Diamond jeweller plans  retail shop

02 June 2017
Author   Eric Nyasha Mhunduru
Almod Diamonds Namibia says plans are underway to set up a diamond jewellery retail shop at its premises in Windhoek.
This comes as President Hage Geingob has bemoaned the lack of Namibian manufactured diamond jewellery on the local market, when he paid a courtesy call on Almond Diamonds Namibia during the company’s 10-year anniversary celebrations at the beginning of May.
In a recent interview with the Windhoek Observer, Almod Diamonds Namibia General Director, Reuven Paikin, said the idea to open up a retail shop was already on paper, but they were some outstanding legal issues that still needed to be finalised before the idea can become a reality.
In particular, Paikin said they would need a special licence to sell diamonds locally.
“The idea is already on paper, but we are still busy with the legal aspect of it. Since we have an EPZ (Export Processing Zone) status, we will need a special licence to sell diamonds locally.
“Not every company that is polishing diamonds is cutting them locally and has a licence to sell the diamonds here. That is the reason why most of the companies that are polishing here are not selling the diamonds locally,” Paikin said.
New York-based Almod Diamonds, trading as Diamonds International, which owns and operates a chain of jewellery stores in the United States, Mexico, and the Caribbean, was established in 1991.
The company retails diamond and coloured stone jewellery (including Tanzanite), timepieces, and other gemstone products, including rings, earrings, necklaces, pendants, bracelets, men’s jewellery, and watches.
However, the jeweller said to locally and for the Namibian industry to grow, they would need to have access to more qualified goldsmiths and gem-setters, better control of the export of gemstones and more demand for fine and high-value jewellery within the country.
Herrle and Herma Jewellers Proprietor, Benita Herma, said there were “a number” of manufacturing jewellers in Namibia who operate on a small scale compared to jewellers in China or India, for example.
Herma noted that local products were of a much higher quality than those offered by the South African chain stores, which were bought or imported from the Far East and re-sold.
She said imported jewellery was generally much lighter in weight, the gemstones used are tiny or synthetic and the quality is low compared to locally manufactured pieces.
“Jewellery manufacturing is heavily dependent on skill, quality control and expertise, and we have few skilled artisans who would fill the gap in Namibia. The market is small, and exporting brings its own challenges among them: security, access to markets, design and relatively high salaries,” Herma said.
She also said the profit margins in jewellery making are very low, and heavily dependent on exchange rates and gold prices.
“The only way to bring a jewellery factory to Namibia is as a branch of an internationally-renowned and experienced company. Any such company would hesitate to do exactly that though because of lack of skills and compared to the Far East where there are high salaries.”
As part of its strategy to become an internationally competitive investment location, the Namibian Government introduced the EPZ Act in 1995 in the hope that this would attract foreign investment to Namibia and boost the country’s manufacturing capacity. 
Several special incentives are offered to EPZ companies including a corporate tax holiday, exemption from import duties, free repatriation of profits, factory facilities at economic rates and a guarantee of free repatriation of capital and profits.
The Jewellers’ Association of Namibia Chairman Rolf Adrian, expressed support towards local value addition and beneficiation due to the various benefits it had, but noted the several challenges that would hamper its success such as Government support, skills and expertise, pricing of diamonds, capital, and availability of labour.
Adrian, who is also the Managing Director of Adrian and Meyer Jewellery Creations, however, could not give the exact number of jewellers in the country, but said there were now far less jewellers in Namibia than at the formation of the association just after independence mainly due to the high cost involved in the process and issues of security.
He said they manufactured their jewellery locally on demand rather than just mass produce and risk losing these products to thieves or not sell them at all due to low market demand.
“Most of our diamond jewellery we manufacture ourselves ± 80 percent, but we also source diamond jewellery from suppliers in South Africa, Hong Kong and the European Union, depending on what we cannot manufacture ourselves.  
“We do manufacture on a small scale, but at the end of the day, we purchase diamonds where the correct stock is available and can be provided with grading certificates, and from where they are most competitively priced, which unfortunately is not always in Namibia.
“We always would prefer to purchase a diamond locally first, if it were possible. One of the reasons we manufacture locally is that we can produce it cheaper and thus offer it at a better price to our clients, which is purely the manufacturing costs and excludes the sourcing of diamonds. 
“In other words, we manufacture jewellery locally, but put in diamonds, which we buy outside Namibia. However, we only manufacture for the local demand and market and to ‘mass-manufacture’ for export and compete against Asia is a complete different story,” Meyer said.

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The Windhoek Observer is an English-language weekly newspaper, published in Namibia by Paragon Investment Holding. It is the country's oldest and largest circulating weekly.

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