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Wednesday, September 28, 2011

Report Tracks ‘Dramatic Changes’ in the U.S. Jewelry Market

Pam Danziger
The U.S. jewelry market emerged from the recession to post a 7.5 percent increase in consumer expenditures from 2009 to 2010, after two successive years of negative growth. Yet the jewelry market today is very different than it was in 2006 and 2007 before the recession, according to a recently released report. 

Unity Marketing's Jewelry Report 2011 notes that jewelry makers and retailers who are expecting to pick up where they left off with the same products targeting the same consumers will find themselves in the lurch.

“Since 2006 Unity Marketing has tracked dramatic changes in the jewelry market related to consumers' product and shopping preferences,” said Pam Danziger, president of Unity Marketing.

For one thing, increased demand for men's jewelry accounts for much of the market's growth.

“Among the most profound shifts our research uncovered is the growing demand for men's jewelry,” Danziger said. “While the rising cost of materials accounts for some of the growth, increased demand for men's jewelry also contributed to the rise in the jewelry market from 2008 to 2010.” 

Jewelry marketers must innovate to find growth in the new economy, she added. “Jewelry marketers and retailers must take into account the many changes that their consumers have experienced coming out of the recession. Jewelry marketers have to be willing to challenge the old strategies and create new designs at new price points to be sold in new ways.”

An example of a company that took to innovation is Danish-based silver jewelry designer and manufacturer, Pandora. The company, known for its charm jewelry, posted worldwide growth of 92.6 percent to $1.2 billion in 2010.

Danziger explains each Pandora bracelet is a customizable piece that allows wearers to commemorate life events and interests with the addition of beads. With base bracelets in the $65 to $1,500 range and beads running from $40 to several hundred, this is a product that offers the opportunity for small splurges over time that will be meaningful to the owner.

“Rather than just selling another piece of jewelry, Pandora has transformed their product into an experience that its customers collect to commemorate milestone events and memories,” Danizger says. “Pandora is a game-changing competitor for traditional jewelry marketers. They sell a new type of jewelry item in new types of stores to a new value-conscious consumer eager to create a personal expression of their lives and memories.  Pandora has a built in repeat business that has a loyal following, since nobody can buy just one Pandora charm.”

The example of Pandora also speaks of dramatic change that continue through 2011. The company's spectacular rise since it went public in October 2010 was followed by an equally spectacular fall in August, when its stock fell 70 percent in a day, following a less-than-stellar second quarter report where the company’s outlook was drastically downgraded. The company blamed rising prices for silver and other jewelry making materials and poor execution.

Despite the company’s recent woes, its charms and other jewelry remain popular throughout the world.

‘Only Watch’ Charity Auction Raises $6.2M for MD Research

From left: Ronnie Wood from The Rolling Stones, Luis Garcia (Directeur de Recherche CNRS), Philippe Ferreyrolles, Monique Pettavino, HSH Prince Albert II of Monaco, Tess Pettavino, Gaëlle Tallarida (Managing Dierctor Monaco Yacht Show), Peter Rigby (Chief Executive Informa), Paul Pettavino, Luc Pettavino (President AMM) - Photo: © Claude Charvin

The "Only Watch" charity auction raised more than 4.5 million euros ($6.2 million) for Duchenne Muscular Dystrophy research.

The biennial event was held September 23 at the Hotel Hermitage in Monaco in a star studded affair that included Prince Albert II of Monaco and Rolling Stones guitarist Ronnie Wood. The auction featured a collection of 40 timepieces created specifically for the auction from the top brands in the Swiss watch industry. The pieces went on a world tour to Bangkok, Singapore, Hong Kong, Shanghai, Beijing, Tokyo, Los Angeles, New York, Milan, Geneva and Monaco prior to the sale.

A Patek Phillipe attracted the highest bid of the evening for its Ref. 3939. The stainless steel minute repeater wristwatch with tourbillon escapement, black enamel dial with a stainless steel prong buckle fetched 1.4 million euros ($1.9 million), nearly three times its asking price. Other timepieces that led auction results included a DeWitt, "Concept Watch No. 3 – X-Watch," that sold for $410,000 euros ($558,381); a BLU Gagarin Platinum flying tourbillon that celebrates the 50th anniversary of Yuri Gagarin's historic flight in space that sold for 300,000 euros ($408,571); and a a Van Cleef & Arpels, Poetic Complication “From the Earth to the Moon,” No. 1/1 that sold for 215,000 euros ($292,673).

View 38 of the 40 timepieces that were sold.
In addition to a full room of buyers and celebrities, the fourth edition of the event attracted strong internet and intense telephone bidding. International participation included Japan, Switzerland, Hong Kong, China, the United States and the Russian Federation.

“The auction result is more than exceptional,” said Luc Pettavino, president of the Association Monégasque contre les Myopathies and Founder of Only Watch. “Only Watch 2011 is the fruit of an excellent collaboration between watch manufactures, partners, media, organizers ... but it is first and foremost an outstanding work done by men and women coming from very different horizons who joined their energies to create hope in research on Duchenne Muscular Dystrophy.”

