Executive Summary

Heart and Soul Gem and Jewellery is a well established company in Sri Lanka for the past 15 years. We have been catering to this market successfully and we have a proven track record of our achievement throughout past years. As mentioned above our products are Gem and Jewellery, and we market stones as well as designer jewellery to our target market.

Our target market is the high end markets that always look for delicate and unique presence of styles in jewellery as well as in stones. We have been the market leader in Sri Lanka for the past five years and have been very successful in holding our position. In order to expand our business internationally we are now in the process of moving into different countries and exporting Gem and Jewellery. On this basis now we are in the progress of exporting Gem and Jewellery to the US market. Not only exporting but also we are planning to open up our retail outlets in the main suburbs which are well known for our types of products which would be California as well as Los Angeles.

Thus, the following report will be analysing the US market as well as the feasibility of our products being exported there. The reports analyses various areas including the market analysis, product specifications, pricing, promotions, rules and implications and so on.


Socio-cultural Analysis

As early days as well as today market for Gems have a high demand all over the world. Mainly the biggest buyer for Gem stones are United States and European countries. People who are highly rich and moderate income earners coming from Royal Families, Celebrities from Hollywood to Bollywood wear these precious stones for their ultimate satisfaction needs.

In USA most ladies wear these expensive stones such as Pearls, Rubies, and Sapphires for uniqueness and for the charming effect that built through these precious stones. Most men and women wear this stones to show there prestige as well as to enhance their public image and to show their wealthiest and the social class.

As the social impact of having a Gemstone is remarkable experience and also mentioned as Good luck. A person who receives a wedding ring or the wedding necklace embedded with Diamond stones, on the wedding day she will be the luckiest lady in the whole world. Also another example a mother who receives a birthstone for her little one will be a memorable gift for all mothers of all ages.

According to US culture women who are rich and fashionable, they normally don't miss to wear these accessories. Most of the elegant women who are capable of having several kinds of gemstones have the advantage of using variety of stones depending on the occasion. As an example diamonds gives a classy look and posh image for evening gatherings. And Rubies are very precious that gives a charming effect on women.

Economic Analysis

Gems & Jewellery industry is one of the fastest growing markets in the world. Mainly USA is the largest buyer for gems and jewellery. The trends and challenges can influence the gems and jewellery market is in USA. There was a less demand for platinum jewellery in last few years in USA.

One of the pluses accruing for the falling U.S. Dollar is the consequent depreciation which results. In this way, the products made in US will become more attractive in the international market. In the same way our gem export will be facing the Dollar shortage. This challenge will have to be circumventing by other ways.

Firstly, it is wise to open a Sri Lanka branch in US because it can serve several purposes. Its can supply wholesale or retail or do the advertising of our local product. Sri Lanka branch can be sensitive to the customs, restrictions or variation & keep our country in form. Our Sri Lankan Branch in Los Angeles can do so much to outdo the glittering synthetics for the following reasons. Also a future purchases in US on gemstone will be at a higher price. It is true that the entire ruff for the gem stone come to US from outside & US has only a few exceptions. The general trend is that foreign stone have a general rising price trend that is keeping pace with the growing, fashions & demand of US.

The Product

Evaluate product as an innovation as it is perceived by the intended market

Relative Advantage

Most importantly, the consumer must consider the product should have benefits that are superior to other options (Solomon, 2008, p. 653).Sri Lanka is well known as the 'island of gems', because the brilliant range of gems found in its soil, namely cat's eye, spinel, blue, white, star and fancy sapphires, garnet, topaz, moonstones, zircon, , and chrysoberyl. The stones are mining in larger scale in Ratnapura and Elahara areas. Gem cutting ensures maximum yield and the best quality as well as its brings the maximum beauty, rarity, durability, and value of the stones.


The innovation must be consistent with current needs, values, beliefs, and behaviours. (Solomon, 2008, p. 652).U.S.A people love jewellery and they appreciate it when their jewellery is fashionable. They have different perception towards different stones. Mostly diamond stone is more popular in USA.

The Market

Describe the market(s) in which the product is to be sold

Geographical region(s)

Los Angeles is one of the renowned cities of United States of America. The city measures 71km longitudinally and 47km latitudinal. The perimeter of the city is 550km. (The Mineral and Gemstone Kingdom, 2010) It is the only major city in the United Statesseparated by a mountain range.

