29 May The effect of COVID-19 on Jewellery prices in South Africa
And how it might influence your jewellery value
The Covid-19 pandemic is a well-known topic today, it has impacted not only our health systems but also the entire economic structure worldwide. Similarly, the jewellery industry has also been impacted dramatically. In this blog, we’ll be discussing how the industry has been impacted and how you can actually benefit from it.
COVID 19 can’t really have a literal effect on product prices, however, since the pandemic started the value of the Rand has dramatically dropped compared to other currencies.
Price impact on Jewellery
Wondering how does this affect jewellery in South Africa? The summed up answer is that the majority of the components of what jewellery is made of is Dollar based. For example, gold is priced in dollars – and we all know that the dollar price of gold has also increased significantly.
For instance, a 1 oz Krugerrand is priced at R34,000 today (21 May 2020). Interesting enough, we’ve seen many clients that want to buy Kruger rands yet no one wants to sell right now. This might be because most people think it will become more expensive in the future – hence the demand.
The same principle applies to Silver, Platinum, Diamonds and other Precious Gemstones which are all quoted in US dollar. The decline of the Rand value against the dollar since March 2020 when the pandemic started, will affect jewellery prices and the value of certain items will increase by roughly 20-25%.
Impact on High-End Watches
Have a valued watch? The same is true with watches. Watches from international brands are all imported and priced in dollar. Therefore, they will see a similar increase of up to roughly 25% too. Our watch expert, Deonne Le Roux had a discussion with the importers of a luxury brand, and the consultant pointed out that a watch that sold for R85 000 in March 2019, will sell for R115 000 at the import costs today.
Take action today!
Your Jewellery and Insurance
You can avoid losing out on an insurance claim if you have your jewellery revalued.
First of all, get all your jewellery revalued at the new price and update your insurance with the new value. In the event that you have to claim and you are undervalued, your insurance company may pay out only a fraction of the insured cost. Unfortunately, there will be nothing you can do about it and you’d be left in a situation that you can’t replace your beloved jewellery.
Unfortunately, insurance companies are also notorious for sending you to their ‘trusted jeweller’. These jewellers supply the insurance company at significant discounts which can sometimes mean that you don’t get the same value or quality before your loss.
Therefore we suggest to ask your insurance broker to add an addendum to your policy that you would like to use a jeweller of your choice. Let’s explain with this analogy:
If you had a Chanel lipstick that cost R1 600, your insurance can’t send you to get a new R300 lipstick from Clicks, just because it is similar in colour.
Similarly, different jewellers have different styles and quality. The legal principle for insurance is ‘for your compensation or replacement that you are in the same position as you have been before the loss. If your jewellery is valued at the correct price, and the valuation describes the items well, it makes it so much easier to negotiate with the insurance to get a fair replacement for your loss.
Buy Jewellery NOW at a lower price
How can you benefit more? With the current state of the economy, the Rand value is likely to drop even more. This will result in jewellery price skyrocketing even more. Therefore we believe it will be wise to buy jewellery items NOW before the prices increases. You might never get jewellery items at this price again.
Get a Jewellery Valuation
We provide a jewellery valuation service at Deonne le Roux Jewellers. If you have jewellery items previously valued by us, you can have a huge saving by providing us with the original certificates for an updated value. We will also be able to do this by email without visiting the store.
Furthermore, if you want to get a jewellery valuation for your beloved pieces you can also get in contact with us.