COVID-19: What Lies Ahead?

Retail Jeweller Market speaks to a cross-section of jewellers to get an overview of the impact of the lockdown on the industry at present and post the lockdown.

Much before Corona crept into the lives and businesses of jewellers, many studies had already predicted a sharp slump in the gems and jewellery business. According to the data compiled by Bloomberg based on the World Gold Council reports, the purchase of the yellow metal in the country was expected to plummet by 30 per cent in 2020 from the 690 tonnes last year, which would make it the smallest annual purchase since the 477 tonnes bought in 1995. For this dip in numbers, some blamed high gold prices and increased taxation while others debated over liquidity crunch. Little did anyone know that in the face of Corona, all else will pale into insignificance. The deadly virus has indeed left the retail industry gasping for breath.  A recent survey done by the Retailers Association of India (RAI) finds that 70 per cent of the retailers ( no data on how many jewellers where interview in the survey) in India expect the business recovery to happen in more than six months whereas, 20 per cent retailers feel that business recovery will take more than 12 months.

I don’t think there is much reason for the jewellery industry to worry. Currently, jewellery in comparison to other products is in a much better position. The advantage of jewellery is that it is not a perishable good. I admit that there will be a slowdown in the market and there will be less demand in the market but all these factors will be temporary. In India, weddings won’t stop and till the time there are weddings, people will buy gold jewellery. Many small karigars are working from home. If one has the raw material with him, then he can do the work from anywhere. The big retailers will be severely affected for they have more staff members and some of them have also taken loans from banks and hence, their expenditure is high.

Amit Ranjan Roy, Partner, Supriti Jewellers, Jorhat, Assam

The closedown of the market during the marriage season will have a negative impact on the business. The impact will be long-term, as once the market reopens, people will first buy their basic needs and jewellery buying will probably be the last thing in their priority list. In order to mitigate the business risks due to the Corona virus outbreak, we are moving to the digital platforms to keep in touch with customers and plan to do home deliveries to the client if needed, once the situation improves a bit. The current situation will have a major impact on the family-owned and chain stores in a similar manner.

Abhishek Kapoor, Owner, Solitaire Diamond Boutique, Kanpur

The jewellery sales were already down for the last few months, due to the high gold prices and Corona virus further hampered the sales in a big way. The wedding season was around the corner and every jeweller had made plans for this period but the sudden change in the situation has led to the loss of the whole season. But the sales will come back to normal by Diwali, as customers who could not spend their money during this season will definitely buy jewellery around that time. The jewellery industry has high hopes both, from the banks and the government for a financial package, as without any financial assistance many businesses will have to shut down their shops.

Prateek Khandelwal, Owner, Shree Guru Jewellers, Nainital

Currently, the most vulnerable section in the jewellery industry is the karigar and small-time goldsmiths who are literally out of job due to the virus scare. The government should frame a policy which will take care of their financial needs.

Ranjit Dutta, President, Pachim Bengal Welfare Association, Mumbai

The government should focus on giving relief to MSMEs. One of the most important initiatives that the government should offer is income tax relief. The government should help the sector by waiving off the interest rate on loan and reduce duties to boost up the sales.

Ketan and Jatin Chokshi, Co-owners, Narayan Jewellers, Vadodara

The pandemic will definitely have a long-term impact on the gems and jewellery industry since the economy will be shattered and buying jewellery will be the last thing on majority of the population’s mind for at least six months. There are no opportunities in this crisis. Since we have a very strong internet presence, we thought in the first week of March, when the first case of Covid-19 was detected that we will concentrate on online sales during this period and even increased our online marketing budget by 250 per cent but we ended up initiating refund process for majority of the orders received in March, as couriers are not working.

Pankaj Khanna, MD & Founder, Gem Selections, New Delhi

The lockdown will definitely have a long-term effect on the industry and the industry will take till the end of the year to get back its momentum. As even after lockdown ends, social distancing will be there. The future jewellery exhibitions and conferences will get cancelled, as people will try to avoid huge gatherings. The customers will first spend their money on buying the essential commodities and then, think of something else. Although the RBI has announced deferment of EMIs on loans for the next three months, it won’t help much as the loan period has not been extended and the customer will have to pay the three months of EMI in one month. 

Raman Jethi, Director, Krishna Krishna Jewellers, Panipat

Courtesy:Retail Jeweller Market speaks