Los Angeles in the United States is a most renowned place for Gem Exhibition. The gem collection in Los Angeles is a very prominent place because it has history along several years. The Gem collection has a world-wide in range and boasts particular strengths in different types from California and other such states. (The Mineral and Gemstone Kingdom, 2010) The collections are being actively improved principally through purchases with customer preferences.

Forms of transportation and communication available in that region

The Los Angeles in the United States operate a well form of transportation system for bus lines, as well as subway and light rail lines across Los Angeles City, with a combined daily ridership of 1.7 million. The majority of this (1.4 million) is taken up by the city's bus system, the second busiest city in the country. The subway and light rail combined average the remaining roughly 319,000 boarding per weekday. (Gem Fashion, 2010) Around 12% of Los Angeles commuters ride some form of public transportation, which places Los Angeles fourth among the 10 largest cities in the U.S. for the share of person along the ride using public means of transport.

The city's subway system is the ninth busiest in the United States and its light rail system is the country's third busiest. The city also has a commuter rail system Metro link in the central which links Los Angeles to all neighboring counties as well as many suburbs.

Consumer buying habits

Product-use patterns

The passion with possessing gems is quite universal. Gems haveamusedand attracted for thousands of years. This also has been the gifts and sums of kings and queens and other such rulers. Most vital gems are the most demanding gifts to give or receive. Gems represent as a symbol of devotion and are the powerful approach of saying "evermore" to a loved one. Due to the hardiness of gems, they can be passed from one generation to another. A gem collecting is quite interesting; unlike purchasing a stockpile or a bond, trading with gems are enjoyable investments to accumulate. (Where are Gemstones found?, 2009) Although gems do not endow with income in the classical pattern, they provide an "intuitive" incomeexceptional in the collector market.

Gems are uncommon, they are limited and findings have become exceedingly rare. Most precious stones are very old and the finest gems are long gone. Most extensive colour gemstone is accomplished withprehistorichand tools, a process by which invention cannot be accelerated to meet demand. (Gem Fashion, 2010) The best way to buy gemstones is to collect when the marketplaces are slowdown and sell when the markets are hot. Gemstones may represent an ideal store-of-value if inflation accelerates.Gemstones are the most determined form of wealth known to man. Gems are extremely convenient; and simply could be obscured and stored. Gems are concealed, convenient, non-detectable asset, and they are tremendous valuable wealth.Gems are anonymous and private; it is easy to store the gems secretly in a bank vault or other such secure place.

Product feature preferences


Ruby is a legendary gem because it has a fiery red colour. In close proximity to its colour, it is a most attractive gem due to its solidity, sturdiness, lustre, and rarity. Most of the transparent rubies of large sizes are even rarer than diamonds. The transparent flawless ruby in terms of value is most expensive compared to the other Gems. ". (The Mineral and Gemstone Kingdom, 2010) Rubies should be Transparent in order to get an expensive value.


Diamond is the mostvaluable Stone. It is well-known for its amazing lustre, hardness and beauty. It is the most valuable gems in the type of gemstone. The most fortunate shape diamond is one that is colourless with a sapphire shade or one, which sprays blue and scarlet rays with no black dots.Diamonds are the solid substance on terrain. (The Mineral and Gemstone Kingdom, 2010) They are more brilliant than any other natural gem. Their sparkling fire, durability, and rarity make them the most prized of gems. Diamonds are the mostglistening of true gems. They have a brilliant lustre, and alsoshow signs of dazzling colour flashes known as fire.

Blue Sapphire

Blue is the foremost colour of the sapphire. Blue is also the favourite colour, for certain people, men and women alike. The colour, strongly relates to the sapphire as it is, with thoughts of compassion and accord, friendship and loyalty: feelings which belong to individuality that show their appeal in the long term. Thus the azure of the sapphire has become a colour which fits as stable and reliable. (The Mineral and Gemstone Kingdom, 2010) That is one of the reasons that women prefer in many country wish for a sapphire ring on their engagement. The sapphire represents loyalty, but in the similar time it gives expression to people's love and desire.


