Boodles’ unique and very special pieces of jewellery have been seen on the catwalk and at many celebrity events. Boodles have recognised that numbers of successful and confident women are buying their own jewellery. Boodles invited Pippa Malmgren to be a brand ambassador and wear their amazing creations at her various speaking engagements and events.
You have recently asked Pippa to wear your jewellery at speaking events. Although there have been a number of celebrities who have worn your jewellery on the red carpet, this is recognising that a number of successful working women are buying their own jewellery.
PM: Whenever I do public speaking – and it doesn’t matter who I’m speaking to, whether metal industries, financial services, healthcare or energy – women make up 5% of the room. The first comment is: “It’s so nice to see a woman on the panel”, and the second comment will always be about clothes and jewellery. Women spend a lot of time in a suit trying to get ahead. They want permission to be feminine in the work place. This is why I am delighted to be able to show-case a brand with longevity, character and style. Boodles has been around since the late 1700s and remains a family owned business.
JW: 100%! We are independent, but we are not on the scale of Tiffany and Chopard. We are a family business and my grandfather used to say: “You can only eat three meals a day”. He was ambitious, but he was always measured, and that is one of our policies. We have a policy on not borrowing money. We like to do things gradually. We don’t want to be growing too quickly, we want authentic growth.
You’re a northern jeweller with your base in Liverpool, how do you see the North/South divide?
JW: When we kicked off in Liverpool in 1798, Liverpool was the second largest port in the world. We were very lucky to have a shop there. We have a selection of big customers up north, particularly in Chester, but many more smaller purchasers. As London benefits from having many international visitors, we have bigger customers there. In London things are more competitive. Up in the north things are very relationship based.
PM: In my opinion, you are going to find that you will have more and more customers in the North because the revival of the economy outside London is quite striking. It’s the return of manufacturing to the UK, the rise in the value of agricultural farmland, and record high prices for farm produce. So these people are doing better every day, and people don’t realise quite how much this revival is occurring.
There is a trend now to create the London Luxury Quarter in Mayfair where you have the art, hotels, and restaurants. How do you think that this is going to impact on you?
PM: I think that the Bank of England is doing its level best to create inflation and that they are succeeding. Property prices are going up, rents are rising fast and that’s a normal outcome of quantitative easing. It does have another impact – it is creating inflation in emerging markets and this inflation is accelerating. This typically leads to social unrest causing people to say: “I need a safe place to go”, which then leads to lots of property purchases in London. For an emerging market investor, London prices looks perfectly reasonable. In my opinion this will work to your advantage, as you will get more customers as they discover your brand. Your brand is more local and older and this is an attractive combination for an emerging market buyer.
JW: My view is more based on gut feel and on judgements that I have made. In the past 6 years, rents have gone up, diamonds have gone up and we have been able to afford all of this growth. It makes me a bit concerned when anything goes up a bit too fast; it’s a little bit superficial when you look at diamond prices. But over the past year this has levelled out and I feel that we are growing into the prices that were pushed up so quickly. In my opinion, we have caught up with a little bit of too much growth too soon. Demand in China dramatically impacted on diamond prices, pushing them towards an uncomfortable height. However, the past year has seen a slowing down – or a catching up – of prices amongst categories of stones where China and to some extended India had been pushing them.
A friend of mine runs a free zone in Dubai, where they run the diamond and metal exchange, and he has seen a growth in diamond trading because of the central location and excellent transport links. Do you see Dubai becoming a centre for diamonds?
JW: I do. In recent years, Dubai has been put on the map, on no small way, as an important world Diamond trading centre.
PM: There is also another element – as we have had the Arab spring and the rise of social instability, Dubai has definitely emerged as a haven in a region that’s less and less stable. Switzerland used to be the offshore tax haven for India for example. Now it’s Dubai. Switzerland is effectively closed for business now, unless you are a resident, because your information will be sold to any government. So the UK and Dubai have emerged as the best locations for investment purely from a tax point of view. There are limited locations in the world that are so attractive in this respect. And then there is your industry specific point. When things are unstable, people look for different forms of holding wealth, and jewellery and diamonds are a form of holding wealth.
JW: The only thing is that is far more complex to assess is the value of a diamond, real expertise is needed. The certificates may look exactly the same but when you look at the actual stones they are chalk and cheese. It is not like gold, it is not a commodity.
PM: Each single stone is different- it is more like art work than it is like gold.
If we look at Christie’s, they are doing more and more online auctions; last year they had 46 online auctions. I believe that if you have a reputation like Boodles, buying a valuable piece of jewellery from the website is not a problem. How much do you think reputation is worth?
PM: I think it is massive and growing. In an environment where prices are rising, the key to value lies in expertise and experience. If hard asset prices are rising then you want to be working with a partner who is not going to be pushed out of the market. You want to work with an entity that has the ability to protect their own margin so that they can survive in this cost based environment. Longevity is so important, and if you look at Boodles, it remains family owned in a world of conglomerates; it is in a great position. The experience of buying serious jewels is also an important part of the purchasing decision. You can’t really compare online with walking into Boodles.
JW: It is critical to have your finger right on the pulse. It’s not rocket science but we have expertise. For example the price of pear-shaped diamonds have rocketed because about a year ago there weren’t that many pear-shaped diamonds being cut. Everyone was cutting round stones. There are certain nuances, if you are buying blind you don’t necessarily know about these trends and why one stone is so much more expensive.