If you sell lab grown diamonds, the odds are pretty good that you’re already selling diamonds from the Bhanderi laboratory, because with 1,475 CVD machines, they say they are the largest growers on planet earth. Given their extraordinary scale, they naturally became an important source of supply for lab grown diamond (LGD) dealers, wholesalers, and jewelry manufacturers. But now, with a newly formed partnership between Bhanderi and the JB Group, retailers will be able to start procuring LGD, as well as LGD jewelry, directly from JB Bhanderi, under the Surreal brand.
According to JB Bhanderi Chairman Jitu Surani: “The lab grown business is evolving at a breathtaking pace, and as the supply chain becomes more streamlined, it’s inevitable that more and more retailers will be searching to buy directly from the source. We intend to be that source.”
The JB Bhanderi partnership starts with extraordinary intellectual capital. The Bhanderi side brings a history of industry leading engineering excellence, including the fact that they
produce the machines that every diamond cutter uses to “plan” the geometry for extracting maximum yield from each rough diamond. And more specifically in the lab grown arena, Bhanderi asserts they’re the largest maker of LGD CVD machines in the world. According to Bhanderi founder Ghanshyam Bhanderi: “We have pioneered development of both the equipment used to grow LGD as well as the recipe and processes for creating the best diamond material.” His son, Ruten Bhanderi, adds: “At every step, our technical knowledge has provided a significant advantage, and with this new partnership, we look forward to dominating the category, especially in larger sizes. With our planned expansion of 3,000 additional machines, we are targeting a 30 percent market share of global CVD production by the end of 2024.”
The JB side brings a well-known diamond family with an exceptional pedigree. As Shubham Surani, Jitu’s son and a third generation member in the family business notes: “My grandfather started in the diamond business in 1960. The diamond business is thoroughly encoded in our DNA, and this new venture, which includes all of our family, is a natural extension of our family history. We became convinced that LGD represented the future of diamonds over a decade ago, and we see a future in which the overall diamond business can be 4-5 times larger than it is today as a result.”
Shubham’s brother Aaditya shares the family’s vision, taking it a step further in contrasting mined and LGD sales, stating: “For many observers, the mined vs. lab dynamic represents a zero-sum game, in which each success for one kind of diamond represents a cannibalization of the other. We have a totally different perspective, and see LGD turbo-charging the global diamond business, propelling us to market share levels in the consumer luxury vertical that were previously unimaginable.”
George Prout, JB Bhanderi’s recently appointed President for the Independent vertical, credits Surani for instilling an early interest in lab. According to Prout: “Jitu is really the person most responsible for my own interest and subsequent involvement in lab grown diamonds. He predicted the current scenario with amazing clarity over ten years ago, and I think that when they write the History of Diamonds many years from now, Jitu Surani will come to be seen as the Elon Musk of lab. He has the knowledge, the deployable capital, and the commitment necessary to dominate this business.”
Prout sees a tremendous opportunity for jewelry store owners as the lab business matures. “We’re seeing chaotic conditions right now, as Darwinistic business processes serve to weed out the vast majority of suppliers in the lab space. The key strategy for independents will be to become aligned with the small group of growers who will ultimately control the lab grown diamond business. In an industry where scale matters, we will be ideally positioned as the perfect supplier-partner for independent stores.”
JB Bhanderi’s exclusive focus on CVD provides an exceptional advantage. According to Mr. Surani: “In order to understand the current state of LGD, you must remember that the large mined diamond companies that have entered the lab sector still view LGD as a side activity, essentially a rounding error from their enormous mined diamond revenue streams. At JB Bhanderi, we believe that our single-minded focus on lab grown diamonds gives us a substantial strategic advantage, as well as providing real benefits that will strengthen our relationships with our G2B dealer network.”
In order to provide the best possible customer service experience for its customers, JB Bhanderi has recently taken over a 14,000 square foot office space in the heart of New York City’s diamond district. As Mr. Surani notes: “The historical importance of New York as the diamond center of North America mandates that we set up our facility here.” But Surani also notes that in order to create space for the additional CVD machines in Surat, the company has recently constructed a new 750,000 square foot laboratory, which will ultimately become part of a massive complex totaling over 2 million square feet producing hundreds of thousands of diamonds per month.”
JB Bhanderi’s leadership team sees a huge future for LGD, as the democratization of diamonds creates accessibility for consumers at all income levels. As just one example, the engagement ring business, where ¾ carat to 1 carat diamonds have dominated for the past 80 years, is now shifting rapidly to a starting size of 2 carats. Furthermore, affluent consumers will now have access to the kinds of diamond fashion jewelry that in the past were only affordable for the wealthy and the Hollywood elite.
According to Mr. Prout: “Lab grown diamonds are the biggest disruptor for this generation of jewelry retailers, and nowhere will the impact be felt in a more positive way than with independent jewelers. Remember, it’s precisely during periods of disruption that market shares are most easily changed. At JB Bhanderi, we hope to provide the products, services, and advertising ideas that will help propel our customers, as well as the diamond jewelry business in general, to unprecedented levels of success. “
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