Emeralds are excellent gemstones. In top quality, fine emeralds are still more precious than diamonds. These encompass the most beautiful, most intense and most beaming green that can probably be imagined as emerald green. The name emeralds come from Greek. Innumerable far-fetched stories have fledged up around this splendidgem. The green of the emerald is the colour of being and of the springtime, which comes round again and again. But it has also, for centuries, been the colour of beauty and of constant love. In olden days in Rome, green was the colour of Venus, the goddess of beauty and adore. And in the present day, this colour standstill a special site in many cultures and religions. Green, for example, is the divine colour of Islam. Many of the states of the Arab leagues have green in their streamer as a representation of the unity of their reliance. (The Mineral and Gemstone Kingdom, 2010) However this colour has a high status in the Catholic Church too, where green is regarded as the most natural and the most elemental of therelated colours.

There are many more stones which are highly demandable in USA, among which the above are the most vital and well known stones.

Shopping habits

These are the products that could be purchase to suit your need at any cost. The result array covers every price points, from low to high end. The designs are available at customer preference. Often buyers rely on the expertise of the sellers to pick out the latest patterns available in their stores. Buyers can purchase any expensive product when it comes for occasional seasons. Some buyers buy for their personal and private collections.

Most of the Americans prefer expensive stones because they prefer Gems as an asset because investing is worthwhile because they last longer and keeping it would have a very huge demand if the stone is really valuable. (Solomon, 2008) The customers could ask for their own preferences if they do not want to buy the design that is available in the market for higher price.

Distribution of the product

Retail Outlets

The distribution methods which we are going to carry on will consist of retail outlets as well as the use of agencies as the middlemen in the process. As mentioned before we are planning to open our company 'Palmna' Gem and Jewellers in America, in Los Angeles and California which are the highly potential places to market Gem and Jewellery. Thus, we'll be having typical retail outlets in these two places. For now we are planning to operate one retail outlet in Los Angeles and one in California. (Where are Gemstones found?, 2009)

The retail outlet in Los Angeles will be situated in down town which is actually the hub for all gemstones and jewellery outlets. Famous gemstones' history lies in Los Angeles such as American Golden Topaz, Bismarck Sapphire Necklace, etc. (History of Famous Gemstones, 2000) Even though the competitors are nearby which might be a challenge for us to market our products, having outlets near them will automatically create the possibility of driving the target market to our outlets since they will anyway come to downtown of Los Angeles for the purchase of Gems and Jewellery. The spots marked in red in the map shows the competitors' outlets in Downtown.

The next outlet will be in California, which is the second major place which has a very high potential market for Gems and Jewellery. This outlet will be located in San Diego in California. This part of California is well known for tourists' attraction. Not only a place filled with tourists but it is also a place where you can find most of the rich and the wealthy people living who is our potential target market. (Gemstones found in California, 1995-2009) Thus, the choice of this place is basically to attract the tourists who visit San Diego and also the rich business men in California.

Middlemen involved in sales

Since our company is having outlets only in Los Angeles and California, in order to distribute our products to potential customers in other regions of USA, we are planning to have agencies involved in it. The main reason of having these agencies would be to handle operations in other parts of USA.

Gems and jewelleries are too risky to be outsourced to external agencies. Thus, we will be having our own internal agencies who will be working in different regions all over USA. They will be part of our employees and will be paid fixed fees on every transaction. Any additional payments will be on the basis of the number of sales they make. These agencies will be in regions such as, Tennessee, Arizona, Oregon, Idaho, Montana, Arkansas and Nevada. (Current Gemstones in United States, 2005-2009) These are potential places which have gem markets and also gem mines.

These agencies will not only be responsible for the distributions in the relevant regions but also will act as Competitor Intelligence (CI) through which our company will keep in track of the competitors' acts.

Advertising and Promotion

Advertising Media

In order to promote our gem and jewelleries successfully in the US market, we have planned of various promotional aspects which would enable us to reach the target markets successfully. On that basis, when it comes to advertising in media the following would be our marketing strategies.

Pricing Strategy

Customary Mark-ups

We are in the aim of taking our gem and jewelleries world by storm in the future. We do not have the same level of price mark ups for all our products. But, we do give the guarantee that the stones and jewellery we are selling genuine stones sourced and obtained by our company under the laws and regulations of USA. The reason why we do not have fixed mark-ups for our products is that the gems are exported from Sri Lanka which are truly genuine and are priceless. According to the customer and the value of different stones we keep a mark-up. But normally as all other retailers, the mark-up would be 300% or more. (Internet Forums, 2009)

Considering the above factors, we cannot exactly decide the prices of the gemstones yet the values of the stones can be revealed. Approximately the values of the gemstones would be as follows

In the above table ND stands for the value not disclosed because it would reveal proprietary information of small number of producers, included in totals.

