The allure of the pearl is steeped in tradition but the gemstone has lost none of its charm in the present day.
In fact, it could be argued that the pearl has come out of its shell and is being appreciated more than ever before.
Pearl has been an endearing fixture on the catwalks for several seasons, fashioned into jewellery and also embellished on garments, handbags, shoes and eyewear. Appearances in popular culture have also propelled the gemstone into the spotlight – one UK jeweller, for example, has reported increased demand for pearl pieces following the generous use of pearls on Netflix hit series The Crown.
Such exposure naturally helps drive demand; however, there are other notable factors impacting on the pearl’s current stance within the industry.
“The pearl market is definitely buoyant and consistent,” Jonathan Jacobson, co-founder of Pearl Traders and finished pearl jewellery business Perlis Jewellery, states.
Jacobson says output from pearl farms has been steady since producers reduced production a few years ago.
“This has meant more stable prices,” he explains. “Sizes of 13 mm and bigger for all major pearl types – white South Sea, golden South Sea and Tahitian pearls – are fetching quite high prices.”
Atlas Pearls specialises in the supply of South Sea pearls to the local and international market and managing director Pierre Fallourd is optimistic about the year ahead.
“In short, we are confident that the first half of 2017 will deliver in spite of a relative slow second half of 2016,” he states. “Prices are holding firm in the most sought-after medium and high-quality categories.”
At the retail level, Fallourd says prices remain stable and that retail stores are now more accurately stocked, owing to the diverse range of pearl types available.
Extensive pearl options – South Sea, Tahitian, Akoya and freshwater to name a few – can be only good news for jewellers but it’s important to understand some of the supply and demand issues at play.
Although Australia is one of the largest-producing regions of South Sea pearls, Peter Hansen of Nash Pearls explains that a select few companies tightly control production so most goods are sold directly to the international market and brought back to Australia to meet domestic demand. This means prices are set at an international level, either in Yen or USD, which then impacts domestic pricing.
“The big producers have also vertically integrated with key high-end retail outlets in key capital cities in Australia and overseas,” Hansen continues. “This also impacts what Australian stock is released to others such as suppliers and jewellery retailers.”
Grading fears
According to Hansen, post-harvest treatment is another area of concern: “We are seeing more of these treated goods coming into the market each year with little to no disclosure creeping into the South Sea pearl market.”
Pearl quality and value are determined by six industry-recognised characteristics – lustre, nacre, colour, surface, shape and size – but unlike diamonds, pearl grading reports and certificates are not routinely issued. Hansen states that most gemmologists lack the equipment necessary to detect sophisticated treatments.
When asked if this is a problem and if a formal report or certification is required, Hansen responds by stating it is a concern at the lower-end of the market where the consumer is unaware if a pearl is untreated, treated or dyed.
“This is made worse by the store owners also not knowing the details of the stock history and not knowing the product very well,” he says. “As the value of the item goes up, it is becoming more common for third-party independent certification to happen to provide additional comfort to the potential purchaser.”
Justin Linney is the creative director of Linneys, a retailer known for South Sea pearls. He states that modern farming techniques have allowed for the increased creation of “perfect, higher-quality pearls”, placing pressure on the grading process and retailer expectations; however, Linney also doesn’t believe there is a need for the implementation of a formal certification scheme.
“It is true that pearl reports and certification are not routinely used for the buying and selling of pearls but I do not see this as an issue because the retailer selling the pearl should have the skill and experience to correctly educate the customer on the value factors affecting the pearl,” Linney explains.
“Whilst I was studying gemmology at the Gemological Institute of America [GIA] in California, I found it interesting to see the grading system they developed for pearls,” he continues. “A grading system such as this may become an expectation of the customer in the future; however, the cost of the gem must be relative to the cost of the certificate so I personally think we will only ever see reports on very high-grade pearls.”
Farm to floor
Despite its complexities, the pearl is continuing to prove its worth within jewellery stores. Carson Webb, general manager of buying group Showcase Jewellers, believes the gemstone plays an integral role in any successful jewellery business.
“They represent just more than 3 per cent of total sales generally for us and also bring healthy margins for retailers and a real point of difference,” he explains.
“We’ve personally seen a massive growth in this area over the past three years, although this [financial] year so far is a little softer.”
