gems and jewelry industry has experienced a steady growth and its product
has been recognized as of great quality in the market worldwide, with
the majority of its consumers living in the principle world markets, namely
U.S.A. European Union, Japan and China. Due to ever-growing competition,
However, competitor countries have improved their production as well as
marketing in a variety of goods and have become our fearsome competitors.
study analyzes Thailand and its 4 competitor countries, namely China,
Hong Kong, India and Italy, with emphasis on the following aspects:
Situation and the Competition
has a very high proportion of diamond trade, especially in the US and
Japan markets, leaving far behind its competitors like Hong Kong, Thailand
and Italy. In addition, India has high potential in manufacturing diamonds
smaller than 0.10 karat, and 90% of these small-sized diamonds sold
in the world market are from India. Thus, Thailand should focus more
on cutting medium and larger-sized diamonds to avoid Indian advantage
over abundant and cheap labor.
is the world center and leading trader of color sapphires. Thailand has
a very high potential to compete, especially in the US and Japan markets,
due to its expertise in improving color gems, hard gems in particular,
and its renowned standpoint in the world market, which result in its highest
gems export amount in the world.
major Competitors such as Hong Kong and India in particular, however,
are the countries to watch because they have high trade potential, especially
in terms of resources.
has very high proportion of synthetic gems trade in the principal world
market, especially the US, while Thailand has higher competition potential,
compared to countries like India and Italy that have almost no active
role in synthetic gems export.
is a leading exporter of silver ornament, with higher competition potential
than other countries, especially in the US and EU markets. In Japan, however,
Thailand’s potential tends to decrease, with Italy on the rise.
In addition, China has gained its respect and reserves close monitoring
while India and Hong Kong has less active role.
much to its manufacturing and exporting capability, Italy has very high
proportion in gold jewelry trade in the world market, except for China
market that trades mainly with Hong Kong. At present, however, Italy’s
competition potential has decreased in the US while Thailand, India, Hong
Kong and China have become stronger.
is the leading exporter of imitation jewelry in every world principal
market. It has higher trade proportion than other countries as well
as possesses continuously growing potential in export. India is
experiencing the same but total trade volume is not as high, while
Thailand has potential in the EU market exclusively, with major
competitors such as China and India that follow closely. In other
markets, Thailand’s potential tends to diminish.
differ in the way they manufacture gems and jewelry product, depending
on the past industrial evolution, industrial structure and supporting
industry. For example, India has outstanding diamond cutting and
gold jewelry industry because it has been in this for extended period
of time; in addition, it is a center of color gems cutting. Italy,
by the same token, has long developed its own industrial cluster
and designed modern machinery, making its gold jewelry industry
a boom. For China and Hong Kong, mixed production technique has
been introduced paying attention to unique technique of each country.
While Hong Kong is selected to be a base for planning and designing,
China is a production host. Moreover, China has started the development
of supporting industry, e.g. production of machinery with the quality
matching European counterparts but cheaper.
manufacturing countries have no internal resource or raw material but
have to rely on importation. China is an exception. With its vast territory,
China has plenty of resources and raw material not yet discovered. In
short term, shortage of raw material does not cause problem to Thailand
as long as improvement of color gems can be maintained. For production,
it is Italy that is most advanced both in terms of machinery and designing
and manufacturing technology, followed by Hong Kong, that is ready to
transfer the know-how to China. It is advisable that Thailand speed up
to offer highly value-added, exclusive product to the market. While a
number of competitors, except for China and India that are in early stage
of brand development, have lunched their brand name product, Thailand
still lacks its own.
Trade and Marketing Analysis
is an important step in adding value to the industry because the investment
return is from pricing though system of marketing penetration. Research
done on buyer’s attitude over Thai goods is in accordance with data
collected on importation of each country, which shows that buyers admire
diamonds from India, color gems from Thailand and India, Silver ornament
from Thailand, while gold jewelry must be from Hong Kong and Italy.
product characteristic, buyers seem to be pleased with Italian goods,
thanks to its quality, design, brand and the country image. The only disadvantage
is high price. While both product from Thailand and Hong Kong are of the
same price range and close design, buyers tend to favor the quality of
Hong Kong product and brand. Product from India and China are unique in
their low price, however, their quality is lower than that of Thai product.
penetrating the market, India emphasizes on low cost and aggressive marketing
strategy at international level. Like India, China uses low cost strategy
and broad marketing penetrating. Hong Kong has adopted the concept of
brand development and a more aggressive marketing strategy, replacing
its traditional low cost emphasis. Italy is the only nation that uses
the strategy of differentiation, penetration to selected market group
by ways of product itself and type of customers, with focus on premium
Role of Government
and Private Sector
In the countries
where industry is at an advanced stage e.g. Italy and Hong Kong,
private sector play an important part in establishing production
network and world class exhibition. While the government sector
plays minor part in pushing for the search for new markets to assist
small-sized business, private sector focus more on trade issue and
improvement on education for industry.
Thailand and India are similar
in the way both countries develop the industry that is to say both
government and private sectors are important force in driving production
and trade. Indian entrepreneurs are strong in creating world class
network, this is why most diamond trade is in the hands of Indian
traders. At present, India has more influence than Israel and Belgium.
For Thailand, the support from private sector lacks clear marketing
strategy, even though close coordination with the government sector
China began its free trade policy
for gems and ornament following its admission into the World Trade
Organization (WTO) e.g. central diamond market and central gold
market that are designed to facilitate the sourcing of raw material.
This includes the product quality control, consumer protection law
and regulation. covering buying, exchanging and repairing the goods.
In addition, China has established special economic zone, which
can manufacturer and export its product, though co-investment with
many countries and possible marketing penetration.
on Strategy for Competition
In maintaining Thailand’s
potential to compete with others, researchers recommend the following
1. Strategy for maintaining
the Thai market and high potential product e.g.
Improvement of color gems and cutting technique.
Coordination in locating source of raw material.
Systematic improvement of gems quality as well as protection of
2. Strategy for international
More aggressive marketing strategies e.g. participation in major
world class exhibition - Promotion of Thai gems and jewelry brand.
3. Strategy for upgrading Thai product at the international
Supporting manufactures and traders in certifying quality e.g. issuance
of product quality certification, engraving to certify warrantee
and purity of gold, silver and platinum jewelry, etc.