The diamond industry has started having issues. There is still money to be made, but there are complications starting to crop up. No industry is not without times they have to weather. The industry may have to change their tactics to be able to keep going. There may even be some culling within the industry to be able to remain strong. Diamonds have been linked with romance for decades, which may be part of the issue now. There are things that need to be considered, especially if a person makes money from the industry. There are also people wanting to invest. People have to know what the weaknesses are, so they need some research areas.
The diamond industry is asking, why aren’t millennials buying diamonds? The diamond industry is one of five that millennials have been staying away from. College debt is part of that reason. The generation has been unable to find jobs to pay for all the debt, making millennials skeptical to take out other forms of financing. They move to cities that are expensive. That means they are not getting married for these reasons. Diamonds are a big investment, especially when all they are for are looks in this case. The generation has decided to take care of food and bills before anything else. This is not good for an industry that needs people buying jewelry.
Another issue the diamond industry is dealing with are the lab created diamonds that are now available. Companies have even had to deal with purchases having these diamonds mixed with the mined ones. People also consider this version of diamonds because of the controversies dealing with mining operations. Other issues also arose because of blood diamonds. This is a way people can get diamonds without there being so many other issues involved. Same looks, but people are not hurt in the process. That means people consider that they are being better stewards of the planet with these.
One issue that is starting to become a big deal is the lack of transparency in the prices of diamonds. People do not like planning on buying items that they have to guess at what the price is. There are sales that happen all the time, but that does not help India if someone has plans for a specific day. These are not conducive conditions for people wanting to buy expensive items if they are on a budget. While the job market is good, that does not mean that people are not being cautious in case of another recession like there was in 2009. People do not want to be caught unaware again.
Companies that are wanting to grow or start need financing. Not all of them do, but when they do, they need it, they need a way to get it. Since the recession in 2009, banks and other companies that loan money, do not want to. This means there is a curtailing of growth among the newer businesses. The people wanting to compete against the big names are less able to. That means prices can remain the area of select groups, instead of upstart competition. That affects all customers.
There are lows in the diamond industry, as shown here. There are many ways that the industry can pull out of it, but it may take time. People in the industry have to figure this out for themselves. People wanting to enter into the industry have to determine if they want to at this time. This may cause investors to be a little wary. None of this will kill the industry, just slow it at this time. It will be of interest for many, so there will be those who will watch.
by: Dennis Hung