Making It Work - March 2024 News

The diamond industry has been given a temporary reprieve from the complications of Russian Sanctions. The G7 countries need a bit more time to put a more complex sanction process in order. As of March first, importers must present a document of ‘self-certification’ for every import or export shipment containing diamonds over one carat. The wording is as follows, “I certify that the nonindustrial diamonds in this shipment were not mined, extracted, produced, or manufactured wholly or in part in the Russian Federation, notwithstanding whether such diamonds have been substantially transformed into other products outside of the Russian Federation.” Every importation of loose diamonds over one carat requires this company signed declaration: one document per customs entry invoice. So far there is no guidance on how to transport diamonds that were imported before these new regulations.

The Canadian minister of foreign affairs, Mélanie Joly prepared the following statement. “Canada has been at the forefront of imposing economic barriers on the Putin regime. Along with our allies and partners, we have imposed severe sanctions on the Russian regime, and we will continue to do so to hold [Russian President Vladimir] Putin and his enablers to account.” More detailed tracking procedures will put in place for all loose diamonds over fifty points before September of this year. Meanwhile, it is understood that any intentional misrepresentation of Russian origin diamonds or jewellery will be subject to penalties. My advice to both importers and exporters is to keep meticulous records of all transactions.

It is notable that these diamond sanctions apply to laboratory grown as well as natural diamonds. On the subject of laboratory grown diamonds, Peter Smith, a well-known jewellery consultant, wrote the following post on LinkedIn. "People are getting very moral about (laboratory diamonds), either for or against. They get almost righteous. You know what I don’t hear people getting righteous about, the average ticket in the retail
store. If you’re doing anything and I mean anything to be complicit in reducing your average ticket in retail jewellery stores, that’s something you ought to be getting righteous about."

I replied to his post saying, “You are 100% correct! With all the talk about better margins, fulfilling customer demand and disclosing the drastic price decreases, many selling lab-grown are forgetting the basic business principle of maintaining or increasing average sticker prices. Some think they can make the difference up in volume or with larger margins but, statistics demonstrate there is a limited, not increasing, total number
of engagement sales. This cardinal rule of business practice concerning maintaining average ticket value supports the long-term viability of any business and decreasing the average ticket price can be dangerous.”

I’m sure that business owners can find exceptions or reasons to depreciate their average sticker prices, but I stress, care must be taken when pushing aside basic business tenants, which were instituted to protect the long-term health of any business enterprise.

In closing, I would like to read a quote by Benjamin Franklin, which I try to emulate in business and in preparing this news broadcast. “Either write something worth reading or do something worth writing”.

….and that ends the March edition of the Regal Imports News

Mel Moss