All proceeds from the auction will finance research, organize scientific roundtables and fund International Collaborative Effort (ICE).

“Thanks to Only Watch, we are going to be able to finance ICE (a program that was started in 2008),” said Luis Garcia, directeur de Recherche at the CNRS. “This program brings together 15 leading teams worldwide who work on therapeutic strategies on Duchenne Muscular Dystrophy, in particular exon skipping, gene and cell therapies.”

The event is organized by the Association Monégasque contre les Myopathies, Antiquorum Auctioneers and the Monaco Yacht Show (which is held at the same time), along with the support of 40 of the watchmakers, the auction concluded a series of preview exhibitions that took place in (during the Monaco Yacht Show).

Thursday, September 22, 2011

Asian Consumers Demand Luxury Jewelry

Fleur d'amour by EJI of Hong Kong.

HONG KONG—While the September Hong Kong Jewellery & Gem Fair has grown to become the largest fine jewelry show in the world, it is not the place to introduce jewelry design trends. Baselworld in March and Las Vegas Jewelry Week in June serve as the trade shows where trends are established.

What the Hong Kong show has established is that it serves as the gateway to most of Asia, in particular the robust China and India markets. In addition to strong economies, countries in this region share an enthusiasm for jewelry. That’s why this industry trade show has grown so large.
Hokusai earrings by Garaude of Paris

If there is a single trend that can be gleaned from the Hong Kong trade fair, it’s that luxury is playing a significant role in the jewelry industry in Asia. This is no surprise as the top luxury retailers have been opening up stores in China at an incredible pace. But at the trade show, traditional high-end jewelry designers from Hong Kong and around the world have followed suit, going after these new big spenders.

And the fair has gone through extraordinary means to accommodate these companies by hosting two well-designed spaces dedicated to makers of luxury jewelry. They are the Hong Kong Premiere Pavilion with approximately 30 exhibitors and the International Premiere Pavilion with more than 50 companies representing some of the top high-end jewelry brands from the rest of the world.

Legrand Jewellery (Mfg) Company

One of the countries making the biggest splash in the luxury arena is Italy, with about 13 companies in the International Premier Pavilion, ranging from the artistic talents of Annamaria Cammilli Gioielli to the world-renowned luxury brand Roberto Coin. But it doesn’t end there. OroArezzo, the trade fair that represents gold jewelry manufacturers in the Tuscany region of Italy, had its own pavilion of companies, many of which make high-end, high-karat fine jewelry. If that’s not enough, in the lobby of the convention center, there’s a large exhibit called, Golden Hat_Titude, sponsored by OroArezzo, which combines glittering gold jewelry paired with a variety of hats on the heads of black mannequins.

India and China, two countries that lack the same tradition of luxury design as in Europe, are also well represented with companies like Bapalal Keshavlal of India and TTF Jewelry of China.

Hong Kong luxury jewelry makers showed that they are willing to compete with the rest of world for the new Asian luxury consumer. Among the standouts at the fair is Forward Jewellery, Eligence Jewellery International (EJI) and Legrand Jewellery.  There are many more such companies making similar inroads in the luxury jewelry.

Asian consumers have the money and the appreciation of luxury jewelry. All that is left is for the region to become more influential in jewelry design. Then it will be the leader in the fine jewelry industry.

Wednesday, September 21, 2011

First Impressions of the Hong Kong Jewellery & Gem Fair

HONG KONG—From the lion dance welcoming visitors to the second part of the two-tier event, to the mad scramble at buffet tables during the evening reception, the September Hong Kong Jewellery & Gem Fair kept me very busy. Unfortunately, I didn’t see much jewelry. That will come tomorrow.

The weeklong event, held in two venues (September 19-23 at the Asia World-Expo near the Hong Kong International Airport for diamonds, colored gemstones, materials and equipment; and September 21-25 at the Hong Kong Convention & Exhibition Centre for finished jewelry) is now the world’s largest fine jewelry fair, according to event organizers, UBM Asia. After attending the show Wednesday, I have no reason to doubt them.

Trade fair organizers and trade association leaders at opening day press conference.

The first two days of the fair attracted 15,000 buyers, a 32 percent increase from last year, Jimé Essink, president & CEO of UBM Asia Ltd., said during the opening day finished jewelry press conference Wednesday. “It is beyond our wildest dreams,” he said. “With (an expected) 45,000 buyers from 135 countries, it cements its standing as the world’s number one jewelry event.”

Letitia Chow, UBM Asia director of Business Development - Jewelry Group, and Wendy Pang, senior marketing manager - Jewellery Fair, at the evening reception.

Why has this tradeshow attracted so much attention in recent years? Two words: China, India.  While much of the world labors under an economic slowdown, the economies of these two countries are humming along. This is where the strongest growth in attendees is coming from, as buyers try to take advantage of consumers who are more than willing to spend their newfound wealth on jewelry. People from Mainland China now accounts for 32 percent of all attendees and for the first time has overtaken Hong Kong as the top visitor group.

