rise? Is it possible to purchase jewelry without losing money and even making money? Quite. And you don’t have to be on the Forbes list to do this. Let's consider strategies within a budget comparable to the annual salary of a beginning financial analyst -£40k.
Buying jewelry that will hardly lose value
difficulty level:short
budget: from £ 3 thousand to £ 10 thousand
The easiest way is to buy iconic jewelry that everyone wants to own for at least five years. There are several collections of famous brands, jewelry from which will hardly lose value on the secondary market. An ideal example is the Alhambra collection produced by Van Cleef & Arpels. Second and third places are shared by Cartier jewelry in the form of nails and the B.Zero line from Bvlgari. In early spring and late autumn, limited editions are released: if you are lucky, a popular piece of jewelry in a rare version will not drop in value even by 20%, which is quite humane in the treacherous world of jewelers. Some brands actively invest in promotion, defining fashion and creating stable demand for their hits. The wave of popular love is also enough for those jewels of these brands that left their native boutique ten years ago. The main disadvantage of such purchases is no originality.
Just un Clou ring, Cartier. 3050 pounds, on the secondary market in London - from 2200. Buying a simple piece of jewelry that won't lose value
difficulty level:average
budget: from £ 5 thousand to £ 15 thousand
For those who are not accustomed to obeying fashion and live by the principle of less is more, there is a Rapaport table and a scale of color and purity of diamonds. It sounds scary, but in reality it is no more difficult than classifying airline fares. Having understood this, it is worth paying attention to everyday jewelry with diamonds of color F-G (almost colorless) and clarity VVS2-VS1 or VS2 (inclusions are not visible without a magnifying glass), which can be bought from little-known jewelers who order stones on the exchange and prefer commercial ones certificates of the International Gemological Laboratory (IGL). But the GIA certificate, which is the gold standard on the market, is not required: rather than overpay for it, it is better to gain a couple of extra tenths of a carat.
At the upper limit of this level of budget, it makes sense to seek advice from a gemologist (his services cost about£ 500) and find a nice light yellow diamond that has a good chance of going up in price. For the same money, you can hire a different kind of expert - a jewelry historian, who will help you choose a worthy antique piece of jewelry. The higher the collectible value of such a piece of jewelry (an unusual but striking example of fashion from the 1910s will cost more than a classic from the 1850s), the more confidently it behaves as an investment. By the way, an antique jewel worth more than£ 5 thousand, most likely, exists in a single copy.
Earrings with sapphires and diamonds, Giovane workshop. Similar ones will be made to order for you for £7-15 thousand. The final cost is determined by the quality of sapphires Buying unusual jewelry that will increase in value
difficulty level:high
budget: from £ 15 thousand to £ 40 thousand
At the upper end of this budget level, you can find a noticeable (carat weight) yellow diamond. Unlike their colorless counterparts weighing up to five carats, even small colored diamonds increase in price - they can be considered an investment. At this same level, it makes sense to pay attention to colored gemstones. Rubies, sapphires, Colombian emeralds, Australian opals and natural alexandrites of the highest characteristics and weighing from two carats are not just money spent, but also an investment. You can’t do without certificates: GIA, AGL and IGL have priority. If the choice falls on jewelry with a famous hallmark, then first-class colored gemstones are at least a guarantee of maintaining a high value. By contacting a private jeweler, you can get jewelry that will most likely increase in price in the first year. As your budget increases, your chances of buying a museum-quality item on the antique market also increase.
At this level you should be careful with the floor precious stones: the probability of making a mistake in forecasts is high. Firstly, recently more and more deposits have been discovered in Africa in which gems that were considered very rare and expensive three years ago are mined. Secondly, fashion interferes with the demand for semi-precious stones. The popularity of this gem variety may increase for a couple of seasons due to its fashionable shade. Market prices will rise, but investment potential will remain insignificant.
Diamond and emerald ring created in the 1920s. Estimated value £15-20 thousand, Jewelery Atelier collection In the top photo: an investment diamond weighing more than 50 carats in the Chopard workshops.
The popularity of jewelry in Russia is growing every day, acquiring a spontaneous character. In the near future, such dynamics will be able to break the record of annual increase in demand for jewelry, which traditionally amounts to 25% per year.
However, consumers should take into account that precious jewelry is not an attractive investment item, being in many respects inferior to bank gold bars. Often, the after-sale value of jewelry is equated only to the cost of precious scrap.
