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Founder hopes online diamond store shines
Wednesday, October 22, 2008
Last updated: Wednesday October 22, 2008, EDT 4:15 PM
BY JOAN VERDON
STAFF WRITER
| Diamonds may be forever, but Yomesh Shah didn't see a long-term future for his family's wholesale diamond business. So the Cliffside Park resident decided to give the family business an avenue for future growth by creating an online diamond and jewelry store, B2CJewels.com. (B2C is short for Business to Consumer. |
DAVID BERGELAND / STAFF
Yomesh Shah of Cliffside Park showing off some of the diamond rings in his Fifth Avenue office in New York City.
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B2CJewels.com lets customers select one of the 50,000 diamonds listed on the site and pair it with a setting to create a custom ring. The site also sells other gemstones, as well as earrings, bracelets and necklaces. Prices for loose diamonds range from $300 to $1.7 million for an 11-carat stone. Shah and his 24-person staff run the site out of a small office in New York's Diamond District.
Shah, 32, is a graduate of the Gemological Institute of America (GIA), with certifications in diamonds and jewelry manufacturing.
He prefers to sell diamonds rather than wear them, so you won't find him flashing any bling. "I leave the big rocks to the ladies," he told The Record as he talked about the birth of B2CJewels.com, the state of the diamond market, and why it's what's inside the box that matters. (Interview edited and condensed for space.) |
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Q. How was B2CJewels.com born?
We started B2CJewels last year. We saw the slowdown in the economy and how it was affecting our wholesale business. Looking down the line five years, 10 years from now, we believe online sales will be growing more than anything else. In the wholesale business right now, the middle man is getting squeezed out, so we decided to go direct to the consumers.
Q. How did your family first get into the business?
Three decades ago, my father and his partner came down from rural India. At that time in India, everyone was coming to the cities and trying to venture into new things. They happened to know somebody in the diamond industry, and they started learning about manufacturing. They got into the business of manufacturing diamonds. In 1985 they established a presence in the United States.
Q. Don't you think someone would want to see a diamond before they buy it?
A GIA rating is a standard that is accepted in the U.S. and worldwide. It's like buying cars or furniture. You look in the catalog and you know what it is. It's just the price that you are hunting for. It's the components that make the value of the diamond. If you buy a computer you would say you want a Pentium or a dual core. With a diamond, you want a G color or F color or VVS, or VS [clarity grades], so it's pretty defined out there.
Q. How do you know the diamond that comes in the mail actually is a G color or VVS clarity?
It comes with a certificate, and you have an inscription number matching the diamond. And we have a 30-day refund policy so you can go to your local jeweler and have it checked.
We want the customers to be 100 percent satisfied and tell their friends, because word of mouth is the best advertising.
Q. How much cheaper is it to buy a diamond from your Web site?
It's 30 to 50 percent less than the regular mom-and-pop or conventional store.
Q. Are you making money on the Web site yet?
It's still in the building stage. In a couple of years we should be getting the fruits of our investment.
Q, What's happening in the diamond market these days? Are prices going up? Is demand going up?
The demand right now is kind of stagnant. Even in these tough economic times, the industry is predicting overall market growth of 3 percent. U.S. jewelry sales are going up from $65 billion to $67 billion this year. That's the projected growth.
Q. They consider 3 percent growth stagnant?
With 3 percent growth – somebody gets a part of it, somebody doesn't get a part of it. They're used to growth of 7 to 8 percent. So 3 percent is pretty low.
Q. Gold prices are going through the roof. Is that happening with diamonds, too?
Earlier in the year, they went up. Right now, they're not going up.
Q. In these tough economic times, are people saying, "Forget the stock market, I'm going to put my money in diamonds"?
Previously, they were influenced by celebrities wearing diamonds, and saying, "Wow! I'm going to get that." Now they're looking at diamonds as an investment. How else can you hold a million dollars in your hand?
Q. Do diamonds hold their value?
Over the years they have been pretty consistent. Compared to gold, certainly. Gold has gone up, gone down. It's gone down to $200; now it's up to $1,000. So I see more fluctuation in the gold than diamonds.
Q. Would a $50,000 diamond appreciate if I held it for 10 years?
It has happened. Some of the best-quality diamonds have doubled in price.
Q. A big part of the jewelry purchase is the box. If someone buys a $20,000 piece of jewelry from you, online, what kind of a box does it come in?
It comes in a very nice box. A wooden box.
Q. Does it have the name on it? B2C?
Not on the box; on the ribbon.
Q. Do you think someone getting a ring in a B2C box is thinking B2C?
They're looking at the diamond first, not the name. That's the important thing.
Q. Why did you go with the name B2C? You didn't want to name the Web site something more romantic?
No. It's a basic name that lets people know they can save money. We say celebrate the moment, don't celebrate where you bought the diamond. Why worry about a brand name.
Q. You're a diamond guy, but I don't see any diamonds on you.
Just this. [He points to wedding ring.]
Q. How big is that diamond? It looks pretty small.
Just 30 point. I leave the big rocks for the ladies.
Exec Access appears every Wednesday.
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