Hong Kong, with its international port, strong business environment and its ideal location, is considered the gateway to China and much of Asia. Designers and manufacturers from around the world are flocking to this show to get into these strong markets. More than 3,300 vendors from 46 countries represent an 8 percent increase over last year, ensuring that the 1.4 square-feet of combined exhibition space is fully occupied. Planned expansion to the two massive centers won’t be ready for at least four years, leaving the organizers with the unusual task of being unable to grow further. But as Essink told me: “It’s a good problem to have."

The official toast at the evening reception.

I last attended this event in 2005 and I have to say to say that moving unfinished jewelry vendors to a second location has certainly made the convention center much easier to navigate. Security checkpoints are fewer and I can actually walk through the hallways and exhibition areas of the five-story convention center without running through a sea of bodies. Layouts are much easier to understand. Silver jewelry and other lower cost finished product have its own area. The International Premiere Pavilion features exhibitors showcasing luxury jewelry from about 20 countries in a dedicated space. Top Hong Kong brands have their own pavilion.

As I said previously, I will be talking jewelry tomorrow.

Hungry people

Sunday, September 18, 2011

JNN at the Hong Kong Jewellery & Gem Fair

The registration area at the Hong Kong Jewellery & Gem Fair.

The Jewelry News Network (meaning me) will be leaving for Hong Kong tomorrow to attend the Hong Kong Jewellery & Gem Fair. The former British colony, with its bustling port, international banks and robust stock market, is the gateway to China, the most dynamic jewelry and luxury market in the world. This alone makes it one of the most important events in the jewelry industry calendar. But there’s more.

The event—being held September 19-23 at the Asia World-Expo on Chek Lap Kok island, next to Hong Kong International Airport for diamonds, colored gemstones, materials and equipment and September 21-25 at the Hong Kong Convention & Exhibition Centre overlooking the beautiful and busy Victoria Harbor for finished jewelry—is one of the three largest jewelry trade fairs in the world and the largest in Asia. Nearly 1.4 million square feet of exhibition space will be used by more than 3,300 vendors from 45 countries to display their products and services to an estimated 45,000 buyers from 135 countries.

While Asia is the focus, this fair is truly an international affair. There will be 20 country pavilions from all the major jewelry markets, with France being the newest group to have its own pavilion. Thailand, a gemstone manufacturing center, has the largest overseas pavilion at the Hong Kong show with more than 150 exhibitors at the AWE and more than 200 at the HKCEC.

The International Colored Gemstone Association, which represents the global colored gemstone industry, also has its own pavilion.

The AWE portion of the fair boasts the world’s largest diamond pavilion, with more than 430 exhibitors.

The luxury market and fine jewelry design have become more of a focus in Asia and the fair responded with pavilions dedicated to high-end jewelry and gems as well as internationally inspired designer jewelry. It includes the following:
* Fine Design Pavilion in the Grand Hall of HKCEC with more than 70 internationally renowned jewelry and timepiece companies;

* Fine Gem Pavilion in – Hall 9 of AWE with more than 50 exhibitors deemed “world class” selling top quality gems;

* Hong Kong Premier Pavilion showcasing the top-notch craftsmanship and exceptional creativity of 30 Hong Kong avant-garde jewelers; and
* International Premier Pavilion with more 50 prominent jewelry companies from around the world showcasing cutting-edge jewelry designs.

I will be spending nearly all of my time at the convention center with the finished jewelry vendors and buyers. The last time I attended the show was in 2005, the year before it moved to two venues. I’m looking forward to seeing how much the show has changed and grown since that time. I will be blogging live from the show as often as possible.

Thursday, September 15, 2011

Patek and Rolex Take Top Spots in Watch Auction

Patek Philippe ref. 2499 sold for $374,500

A Patek Philippe ref. 2499 led auction results by selling for $374,500 at Antiquorum's September auction of Important Modern & Vintage Timepieces. Made in 1976, the 18k yellow gold wristwatch with round button chronograph, perpetual calendar, and moon phases originated from the collection of professor Thomas Engel.

Patek Philippe Ref. 1436 sold for $284,500.

Other Patek Philippe timepieces that commanded high prices included a ref. 1436 split-second chronograph with transitional dial retailed by Tiffany, sold for $284,500; a ref. 3971 that sold for $116,500; and a ref. 5038, a limited edition white gold perpetual calendar, which fetched $56,250.

The September 14 auction in New York featured 319 collectable timepieces and took in nearly $2.8 million, with 78 percent sold by lot and 119 percent sold by value. It attracted 353 registered internet and phone bidders from around the world, including Hong Kong, China, Taiwan, the Russian Federation, the Netherlands, Canada and the United States.

Rolex ref. 6241 Daytona sold for $110,500

Popular modern and vintage Rolex watches also achieved important results as confirmed by the two examples of the Rolex ref. 6241 offered in the sale. An 18K yellow gold Paul Newman and a 14K yellow gold Daytona retailed by Tiffany & Co. both sold for $110,500.

Rolex Submariner ref. 6538 sold for $76,900

Rolex watches complete with box and papers sold well, including the Rolex Submariner ref. 6538, "James Bond" Big Crown with gilt dial, which sold for $76,900; the Rolex Ref. 1019, which sold for $45,000; and the Rolex. Ref. 1655, which fetched $21,875.

