commerce Bahrainthismonth.com 42 November 2023 The region’s largest jewellery and watch event, Jewellery Arabia 2023, will be taking place from November 14 to November 18. With this in mind, business expert, Pria Masson, delves into the business of jewellery, watches and wearables. Beauty is in the eyes of the beholder. Value is in the eyes of the purchaser. Margins and good business, that’s in the hands of the entrepreneur. However, margins are a function of basic economics i.e. demand for the product at a certain price. How high that price can go, usually depends on whether it’s a want, a need, or a desire. Usually, when its desire, volumes are not very high but those that want it, are willing to pay a high margin for it. Jewellery, in almost all its forms, falls under just this very lucrative niche. Lucrative, if the cards are all played right. Let’s dive in. What does the market look like? As per Statista, the global jewellery and luxury watch market was worth over USD80 billion in 2022. The space includes watches and gold and diamond jewellery. In the GCC, the total revenue for 2023 is expected to be approximately USD3 billion dollars . As I always say, revenue is not the same as profits. However, in terms of margins, most jewellery, and luxury watch and wearables, will make a large margin on a unit basis – usually north of 40 percent. An established brand or higher luxury offering will allow for higher margins. So, why is it that more people do not get into this space? The logistics and execution – not so simple The first challenge is that the core raw material, precious metals like gold, platinum, gemstones, etc; are expensive and difficult to source at a suitable price. This means, large upfront investments. The second challenge is expertise. Jewellery making is a specialised skill and intricate work. Hand crafted work is high in demand. Machine made jewellery has a large market space but, the machines are of course expensive. Manpower is the most precious asset, and it comes at a price. Add to it inventory issues, because of no guarantee of sales, high marketing, and branding costs and of course, finding a niche market. The niche market makes marketing complicated. Jewellery is personal and preferences differ across geographies, cultures, and income levels. Figuring out who your actual audience is critical – and challenging. and Smart The World of Jewellery
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