Gold anchor chain
The guides of one of the largest jewelry factories in Russia, Adamas, make an unusual offer to visitors. Everyone is invited to test their strength and try to break a gold chain 0.3 mm thick. Not everyone decides to ruin a piece of jewelry. But an experimental experiment proves that a healthy adult man can break a chain of such thickness. Once the result is established, the jewel is safely sent for melting down.
Based on the stories of the guides, the thicker the chain, the greater the weight and force applied to it it can withstand. Amazingly, once at an exhibition of gold products, in order to demonstrate the quality of their products, employees of the Adamas plant managed to string a “nine” car on a long chain 0.8 mm thick.
This is not the plant's only record. In honor of the celebration of the 850th anniversary of Moscow, a chain 850 m long was made in the chain knitting workshop. It turns out that there is nothing complicated about this, because while the chain is being woven by the machine, it is immediately wound onto a huge reel. The main problem in setting the record was the transportation of the product. The challenge was to move the chain without getting it tangled.
The pattern of the manufactured chain is also of great interest. The anchor pattern is made from round links, and the armor pattern is made from oval curved elements. The pattern is formed by a special program installed on Italian machines. It is worth noting that all the plant’s products are manufactured using imported equipment, the technological characteristics of which contain the know-how of the enterprise and are therefore kept in the strictest confidence.
Purity of gold
A more challenging task is offered to plant visitors in the raw material storage area. Anyone can try to hold a real gold bar in their hands. It turns out that an ordinary person cannot tear a piece of pure gold weighing 12 kg from the table with one hand. Fortunately, jewelry production technology does not require such efforts on the part of workers.
To make the products, the gold bar is placed in a planer, where small curls are separated from it. To prevent future jewelry from being scratched or worn out, other alloy components are added to pure gold in strict proportions, on which the fineness and color of the product depend. The resulting composition is placed first in one and then in another special furnace, in which a new ingot is formed. From this piece of metal, a wire with a diameter of 0.2 to 1.8 mm is drawn, from which chain links are subsequently obtained.
It is worth noting that the technology for manufacturing gold chains at the plant combines the principles of mechanical engineering and metallurgy.
The birth of a new decoration
Depending on the complexity of processing the material and the pattern of the design, the creation of jewelry from the moment of receiving the ingot to the shipment of the finished product to the warehouse takes from one to two months. The result is chains and bracelets weighing 0.3-70 g.
In the days of crimson jackets, the weight of some chains could reach from 100 to 200 g. These types of links, like other jewelry, had to be assembled by hand.
Nowadays, creating a jewelry masterpiece requires well-functioning work at every stage. First, designers draw up a sketch of the future product, on the basis of which master fashion designers make the first sample of the future decoration from brass or silver. The resulting prototype is of great value, since if the first batch of jewelry is successfully sold, the sample will become the standard on the basis of which mass production will be launched.
Then the prototype is placed on a special leg - a sprue - and sent to the rubber mold workshop. There it is lowered into a block of special soft rubber, similar to plasticine. Under pressure from the press, the rubber is vulcanized, and the master receives a rubber mold with a prototype enclosed inside. Then comes one of the most crucial moments. The rubber mold specialist must very carefully cut the resulting product in half to remove the sample.
At the next stage, molten wax is poured into the resulting rubber matrix using special equipment, and as a result of solidification, a certain form of decoration is obtained, for example, a figurine of Christ for crosses. Using the melting sprue leg method, the jeweler places each figurine on a wax cylinder, which is sent to the foundry, where it is filled with a special solution based on fine gypsum.
Further transformations are hidden from human eyes. The gypsum mold is transferred to the oven and subjected to heat treatment (800 degrees). After the wax has completely flowed out, a gold alloy is poured into the freed, cooled cavities. After the metal has hardened, the gypsum flask is carefully washed away with a powerful stream of water. In order not to damage the gold parts, the plaster mold should never be broken or attempted to be split mechanically.
To assemble the finished product from the obtained gold parts, special tools are used: a hair of gold solder and the tongue of a propane torch. In this case, the master must have keen eyesight in order to complete the assembly correctly.
Not all gold glitters
It is worth noting that after separating the finished product from the mold, raw gold it seems dull and inconspicuous. In order for the jewelry to shine, it still has to undergo special processing.