“The outcome for our September auction confirms that Rolex Sports watches continue to generate strong interest among collectors throughout the world,” said Evan Zimmermann, Antiquorum president and CEO.

Audemars Piguet Royal Oak 'City of Sails,' Ref. 25979 sold for $46,250

Perhaps in anticipation of the Audemars Piguet Royal Oak Anniversary in 2012, all Audemars Piguet Royal Oak watches sold well. The top lots included a Royal Oak Perpetual Calendar with anthracite dial, which attained $31,250, and the limited edition "City of Sails" which sold for $46,250.

New ipad App for the FT 'How To Spend It' Magazine

This is more of a public service announcement than a story. In my opinion one of the world’s best luxury lifestyle magazines is the Financial Times "How To Spend It." The FT has recently launched a free iPad app as a complement to the color newspaper supplement.

The ipad includes the following:

* A searchable content of more than 60 editions of How To Spend It;

*·Content from new issues posted seven days a week;

* Daily postings, such as blogs, columns, interviews and news from the How To Spend It staff that isn’t in the magazine;

* Content organized by subject rather than by print edition;

* Access to most magazine features and columns before they appear in print; and

* A “Gift Guide” with more than 600 inspired ideas for men and women with a new gift posted every day; and

“When we designed this, our first question was: why adopt a print-style published edition format when we can organize content logically and allow readers to search their favorite subjects, columns and writers?” said How To Spend It editor Gillian de Bono. “With daily postings, the app gives magazine readers a unique sense of discovery.”

Download the app by following this link.

Now you don’t need a subscription to the FT in order to enjoy the magazine. However, I would also recommend an FT subscription.  

I really do hope the ipad app runs better than the slow, cumbersome, flash-heavy, although beautiful, "How To Spend It" website.

Wednesday, September 14, 2011

August Retail Sales Flat as Consumer Spending Stalls

Retail industry sales (which exclude automobiles, gas stations, and restaurants) in August increased 0.1 percent seasonally adjusted over July and 6 percent unadjusted year-over-year, according to the monthly survey by the National Retail Federation, a retail trade association.

The NRF results are in line with data released by the U.S. Commerce Department that shows total retail sales (which include non-general merchandise categories such as autos, gasoline stations and restaurants) increased 0.1 percent seasonally adjusted month-to-month and 9 percent unadjusted year-over-year.

“Consumer spending in August was tempered by a continued lack of confidence in the strength of our economy,” said Matthew Shay, NRF president and CEO. “Having carried the brunt of the economic recovery so far, consumers may be waiting for good news in terms of employment and market stability, cautiously spending on things they need and thinking twice about things they want.”

Specific sales results from the NRF survey include:

* Sales at electronic and appliance stores increased 0.5 percent seasonally adjusted month-to-month and 2.5 percent unadjusted from last year. Sporting goods, hobby, book and music stores’ sales increased 2.4 percent seasonally adjusted over July and 9.3 percent unadjusted year-over-year.

* Health and personal care stores sales increased 0.2 percent seasonally adjusted over July and 5.4 percent unadjusted year-over-year.

* Building material and garden equipment and supplies stores sales increased 0.2 percent seasonally adjusted over the previous month and 9 percent unadjusted year-over-year.

Monday, September 12, 2011

Richline Group to Buy Fifth Italian Jewelry Brand

Warren Buffett seems to be attracted to Italian jewelry companies. ©AP Photo/ Kathy Willens

Jewelry company Richline International, will buy Italian jewelry brand, Carniani, Reuters reports.

The acquisition includes the production, design, intellectual property and distribution rights of the Italian jewelry brand.

Richline International is based in Arezzo, Italy, an area known for gold jewelry manufacturing and design. It is fully owned by Berkshire Hathaway's Richline Group, a global jewelry manufacturer. This will be the company's fifth jewelry brand acquisition as the it plans to expand further in Italy. In May, the company announced the acquisition of 7Ar, Erz and Farinex jewelry brands. Berkshire Hathaway is led by billionaire investor Warren Buffett.

The Richline Group was formed in 2007 and includes a diverse group of jewelry brands specializing in metals, gemstones and design. They include Andin, Aurafin, AuraGem, Bel-Oro, Michael Anthony and Tru-Kay.

Update: Swatch Group Ends Partnership with Tiffany

The Atlas Chronograph watch in 2009, one of the first watches created by Tiffany Watch Co. Ltd.

Updated at 2 p.m. with a statement from Tiffany & Co. disputing the claims of the Swatch Group. See below.

In a terse statement Monday, the Swatch Group said it will end its partnership with Tiffany & Co. to make and distribute branded watches for the luxury jeweler and will seek compensation for the loss of business. The world’s largest watch group blames Tiffany for what it calls a “breach of contract.”

“Today Swatch Group terminated its cooperation contracts with Tiffany & Co,” the Biel/Bienne, Switzerland-based company said in a statement. “This action became necessary following Tiffany & Co’s systematic efforts to block and delay development of the business.”