Available Discounts

The discounts would vary from stone to stone and from purchase to purchase. Especially bulk purchases by consumers provide them with higher discounts than usual. Yet, the discounts would normally be a minimum of 5% to a maximum of 50% (The most widel traded Gemstones, 2009). Our company discounts will normally range as follows.

Compare and contrast your product and the competition's products

Direct Competitors

When exporting gemstones to USA we are bound to meet many competitors in the market, therefore we need to make sure that the gems and jewelry are up to high standard and with great quality to survive in the industry. The main three direct competitors are,

  • Tiffany & co
  • Macy's jewelry
  • Zale's jewelry

Tiffany & co.

Tiffany & co. is known for great jewelry and for good quality for more than 150 years where the diamonds found at tiffany's stores are difficult to be found in other stores unless special orders for that type of quality is made. (Jewellers, 2009)

They have many types of diamond jewelry starting form rings, bracelets, earrings, necklaces and pendants, and also engagement jewelry etc. packaging is done in a variety of ways but tiffany's is mainly famous for the blue box and the white bow which also has a hidden meaning of quality jewelry. Tiffany's also provide a full life time warranty where as if the diamond is not up to standard or as promised in the certificate they accept the jewelry back and provides with a refund of the full purchase price or a replacement with a diamond that meets each of the characteristics warranted. When a stone is cut for brilliance it may also loose size, and as known for "brilliance is our measure" tiffany's diamonds are cut for beauty not for size.

The price range will vary from $1,000.00 to $ 50,000.00 for all the diamond stud jewelry, (Jewellers, 2009)However when purchasing a tiffany diamond the customer gets a brand name which is easily identifiable, Therefore customers mainly pay for the name of the brand not just for the product.

Tiffany's promotional strategies are through websites which includes all the details of what's new in store and the respective prices and the outlets available in each city. Brochures, leaflets and billboards and jewelry exhibitions are also part of their promotional campaign to make the customer s more knowledgeable about the fine quality diamonds and jewelry available in store. (Jewellers, 2009)

Macy's Jewelry

Macys has gained its brand equity throughout the years and will be a major competitor to us in the market as they are similar and consist of many gemstones with jewelry, gemstones such as diamond, ruby, sapphire, semi precious gemstones, turquoise, diamonds, cubic zirconium etc. it is known for quality and supplies a variety of jewelry to its customers primarily rings, bracelets, watches, men's jewelry, fashion jewelry, necklaces and pendants etc. The jewelry boxes are packed in many ways with different colours to suit the taste of the customer and different shapes. The price range will vary from $500.00 to $10000.00 based on the customer's preference and the gem and jewelry type. (Jewellers, 2009) Like any famous brand mostly the price will be determined according to the brand as mostly the customers will have to pay a higher amount for the brand name.

Macy's uses different types of advertising and promotional methods to create awareness of what's new in stores and to gain customer loyalty. The promotional strategies are mainly promotional campaigns, billboards, leaflets, brochures, and magazine articles as gem and jewelry is a high end product and too much of publicity will cheapen the image of the product. Promotional campaigns will consist of events such as jewelry exhibitions where it will be easy access for Macy's to reach its customers. (Jewellers, 2009)

Zale's Jewelry

As most of the Americans prefer diamonds when wanting to purchase a gemstone Zale's jewelry can also be classified as a competitor to us in the gem and jewelry industry. They have been in the industry and had been trusted since 1924 by making fine quality high class diamond stud jewelry which is mainly watch's, bracelets, necklaces and pendants, rings and engagement jewelry etc. (Jewellers, 2009) The brand name is not so prestigious at Zale's but they do deliver fine quality diamond jewelry to its loyal customers and furthermore customers have to pay only for the piece of jewelry and not for the brand name as for the other competitors.

All the jewelry is packed and given to customers in unique jewelry boxes with different colours mostly to suit customer preference mostly in pink, blue and black at the Zale's jewelry store.

Distribution is done all around Los Angeles, California (Burbank Town center, Glendale Galleria, Citadel outlet, West Side Pavilion, Fox Side mall, Santa Anita Fashion Park etc.) so that it will be convenient for customers to go to the nearest store and purchase jewelry according to their choice.