The products are first placed in a mixer with hard plastic granules, then with sand from crushed walnut shells. Then they are washed and polished using special rotating rollers.
Work path strewn with stones
Decorating a product with precious stones makes an unforgettable impression. Using a six-power magnifying glass, the craftsman places the tiny stones into the prepared holes with extreme precision, then bends the microscopic burrs around to hold the stone firmly in place. All operations are performed manually and require special concentration and patience. In one shift, a master can process from 3 to 4 thousand precious stones.
Despite the widespread stereotype that women are more predisposed to small and routine work, it is men who often become jewelers.
To prevent gold from ending up in your pockets
Having once visited a jewelry factory, you can’t help but think about how employees avoid the temptation to take gold with them, and how management manages to control the theft of property.
Adamas managers shared a new method to avoid theft in production. Instead of forcing workers to undress before entering and leaving production, as was the case in Soviet times, plant management keeps records of every gram of jewelry issued for signature.
At the end of the work shift, the employee must return the same amount of gold and stones by weight as he was given at the beginning of the work day. This allows workers to move freely around the production floor while carrying jewelry. At first glance, the gold in an unsightly plastic bowl in the hands of one of the employees looks very funny.
New technologies of ancient craft
About two years ago, the plant introduced a new rhodium plating technology, based on which, using electrochemical methods, jewelry is coated with rhodium, a precious metal from the platinum group. This technology allows you to increase the strength of the product and give it a snow-white shine.
Several years ago, this innovation was not to the liking of buyers, since after rhodium plating the jewelry looked like ordinary jewelry. Remnants of the Soviet past had an effect, when a person wanted everyone to know that he was wearing gold. According to the president of one of the largest retail chains, Center Jeweler, today’s young people are more loyal to innovations and put the quality of the product at the forefront, rather than public opinion.
Golden mathematics
According to the Russian Guild of Jewelers, income from the retail sale of precious items in the Russian Federation increases annually by 20-25%. Global sales volume in monetary terms is more than 100 billion dollars.
Analysts note that the Russian jewelry market does not have a clear consolidation. The total number of registered enterprises operating in the jewelry industry is about 25 thousand.
According to the study, this area has a pronounced gender identification of clients. About 70% of the buyers are women, and the remaining 30% are men who purchase jewelry for their companions.
In addition, the demand for jewelry is seasonal. Gold products become most in demand during holidays (New Year, Valentine's Day, International Women's Day). Demand wedding rings, for example, increases during the wedding season (spring and autumn).
Experts also note that when buying jewelry, customers are most often guided by emotions, so it is very difficult to predict the next impulsive increase in demand.
According to a sociological survey conducted among Russians, jewelry took fifth place in the top gifts after souvenirs, alcoholic beverages, toys and perfumes. It is noteworthy that precious jewelry has overtaken mobile phones and various gadgets.
At the same time, the most popular, compared to other types of jewelry, are rings and earrings made of precious metals(22% and 18% of total demand).
Demand dynamics
According to the famous Italian jeweler Paola Valentini, the jewelry industry is subject to a certain cyclical nature. So-called macrotrends have a lifespan of about 30 years, and microtrends have a lifespan of about 3 years.
For example Russian market, a macro-trend can be seen in the drop in demand for brooches, which have become less popular. And micro-trends, which are easier to notice due to their short duration, can be traced in the fall in demand for black diamonds. The popularity of this type of stone appeared during the 1990s among criminal gangs and lasted about 3-4 years. Signets with black diamonds were the distinctive sign of one of the gangster groups in the Moscow region. This sign became the fatal mark of local authorities, because of which they were easily identified by their enemies. After the death of the group members, the fashion for black diamonds quickly faded.
Precious metals are always in fashion
Changes in demand over time also affected precious metals. For example, in the early 1990s in Russia, products made of 585 gold, which had a red tint, were especially popular. Over time, Russian consumers switched to yellow foreign metal. And recently, the country has been swept by the fashion for white gold jewelry.
It is also noteworthy that platinum and palladium are still in less demand for Russian consumers. Only two Russian jewelry factories in Krasnoyarsk and Yekaterinburg are engaged in the production of products from these metals. At the same time, there are certain problems with observing the rules for their testing and branding.
A girl's best friend isn't just diamonds
According to the study, diamonds have traditionally remained the most sought-after precious stones, accounting for a third of total jewelry industry sales.