In December 2007, with a great deal of fanfare, the two companies announced that it was creating Tiffany Watch Co. Ltd. The agreement, finalized in the spring of 2008, created an entity responsible for the development, production and distribution of Tiffany & Co. branded watches. Worldwide sales were handled through points of sale operated by Tiffany & Co., by The Swatch Group Ltd. and by independent retailers.

Tiffany Watch Co. Ltd. will wind down over the course of two years following the termination of the cooperation contracts, Swatch said in its statement, adding that it will seek damage claims.

“Swatch Group and Tiffany Watch Co. Ltd. will press claims for damages against Tiffany & Co., New York, in compensation for the loss of planned long-term future business.” 

Tiffany issued a statement at about 11:30 a.m. disputing the claims of Swatch Group saying that the watch company failed to uphold its end of the agreement terms.

“Since Tiffany & Co. and The Swatch Group Ltd. entered upon this venture more than three years ago it has become increasingly clear that Swatch is unwilling to honor the terms of our agreement, make the necessary commitments and work cooperatively to develop the business for TIFFANY & CO. watches in the luxury space, Tiffany said in its statement.

“Despite assurances to contrary made in 2007, Swatch has failed to provide appropriate distribution for TIFFANY & CO. brand watches, with the result that our current business forecasts do not include any meaningful increase in watch sales or royalty income. Tiffany has honored its obligations under the agreement, and insisted that Swatch honor its own obligations, particularly its obligation to respect Tiffany's rights regarding brand-management and product design. Tiffany & Co. is confident that its position will be vindicated in the pending arbitral proceedings in relation to this matter and Swatch's misconduct.”

Friday, September 9, 2011

The Pentagon's Jeweler Remembers 9/11

The Pentagon in January 2008. Photo credit: Wikipedia; Source: the Pentagon; Author, David B. Gleason

While much of the world will be focused at the World Trade Center complex for events in remembrance of the 10th-year anniversary of the 9/11 terrorist attacks, the Pentagon will hold its own low-key commemoration. One person who will not be attending the Sunday event is Brian Mann, who has spent his entire working life in the building that serves as the headquarters for the U.S. Department of Defense.

About 23,000 military and civilian employees work in the 6.5-million-square-foot structure, considered to be one the world’s largest office buildings by floor area. To service their needs there are host of private companies in the concourse area that include a food court, pharmacies, laundry and dry cleaning services, a florist, a candy store, an electronics store and a barber shop. There’s also a family retail jeweler, David Mann Jewelers.

The retail operation was founded by David Mann in 1945, three years after the Pentagon opened, as a watch repair shop. Over the years the business grew to a full-scale jewelry retail operation. It is now owned and managed by David’s sons, Brian and Conrad. “I’m 57 years old and my brother is a little older,” Brian says. “It’s the only job we’ve ever known.”

The brothers were working in the store as usual on September 11, 2001, when five al-Qaeda operatives hijacked American Airlines Flight 77, en route from Washington Dulles International Airport to Los Angeles International Airport, and deliberately crashed it into the west side of the Pentagon at 9:37 a.m.

The brothers’ store is on the southeastern side of the building. They were close enough to the crash site to know that something unusual had happened but far enough away to not know what it was.

Brian says at first he thought it was a construction accident, because that portion of the building was undergoing a renovation. He and brother realized quickly that it was something worse, perhaps a bomb, when they saw people running and were told by the Pentagon police to leave. He says as he was driving away he saw the black smoke from the fire. He was able to get in touch with his wife and son and daughter while in the car driving to his Maryland home, but it was difficult because of all the cell-phone activity.

“There was a lot of confusion at that particular time,” Brian says. “No one knew exactly what happened. It was not until I was able to get in the car and head home hearing it on the radio that it obviously was a plane and it was not a construction mishap.”

A total of 125 people in the building were killed as well as all 64 people on the airplane. Because of the renovation (part of a 12-year upgrade for the entire building) the area was only about 20 percent occupied at the time of the attack.

“It could have been in the other side of the building,” he says. “I think everyone in the building and throughout the world thought about the what ifs and what was going to happen. It affected a lot of people who had friends and relatives (inside the building). We’re just fortunate. It could have been worse and for some it was the ultimate sacrifice.”

They actually opened the shop the next day at the request of then Secretary of State Donald Rumsfeld but it quickly became obvious the store and building couldn’t function as if it were a normal day.

“The building was still on fire before we opened by 8 a.m. We were told to close down.”

One of the personal connections he had to someone who died in the attack was with TV commentator and attorney Barbara Olsen, (who was on the plane that crashed into the Pentagon). He met Olsen a couple of times through a friend who published some of her books. With a few others, he says he recognizes them as customers.

“There are familiar faces that you would remember who might have come in,” he says. “Face recognition was the most important thing and there were a handful that I recognized.”

Needless to say while David Mann Jeweler is a typical jewelry store, there are some unusual aspects to having a business that serves, almost exclusively, Department of Defense officials and contractors. First are the days and hours of operation. Store hours are from 8 a.m. to 5 p.m. Monday through Friday. The shop is closed on weekends and holidays and there are no evening hours. He and his brother begin work at 6:30 a.m. each weekday.

