Malabar Gold & Diamonds: Government agencies must take stringent measures to implement hallmarking fully
Leading jewellery retailer Malabar Gold and Diamonds believes that the mandatory hallmarking has not been implemented fully, leading to fake hallmarking. The jewellery major wants the government to take stringent measures to make hallmarking across the country mandatory, coupled with crackdowns on fake hallmarking.
With an aim to become the number one jewellery retailer in the world, Malabar Gold plans to open around 500 new stores in three years across the globe. To tap the global audience and compete with international jewellers, Malabar Gold is banking on its international designs and marketing strategies.
Ahammed MP, chairman of Malabar Gold & Diamonds, spoke to FashionNetwork.com about his company's journey, expansion, impact of reforms in the jewellery industry, and hallmarking.
FashionNetwork.com: Malabar Gold & Diamonds has managed to become one of the world’s leading jewellers in a short span of time. Talk us briefly through this journey, on how the company managed to achieve this feat?
Ahammed MP: The continued focus on achieving excellence, unparalleled craftsmanship, unwavering commitment to quality and transparency and world-class customer service and shopping experience are the key drivers of the journey of Malabar Gold & Diamonds. It all started with a showroom in Kozhikode in Kerala in 1993 which has now made Malabar Gold & Diamonds a global jewellery brand with over 280 showrooms in 10 countries.
Our vision to become a global jewellery brand from India is guided by our mission - Make in India and Market to the world. Our goal is to enhance the value of Indian craftsmanship thereby achieving the number one position in the world. Indian craftsmanship has the potential to influence the global fine jewellery trends. Our efforts are focused on giving due recognition to the unique craftsmanship of our country.
FNW: Malabar aims to be the number one jewellery retailer in the world. By when do you see this dream becoming a reality and what steps is the company taking for the same?
AMP: Becoming the number one jewellery retailer in the world is a continuous journey focusing on quality, transparency and design excellence. As far as our retail expansion road map is concerned, we aim to triple the retail network from 280 showrooms this year to 750 in three years.
FNW: Malabar Gold already has a strong presence in GCC countries and continues to expand in this region. Which international market contributes the most to the company’s overall revenue and will we see Malabar explore new markets (Europe, America) going forward to become a truly global brand?
AMP: Malabar Gold & Diamonds currently has presence in nine countries excluding India with a total of 280 stores. These countries are UAE, Saudi Arabia, Qatar, Oman, Kuwait, Bahrain, Singapore, Malaysia and the U.S. Of the mentioned countries UAE contributes 45%-50% of the overall revenue. The expansion plans for the coming years are focused on strengthening presence in existing countries as well as expanding into the UK, Egypt, Australia, Canada, Europe, Bangladesh, Sri Lanka, and select African countries.
FNW: Indians look at gold as a safe investment while in the international markets customers mostly look at jewellery differently. Is Malabar planning to tweak its strategy/designs to cater to a global audience to compete with high-end jewellers?
AMP: Gold is intrinsic to the socio-economic and cultural fabric of the country. Having said that, the new-age jewellery consumers now look for design value in jewellery along with investment value. The success of our Brides of India campaign in 2021, which focuses on the grand entry of brides, underlines the evolved sensibilities of contemporary brides and their preferences. Our design and marketing strategies are always in line with the evolving demand scenario. We are following a similar approach while catering to our global audience.
FNW: India has recently introduced a host of policy changes in the jewellery sector. Sometime back there were reforms undertaken by GCC countries which had affected the jewellery business. As an international player, how do you deal with the changing policies and how much of an impact does Indian policies have on your global operations?
AMP: We expect that the government of India will play a proactive and supportive role in boosting jewellery retail trade and exports taking into account the vast potential. The recent FTA between India and UAE will pave the way for making India the OEM manufacturing base for global brands. The agreement will also strengthen the robust jewellery retail and wholesale business and reinforce UAE as the preferred jewellery destination as it offers the best price, quality, and design offerings. These developments will have a positive impact on our global operations. The Jewellery sector has been requesting the Union Government to drastically reduce the import duty on gold to prevent smuggling. We look forward to a positive measure in the next union budget.
FNW: Tell us about your future expansion plans in India and abroad? What is the investment earmarked for it? What is the target revenue going forward?
AMP: In FY22, we aim to strengthen our retail presence by launching new shops across India and abroad. We have earmarked Rs. 1,600 crores for the expansion in FY22 which will create 1,750 new employment opportunities. In January this year, we opened 22 showrooms - 10 in India and 12 in overseas locations. In India, we'll further expand our presence in states like Kerala, Karnataka, Tamil Nadu, Telangana, Andhra Pradesh, Karnataka, Maharashtra, Delhi, Uttar Pradesh, Odisha and West Bengal. Our global expansion plan includes markets like UAE, Oman, Qatar, Bahrain, Singapore and Malaysia.
FNW: The government has made gold hallmarking mandatory. What does it mean for the jewellery industry, secondly do you think it will have an impact on your sales or some of the organised players considering the fact that hallmarking has brought in more transparency and increased consumer trust in the unorganised sector?
AMP: Mandatory hallmarking will translate into superior purity standardisation and greater consumer awareness in the domestic jewellery trade. It will make the trade more organised, eliminate grey areas and ensure level-playing for all jewellers. It will act as a big boost to the organised jewellery retail trade in the country. However, currently, it has not been implemented fully and there is also fake hallmarking. Government agencies must take stringent measures to make hallmarking total.
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