Gareth Penny: "We Are Not A Closed Shop"
January 23, 03Cocktail parties are fertile grounds for hearing intriguing anecdotes. We overheard a discussion between a potential DTC sightholder and some of his colleagues about making applications and presentations to the DTC to become a sightholder.
The broker of TP ['the potential'] recommended that it's probably wiser for him to wait two years and apply then. Some of the parties to this discussion held a contrary opinion. It was held that DTC brokers may also have their own priorities, their own shortlists, and, realizing how time consuming the application exercise is, they may, in a way, do some kind of pre-selection.
Moreover, as the DTC in Supplier of Choice continues to encourage potentials to work with brokers, they may well be just fulfilling their role by using their expertise in "DTC thinking" to recommend to TP to wait. That, in turn, raised the question whether, in respect to brokers, Supplier of Choice is any different from the previous system. The ultimate authority on Supplier of Choice is its architect Gareth Penny. We asked him what his position would have been if he were part of that discussion at the cocktail party.
Gareth's position may best be summarized as follows: first of all, the whole idea of the EC approval of our system was to underscore that the DTC is not a closed shop. Anyone that feels that he wants to be considered should apply. As much as we encourage applicants and others to work with a broker, I want to stress we are more than willing to also engage in direct explanation with any new applicants who are considering applications, but are not really sure.
We have now prepared a comprehensive sightholder pack, which includes every detail there is to know about Supplier of Choice, including the questionnaire, etc. Anyone familiarizing himself with the sightholder criteria may already form a very good view as to where he would fit in or not. Of course, we already have an extensive list of extremly good clients against whom a new applicant would be competing.
Gareth used the opportunity to reflect a little bit aloud: we're probably going to consider more than 60 potential clients. That's a feeling - we have no set number yet. We have asked brokers to submit names of companies to whom we will send a sightholder pack. After analyzing all the information, we will have to make a shortlist, which, after everything else has been considered, is very much a function of our availability of certain articles and those particular articles that applicants apply for. There are still many players in the industry who understandably are focusing on their desire to secure continued rough supplies who may not fully comprehend that we, the DTC, are reminding ourselves constantly of the bigger picture.
"We look at the new applicant, and our active sightholders, as parties through whom we can grow consumer demand for diamond jewelry for the long term and in a sustainable manner. We consider Supplier of Choice as an opportunity to revitalize our industry and to match the growth rates enjoyed by the leading luxury goods companies.
"To help realize this vision, the DTC needs to develop and expand its market-focused value-added services and to work with those diamantaires who are best equipped to distribute diamonds efficiently and market them effectively. For this reason, consumer needs and consumer choice should be the central concern for all of us," recalls Gareth.
We moved the conversation back to the cocktail party talk. "We must avoid misunderstanding and not judge conversations between brokers and TP out of context. If a party clearly doesn't meet some essential criteria, the advice of the broker ought to be heeded. I can only say that, as a matter of DTC policy, nobody in this building is empowered to discourage any potential sightholder to apply. Every diamantaire has the right to put his hat in the ring, to get all the documentation."
I asked: "if in doubt, should one apply or shouldn't one? If you apply and get rejected, will this count against you two years down the road?" Gareth's message was clear: "When you have a viable business, that has officially audited books, that has a good track record, and good marketing and distribution skills, there should be no inhibition to apply. And, no, it will not be held against you two years down the road if you were found lacking today."
After putting down the telephone and reflecting I couldn't help smiling. The master diplomat had really left us with two messages: on the one hand: brokers are very important to us and you ought to listen to them and, on the other hand, we have now an open door and we are willing to engage into a direct dialogue with any deserving party.
Brussels has said what it said - and London will never be the same.