De Beers sales strategy revolves around a model of Supplier of Choice (SoC). They allow only authorized purchasers of rough diamonds to buy from them. An authorized purchaser is called as a sightholder and De Beers grants authorization based on criteria such as the category of diamonds required by the sightholder (this would be determined by their business), De Beers’ availability forecasts, similar demands from other sightholders and an objective assessment of all applicants against the SoC criteria.
De Beers adheres to its Supplier of Choice model quite strictly with 90 percent of the rough diamonds available (by value) sold through sightholders. De Beers has introduced more flexibility in this process. The new allocations model will involve a simplified, compliance and demand-based customer qualification process. It will also create opportunities for non-sightholder diamond businesses to purchase rough diamonds from sightholder sales. These new buyers would be called as accredited buyers and would get their pick from the boxes that were refused by the sightholders or roughs that are outside of the Intention to Offer pool of De Beers.
In addition to the sightholders, accredited buyers and diamond auction, De Beers has added one more stream of buyers – Strategic Supply. De Beers monitors the players in Diamond Industry and it will send out invitations to key players to become part of Strategic Supply chain. The invitations would go out by December 1st. These new players will have similar rights as the sightholders except that their contract would be for 1 year as opposed to sightholders whose contracts renew after every 3 years.
[Picture Courtesy: De Beers]
In further bid to improve its engagement with sightholders and calm any ruffled feathers post above changes, De Beers has adopted a new logo for sightholders that shows a “S” in a circle with a diamond in the center. This logo aims to reflect the central role that sightholders play in De Beers business. “The signature stands for excellence, leadership and integrity in the diamond industry and signifies our joint commitment to excellence,” explains David Johnson, the head of midstream communications for De Beers.