Italian charm

Jewellery World publisher John Abolins discovers the charm of Vicenza's mid-year jewellery fair.

Jewellery World publisher John Abolins discovers the charm of Vicenza’s mid-year jewellery fair.

Despite the tough economic times currently experienced around the globe the Vicenzaoro-Charm jewellery fair in May still attracted 1301 exhibitors as well as visitors from 963 local companies and 338 international ones to fill 60,000 square metres of exhibition space.
While some consider there are too many international fairs around the world, the Vicenza fair organizers believe Vicenzaoro (which is held in January, May and September each year) is among the top four alongside Basel, Hong Kong and Las Vegas.
Vicenzaoro has been catering to the luxury market since the fair was founded in 1948 and it’s a position it wants to maintain because this sets the fair apart from other international shows.
While still catering for the luxury market some adjustments were made to the May collections to entice visitors to purchase the jewellery on display.
Other than the very expensive top end of the luxury market, many pieces on display were lighter.
For example diamonds of over one carat were replaced by seven smaller ones while splendid hydrothermal quartzes, often oversized, were often chosen over more costly natural stones and micro pavés of finely sifted diamonds and sapphires were seen more often than their larger counterparts.
Overall it seemed that exhibitors were trying to convey the message that their jewellery is an affordable luxury.
Other trends included the move back to yellow gold although white gold was still popular with solitaire diamonds.
There was a time when Australians ordering 9 carat from Italy had to place their orders by May so it could be produced before Italians closed their factories for the summer holidays.
But today you can find companies that will let you order 9 carat in late August and will deliver well before the Christmas selling season.
And while gold dominated Italian offerings there was also plenty of quality silver on show as well as several watch brands including Sector, part of the Morelatto group of companies.
Vicenzaoro-Charm ended on a high note with the Fair opening its doors to the public for the first time to raise money for earthquake victims in the Abruzzo region of Italy.
The next showing in Vicenza is Vicenzaoro-Choice, September 12-16.
For more information visit www.vicenzaoro.org

Palloys – the power of three

The Palloys Group combines the expertise of three of Australia's best known suppliers to provide jewellers with all the basics they need to thrive.
The Palloys Group combines the expertise of three of Australia’s best known suppliers to provide jewellers with all the basics they need to thrive.
The Palloys Group is a family company that has grown to incorporate three of Australia’s best known jewellery industry suppliers – Palloys, AGS Metals and Regentco Findings – without forgetting its roots.
The Cochineas Family purchased Palloys from the Kay Family in December 2007 and has since expanded the business into the “three-armed” Palloys Group with the acquisition of AGS Metals from AGR Matthey in July last year and Regentco Findings in May 2009.
Yet despite relatively rapid expansion in the last 18 months, the same familiar faces can still be found at Palloys, AGS Metals and Regentco because Palloys Group managing director Andrew Cochineas is adamant that this “family business” is not interested in “growth for the sake of growth” but instead is clearly focused on providing quality products and superior customer service.
“We aim to be a full service metals offering to the jewellery and allied trades so we have our casting arm (Palloys), our precious metal fabrication arm (AGS Metals) and our jewellery findings arm (Regentco)” he explains.
“We’ve grown organically in lots of ways but we still remember our roots and the principles of Palloys founder Felix Parry who believed in ‘service, quality and trust’.
“We aren’t interested in selling and running – we want to build long lasting, mutually beneficial relationships with our clients.  I suppose that at the end of the day, we don’t consider our customers as clients – we consider them our business partners and friends and we want to help them to produce the highest standard product for their consumers.”
In fact, Andrew says the key factor driving the purchase of each member of the Palloys Group is simply a love of the jewellery business.
Andrew began working in the industry as soon as he left school – albeit on a part-time basis selling jewellery to help fund his way through university.
He says the opportunity to pursue a full-time career in the jewellery industry didn’t arise until he met Norman Kay at a social event in 2007.
Today Andrew is the managing director of the Palloys Group and Norman Kay is chairman.
Andrew says that all three businesses in the Palloys Group are leaders in their respective fields that combine quality, value and good old fashioned service.
“There are not many businesses in the jewellery industry – or any industry for that matter – that have been serving since 1951.  Through the good times and the bad, Palloys has been there and we plan on being there for the long term.  The Felix Parry and Norman Kay legacy of trust and integrity is one that we aim to maintain and build on.”