“If you average it all out with a seven-day operation or a six-day operation, (the hours) will equal out,” he says. “You have the benefits of three-day weekend holidays and some not so good benefits. When Christmas falls on a Monday, my last business day is on Friday. For two full days we’re closed. You’ve got to make hay when the sun shines.”

Security has tightened over the years, even before the attack. He used to be able to serve customers who did not have a relationship with the Pentagon, but that gradually ended. Now it is very difficult, only possible with an escort service. However, he does have some impressive clientele, including the past two secretaries of defense (Rumsfeld and Robert Gates).

“Rumsfeld was in the store five days after 9/11,” he says, “a very, very nice gentleman and very well-respected in the building. You just never know who might come in.”

Since the attacks, activity in the Pentagon increased as one would expect during a time of war and security is even tighter. Another change is the store was renovated and relocated to a new space in the concourse. It was the final stage of the long-term renovation program, prior to 9/11. All of these changes were anticipated. However, there has been one unexpected change since the attacks: the level of business for Valentine’s Day.

“A lot of jewelers when it comes to Valentine’s Day, it’s not a big day,” he says. “After 9-11 we call it a mini-Christmas.”

Brian says it’s obvious why the first couple of Valentine’s Days after the attacks were busy but buying jewelry for loved ones on this romantic holiday has morphed into a sort of tradition at the Pentagon.

“I can’t say for sure why, but other than Christmas it’s our busiest day depending upon how the calendar falls,” he says. “We’ve been very fortunate that love is in the air in the Pentagon.”

Benches at Pentagon Memorial. Photo credit: VeloBusDriver via Flickr
September 11 happens to fall on a Sunday this year, an off day for Brian Mann and that’s just fine with him. He says after 10 years he would rather spend the day as usually does.

“The Pentagon was the first one to have a memorial outside. I’m sure they’ll be things going on that day for the people who want to observe and I’m sure that’s what they will be doing. I’ll certainly think about it but ten years has past and life goes on,” he says. “Let everyone remember in their own way on a very nice Sunday.”

This story also appears on

Thursday, September 8, 2011

JVC Publishes Guide on FTC Platinum Amendments

The Jewelers Vigilance Committee released The Essential Guide to the U.S. Trade in Platinum Jewelry to clarify Federal Trade Commission’s 2010 amendments to the platinum section of the guides for the jewelry, precious metal and pewter industries. This guide explains these revised standards, and what they mean in practical terms for those who manufacture, promote and sell platinum jewelry. The guide was underwritten by a grant from Platinum Guild International USA

The Essential Guide includes legal standards for platinum, glossary of terms, frequently asked questions and two platinum tolerance charts, explaining how to stamp and describe both traditional products and platinum products containing a minimum 500 ppt platinum alloyed with base metal. 

“This Essential Guide explains fairly complex FTC amendments for the marketing and stamping of products containing platinum,” said Cecilia Gardner, JVC president and CEO. “This tool gives practical guidance on how to compliantly market and describe these products.” 

To view and download the Essential Guide online, visit this link on the JVC website or this link to the PGI website.

Wednesday, September 7, 2011

Harry Winston Sales Up While Profits Decline

Harry Winston saw a 98% increase in retail sales.

Harry Winston Diamond Corp. saw its luxury retail sales nearly double along with a modest increase in rough diamond sales, but it wasn’t enough to lift profits for the Toronto-based company.

The company said Wednesday that second quarter consolidated sales increased 44.7 percent percent to 222.4 million year-over year, resulting in a 6 percent increase in gross margin to $72.2 million and an operating profit of $23.1 million, compared to an operating profit of $29.9 million in the comparable quarter of the prior year. Consolidated EBITDA was $43.8 million compared to $49.4 million in the comparable quarter of the prior year.

Despite the sales increase, net profits fell 23 percent to $10 million.

Harry Winston consists of two businesses. The first supplies rough diamonds to the global market from its 40 percent ownership interest in the Diavik Diamond Mine. The company, however, is internationally known for its second business as a premier diamond jeweler and luxury timepiece retailer with salons in key locations throughout the world, including New York, Paris, London, Beijing, Tokyo, Hong Kong and Beverly Hills.

The luxury brand segment reported a 98 percent increase in sales to $132.8 million for the period, year-over-year. At constant exchange rates, the increase was 81 percent. Included in the second quarter was $55.6 million of high-value transactions, which generally carry lower-than-average gross margins. Operating profit was $6.8 million for the quarter compared to $2.3 million in the same quarter of the prior year. EBITDA for the luxury brand segment was $10.1 million compared to $5.5 million in the comparable quarter of the prior year.

“Global retail demand, especially in the emerging economies such as China and India, has delivered both strong retail sales growth and strong rough diamond prices. Seeing through the effect of a small number of high-value, lower margin sales, our own jewelry and timepiece business shows solid growth in both sales and margin in the core bridal, timepiece and designed jewelry segments,” said Robert Gannicott, Harry Winston chairman and CEO.

