‘From humble beginnings come great things,’ said a wise man. This quote is what describes the journey of Gold Star, one of the most eminent diamond and jewellery companies in the world. Right from rough to polished diamonds to manufacturing exceptionally fine jewellery, Gold Star depicts its passion for supremacy in everything that the company achieves.
The journey of Gold Star dates back to 1960s, when Satish Shah came to the ‘city of dreams’, Mumbai to pursue his dreams in the diamond industry. Although he came from a very small village called Malan in Banas Kantha district of Gujarat, Satish Shah had big dreams when he started as a diamond cutter in the city. Within a very short span of time, he started his own fully equipped diamond manufacturing business with the support of his brothers Bharat and Nitin.
However, the initial journey was not smooth as Satish Shah faced numerous hitches. Even the government policies were not conducive enough to support diamond business then. It was not easy to purchase rough diamonds and manufacture polished goods. At that time, the company did not even have its unit for rough manufacturing due to which they lost their DTC sight in 1984. Nevertheless, the DTC sight was back with them after setting up a major unit in Surat, which employed 500 people who were brought from Kerala to work in Surat. Eventually with his sons entering the business, he widened his horizons and started a jewellery-manufacturing unit in 1990. Since then the business has grown strength to strength. Today, Gold Star has spread into six units in SEEPZ and one in the domestic market.
As we all know, most of the diamond businesses are run by close-knit families; Gold Star is no exception to it. While Satish Shah still plays a major role in handling finance and polished diamond purchases for the jewellery unit in SEEPZ, he has intelligently distributed the responsibilities of his business amongst his three sons. His elder son, Sanjay looks after rough manufacturing, DTC and sales of loose polished diamonds. Sanjay, also, handles creation of various different patent cuts in polished diamonds while the marketing is done through its jewellery production. Alkesh, the second son handles the entire segment of jewellery manufacturing, both for export and domestic market. Ankur is located in the U.S. to look after the U.S. market. Together this team is looking forward to take the group to the next level.
Gold Star is a vertically integrated company providing end-to-end business solutions to their clients, right from rough to polished diamonds to exceptionally fine jewellery. They are a one-stop-shop where the company not only supplies various patent cuts diamonds as loose but also they are set in beautiful jewellery pieces targeted to specific audiences. The company works out the retail pricing and then these are presented to the client, which helps them to sell jewellery in a more productive manner. The company invests heavily on research and product development to constantly create new and innovative designs, which are in sync with the trends and contemporary styling. This is something that their clients are always looking forward to.
Turning Points
No business is devoid of challenges and as mentioned earlier, Gold Star too, had its share of challenges that led to further success in the business. Talking about such challenging turning points in their business, Sanjay Shah, Director, said, “In recent times, I can think of few such points. To begin with, the decision to venture into jewellery business in 1990 was a major challenge as we were in competition with existing clients who were jewellery manufacturers themselves. Although this was a major change for our company, there was a huge opportunity in business. This apart, when in mid-90s we lost our DTC sight, it was a dent in our business but it helped us to focus more on our jewellery business and grow at a much faster pace. In 2003, we regained DTC sight with DTC looking for companies who could promote diamonds more directly in retail arena rather than the diamond changing many hands before it reaches retail stores. This was a great gain for the company as it showed what it was capable of doing.” He further said, “In the middle of 2000, there were many companies going bust in the U.S. like Star Diamond, M Fabrikant, etc. These were the companies to which Gold Star was supplying. During this time, we appointed Michael Lerche as marketing head for the U.S. market. The decision proved to be a great benefit for Gold Star as Michael Lerche was associated with Star Diamond for many years, a company which Gold Star used to supply. His vast experience helped Gold Star to sell directly to majors in the U.S. and increase its presence in the U.S. and helped in its margins.”
The company had cemented great presence in the U.S. with majors like Sterling, Helzberg, Zales, Macy’s, etc. However, it was now time to target independent retailers. They were selling to independent retailers but it was never direct. To tap that market, Gold Star set up a different division in New York with partnership with one of their clients, Amit Patel in 2008. It was challenging, as the company didn’t want to eat into their existing client share, which would hurt their current business, yet gain a part of the vast market. But, the company successfully managed to sustain their clients and enter this segment, too.
Challenges in the Indian Market
Everybody agrees that the current domestic market is not in its best shape. Echoing the thought, Sanjay Shah said, “The domestic market is going through a tough period with retail customers not willing to spend money due to the slow economy. Currently one is nervous to move in any direction. We need to wait till times are favourable to push the sales. Also, threat of CVD is very high, especially in domestic markets as no regulations are in place either by council or the government like at international level in New York. We are seeing consumers’ faith shaking when it comes to buying diamond jewellery. They are buying more of gold in place of diamond jewellery.”
Strategies
The company constantly invests in research and product development to introduce new and innovative products to help its clients to support retail business. They also help their clients with all the business support needed to help their sales. From creating promotional material, website, marketing strategy and helping them with Internet sales, etc. they assist their clients in all facets. “Constant public relation is equally important, too,” said Sanjay Shah.
It has been a constant process to make Gold Star a huge brand. Sanjay Shah on his association with the brand said, “I definitely feel blessed not just to be a part of this magnificent group but to be able to give it the cutting edge and bring to it the array of innovative cuts which has added to its recall value across the globe.”
Future Plans
As it is known to all that the markets are tough and challenges are many especially due to the competition from other industries. Like all its contemporaries, Gold Star, too is treading the waters with caution and will put its plans for the next level into action post this period.
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