Palloys
Based in Sydney’s Surry Hills with drop off points Australia-wide, the Palloys arm of the business specialises in jewellery and base metal casting as well as precious metal refining, elecroplating, antique reproduction casting, mould-making and CAD/CAM.
Andrew says the company, which is recognised throughout Australia’s jewellery industry as a leader in technological development, is best known for its casting services.
“Palloys can cast almost anything in a large range of casting alloys,” he says.  Apart from the thousands of rings, pendants and other jewellery items that Palloys produces weekly for jewellers in every Australian state, he cites pens, medals, boxing belts, watch casings, medical & dental prostheses, antique reproductions, cufflinks, charms, trophies, pendants and the mounts on Queen Elizabeth II’s Coach as just a few examples of the company’s other works.
According to Andrew, one of the key factors that make Palloys casting services stand out from competitors is its proprietary alloys.
“All the alloys at Palloys have been developed in-house by our metallurgists for the exclusive use of our clients.  Unlike many casting companies we do not use master alloys from overseas.  Apart from the comfort of knowing that they are buying their castings from a company that understands the metals they cast because they make them, the big advantage for jewellers is that we can positively guarantee our caratage” says Andrew.
In addition, Palloys boasts one of the fastest turnarounds for jewellery casting in Australasia.
“If we have a jeweller’s mould we can get a finished cast to them the next day and if they are really desperate for time we even have a ‘two-hour burnout service’ where we can cast for them in just two hours.
“This means that if a tourist walks into a jewellery shop at around 10am and says ‘I want that ring with sapphires in size P by 5pm today’ the jeweller can lose that sale or call Palloys and have the cast ready for them to work on in only a few hours.”

AGS Metals
With its head office in the Sydney CBD and pick-up offices around Australia, AGS Metals is one of the largest suppliers of fabricated precious metal products to the Australian jewellery industry.
Along with granules, wire, strip, sheet and chenier, AGS Metals also supplies wedding rings (finished and semi-finished) and provides plating products and refining services.
AGS Metals was a joint venture between AGR Matthey and Palloys for almost 20 years.  In July last year, Palloys bought out the AGR Matthey share of the jewellery business when the gold refiner decided to sell off its jewellery division.
“AGS Metals is a very well known supplier in the fabricated metals market and Steve Lowden as CEO of AGS Metals has one of the most respected names in the fabricated metals industry,” says Andrew.
“When AGR Matthey decided to sell the purchase was a natural extension to the AGS Metals business.
“Like Palloys, AGS Metals offers superior quality product at the right price – supported by the advice of metallurgists, not just sales people.
“AGS is also one of the only places in Australia where you can buy Johnson Matthey formula solders – widely regarded as the benchmark in jewellery solder technology.”

Regentco
  
Since its takeover by Palloys Group, Regentco has moved into a “bigger and brighter” Australian head office next door to the AGS Metals Sydney CBD office.
Specialising in jewellery findings, Regentco is, according to Andrew, renowned for its “excellent quality and incredibly good prices”.
“The difference between Regentco and many other jewellery findings businesses is that we are not just a re-seller,” he says.
“We actually manufacture the findings we sell.  It is in this way that we offer superior quality findings at the right price.”
He says that Regentco will continue to produce its current range but some exciting changes, including a big increase in jewellery findings stock levels available for pick-up or next day delivery, a new electronic and printed catalogue and a custom jewellery findings service, will be introduced in coming months.
Andrew says the latter service will enable jewellers to customise findings with their own logo or manufacturer’s mark.
“Custom findings give jewellers the opportunity to brand almost all of their jewellery items,” he explains. “For example a jeweller can brand a pair of earring butterflies with their logo or manufacturer’s mark.”
Future Direction
 