Meanwhile, sales from its mining segment increased 3 percent to $89.6 million for the second quarter, year-over-year, resulting primarily from a 41 percent increase achieved in rough diamond prices, offset by a 27 percent decrease in volume of carats sold. The mining segment recorded operating profit of $16.3 million compared to $27.6 million in the comparable quarter of the prior year. EBITDA for the mining segment was $33.7 million compared to $44 million in the comparable quarter of the prior year.

“The market price increase in rough diamonds has more than compensated for two complete sales versus three in the comparable prior year quarter as well as the lower quality diamonds mined from the upper part of the current open pit,” Gannicott said

“Looking forward we continue to see strong global jewelry and timepiece demand from China while Japan and the Middle East improve and the U.S. remains subdued. On this basis we expect to continue to grow our own jewelry and timepiece business despite challenging economic conditions in the U.S. and Europe. Although we do not predict further near-term rough diamond market price increases we do see our own rough diamond sales price already improving.”

Elizabeth Taylor’s Legendary Jewels May Fetch More Than $30M

The Elizabeth Taylor Diamond

Elizabeth Taylor amassed one of the greatest private jewelry collections in the world during her long, colorful life. A total of 269 of her personal jewels are going on sale on December 13 and 14 as part of the four-day “Collection of Elizabeth Taylor” auction at Christie’s New York.

On December 13, the international auction house will present 80 of Taylor’s most iconic jewels in a special evening sale, followed by 189 additional jewels in two sale sessions on December 14. The jewels include Taylor’s most iconic diamonds, gemstones, historic jewels, and one-of-a-kind creations, as well as personal mementos and beloved gifts. Christie’s estimates this collection of storied jewels will bring in more than $30 million.

“This is without a doubt the greatest private collection of jewelry ever assembled in one place,”
said Marc Porter, chairman and president of Christie's Americas.

“Elizabeth Taylor’s passion for jewelry was well known, but it is her depth of knowledge about fine jewelry that truly impresses,” added François Curiel, international jewelry director and president of Christie's Asia. “From the first time I met her in 1998, it was clear that she possessed an expert’s eye for craftsmanship, rarity, quality and history.

The collection includes examples from Bulgari, Boucheron, Cartier, JAR, Schlumberger, Tiffany and Van Cleef & Arpels.

Select highlights from the Elizabeth Taylor’s collection of magnificent jewels will go on a three-month global tour this month, starting with a public exhibition at GUM on Moscow’s Red Square on September 15, followed by public exhibitions of collection highlights in London, Los Angeles, Dubai, Geneva, Paris and Hong Kong. In December, the tour will culminate in a special ten-day exhibition of the complete collection at Christie’s New York.

The complete catalogs of the Evening and Day sale sessions of The Legendary Jewels will be available for purchase in October, Christies said. Further details of Elizabeth Taylor’s collections of fashion and accessories, fine and decorative arts, film memorabilia, and other items will be announced in the coming weeks.

Jewels that will be on sale include:

The Elizabeth Taylor Diamond
The 33.19-ct., D color, potentially internally flawless diamond (top photo) mounted on a ring was a gift from Richard Burton on May 16, 1968. The most iconic of her cherished white diamonds, this spectacular stone was a constant in Elizabeth Taylor’s life and became the ring she wore virtually every day. The Type IIa diamond was purchased at auction for $300,000 in 1968 as the Krupp diamond. Christie’s and the trustees of her estate have renamed it The Elizabeth Taylor Diamond to pay homage to its owner.
The auction estimate is $2.5 million to $3.5 million.

La Pérégrina – The Legendary Pearl
This remarkable pearl of 203 grains in size—equivalent to 55 cts.—ranks as one of the most important historic pearls in the world. Discovered in the early 1500s in the Gulf of Panama, the pear-shaped pearl became part of the crown jewels of Spain. Prince Philip II of Spain gave it as a wedding gift to his wife, Mary Tudor of England, and it later passed on to the Spanish queens Margarita and Isabel, who proudly wore the pearl in 17th century portraits painted by Velázquez himself. Richard Burton famously purchased the pearl for Elizabeth Taylor at auction in 1969 for $37,000, after successfully outbidding a member of the Spanish Royal family. Burton gave the pearl to Taylor on Jan. 23, 1969. Inspired by a 16th century portrait of Mary Queen of Scots, Taylor commissioned Cartier to design a new mount of matched natural pearls and rubies. It was designed by Taylor with Al Durante of Cartier to offset what she called “the most perfect pearl in the world.”
Estimate: $2 million to $3 million

The Mike Todd Diamond Tiara
An Antique Diamond Tiara, circa 1880
As noted in her 2002 book My Love Affair With Jewelry, Elizabeth Taylor’s husband theater and film producer Mike Todd presented her with this antique diamond tiara, circa. 1880, saying, “You are my queen.” She wore it to the Academy Awards in Los Angeles in 1957, where Todd’s film Around the World in 80 Days won for Best Picture.
Estimate: $60,000- $80,000

The Ping Pong Diamond Rings
Richard Burton and Elizabeth Taylor both loved Ping-Pong. At home in Gstaad on one occasion, Burton promised Taylor a diamond if she could win 10 points against him. She did, and to keep his end of the bargain he gave her three small diamond rings, dubbed “The Ping Pong Diamonds.”
Estimate: $5,000-7,000

