The 5.5% Duty on Indian Jewelry—Calling for Answers from Indian Manufacturers and Retail Stores Who Purchase Indian Goods
I’m not much of a politician so I’ll get right to it—being that I am a current retailer of Indian manufactured goods.
My parents have always purchased goods from Indian manufacturing companies. I use to think Indian companies were “penny wise pound foolish”—hold on before anyone has a fit. When princess cut invisible settings became popular my parents bought a whole lot of it—the FL market was demanding it. They purchased much of it from Indian manufacturing companies and we soon found out that the stones were glued together so they easily and frequently came out. We had a lot of angry customers on our hands. At that time, the qualities of diamonds were good (depending on which company of course) but the finish including the rhodium was not up to par as compared to the goods we were purchasing from Hong Kong for only a bit more—but still comparably less to American made goods.
My parent’s continued to buy from various Indian manufacturing companies. They found that the FL market is extremely competitive and goods from India gave them that edge when it came to pricing.
I get really irritated when it comes to quality—so I had sworn off many Indian manufacturing companies—probably good ones too, ones that didn’t cause my folks any problems, but I just didn’t want to take any chances because of the opening of our 2nd store. Mom-dad’s store is established so they can handle testing out different vendors.
At JCK O7—I was with mom-dad so I visited with many of their existing manufacturers and found that they’ve changed and were not so foolish like long ago. You can always order which quality you prefer—but I noticed the setting and the finish of the goods were much better—so I went forth and purchased. The goods I purchased were very unique pieces that could be offered at an affordable price to my customers.
Staring in July, jewelry imported from India will bear a 5.5% tax. What does this mean? We’ve been paying the tax on goods from Hong Kong and China—you wouldn’t realize it because it’s already accumulated into the price. Now the tax on Indian goods—are we going to realize it? Are Indian goods no longer going to give us the same advantage when it comes to offering our customers better prices? Are Indian companies going to face more competition against goods from China? Will Indian manufacturing companies start selling more domestically—in turn will we see fewer goods from Indian manufacturing companies importing to the US?
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Aananta (India) commented:
I have read with interest, Ms Shanu's blog entry. Am a small
manufacturer and exporter of jewelry from Mumbai, India & my
focus has always been on quality rather than quantity. Yes, the
duty will certainly make an impact , esp. since the dollar is not
at its best against the Indian Rupee. There is however in my mind,
a solution.. the trick is to find focused manufacturers, who are
making internal changes at cost-cutting, whilst still maintaining
hi-quality.. American manufacturers can be happy, at the better
playing field this development provides & Indian manufacturers
need to pull up their socks ..and pants :) survival of the fittest
! Also, in my mind, nothing lasts for ever..business is
ever-changing and long-term players need to be flexible Vijay
www.aananta.net
Michael Perlin commented:
I can fully understand the situation retailers face regarding price
competition and I agree that for many years goods that were
manufactured from India were of inferior quality. But being a
manufacturer in the USA it was always disconcerting that for many
years Indian manufacturers were able to buy castings in the USA,
have them shipped into India, finish them in India and them ship
them back to the USA duty free. How does an American manufacturer
compete with this? I am a firm believer in equal opportunity and I
believe that this duty will help to level the playing field as to
pricing and put the emphasis on quality and service which, at the
end of the day, are far more valuable to the retailer than pricing
alone. It is important for retailers to keep in mind that if you
get a customer on price you will lose them for the same reason. If
you get a customer on good service, quality and value you own them
for life.