However, recently, jewelers have increasingly begun to use a large palette of stones in the design of products, including aquamarines, garnets, topazes, corals, etc.
Jewelry with richly colored rubies is also becoming increasingly popular.
Jewelry geography
Most jewelry factories in Russia use precious stones from different parts of the world in the manufacture of jewelry. At the same time, many foreign jewelers prefer to work with diamonds made from Yakut diamonds.
Despite the annual increase in demand for foreign jewelry, imports of finished jewelry occupy a small share of the total volume of the Russian jewelry market.
It is worth noting that Russian consumers give preference to domestic products. Therefore, taking advantage of this, some jewelry factories pass off the foreign raw materials from which their products are made as domestic ones.
Foreign curiosities
The Russian Jewelry Network agency provided data that in 2006, 1.5 million imported jewelry items were sold in Russia. This figure can be compared with the dynamics of Russian jewelry production, but it is worth considering that only crumbs.
Russians are actively buying gold jewelry from much-touted Brazil, bright Thai products with colorful gems, prestigious designer beauties from Italy, as well as delights from world-famous houses - Tiffany, Van Cleef, Cartier. The main import supplier is Italy. Almost fifty percent of imported “overseas” products are produced in Italy, and this amounts to about 5 tons various decorations. Thailand and Türkiye shared second place. European manufacturers of the jewelry industry penetrate the Russian market legally and officially, while Asian factories fill the shelves with their products, sending them to the country in the bags of unknown “shuttles”. Analysts report that the shadowy jewelry market has already exceeded legal imports by 4%, which is visible in customs statistics.
Strict quality control - the choice of Russians
But the East does not have too much influence on the domestic market for jewelry innovations. The majority of Russian residents choose domestic jewelry. About 70% of Russians trust jewelry manufacturers from Russia. It is known that the end buyer is not interested in the names of manufacturers in 50% of cases. Experts expressed the opinion that this situation is due to the sellers’ faith not in the integrity of their compatriot factories, but in the correctness of the work of state control over Russian gold turnover. Expert Sergei Alkhazov said that only in Russia the assay supervision establishes the mark 585 on a ring or other product only in the case when the gold content is several units higher, while the Italians put 585 as a conventional figure. You can buy an Italian curiosity with an honorary mark of 585, and get an item with a real gold content that corresponds, at best, to 500 fineness. Alkhazov also warned that the quality of jewelry from other countries cannot be criticized at all; very often even a stone in jewelry turns out to be half glass.
Abroad, as experts say, concern about the quality of the product rests entirely on the shoulders of the seller. In our country, any scams involving precious metals and expensive stones entail criminal liability, which is ultimately borne by the manufacturer. The only guarantee of the quality of foreign jewelry is the well-known name of the seller. It is worth noting that prices in high-end boutiques, such as Bvlgary, are appropriate.
Tricks of Russian factories
Thanks to good attitude buyers, modern Russian factories do their best to allow some production tricks. They use a tolling scheme, which is currently permitted by law. Domestic jewelers export some of their raw materials to Asian countries, use the cheap labor of partner companies there, and then transport them to Russia finished goods. Subsequently, such a product is presented to Russian consumers as its own, and absolutely legally. It is almost impossible to control the scale of the above phenomenon.
Russian consumers also have their own unique characteristics. Compatriots have a habit of collecting a certain set of jewelry, and ladies from the West simply buy earrings that they like, without thinking or worrying about the fact that she does not have a suitable necklace. But the dominant global trend has already reached Russia. And it’s not about brands and preferences, but about attitude. Previously, jewelry was a real treasure, it was passed from grandmother to granddaughter. Nowadays, jewelry is an ordinary accessory. Jewelry that belongs to the mass market segment does not make any investment sense.
The goal is beauty!
During the Soviet Union, buying jewelry was considered a fairly serious financial investment. An expensive brooch or a massive “engagement ring” belonging to a citizen was at the same time legally considered part of the “gold and currency fund” of a considerable country. In practice, as Sergei Alkhazov explained, this meant an enduring liquidity treasure. The man realized that when buying a product made of gold, he would sell it at a higher price in six months. Jewelry was often in short supply.
The times of the USSR are over, and prices for precious metals have only increased. Currently, only 9% of buyers of gold goods consider such a purchase to be a profitable investment.