The prices of diamond stone stud jewelry will be approximately from the range of $400.00 to $8000.00 and more varying according to the jewelry piece. (Jewellers, 2009) Zale's jewelers will also conduct exhibitions which are open for any person to come and purchase jewelry according to their preference and taste and the diamond cut quality they require. The promotions they will conduct will be the giving out of brochures, billboards, web site etc.

Market Size

Expected Industry Sales

USA is one of the largest market for Gem and Jewellery with 4% of the global Gems and Jewellery market. The expected industry sales in the domestic market for the year 2010 would be over US$ 10 billion. Apart from this the export market is expected to have a sales level of US$ 17 billion in the year 2010 which is around14% of the USA exports. USA accounts for about 20% of the world consumption in Gem and Jewellery and also one of the largest countries in the world known for diamond cutting and polishing. (Current Gemstones in United States, 2005-2009)

Expected Company Sales

In such a large market our expected sales for the planning year would be US$ 2.3 billion covering both the retail and the exports sales. This would be only around 8% of the industry sales. We are not expecting high sales in the planning year itself since it'll be of a great challenge to capture a place in such a huge market. Thus, through our jewellery retail outlets we are planning for a sale of US$ 0.8 billion and through gem stone exports a sale of US$ 1.5 billion.

Government participation in the market place

Procedure for Export of Gems

All Gem Exports should be channelled through the Exports Division of the National Gem and Jewellery Authority. ) Colombo & "Gem Centre" - Ratnapura or Gem Export Centre, Air Cargo Village, Air Port- Katunayake.

  1. The prospective Exporter should obtain a Gem Dealers License to cover the value of the merchandise to be exported.
  2. Exporters who wish to export their Gems should bring their goods to the Export Division N.G.J. A., before 3.00 p.m. on all working days & 12.00 noon on Saturdays with eight (08) Copies of Commercial Invoices, which are to be used as follows.
    1. Export Manager - Original
    2. Sri Lanka Customs - 2nd Copy
    3. "NGJA" Statistics Division - 3rd Copy
    4. 4th Copy to be used to make relevant payments to NGJA.
    5. Statistics Division (Customs)- 5th Copy
    6. 6th to 8th Copies are released to the Exporter. They are used to obtain Insurance Cover, for Airmail/Air Freight purposes, G. S. P. Certificate, "Carnet" Certificate and a copy to be retained by the exporter.
  3. Invoice
  4. The items will be examined at the Examination table by N.G.J. A. Gemmologist / valour and Customs Gem Appraiser / Gemmologist in the presence of the Exporter or his / her authorized representative.
  5. The sealed parcel is kept back with the N.G. J. A. and four copies of the invoice will be handed over to the exporter duly acknowledged by Export Manager; for the receipt of the parcel. Then the exporter is required to obtain insurance coverage for the parcel and pay the Export Service fee on F. O. B. The Exporter should get the Airway Bill from the respective Air Line Office and get a confirmation of the date and Air line which Air freights the Gem Parcel to the destination.
  6. On the day of collecting the parcels, Exporter should come to the NGJA, and particulars of the parcel have to be entered in the Releasing Register before 10.00 a.m. Air Mail parcels are released on all working days.
  7. The N.G.J. A. will check all the documents pertaining to the Export and release the parcel to Customs through Exporter enabling them to release the parcel to the Air Line (for Air Freight Parcels). After Customs formalities, are completed parcel (Air Mail) will be kept by Customs till it is released to the Post Office at the NGJA., for which the Exporter must bear the cost of air mail and stamp fees.

After having the above mentioned approvals exporter can send the gemstone to the exporter country.

Part Two

Marketing Plan

Executive Summary

With the clear idea about the company, the market and the products to be exported which are clearly and specifically mentioned in the Marketing Audit, the following will detail the information about the marketing and sales of our company in USA. This Marketing Plan would focus on the promotional aspects, distribution, price determination and also the estimated budget and the income statement for the year 2010.

This analysis would give a very clear idea regarding the process and possibilities of having a successful business in USA. It also highlights the vital aspects and how we are planning to market our product in such a competitive market which is totally different from our country Sri Lanka in ways of Culture, Technology, Economy, Politics and many more.