BVLGARI Emerald and Diamond Suite
Collected over the course of many repeat trips to the Bulgari boutique on the Via Condotti in Rome (1962 – 1967), the jewels that make up this suite were keepsakes from the filming of Cleopatra.
Necklace estimate: $1million – $1.5 million
Pendant estimate: $500,000 – $700,000
Ring estimate: $600,000 - $800,000
Bracelet estimate: $300,000 – $500,000
Earrings estimate: $150,000- $200,000

Cartier Ruby and Diamond Suite
Gift from Mike Todd, August 1957
During her marriage to producer Mike Todd, Elizabeth Taylor was swimming laps in the pool at their villa in St.-Jean-Cap-Ferrat in 1957 when he surprised her with a trio of Cartier boxes containing this suite of ruby jewels.
Necklace Estimate: $200,000 – $300,000
Bracelet Estimate: $150,000 – $200,000
Earrings Estimate: $80,000 – $120,000

Richard Burton Ruby and Diamond Ring
The 8.24-carat ring by Van Cleef & Arpels was a gift from Richard Burton, given to Taylor at Christmas, 1968.
Estimate: $1 million – $1.5 million

The BVLGARI Sapphire Sautoir
Set with a sugarloaf cabochon sapphire of 52.72 carats, this Art Deco style sautoir from Bulgari was a gift from Richard Burton for Elizabeth Taylor’s 40th birthday in 1972. She later added the ring to make it a set.
Sapphire and Diamond Sautoir estimate: $600,000 to $800,000.

JAR Sapphire ‘Ball’ Ear Clips
Purchased in Paris, December 2001
Taylor had her finger on the pulse of contemporary jewelry design. This set of sapphires ear clips was custom-designed by the celebrated jewelry designer Joel Arthur Rosenthal (known by his initials JAR) who maintains a small, appointment-only boutique on the Place Vendôme in Paris. For these special earrings, JAR incorporated varying shades of sapphires to evoke the elusive hue of her eyes. It was purchased in December 2001.
Estimate: $100,000 – $150,000

The Prince of Wales Brooch, circa 1935
Formerly owned by the Duchess of Windsor, this sparkling diamond pin in the form of the three feathers from the royal insignia of the Prince of Wales was originally a gift from the Duke to the Duchess. As an acquaintance of the royal couple, Taylor had admired the brooch whenever she saw the Duchess wearing it, but turned down the latter’s generous offer to let her make a copy of it. Years later, after the Duchess died and her estate was brought to auction, Taylor purchased it at auction in April, 1987.
Estimate: $400,000 – 600,000

The Taj Mahal Diamond, Circa 1627 – 28 with Gold and Ruby Chain by Cartier
Inscribed with the name Nur Jahan, the wife of the Mughal Emperor Shah Jahangir, this heart-shaped diamond is believed to have been a gift from the ruler to his son, who became the great emperor Shah Jahan (1592-1666). At the age of 35, it is believed that the young prince presented the diamond to his favorite and most beloved wife, Mumtaz-i-Mahal. The emperor’s grief at her death just four years later was legendary – in her memory he commissioned the majestic Taj Mahal . Richard Burton was captivated by the history and significance of this special diamond, and gave it to Elizabeth in 1972 for her 40th birthday.
Estimate: $300,000 – $500,000

Night of the Iguana Brooch by Jean Schlumberger, Tiffany & Co.
More catfish in form than iguana, the serpentine jewel was fashioned of diamonds and gold, with emerald and sapphire accents. It was a gift from Richard Burton to Taylor on August 11, 1964, to wear on the premiere of his film, “The Night of the Iguana.”
Estimate: $200,000 – $300,000

The Edith Head Necklace
The gold necklace with ivory opera passes, circa 18th and 19th centuries, was a gift to Taylor from the Estate of Edith Head, a costume designer and very close friend of Taylor.
Estimate: $1,500 – $2,000

Charm Bracelet
This gold bracelet of 20 charms includes an engraved clapperboard commemorating “The Taming of the Shrew,” a gold jeweler’s loupe inscribed with Elizabeth’s name, and a gold sphere locket that opens to reveal four medallions—each one engraved with the names and birth dates of each of her four children.
Estimate: $25,000 – $35,000

The Burton Wedding Bands
These diamond-set wedding bands were given to Elizabeth Taylor by Richard Burton upon their marriages in 1964 in Montreal and in 1975, on the occasion of their second marriage in Botswana.
Estimate: $6,000 – 8,000

The ‘Granny’ Suite Necklace
To mark the birth of her first grandchild in 1971 at the age of 39, Richard Burton gave Elizabeth Taylor this lion-themed necklace from Van Cleef & Arpels. It’s part of set with matching ear pendants (not shown) that will also be included in the auction.
Necklace estimate: $120,000 – $180,000

The ‘Cleopatra’ Mirror
The turquoise and gold Egyptian revival motif mirror was created by Bulgari in 1962 at the time the epic film Cleopatra, starring Richard Burton and Elizabeth Taylor, was finishing production in Rome.
Estimate: $8,000- $12,000