Today, you can return a small part of the funds that were invested in decoration at purchasing government offices. In such government agencies, jewelry is accepted at the price of scrap precious metals. The government agency does not have the right to refuse a request to accept a product. You are willing to buy good-looking rings at thrift stores for a little more. There are such stores in large jewelry chains. A merchandiser evaluates a used product and puts it up for sale at a price lower than that of new jewelry. The owner of the ring can oppose the opinion of the merchandiser, demand an increase in price, pay the store the cost of storing the product and wait for the sale of his property.
Pawnshops traditionally price everything they bring in at pennies. In fact, they don’t need the product; it serves as a safety net that the money they borrowed will be returned to them with considerable interest.
If we compare the purchase of jewelry not with existing investment instruments, but with any consumer goods, then the picture is not at all depressing. After a year, a gold ring retains a decent supply of liquidity, which is incomparable to a worn-out mobile phone of an out-of-date model or a worn-out jacket.
How not to make a mistake with investing?
A very expensive piece of jewelry is an excellent investment. Such products are made by both global and domestic brands that specialize in exclusive items. Such organizations include the Sirin company and the jewelry house of Marina Tsoi. Back in 1998, talented and original jewelry artists Maxim Voznesensky and Irina Dorofeeva came up with a unique way of presenting precious jewelry - a kind of theater. Their idea worked great. At the moment, this is the only domestic manufacturing company that competes with global brands at the International Exhibition in Basel. Nine years of work by the innovators of the Jewelry Theater brought the world 10 amazing collections. Many decorations are made by hand, some are made in a single copy.
Production exclusive jewelry very different from mass production, even high-level ones. The jewelry master receives a detailed sketch of the model from the designer, creates an even more thorough drawing himself, and only then begins to work. 750-carat gold is selected for the workpiece, and then the craftsman cuts out all unnecessary parts. No forms are used. One elite model is created from two weeks to several months.
Jewelry is a beautiful investment!
Artist-jeweler Mikhail Voznesensky claims that there are three components that make a piece of jewelry a legitimate investment item: an expensive high-quality stone, professional-level craftsmanship, and decent design. Voznesensky said that there had already been a number of cases when products produced by the Jewelry Theater were resold at much higher than the original price. From an investment point of view, it is more profitable to invest your savings in a large diamond than in any artistic delight. But domestic manufacturers do not offer to buy “just a diamond,” but only a diamond in a setting. However, if the price limits of the stone are very high, this cut is not significant.
Over the past 3 years of working with jewelers, I have studied all the ins and outs of this business, so I will be happy to tell you 10 secrets, knowing which you will be able to buy diamond rings at the lowest price and with free home delivery.
And so, let's go in order:
1. Discounts of 30%, 50% or more are fake
Retail stores make every effort to get you to succumb to your emotions and make a purchase here and now. The markup on jewelry reaches 500%, so they write an inflated old price and put a new one at a discount of at least 80%, but this does not exclude the fact that in a nearby store this product is cheaper even without a discount. Don’t give in to emotions, most likely you will find this product at a price 10-20%, or even 50% lower.
2. Prices in stores are radically different
It is important to understand that stores are wholesale buyers from jewelry manufacturers. Each store has its own wholesale price. For some it is lower, for others it is higher, depending on working conditions. Therefore, you should not be surprised that prices for the same products can differ significantly.
3. How to find the exact same product in another store cheaper
If you like a product in a store, the manager will tell you the manufacturer without any questions. You won’t be able to buy this product directly, since the manufacturers do not work with individuals, but by looking at the article number of this product on the Internet or on the manufacturer’s website, you can easily find out where else you can find this jewelry.
Required: if you choose jewelry in online stores, then compare prices with other online stores. It’s done like this: copy the article number of the product you like, enter it into a search engine and compare who sells this product for how much. By comparing even one product, you can easily understand who has what markup.
For example, let’s take a red gold ring with 1 diamond, price 14,770 rubles:
Now we copy the article, enter it into Yandex search and look at the prices of the same ring on other sites:
This is how you can easily determine who makes what markup on products. And such a markup on absolutely all products in the range.