This analysis was carried out with the use of the primary data collected from our company and other companies in Sri Lanka who are similarly exporting to USA. The secondary data collection was done through the internet and the relevant books which gave us ample of information regarding the industry and the market in USA. Thus, we were able to complete the report successfully and were able to put forward a detailed Marketing Plan.

Marketing Objectives

Product adaptation or modification

Core component

The market for Gemstone is more or less based on demand and rarity. Most people pay more for variety of gems that are esteemed and that are hard to find. It is moreover easy to get attracted to a certain colour gemstone, and finding usually a synthetic or fake jewel that reflects just as the real thing. Real jewellery with the label "natural" or "genuine" would show a little bit about the origins and terminology of types of gems. (Import Inspection, 2007)

There are certain categories of gems that are allied with certain rock types. A person should be familiar with rocks; so that it will be easier to value with different types of gems that are common or extremely rare. For example, quartz is somewhat easy and frequently easy to find in nature. Though, gems can only be found in specific and limited environments, thus it is far more costly and valued.

Packaging component

There is a special packaging for Gemstones in order to sell the product in the market. Higher quality packaging material is used to pack the gemstones. For every purchase of a Gem the customers would be provided with authentic leather jewelry boxes layered with the company logo as a personal keepsake. Additionally, a purchase will arrive enclosed in a special glossy black Box, hand tied with a silver satin ribbon for every purchase. There is a Gift for every purchase .The customers will be impressed with the class, quality and distinctive design.

Support services component

To support the customers is a great pleasure because it will make the customers know the types of precious gem stones among the vast collection. Gem stones are undoubtedly unique gifts from Mother Nature and it is immensely important to preserve the natural quality and substance of the stone while cutting and designing to make the jewellery. It is important to provide high quality gemstone while preserving the genuine colour, shape and texture of the gem to the customers. Most of the Americans prefer gem stones, especially the Blue Sapphires and Rubies because they are world renowned for their great colour and value. Thus, the customers should be given to select the best gem stones when visiting to the store. Internet Forums, 2009)

Promotion Mix


Since the largest category in our advertising budget is likely to be the media costs, it makes sense to have a sound plan to manage that investment. The tool we need is a good media plan which helps us with every aspect of advertising. Advertising media refers to various means of advertising vehicles such as billboards, magazines, newspapers, television, and internet by which promotional messages are communicated to the public. The below mentioned advertising objectives would explain the importance of this particular area.


  • Raise awareness of the company & product by 25% a month, within the clearly identified target market.
  • To implement geographic coverage within the California and New York cities.
  • Communicate about the most precious and rarest gems available and the value for money of obtaining those.
  • Build confidence in the organization and achieve an average of 60% increase in the sales.
  • To be informative and encourage further information search for our product.
  • To create a reputation as the market leader in Gems and therefore increase brand recognition & loyalty.

Media Mix

"After understanding the various aspects of each media separately and the advantages and the limitations of each, we can conclude that no single media would be able to reach the target population individually. The advertisers need to prepare an extensive media mix in order to accomplish their objective of maximum reach and frequency." Thus our media mix for this particular campaign will be elaborated separately as follows. (Highlights, 2008)


We chose Television as our media vehicle of broadcasting for the advertisement to be aired & out of which especially ABC & FOX, since these were considered the most watched TV channels in California and New York.

Since most of the people are unaware of the company, we suggest the ads are aired 3 days a week between the time period of 7.00 pm and 10.00 pm during the initial first 4 months. The days have been scheduled as Wednesday, Friday & Sunday at a frequency of 3. These time slots were chosen because most of our target consumers gather around TV especially during this time.


The magazine ads will be published certainly in "The New Yorker" & "Diablo", which considered mostly being viewed by our target market. For these ads too, we must maintain a continuity method of scheduling for a period of 4 months and this will appear in the first quarter of the first page of the magazine. The selectivity of the target audience also specified by using the particular magazines and also there will be a reader involvement and acceptance towards the product. Since the selectivity is there, by counting down the circulation number, it could assure the effective number of exposures.


We are hoping to design 2 leaflets to be distributed among different groups of people. Through these 2 leaflets we are going to bring up emotional appeal which we would think will be more effective. The 2 leaflets will be distributed at different locations in the city centers and also near the company location. These may also distributed along with the weekly popular newspapers for the initial 6 moths.

