Blue Nile has introduced a service that allows consumers to sell diamonds for cash. The company claims that it can offer better prices and greater transparency than traditional players foreclosure jewelery sector.
Service, developed in collaboration with a specialist in e-commerce Mondiamo, available only in the US and Canada, but plans are under way to its expansion on a global scale. According to the company, thousands of customers have used the product for the first time passed the pilot test in June.
The process of service within the service includes the deployment of a living system of pricing for the Blue Nile diamonds, the GIA has been certified, to create a guaranteed cash price range. Then customers will receive a free set of the insured for delivery, to provide their diamond jewelry for inspection and evaluation. The company then offers them a price.
Secondary market of diamond jewelry is estimated at billions of dollars annually, according to in Blue Nile, adding that total estimated cost of the diamond jewelry to consumers worldwide property exceeds $ 1 trillion. However, before the secondary market of diamond jewelry was a stressful and non-transparent sales experience, with an almost total lack of transparency around the true value of the product, the company said.
"One of the guiding principles of the Blue Nile is to ensure transparency for consumers, so that they can make a purchase of a diamond that is right for them, - said Harvey Kanter (Harvey Kanter), Chairman of the Board, CEO and President of Blue Nile -. This partnership provides transparency for those who wish to sell their diamond jewelry. "
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The report points to a slowdown in China's GDP as the main cause of the phase of uncertainty in the diamond industry, which began in the second half of 2014 and passed in the first half of 2015. According to Bain, «the dynamics of the retail diamond jewelry in Greater China has caused a decrease in demand for diamonds and, in turn, on rough diamonds." Nevertheless, the report stresses that in 2014 and in the first half of 2015 revenue growth in the value chain of the diamond industry amounted to between 4% and 8%.
"The retail sales of diamond jewelery in 2014 rose by 4% due to good sales in the United States, which made up for the slowdown in China - said Bain. - The results of 2015 show that the US market continues to grow, as the Chinese market continues to slow down. " However, despite the growth of the market as a whole, with the May 2014 diamond prices and diamonds declined by 12% and 23%, respectively, since the beginning of 2015 - by 8% and 15%, respectively, against the background of both short-term and long-term factors shaped the dynamics of prices, the report said.
A weaker-than-expected growth in consumer demand primarily affected demand for diamonds, leading to an increase in inventories and a decrease in retail wholesale purchases of stones. Slowing and then spread to the producers of raw materials, since processing companies increased their inventories and reduced their purchases of rough diamonds, in spite of the decline in prices.
As soon as the processing and retail business segments liquidate their excess reserves in the diamond pipeline is restored the normal flow of diamonds and the business will return to its normal state, says Bain, adding that at this time, however, the market should return to their path of long-term growth faster than is usually the case in the past, due to the positive macroeconomic indicators, and that for a sustainable recovery must be conscious control offers level by miner and in the diamond manufacturers.
Referring to the ills the middle of the diamond pipeline, the report notes that in this segment a little market leverage on almazoproizvoditeley and retailers, as well as limited access to finance and that, nevertheless, his players are unconsciously or consciously assume the risks or seek to obtain the benefits associated with price volatility, and it is their business model is not able to withstand. According to Bain, «continued development of the middle segment of the market should allow the industry to create a more sustainable business model."
Among the problems currently facing the diamond industry, the report mentions the need to maintain long-term demand for diamonds in the developed markets and among the new generation of consumers; continuing risk of market penetration of natural diamonds synthetic stones unannounced; and the need to restore the profitability of medium-sized business segment.
The report gives a positive long-term outlook for the diamond market. The demand is expected to study authors, begins to exceed supply since 2019. Until then, the balance between the demand for rough diamonds and its proposal will be sustainable. "We expect, - the report says - that demand for rough diamonds recovered from the recent recession and will return to the path of long-term growth, with an average of from 3% to 4% per year, based on strong underlying factors of the US economy and the continued growth of the middle class in India and China. It is assumed that the rough proposal in terms of value to 2030 will be reduced by 1% to 2% per year. "
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