4. Lifetime warranty, assay supervision and other certificates of conformity
On the one hand this important information, on the other hand, every production today provides a lifetime guarantee, is required to be registered with the Assay Office and has all the necessary certificates. No entrepreneur working with jewelry in Russia can work without these documents. Therefore, if in some place they give it to you for some incredible competitive advantage, then most likely they are trying to divert your attention from the inflated price :)
5. Prices are cheaper in online stores
Over the past 3 years, an endless number of online jewelry stores have appeared. In many of them, the purchasing conditions are much more favorable than in ordinary stores. They can offer free home delivery, fitting upon receipt, and payment by any in a convenient way and many, many other things. If buying jewelry is a conscious step for you, and not a spontaneous purchase, then you can save a lot when buying in an online store. Although be careful with them, sometimes the markup there can be simply cosmic.
6. “Masovka” sells best
The best item sold in jewelry stores is “masovka.” Usually these are unremarkable lightweight products with semiprecious stones, which are already produced by everyone who can. As they say, “our people love all kinds of shit.” But be that as it may, this “shit” sells best, which means most of the store windows are full
precisely these products.
7. Manufacturers steal jewelry designs from each other
Now I will tell you the main secret.
The most expensive thing when creating a new piece of jewelry is its design and 3D model. Small handicraft production cannot afford this luxury, and they stupidly steal 3D models of jewelry, producing exactly that very “masovka”. Accordingly, normal manufacturers employ 3D jewelry designers and come up with new jewelry every month. The birth of new products is very expensive, so manufacturers recoup their costs by producing these products only with precious stones, which increase the cost of new products, and, accordingly, the built-in profit. Therefore, every manufacturer, when releasing new collections, tries to sell their products as early as possible and as much as possible. As soon as his products are copied by others, releasing them with semi-drugs, the manufacturer begins to lose a lot in sales. And the race for new jewelry begins. Businesses are trying to find a balance between new enticements and masking. Everyone is trying to see from each other who is producing what. This is an endless process in jewelry production that reaches the point of paranoia.
8. The more expensive the product, the more the store earns from it
Often stores don’t bother with markups and stupidly multiply the wholesale price by 2 or 3. This creates a huge markup on expensive products. It’s one thing when a product retails for 3,000 rubles, but even a 2,000 ruble markup doesn’t seem terrible. But if a product costs 150 thousand or more than a million, then the margin from one sale can reach incredible sizes. Therefore, if you are buying an expensive product, be sure to ask for an additional discount and be sure that they will give it to you. And if you buy jewelry worth more than a million rubles, the store director or production owner will personally bring it home to you with a bottle of champagne and a bouquet of flowers.
9. Look for new items on jewelry exhibitions
All the latest trendy jewelry can be found at jewelry exhibitions. The largest of them, JUNWEX, takes place every year in September. Most of the stands there are occupied by our Kostroma jewelers.
10. Free delivery to your door
Online stores are often more motivated by service than offline sales stores. They don’t see the client in person and cannot persuade him to buy here and now. Therefore, we are forced to offer additional services that may be convenient for the buyer. And this could be free delivery of the product to your home, the opportunity to try on and reject the product, payment upon receipt and all kinds of gifts. Be sure to study the terms of purchase in the online store. Why adapt to the store and pay more when there are those who offer good conditions and a good price.
P.S.: Let me remind you that I live in the Kostroma region, where more than 1,200 jewelry enterprises operate and which is rightly called the Jewelry Capital. Well, if we translate this into human language, then approximately 9 out of 10 products that you see on the shelves of jewelry stores are products made in Kostroma;)
P.P.S.: Lowest prices for jewelry only in the store
The crisis has seriously affected the Russian jewelry market. During a period of declining purchasing power, buyers are not, to put it mildly, first of all thinking about buying expensive jewelry. And it is in such conditions that it is especially interesting to find out an expert’s opinion on the trends in the development of the segment, and on the most promising niches.
Jewelry market needs to be analyzed in the context of the overall consumer market. In 2017, against the background of improving macroeconomic indicators and the strengthening of the ruble exchange rate, a feeling of market stabilization was formed, and the level of negativity in consumers’ assessment of their prospects decreased. At the same time, there are no sufficient grounds for an upward breakthrough and a significant increase in sales in consumer markets.
According to a study by Fashion Consulting Group, imports of jewelry into Russia continue to decline, and according to the results of three quarters of 2016, they even decreased by about a quarter compared to the very low indicators of the previous year. The increase in the cost of imported products, which occurred for Russian buyers after the depreciation of the ruble, forced some players who produced products abroad to consider options for transferring production to Russian territory and to look for local manufacturers. There is hope that the rollback of imports will free up space in the market for local producers. In addition, due to the difficult economic situation, as well as the state policy of promoting projects under the “Made in Russia” brand, the loyalty of Russians to local products is growing.