Andrew is confident that Palloys, AGS Metals and Regentco will continue to grow in partnership with local jewellers.
He says all three companies have stood the test of time and will continue to do so – irrespective of the current global economic crisis.
“I believe the current economic difficulties may even help local jewellers” he says.
“When a local jeweller factors in the massive increase in the gold price and import duties, the cost of importing jewellery into Australia is no longer so favourable.
“In addition, when importing products from overseas, jewellers normally have to pay upfront and order large quantities.  In contrast, when a jeweller orders from Palloys, AGS Metals or Regentco the minimum order is just “one” and they have 30 days to pay.”
He concludes that Palloys, AGS Metals and Regentco’s quality products and superior customer service will ensure their continued success – and the success of their customers too.
“Speed is a critical factor in business success today.
“Having a supplier like us at their service is also a big advantage for jewellers’ cashflow compared to off shore options.  With us, jewellers don’t need to wait four weeks for their stock and the certainty of knowing they can get their product quickly from Palloys, AGS Metals or Regentco means that they don’t need to keep a huge volume of stock in their safe waiting for a sale.
“Instead, they can keep a minimum of stock and replenish as necessary with us.”
“The strength and longevity of our businesses can guarantee that.”
Contact Details:
Palloys, Phone 1300 886 108 Australia-wide or visit www.palloys.com.au
AGS Metals, Phone 1300 883 061 Australia-wide or visit www.agsmetals.com.au
Regentco, Phone 1300 879 899 Australia-wide or visit www.regentco.com.au

End of the gold rush?

