Nitin Sindhu VY | Mumbai
Gold prices in India had shot up to over 1 lakh for 10 grams recently, hurting sales badly. Many small jewellers saw demand drop by 40-80%. People were either not buying or choosing cheaper options.
Why Were Sales So Low?
1. Only Investors Were Buying – Most buyers were purchasing gold bars or coins (for investment), which give jewellers very little profit.
2. Wedding Buyers Opted for Cheaper Gold – Families buying jewellery for weddings switched from 18-carat (75% gold) to 14-carat (58% gold) to save money. A 14-carat necklace is 30% cheaper than an 18-carat one.
Big jewellery brands quickly replaced their 18-carat collections with 14-carat to attract customers. But small local jewellers struggled to make this change fast enough.
High Gold Prices Caused More Problems
- Jewellers had to spend more money to keep stock.
- But their expenses (rent, salaries, bills) stayed the same.
- This put many small shops under financial pressure.
Now, Prices Have Dropped – Will Things Improve?
The recent dip in gold prices has given some relief. Even if prices stay at this level, it will help jewellers sell old stock and adjust to the new demand for 14-carat gold.
However, global tensions and economic factors could still make gold prices unstable. For now, jewellers hope sales will pick up, especially before the next wedding season.
The Bottom Line:
- Good news: Lower gold prices mean better sales.
- Challenge: Small jewellers must adapt quickly to survive.
- Hope: If prices stay stable, the jewellery market can recover.
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