I have been attending the gem shows at Tucson for over 20 years.
Tucson is the one show that is a “must” for jewelers. Why, the best
prices, the best seminars ^& other educational opportunities and the
key people in the trade all gather there once a year.
If you are a wholesaler the trip is critical. It is really only at
Tucson where a wholesale jeweler has the opportunity to bridge the
gap between the prices jewelers pay and those manufacturers need to
Although there are many price levels in the gem trade and short of
buying parcels, there is really no distinction between
manufacturer’s cost and jeweler’s cost so a manufacturing jeweler
who buys at wholesale, takes a markup then passes the item along to
a retail jeweler who marks it up to retail, the gem will likely find
the item too expensive and therefore difficult to sell. A
manufacturer who buys a gem and does not mark it up might as well
dig a big hole, throw her/himeself in and pull the dirt in over the
top of him/herself.
Today the issue is even more critical. The gem market, much like the
diamond market is beginning to colapse in on itself, the traditional
3 tiered market (source, wholesale, retail) four tiered if you count
rough, that has opperated for thousands of years is breaking down.
The internet has allowed source dealers to sell to retail buyers in
the U. S. And it is happening to a surprising extent. Savvy retail
buyers a already purchasing gems directly from Bangkok dealers,
bypassing the traditional wholesaler and retailer. In the diamond
market this has meant that retail magins have shrunk to as little as
10%. On Ebay U. S. wholesalers, who were the first to use the
internet to bypass retail channels, are being edged out by source
dealers from Bangkok and Sri Lanka. U. S. Ebay dealers who had a
very Merry Christmas last year are already singing the blues.
The colored stone market has a few hurdles that have slowed this
trend. The fact that fine colored stones are rare coupled with the
lack of a universally accepted grading system with a phalanx of labs
to provide quality certificates have made sourcing gems from
overseas a dangerous hit or miss prospect at best. Still, some of
the same source dealers who set up in Tucson are sellling gems
direct to U. S. consumers over the internet. This is a market major
crisis and it is the future and it will not go away.
What can independent jewelers protect themselves. Well, the tearing
of hair and knashing of teeth are not likely to do much good.
Likewise the finger in the dike strategy; boycotting wholesalers who
set up websites as some have proposed, simply will not work. I have
a few ideas but, in the words of the late great Betty Davis, “buckle
your seat belts honey, its gonna be a bumpy ride.”
See you in Tucson,
For Information and sample chapters from my new book: