UpFront

JSA RAISING FUNDS TO UPGRADE TECHNOLOGY

To upgrade its crime-fighting technology, the Jewelers’ Security Alliance launched its first-ever fund-raising campaign in July. JSA, the non-profit crime-prevention association based in New York City, hopes to raise $600,000.

“We’re coming into the 21st century and we had better be ready to meet its crime-fighting challenges,” says JSA Chairman Marvin Markman of Suberi Bros. Inc. “The crooks are ready — they already have the technology.”

While the organization has no firm plans as yet, Markman says technological upgrades may include putting JSA security seminars on CD-ROM and using the Internet. Being on-line would allow JSA to link its regional representatives by computer, provide members with immediate and direct access to security bulletins and detailed crime information or hold member meetings on the Internet.

“We want to become part of the daily operational situation of our members,” says Markman. “Security is a life-and-death issue for everyone in the jewelry industry, and supporting the JSA is the most effective way to protect ourselves from crime and violence.”

JSA directors concluded earlier this year that revenue from membership dues wasn’t enough to re-engineer the organization to meet changing technological needs. All money raised in the new campaign will be used to upgrade JSA’s technology and services, says Markman. None will go for operating expenses or membership recruitment for the 113-year-old, 13,000-member organization.

While the capital improvement campaign — JSA’s first — is scheduled through July 1999, the actual fund-raising effort will last only through January. Donors are asked to make pledges payable over the three-year period. As of late July, the campaign was off to a fast start, with pledges totaling $200,000 from several industry companies and $50,000 already in hand.

Those pledging at least $3,000 will be honored with Gold or Silver Shield Awards at JSA’s annual luncheon in January.

RUSSIA GETS $560 MILLION IN LOANS FOR MINE WORK

Almazy-Rossii-Sakha, Russia’s diamond mining and marketing company, will receive a windfall $560 million in loans to repair badly deteriorating mines and explore for new ones.

ARS will receive a $500 million loan from NatWest Markets, an international financing arm of NatWest Bank. The remaining $60 million will come from the Export-Import Bank of the United States.

Russia’s four mines are in dire need of repair and upgrading. Production has fallen by half in the past decade and lack of funds has brought a halt to the development of a major new mine. Only one, Udachnaya, remains fully operational. Russia produced a total of 12.5 million carats valued at about $1 billion to $1.6 billion last year. The vast majority of this total came from Udachnaya. Water and mud seepage into the large Mir facility has limited production there to combing aboveground stocks.

The $60 million loan from the Export-Import Bank of the United States is related to a 10-year agreement with Lazare Kaplan International, New York, N.Y. Under the agreement, LKI will polish and market $45 million worth of large Russian diamonds yearly. In exchange, ARS will use the loan to buy U.S.-manufactured equipment to upgrade its mines.

LKI has already begun work on a diamond polishing plant in Moscow that will process diamond rough supplied by ARS. The plant, expected to go into operation this fall, will be managed by LKI and staffed by Russian technicians.

Most of the rough will be two to 10 carats and will be sold through LKI offices worldwide. LKI will market the diamonds separately from its Ideal Cut line, but won’t promote them specifically as Russian diamonds.

In addition to work at the Udachnaya and Mir mines, the loans mean ARS may be able to further develop the Yubileynaya mine, which has the potential to produce several million carats yearly. Three other finds are also ripe for development. The Arkangel’sk area and two large kimberlites in Sahka reportedly contain millions of carats in reserve, though development costs remain formidable.

RAPAPORT MAKES CHANGES FOLLOWING TRADE PROTESTS

The Rapaport DiamondPrice list has stirred controversy through most of its 18-year life. This year is no exception.

Publisher MartinRapaport added emerald-cut and marquise shapes to his list in the July 5 edition. “I added these stones because there was a big demand for prices of specific shapes,” says Rapaport. But the following edition changed prices in most categories. Emerald cuts were raised significantly across the board — more than 20% in many cases. As one example, a 1-ct. F VS1 increased from $4,200 to $5,200 per carat in just one week.

The marquise adjustments were much more varied. Most of the big increases were concentrated in the larger stones. For example, an F VVS2 5-ct.-to-5.99-ct. diamond that previously listed at $21,400 per carat was increased to $22,500 per carat.

Rapaport says the prices were raised to more accurately reflect the premium prices paid for finely made fancies in the New York market. When he added the cuts to the report, Rapaport did preface them with a disclaimer that well-made stones could carry substantial premiums to those listed in the report and that poorly made diamonds could carry substantial discounts. But that did not satisfy dealers, who felt the prices listed in the report were much too low. In fact, when the report hit the street, dealers complained bitterly that prices were as much as 20% below what they should be. “He’s missed the boat this time and lost his credibility” says one prominent New York manufacturer.

“He’s one reason why profits are so low. Now he’s making sure we don’t have any,” says another.

Dealers were somewhat mollified by the revisions, but many cite the incident as the latest in what they believe is the destructive influence of the Rapaport Report. Over the years, diamond dealers and manufacturers have blamed the report for declining margins, saying it has contributed to “commoditization” of diamonds because it allows readers to comparison-shop for diamonds based on their weight, color, clarity and price.

However, the report has its supporters. It is the most widely followed price list worldwide and in the past decade has expanded from a diamond community pamphlet to a full-fledged magazine.It now goes to retailers, manufacturers and even the general public.

CAMPAIGN AIMS AT UPSCALE BUYERS, GUILD RETAILERS

Consumers will have many opportunities this fall to learn how “Gold Makes the Moment.” That’s the central theme of the World Gold Council’s consumer advertising campaign for the critical holiday selling season.

For the first time, the campaign will rely solely on 18-karat-plus designer jewelry and will encourage independent guild retailers to commit increased inventory and promotional support to gold designer jewelry.

The campaign begins with a splash: a 36-page advertising section in the 150th anniversary issue of Town & Country magazine in October. That will be followed by four-page inserts in the November/December issues of the upscale magazines Departures, Gourmet, Vogue, W, Allure, Architectural Digest, Vanity Fair and Harper’s Bazaar, and a five-page gatefold ad in the New York Times Magazine in December.

The campaign will feature jewelry by more than 50 designers interspersed with elegant photographs of models in settings that capture “snapshot moments” in everyday life, says Debra McDonough, communications director for the World Gold Council. Example: a mother holds her baby with copy that reads “Gold makes the moment tender,” a woman watches her partner shave with copy that reads “Gold makes the moment playful” and two women chat with copy that reads “Gold makes the moment intimate.”

“With this series of pictures, we were able to create pictures that people can relate to,” says McDonough. “There is gold jewelry in each picture. It’s not prominent, but it’s there to show that it’s part of these people’s lives.”

McDonough and outside consultants developed a fully integrated co-op campaign that also includes a direct mail catalog program and related artwork for use in local advertising and displays.

The campaign will run through the holiday season and possibly into next year, depending on the results. “Gold jewelry, unlike some other types of jewelry categories is worn, given and received every day, not just for special occasions,” says McDonough.

JCK NAMES EDITOR IN CHIEF & MANAGING EDITOR

Peggy Jo Donahue, special projects editor at Jewelers’ Circular-Keystone, was named editor in chief of the magazine in July, announced Charles M. Bond, publisher. She succeeds George Holmes, who retired on July 12.

Ren Miller, copy editor of JCK, was named managing editor of the 127-year-old magazine, based in Radnor, Pa. Miller succeeds Deborah Holmes, who also retired July 12.

Donahue began her career at JCK in 1979 as an associate editor, where she covered various beats until 1983. During these years, she received two Jesse H. Neal editorial achievement awards from the American Business Press. Donahue was next appointed executive editor of Executive Fitness Newsletter, a Rodale Press publication, a job she held until 1986. She then embarked on a freelance writing career, where her clients included Rodale Press, Springhouse Corp., Philadelphia magazine, Money magazine, Business Week, Working Woman and other magazines. She received an Excellence in Cardiovascular Reporting award from the American Heart Association during this period.

Donahue is the author of three books: How to Prevent a Stroke (Rodale Press, 1989), Relief from Chronic Skin Problems (Dell, 1992), and Not in Front of the Children (Viking Penguin, 1993, with Lawrence M. Balter). The Library Journal named her stroke book one of the top 30 medical books on the market for a lay audience. She also has cowritten and edited several other book projects.

Donahue rejoined the JCK staff in 1994 as the editor of GEM magazine, along with her work in special projects. She was graduated magna cum laude from Trinity College, Washington, D.C., with a bachelor of arts degree in American Studies. She also studied at Oxford University, England, and is a fellow of the Watson Foundation, which awarded her a year-long stipend to study English and Irish theater in those countries.

Ren Miller came to JCK in 1987 and, in addition to serving as copy editor, has managed special issues and performed major editing and reporting tasks. He is the recipient of 10 Chilton editorial awards for writing excellence. Miller majored in communications at Lock Haven University, Lock Haven, Pa., where he received a bachelor of science degree. He spent five years as area news editor of The Altoona Mirror newspaper, Altoona, Pa., and five years as night editor of The Express newspaper, Easton, Pa.

JCK NAMES WILLETT ASSOCIATE PUBLISHER

Peggy Willett, former executive director of the American Gem Trade Association, was named associate publisher of Jewelers’ Circular Keystone. Willett will assist Publisher Charles Bond with a variety of management responsibilities and will provide additional representation of JCK in important segments of the industry. Willett brings nine years of experience from her post at AGTA, where she saw the association’s budget increase almost tenfold. Willett also was responsible for the association’s strategic, operating and financial planning processes, as well as its highly successful GemFair in Tucson. She also supervised membership services, oversaw the association’s communications and promotion efforts, worked with the board of directors and managed a staff of seven.

Willett serves on many industry boards and successfully forged alliances with many organizations in the jewelry industry during her years at the AGTA. She is the recipient of the Women’s Jewelry Association Award for Excellence in Marketing and is a member of the following groups: the WJA Board of Directors, the JCK International Jewelry Shows Advisory Board, the Jewelry Information Center Board of Directors, the Jewelers Vigilance Canada Board of Directors and the American Society of Association Executives Board of Directors.

Before joining AGTA, Willett worked in jewelry retail sales and custom jewelry design for Gem & Minerals, Dallas, Tex. She also designed a line of precious jewelry called Peggy Willett Enamels. She also managed the Studio San Guiseppe Art Gallery in Cincinnati, Ohio. Willett was graduated summa cum laude from the College of Mount St. Joseph, Cincinnati, with a bachelor of arts degree.

JA LAUNCHES BENCH JEWELER CERTIFICATION

A new certification for bench jewelers should be in place early next year. Jewelers of America is developing the testing process in conjunction with the Gemological Institute of America and the Texas Institute of Jewelry Technology in Paris, Tex.

This program will recognize the professional status of bench jewelers, says Matthew Runci, JA executive director. It also will serve a promotional purpose. “We will make consumers aware of how important these skills are and how accomplished jewelers can design beautiful custom jewelry for them,” says Runci.

The testing process will consist of practical, written and video/written exams. Practical exams will be proctored at the jeweler’s own bench and selected other locations.

The exam will be in one to three sections for each level. The levels to be certified include bench jeweler technician, bench jeweler, senior bench jeweler and master bench jeweler. Jewelers can opt to take any of the first three levels without initially passing another level. But master jeweler candidates must first earn certification as a senior bench jeweler.

This controlled testing and certification process will give consumers a way to evaluate a jeweler’s competence, says John Darden of Darden’s Jewelers, Murrells Inlet, S.C., who led JA’s program development task force. JA is now accepting applications for the program. Call (212) 768-8777.

GIA TO DEDICATE NEW WORLD HEADQUARTERS

The Gemological Institute of America will dedicate its new world headquarters and campus in Carlsbad, Cal., Nov. 1.

The new facility will feature expanded laboratories, state-of-the-art equipment, a larger warehouse and improved customer support. GIA expects to double the size of the Advanced Retail Management System service department and to expand its on-line telecommunications network, GIA-Net, at the new facility.

Plans are in the works for other amenities. “A museum and an auditorium are top priorities for the immediate future,” says Jim Littman, GIA director of development. “We hope to provide dormitory facilities for students.”

The move to the new location, 100 miles south of current headquarters in Santa Monica, will be a two-phase process. The GIA Gem Trade Laboratory (West Coast), GEM Instruments, Print Shop, ARMS and Research will be in place at the beginning of September. The new address is 5355 Armada Drive, Carlsbad, CA 92008.

By January, GIA Education, the GIA Bookstore, Marketing, Development, Alumni & Associates, Accounting, Technical Support and the Richard T. Liddicoat Gemological Library and Information Center will move to 5345 Armada Drive, Carlsbad, CA 92008.

The first class at the new campus is scheduled to begin Jan. 16.

The existing campus will operate until June at 1660 Stewart St., Santa Monica, CA 90404; (800) 421-7250 or (810) 829-2991, fax (310) 453-7674.

PGI DEMANDS HIGHER STANDARDS FROM FTC

American consumers have sent the platinum market soaring by 300% in the past three years, but officials of Platinum Guild International USA Jewelry Inc. fear that popularity may be curbed by lower-quality alloys recently introduced into the U.S. market.

PGI-USA, a Newport Beach, Cal.-based trade organization, is urging the U.S. platinum industry to fight the use of an alloyed 58.5% platinum product being promoted in the market. The Federal Trade Commission opened a comment period through August for the consideration of platinum hallmark guidelines.

“The U.S. is the only place in the world that can legally sell an alloyed platinum of this low purity,” says Laurie Hudson, president of PGI-USA. Most Western European countries regulate standards of purity as high as 95%. No other country in the world allows purity standards below 85%, she notes.

PGI-USA requested a minimum content of 85% and consistent platinum hallmarks of PT999, PT950, PT900 and PT850. The higher standards would facilitate the importing and exporting of platinum jewelry and provide consumers with a recognizable and consistent system of hallmarks.

Lower-purity platinum has not proven as durable, hypoallergenic and scratch-resistant as top-quality platinum, Hudson says. “The 58.5% platinum has not been properly analyzed or researched to the point where PGI would feel comfortable endorsing this platinum product category,” she says.

JOSE HESS ELECTED PRESIDENT OF CIBJO

Jose Hess was elected president of CIBJO, the International Confederation of Jewellery, Silverware, Diamonds, Pearls and Stones, at the organization’s congress in Vienna, Austria.

Hess is a jewelry designer and president of Jose Hess Inc. in New York City. He is the past president of the Manufacturing Jewelers and Silversmiths of America and the 24 Karat Club of New York and is currently president of The Plumb Club. Among his honors are several De Beers Diamonds Today awards.

Members elected Nanette Forester vice president of CIBJO’s Colored Stone Commission. Forester is the CIBJO representative for the American Gem Trade Association and chairs the U.S. CIBJO delegation.

CIBJO is an international organization uniting jewelry industry representatives from more than 20 countries. The next meeting will be in June following the JCK International Show in Las Vegas.

CULLEN TO RETIRE FROM PGI

The longtime head and guiding force of the Platinum Guild International is stepping down after 21 years and his replacement has been mined from the diamond industry.

David J. Cullen, chief executive of PGI, will retire Sept. 30 and be replaced by former De Beers executive James Courage.

During his time with PGI, Cullen oversaw the development of PGI offices in the U.S., Japan, Germany and Italy to promote platinum jewelry and investment.

When Cullen joined the just-established guild in 1975, the jewelry industry was largely uninterested in designing and manufacturing with platinum because of high costs and lengthy production periods. As part of his duties, Cullen researched methods to improve production and educated the industry about the durability and beauty of platinum. Under his leadership, worldwide platinum jewelry consumption jumped from 15 tons in 1980 to 58 tons in 1995.

“We will truly miss the direction and leadership of David Cullen,” says Laurie Hudson, president of PGI-USA. Cullen will work as a consultant in the fine jewelry industry.

When James Courage takes over the helm, he will bring a wealth of international marketing experience to the post. He has worked with De Beers’ consumer marketing division for 12 years, overseeing marketing programs in Germany, the United Kingdom, Spain, Switzerland, Canada and the U.S. Since 1994, he has been responsible for De Beers’ Hong Kong regional office and oversees its marketing campaigns in Hong Kong, China, Thailand and the Philippines. Courage will be based in London.

“Mr. Courage has a keen interest in the U.S. market,” says Hudson. “I am confident the Platinum Guild will continue to grow and prosper under his management.”

PEARL DESIGN CONTEST CHOOSES WINNERS

Passion for pearls worldwide was recognized in the 24th International Pearl Design Contest this summer in Tokyo, Japan.

Sponsored by the Japan Pearl Promotion Society in cooperation with the World Gold Council, Platinum Guild International and the Japanese government, the contest received 980 entries from jewelry designers in 19 countries.

Entrants were required to include cultured or natural pearls in their designs and were judged in three categories — freestyle design, thematic design and paper renderings.

Noriko Ooshima of Japan won the grand prize in the freestyle design category with a necklace/pin combination called “Yuragi,” or “Swing.” The piece is made of akoya pearls, diamonds, platinum and a single South Sea pearl.

The thematic design category focused on botanical motifs. Claudia Batge of Germany won first prize in the category with a ring re-creating the Lotus flower. The ring, entitled “Lotosblute,” is crafted from akoya pearls and gold.

For the first time in the contest’s history, a U.S. designer was awarded first prize in the paper rendering category. Michael Pangrazio of Seaside, Cal., a visual effects artist in the motion picture industry, created a necklace he calls “The Four Squid,” combining limoges painting, Lightning Ridge blue opal, pearls and gold to create an undersea effect.

Twelve other Americans won awards in this year’s contest:

  • Amr Hawas, Ann Arbor, Mich., second prize, paper design.

  • Martina Windels, Providence, R.I., third prize, freestyle.

  • Eva Seid, New York, N.Y., fourth prize, freestyle.

  • C.Y. Sheng, Nashville, Tenn., fourth prize, freestyle.

  • Catherine de Couto Healey, New York, N.Y., fifth prize, paper design.

  • Jeff Dak Yue Sue, Woodside, N.Y., fifth prize, paper design.

  • Catherine Hsiao, Nashville, Tenn., fifth prize, paper design.

  • Jang-Wook Lee, Seoul, South Korea (U.S. entry), fifth prize, paper design.

  • Link Wachler, Birmingham, Mich., fifth prize, paper design.

  • Jan Houston, New York, N.Y., fifth prize, paper design.

  • Jean M. Jung, San Anselmo,Cal., fifth prize, thematic.

  • Ion Ionesco, New York, N.Y., fifth prize, thematic.

SALE OF SIGNET’S UK HOLDINGS IS NEAR

Signet Group of London in early August was close to selling its two remaining British chains, H Samuel and Ernest Jones, according to reliable sources in the United Kingdom. Signet Group is the world’s largest jeweler and parent of Sterling Inc. of Akron,Ohio, the second largest U.S. jeweler. The sale was expected to close by early September.

The would-be buyer is identified as Apax Partners of London, a venture capital firm. At press time, the pending sale price was reported to be about $435 million.

The sources say it’s highly possible the Signet Group will move its headquarters to the U.S. after the sale because Sterling is its major profitmaker.

The sale, if it goes through, would return Zale Corp. with more than 1,200 outlets to the position of world’s largest retail jeweler.

WITTNAUER TO DISTRIBUTE ADIDAS AND ELLESSE

Wittnauer International is now the exclusive marketer and sales representative for Adidas and Ellesse brand sport watches in North America and the Caribbean. The move broadens Wittnauer’s range of sport watch offerings, especially those under $300.

“The goal of this company is to be growing and vibrant,” says Phil Schwetz, Wittnauer’s director of marketing for Adidas, Ellesse and other brands. “Sport watches are a growing category, and Wittnauer now has a full range of sport brands that complement one another.”

Wittnauer, based in New Rochelle, N.Y., also offers the Swiss-made Zodiac diver watch line, which retails for $225-$2,500. Ellesse watches, which feature a Swiss movement, retail for $195-$595 and Adidas men’s and women’s watches are $50-$315.

Wittnauer signed the exclusive agreement with Stelux, the Hong Kong company that owns the worldwide watch licensing rights to the Adidas and Ellesse brands. Stelux had distributed the brands through its U.S. arm, Stelux USA in Mountain View, Cal., since their introduction in the U.S. in 1994.

Wittnauer will review Stelux’s previous distribution arrangements. Schwetz notes that Adidas’ strong distribution through retail sporting goods outlets will likely continue. Wittnauer will transfer inventory from California to its manufacturing and distribution facilities in Puerto Rico; its service facilities have already begun to handle the new brands. Stelux USA will continue to operate as the U.S. branch of the large-scale watch and watch components manufacturer.