Over the past 3 years, Russian jewelry retailers and brands have been testing new projects and carefully studying local production opportunities, especially in the middle segment, where consumers are expecting something more unconventional. If in 2013 about 65-70% of jewelry in Russia were foreign products, then in 2015 this share began to decrease noticeably in favor of Russian goods. The Guild of Jewelers gives an optimistic estimate that more than three-quarters of the products on the market now are domestically produced.
However, despite the decrease in the share of imports, against the backdrop of a sharp drop in the purchasing power of the population compared to the pre-crisis period and, accordingly, a catastrophic drop in demand for jewelry products, Russian manufacturers suffered no less than buyers of imported goods: production volumes decreased by almost half Russia (-45% gold and -20-30% silver). There has been an outflow of buyers from mid-price segment brands to budget segment brands.
How much has the jewelry market as a whole been affected by the crisis?
Volume and dynamics of the gold jewelry market, tons, 2012-2016
During the peak of the crisis in 2015, the demand for gold jewelry in Russia rolled back 14 years - the market (in currency equivalent) decreased by 43% compared to 2014. In 2016 The decline in demand continued - sales fell by another 11% compared to 2015.
Volume and dynamics of the jewelry market, rub., 2012-2016Q4/2017F
The jewelry market (including gold jewelry) is experiencing negative dynamics: 2015 showed a decrease of almost half and reached the lowest level in the last 10 years. In 2016, the market fell by another 18% and amounted to $172.2 billion. The forecast for 2017 is stabilization to 3% under an optimistic scenario and a decrease to -10% under a pessimistic scenario.
Specifics of the jewelry market in Russia 2016
Until recently, the jewelry market was strongly influenced by the “post-Soviet legacy.” Only a small number of foreign jewelry companies, represented in single- and multi-brand stores, exclusively in large cities, were able to gain a foothold in the market over the last decade.
- The market was formed by large “historical” brands capitalizing on the reputation of Soviet-era manufacturing plants;
- The dynamics of development are slow and inert. Models created back in the 70s - for example, Bismarck chains - are still popular.
- To put it simply, the specifics of the Russian jewelry market in comparison with the European market can be described as “conservative demand.” The products and collections on the shelves reflect the population’s love for demonstrative decorativeness on the one hand and for tradition and classics on the other.
- High-quality expensive jewelry is not perceived as an adequate replacement for jewelry, even for everyday and daytime use.
- Unlike the European market, wearing jewelry every day is the norm from school age.
About 40% of the jewelry market is accounted for by large players
At the moment, there are top 7 players on the jewelry market in Russia, which together occupy 32% of the market. The largest jewelry network In terms of revenue for 2016, the Adamas chain is the largest - 11.6 billion rubles. and 6.7% of the total market. Pandora takes second place with revenue of 8.6 billion rubles, third place goes to Moscow Jewelry Factory, 8.3 billion rubles. respectively. Also, luxury segment brands account for another 10% of the market; they enter the retail market through such large distributors as Mercury Group, Jamilco, Cosmos Gold, Bosco di Ciliegi.
Key trends in the consumer market
- A natural “movement into silver” and an increase in supply in the category of lightweight gold products. A repetition of demand fluctuations that were observed during the 2008 crisis. Buyers who do not view jewelry as an investment, but buy it as an accessory jewelry, pay more attention to silver products. The range and variety of silver jewelry increases during a period of declining purchasing power
- Relatively stable demand for niche offers. Such products of original design, clearly targeted at a specific target audience, always find their buyer. Jewelry in which you can express your individuality is the result of careful selection and in a crisis has a more stable demand.
- Carte blanche for the Russian manufacturer. The work of foreign jewelers has become more expensive due to changes in the exchange rate in Russia, so they do not see any special prospects for selling their products in Russia, and are temporarily giving way to Russian manufacturers.
- Most trading enterprises have adopted the concentration of efforts on special price offers and assortment optimization as the basis of their marketing policy. The number of intermediary companies between the manufacturer and the retail operator has been reduced. Retail companies are actively developing their own brands and are gradually ousting brands that do not have distribution networks from the mass market.