Jenny Berich discovers the rising price of gold doesn't always lead to a fall in gold jewellery sales.
As the price of gold continues its rapid ascent with no signs of significant falls in the near future, gold jewellers are coming to terms with the fact that the world’s most popular precious metal is destined to become even more precious in coming months
According to GFMS, the world’s foremost precious metals consultancy, the growth in investment demand has been the primary driver of the rally that has taken gold from around $250 in early 2001 to peaks above or close to the $1000 level since early last year.
In the consultancy’s June newsletter, GFMS executive chairman Philip Klapwijk said world gold investment (the sum of implied net (dis)investment, official coins, bar hoarding, and medals and imitation coins) grew from an average of 383 tonnes per annum from 1993 to 2000 to reach an average of 707 tonnes per annum from 2001 to 2008.
He said this change represented a jump in value from an annual average of around US$4 billion to nearly US$12 billion per annum.
According to GFMS, this booming investor interest in gold investment has been primarily driven by:
  • the general decline in the US dollar since 2002
  • rising commodity prices (at least until mid-2008)
  • concerns over the security of bank deposits following the near meltdown of global financial markets
  • the more recent  drop in short term interest rates in the major advanced economies
  • growing concerns at the potential longer term inflationary consequences of unprecedented monetary and fiscal policy easing.
“The contrast between this economic and financial backdrop compared to that prevailing in the mid- and late-1990s is stark,” said Klapwijk
“Back then the economic environment was characterised by low inflation, high real interest rates and an extraordinary bull market in equities.”
He said that GFMS expects to see a “massive increase” in world investment in the remainder of 2009, especially given increasing fears over the long-term inflation threat in western countries.
Indeed, in its May Quarterly report, the Consultancy has forecast that gold investment will exceed 1500 tonnes or approximately US$47 billion this year “carrying the price to new peaks in the second half”.
Local impact
On the domestic front gold and gold jewellery wholesalers and retailers are not immune to the impact of the rising price of gold but the effect is not necessarily negative.
For example, Andrew Cochineas, the managing director of the Palloys Group (Palloys casting, AGS Metals precious metal fabrication and Regentco jewellery findings) believes the rising price of gold is unlikely to lead to a fall in gold jewellery sales.
“The obvious conclusion that many people draw is that the higher predicted gold price will result in lower jewellery sales but I don’t necessarily agree with that,” he says.
“As an example, the average ring weighs approximately three to eight grams.  If gold prices increase by a further 20 percent as predicted, the net cost increase will not be substantial and in any event will probably be negligible in comparison to the value of the design, the stones and the labour that also make up that ring.”
In addition, he says research indicates that consumers see jewellery as a “special” purchase – and in most cases, “’special’ equates with ‘expensive’”.
“In other words, consumers are already hardwired into believing that jewellery is meant to be expensive.  What we believe this means is that if marketed correctly, increased retail jewellery prices should not have a negative effect on gold and gold jewellery sales – it really is all in the spin!”
Cochineas says that sales volumes of his company’s higher cartage products have actually increased in recent months as “we are seeing a big move to higher gold caratages”.
He is equally optimistic about gold jewellery sales in the coming month.
“Studies indicate that in times of economic uncertainty, sales of ‘feel good’ items, like perfume, lipstick, alcohol and jewellery can actually increase – if marketed correctly.
“Moreover, in times of economic uncertainty you see an increasing focus towards good quality products that last.
“This can only mean good things for the Australian ‘home grown’ jewellery industry.
“Despite the rising price, consumers will continue to demand gold jewellery and sales will continue as usual.”
Similarly Phil Williams, director of PJ Williams, says the wholesaler’s experience in the last 20 to 30 years has shown that rising gold prices do not automatically lead to a drop in gold jewellery sales – particularly in the middle and upper market.
“When the price goes up the volume of gold used in individual items tends to go down but the total end value of the items stays the same so profit remain the same,” he explains.
“The rising price of gold may can however have a big impact at the lower end of the market where customers are extremely price conscious.”
Conversely Kokozian Jewellery Manufacturing managing director Michael Kokozian is less than optimistic about the rising price of gold on the local market.
“The impact the rising price of gold has on the local Australian Market is astronomical,” he says.
“It has caused the end product to rise in price by a minimum of 35 to 40 percent which in turn has seen a massive exodus in the popularity of gold thus affecting sales.
“In a world where hand made solid bracelets and chains have an average weight of 18 to 35 grams you can see a minimum shift in price anywhere in the vicinity of $300 to $500 while a pair of quality Australian-made pair earrings will have a minimum shift in price by $45 to $65.”
Kokozian believes the GFC combined with the higher price of gold has led to manufacturers changing their products to create more affordable jewellery pieces.
“Naturally during these hard times, people will minimise or stop spending on non- essential items,” he explains.
“Those who are still choosing to buy ‘non-essentials’ will look at cheaper options.
“Most of the local manufactures, my self included, are therefore using different techniques to manufacture either lighter and more cost affective designs, where we are now mixing gold with cheaper metals the main being silver.”
However on a more optimisitic note Kokozian says he has also observed a “slight shift” in consumer interest away from cheaper white metals back to the more traditional yellow an rose gold.
“I am very optimistic that we will see a shift in trend back to the more traditional yellow and rose gold jewellery which will be helped by the stable but high price of gold which we have seen for the last months.”
Jim Short, the managing director of EBS Metals precious metal refiners and casters is equally concerned about the impact of rising gold prices and the GFC on the local market.
“Australia may continue to muddle along better than other countries, but demand for larger priced items will probably be subdued for one to two years,” he says.
”The GFC has had a big impact on the higher-end. For example, the rise in the price of gold has made 10g chains/bracelets seem very expensive at retail – around $500 today instead of say $270 two years ago.
“The GFC will see business and households increasingly shy away from debt, and encourage them to pay off existing debts. This shrinkage will affect all retail as customers
will think twice before buying on plastic.
“Engagement rings and wedding bands will probably hold up and communities that buy gold for baptisms, communions, confirmations etc will still buy but discretionary spending will remain subdued.
“Eventually though, the yearning for a bit of luxury after months of belt-tightening will see sales lift , but this could be one to two years away.”
Rose-coloured future
And when the belt-tightening does lift most wholesalers are convinced that yellow and rose gold will be back in favour.
“White metals have enjoyed the spotlight for many years now and I feel that we are now seeing the tail end of this trend,” concludes Kokozian. “I predict we will see the trend swing towards rose gold over the next year as this seems to be in vogue throughout Europe.”
Cochineas concurs that the biggest trend in the gold jewellery market is the move towards rose golds.
“The increasing demand for rose golds reflects the prevalence of rose and pink golds in the latest European jewellery and watch collections.”
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