When speaking with Jeweller in late 2016, Nationwide Jewellers director of merchandise and marketing Niven McArthur acknowledged that a tough retail year had affected the turnover of the buying group’s preferred supplier members specialising in pearls but no more than suppliers of other categories, thus indicating steady albeit subdued – demand. He called pearls unique because of the range available, fitting into just about any jewellery category and price-point.
Temilli Jewellery, which has four locations in Melbourne, has sold loose pearls and pearl jewellery since 1999 and currently stocks a range of South Sea, Keshi, Tahitian, Akoya and freshwater pearls.
Temilli Jewellery marketing manager James Temilli says the pearl now appeals to a wider age group and believes is an essential part of a jewellery business.
The fact that the gemstone is a great tourist attraction is another main benefit, according to Temilli. In addition, Jacobson says certain tourists make pearl purchases in Australia because they trust Australians more than other nationalities.
“It has been said that even Chinese tourists trust Australian stores to buy Tahitian pearls in Australia. Even though they are not farmed here, they prefer to buy Tahitians in Australia over their home country of Mainland China,” he explains.
Duffs Jewellers director Ben Duff says his store has stocked pearls and pearl jewellery for as long as he can remember. Duff started working in the family-run business, which has four locations in Victoria, in 1988 but says he also recalls seeing a Mikimoto pearl display as well as the shell-based brands “popular back in the day” in store in the 1970s.
“Apart from being a profitable part of our business, I feel that pearl jewellery, especially South Sea, offers an excellent point of difference from the majors,” Duff says. “Pearl jewellery as a whole provides some great origin stories – Japanese Akoya, Broome South Sea – as well as being a unique individual product and not regarded as just another piece of generic jewellery.”
Product knowledge is key to successfully selling jewellery of any category but it is particularly imperative when it comes to the somewhat complex nature of pearls.
Duff says he surveyed staff a couple of years ago asking what product they would like more training on and the overwhelming response was pearls. He consequently developed a training module that includes “origin stories” and he states it has certainly helped to improve sales in both South Sea and Akoya product.
“It has also enabled the staff to help weave an interesting story around pearl jewellery, and as we all know, customers love a good story,” Duff adds.
In addition to origins, awareness of new production techniques is paramount.
Ikecho Pearls supplies different pearl types including South Sea, Akoya, Tahitian and freshwater, and Ikecho director and designer Erica Madsen says one of the major recent market changes is the introduction of the freshwater Edison pearl.
Madsen explains that the Edison pearl is cultivated in a similar way to Akoya and South Sea pearls whereby a bead is inserted into the mussel tissue of the oyster, and she is now educating retailers about this new process.
“We are finding the natural pink Edison pearls to be the most popular at the moment,” Madsen says, adding, “Because of their size we are now stocking the Edison in white so our customers can now buy large pearls at a very reasonable price.”
Size is one of the trends highlighted by Aquarian Pearls designer
Kate Vivas, who says, “The market is showing an increase in demand for large statement pearls – oversized loose pearls 18 mm and over for large pendants.”
Fashion-forward
There is general consensus that classic designs will always be in demand but one can’t deny the latest pearl trends pushing traditional boundaries.
“The market has been calling for, and appreciating, more unusual pieces both in jewellery and strands,” Jacobson explains.
“We have been making more unusual pieces, including larger, showy pieces in strands, necklaces and rings and pendants that sell very well being ‘different’.”
Linney states that his business has always been a leader for using pearls in new and innovative ways.
“We have recently released our 2017 collection,” he says. “In line with the current trend of body chains and body strands, Linneys has re-invented the traditional pearl necklace to develop the Pearl Body strand. The piece is just a taste of the contemporary new direction the collection is taking.”
Meanwhile, Fallourd explains Atlas Pearls has developed a distinctive fashion and style approach to showcase pearl jewellery over the past three years.
“Pearls have been categorised – quite unfairly I must say – into a category coming from another century,” he states. “We believe that the very nature of this gem is very much anchored in the future and that it is our role to encourage customers to look at it with different eyes through ever-renewed creativity.”
The loose pearl supplier is now capitalising on the increased demand for unique pearls by producing and selling finished jewellery: “We believe each pearl is unique and that there is a pearl for every woman.”
Perhaps this is a mantra all jewellers should embrace.
The pearl industry is undergoing several changes at production, supply and retail levels but the queen of gems and the gem of queens has a strong future ahead as long as retailers are abreast of such issues and consumers maintain a special place for pearl jewellery.