JA TESTS NEW PROGRAMS

Jewelers of America is going coast to coast to test the waters for future program development. It has begun three pilot programs to assess the needs of U.S. jewelers in education, truth-in-pricing and the development of JA affiliates.

In the first program, JA and the California Jewelers Association will develop a local business education network in Southern California. Plans call for a business education resource center that will include support services and professional and managerial training.

The second program involves truth-in-pricing issues. Seven JA state affiliate leaders met in New York to discuss effective strategies such as working with state legislatures, attorneys general, local Better Business Bureaus, telephone directory companies and newspapers.

The third program involves the Maryland, Delaware, Washington,D.C., State Jewelers Association, which has selected several organizational priorities that may be used as models for other affiliates. These include creating new job descriptions for the board, developing an annual local event to provide a forum for jewelers to meet and talk with other jewelers, and creating a venue where jewelers can sell old merchandise.

CORRECTIONS

A story announcing the appointment of Thomas A. Andruskevich as president and chief executive officer of Henry Birks & Sons Inc., Montreal, Canada (JCK, July 1996, p. 32C), incorrectly identified the company as the largest jeweler in Canada with 37 stores and sales of $110 million in 1995. Peoples Jewellers Corp. has higher sales and 187 locations, says Clare R. Copeland, the company’s president and chief executive officer.

A caption in “Cool Silver Equals Hot Sales” (JCK, July 1996, p. 77) listed the incorrect location of Elling Jewelry. The correct address is 169 E. Flagler St., Suite 1616, Miami FL 33131; (305) 371-6799.

FAMILY CONTROL ENDS AT L. LURIA & SON

The Luria family has sold its remaining shares in L. Luria & Son of Fort Lauderdale, Fla., a jewelry and giftware retailer founded in 1898.

Former Chairman Leonard Luria, current President Peter Luria and three other family members sold 1.3 million shares of Luria stock on Aug. 9 to Ocean Reef Management, also of Ft. Lauderdale. Ocean Reef was formed by Rachmil LaKach, former president of Parlux Fragrances, a perfume company in Ft. Lauderdale. The deal was valued at about $8 million.

LaKach is the new chairman of Luria, though Leonard Luria remains on the board as honorary chairman. Erwin Zafir, long active in the watch industry, is the new vice chairman. The deal gives Ocean Reef the right to elect the majority of Luria’s directors. A shareholders meeting is expected to be held before November. Lakach expects Peter Luria to remain as president and Gerald Nathanson to remain as chief executive officer.

A company spokesman said employees were excited by the acquisition and “the confidence it shows that [the buyer] has in the company.”

No major changes are planned, though personnel training will be intensified and will include a stronger emphasis on service, says LaKach. New programs will promote the sale of more jewelry (now about 40% of annual business), perfumes, cosmetics and bath products. There also will be more emphasis on tableware, crystal and small kitchen appliances. “Luria is known as one of the top jewelry departments in Florida, and we hope to make it one of the leading companies again,” says LaKach.

This is Ocean Reef’s first foray into jewelry retailing. “We intend to get deeper into the industry with companies that have similar profiles [to Luria],” says LaKach. Future acquisitions won’t be limited to Florida.

DISC HONORS THOSE WHO SERVE

New York’s diamond community turned out to honor men and women who have served the industry for many years at the Sixth Annual Diamond Industry Steering Committee dinner July 30 in the Waldorf Astoria, New York, N.Y.

Among the honorees was Michael Grantham, former market liaison for De Beers’ Central Selling Organisation. Grantham received DISC’s Lifetime Achievement Award for his 30 years with the CSO.

Also honored were Anna Martin, vice president of ABN-Amro Bank; Ralph Shapiro, former president of the Diamond Dealers Club West Coast; Sergei Oulin, vice president of Almazy-Rossii-Sakha in Russia; and Itzhak Arikha, publisher of International Diamond Publications.

Inducted into the Diamond Industry Hall of Fame were Ray Perlman, former chairman of the DDCArbitration Committee; Jacques Roisen, past president of the International Diamond Manufacturers Association, and Michael Roman, former chairman of Jewelers of America.

DISC also honored the three immediate past presidents of DDC — William Goldberg, Ralph Bar and Eli Izhakoff — for their service to the industry.