Sales Promotions

Sales promotion can be identified as a planned and implemented marketing activity that boosts sales of a product or service for a short time. When considering the objectives and strategies of sales promotions, this can be divided into two main categories; pull strategies directed towards consumers and push strategies directing towards trade.

However, since Gems are considered as a high-end consumer product we do not think it is advisable to follow sales promotions such as coupons, buy-one-get-one-free, price deals such as discounts because this will cheapen the image of the product. It is understood that the high prices of the Gems alone conveys the quality and up-class of the product. There are a very few sales promotional methods we are able to effectively use. This would include premiums and buying allowances.


The objectives of conducting the sales promotions are as follows:

  • Induce customers to immediately purchase and increase short term sales.
  • Be informative about the rarest Gems available.
  • Target a special market segment
  • Create awareness and encourage the agents to market the precious gems.


In this scenario we have planned to provide a product based offer which is a good quality wrist watch along with the purchase of a gem priced above 10,000 USD. We planned to implement this strategy basically due to the fact that the consumers will be way more satisfied that they really got something very valuable for what they spent. This will be initially given free during the first three months after the launch.

Buying Allowances

The main objective of carrying out such a trade promotion is to promote the sales in B2B market and to persuade the agents to buy our gems and resell them to end consumers. Buying allowances would be so essential to market our product since our company is entirely new to the US Gem Industry and will be an effective strategy to adopt.

Distribution: from origin to destination

Port selection

We are exporting gems to United States by Airplane. There are two essential factors to be concerned before exporting gems to USA. Those are Security & custom Import Duty & charges. Due to security reasons gems should be air freighted in small quantities and should avoid exporting through sea freight. The buyer arranges all his own insurance, name of plane for loading and the buyer is also responsible for USA import taxes and duties. When we export gems to US, there should be Export permit & airway bill.


Gems boxes are made of Linen and there are different colours and sizes. This will added value to the core product. The display of the package increase their sales .The boxes are made in 100 % cotton and recycled paper board. This indicates the environmentally friendly and the positive image towards the environment. These boxes are thinner as well as stronger but it will cost more than normal packaging.

Packaging will vary according to New Year, Christmas, and Valentine's Day seasons. So there will be more seasonal demand for creative and new designed packaging that will enhance the value of Gem stones. We also provide custom built and designed packages for special occasions as an example for weddings we provide customer specialized packages, and for valentine's Day celebrations we deliver the best quality materials with supplementary gift with every Gem & jewellery box. When exporting gems from Sri Lanka to USA all exporters must insert their gem stones in special aluminium tin.

Insurance claims

Therefore per each gem stone exporter will have to pay Rs.300.00 and the insurance amount will vary according to Value of the Gem stone as insurance fees.

Distribution channel

Below shows a chart of distribution channels of gems and jewellery in the USA market. Jewellery manufacturer sells to agents/wholesalers and there after the chain will continue where agents/wholesalers will sell to jewellery shops/ departmental stores/mail order suppliers who directly will market the product to the consumer/end user.

Import/ Export Agents

When choosing an agent a comprehensive research much be done regarding their infrastructure as to whether they are capable of handling proper distribution to get maximum sales. Once a few agents are short listed and scrutinized with very careful analyzing the best agent must be chosen since gems are a very special commodity catering to the up market. The agents should be closely scrutinized in Los Angeles and California to evaluate the market so that wealthy clients will do their purchasing in places the agents deliver goods. (Distribution, 2008)


The final result of the sales would depend upon the ability of the retailers to sell the jewellery to the customer therefore they must be chosen with utmost care. The up market areas should be decided upon to display the jewellery. Los Angeles and California has many wealthy customers and these customers mostly shop in particular areas which have a combination of high fashion clothes shoes and other accessories and the retailers should be found from these areas where they would display the jewellery to the highest enticement. Usually these are shopping complexes and retail jewellery shops are within these complexes. A basic survey should be done about the cliental who visit these areas to decide upon the retailers. (Distribution, 2008)

Price Determination

Handling charges levied by Export Division for gems

Submission of Export documents through a handling agent is a requirement of the Sri Lanka Customs. Without a handling agent, customs would not accept the import or export documents for processing. For every export order as handling fee on Consignment basis 0.70% on the FOB Rupee Value + 15% VAT


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