De Beers Paper

For centuries, diamonds have been regarded as one of the most valuable commodities in the world and the industry has evolved into billions of dollars. At the top, De Beers dominated the entire industry worldwide, from exploration to retail selling. However, it has a reputation of a monopolist, where it influences supply and demand. The two critical factors that De Beers carefully maintained throughout the century to remain in monopoly was to create the illusion of the scarcity of the diamonds and to keep the prices high. Realizing the benefits of the cooperation and the dangers of the oversupply, most

Identify and describe the most important components in the specific and general environment - be specific in your description of how these factors will impact the company’s performance. Use appendices for supporting data.

The De Beers Group of Companies established itself in the diamond industry in the late 1800’s and it was only a matter of time until De Beers owned virtually every diamond mine in South Africa. Diamond distributors joined up with De Beers because of similar interests: they wanted to create a scarcity of diamonds, so that high prices would follow. Eventually, De Beers would establish exclusive contracts with suppliers and buyers, making it impossible to deal with diamonds outside of De Beers. For the remainder of the 20th century, the business model was the same: A subsidiary of De Beers would buy the diamonds and De Beers would determine the amount of diamonds they wanted to sell, and at what prices. In turn, De Beers funneled all of the

Thesis: The extremely strong chemical structure of diamonds contributes to its unique chemical and physical properties, which allow diamonds to be used for a variety of practical applications.

In developed countries, a diamond signifies love, status, beauty, and endurance/strength; however, in developing countries such as Africa, the diamond symbolizes torture, extreme labor, and exhaustion. The idolization of diamond rings began in the 15th century when Archduke Maximilian of Austria presented Mary of Burgundy a diamond ring upon the suggestion of “a faithful advisor who counseled: “At the betrothal Your Grace must have a ring set with a diamond and also a gold ring” , thus it became a public demonstration of marriage (http://www.thenaturalsapphirecompany.com/education/sapphires-as-heirlooms/the-history-of-engagement-rings/). Diamond rings are also given within marriage on significant anniversaries such as the 60th, as a symbol of the marriage’s longevity. As these gems became more highly demanded, businesses started looking for

A diamond is the hardest natural substance on Earth and is made of pure carbon(Rossi 1). Diamonds are formed in extreme heat, usually reaching around 2,200 degrees fahrenheit, meaning that they come from the world’s warmest countries. These countries that many of the world's diamonds are mined in include Russia, South America, or Africa(Bindenagel 2). Diamonds can be used used as a gift to a loved one, a parent , or a child, but many do not know the history of where these diamonds are coming from. A conflict diamond also known as a blood diamond, is a diamond that is mined from slavery and is sold to finance wars, rebels or a warlord (Calderwood 2). Conflict diamonds were first introduced to the world in 1935 when the De Beers,the leading

2 - Identify which of the SWOT factors are most critical to the organization’s on-going success and discuss why they are critical.

Diamonds are commonly known for their stunning lustre, representing innocence and constancy. Not only do diamonds have tremendous admiration for their beauty and meaning, their unique chemical structure gains appreciation from scientists across the globe. The word diamond originates from the greek word adamas, which means indestructible. Provided diamonds are the hardest substance on the planet, the definition has significant reason (Helmenstine, n.d.). Having an estimated age of 3.2 billion years, the incredible strength of diamonds allows them to maintain their composition despite significant changes in their environment (Geoscience News and Information, 2015).The extremely strong chemical structure of diamonds contributes to its unique chemical and physical properties, which allow diamonds to be used for a variety of practical applications.

In a lot of jewelry commercials, the main point is “he went to ‘name of store’” with the ring being a diamond one. A popular way of selling an engagement ring by telling the consumer where they should buy their engagement ring. The engagement ring, specifically ones with diamonds, is an interesting concept that is known as a widespread tradition. One compelling notion is that a person has to spend three months’ salary to buy one is also compelling. Some people would say that to be truly considered engaged you would need to have a diamond. They also believe that diamonds are forever. The concept is that diamonds are worth a lot more than other precious stone like emeralds and sapphires or semiprecious stone like ambers and pearls. The price of diamonds is very high, and it can be higher depending on the company and quality of cut. A lot people are worried that a lot of diamonds used for the rings may be blood diamonds, also known as war’s diamond, which are diamonds that have been mined during war, so some claims that their diamond came from another source such as a lab. The idea that diamonds are worth a lot of money is highly debatable because of how they are processed. Are diamonds even worth the cost?

Diamonds have become the ultimate symbol of luxury and money and are highly valued throughout the world today. However, in the spectrum of time diamonds have served a variety of other purposes. Diamonds were formed 3.3 billion years ago by extreme heat and pressure within the earth and are formed entirely out of carbon, making it the hardest natural surface known to man (debeers.com). Archaeologists believe that early humans actually used diamonds as spear heads and other tools. However, over time diamonds have become a luxury good, connected with much prestige. The high status of diamonds helped create the diamond rush that would forever alter the fate of South Africa.

Suggest five (5) ways in which the primary stakeholders can influences the organization’s financial performance. Provide support for the response.

For more than a century the diamond industry has flourished beyond expectations. The diamond has grown from a small yet rare gem stone to that of a rather large and powerful symbol of wealth. The industry has been controlled by one major corporation, De Beers. De beers along with the cartel it set up has built an industry that will last forever. (Spar, 2006) This paper will analyse the diamond industry, paying specific attention to the cartel, how it operates; the future of the system and examine what the price of diamonds would be without a cartel system and a brief history on the diamond industry. Furthermore, it shall comment on the statement that the “The Diamond Price is Too High” and analyse why

Bury carbon dioxide 100 miles into the Earth and heat it to about 2,200 degrees Fahrenheit. Then place it under the pressure of 725,000 pounds per square inch and quickly rush towards the earth’s surface to cool. What would that result in? A diamond (Bain & Company, 2011 p.3). Otherwise known as the quintessential token of love and promise. Diamond consumption, particularly diamonds as engagement rings, is much higher in the United States in comparison to the Czech Republic, due primarily to better brand development, which we can see in the synonymous nature of diamonds equating to love, and a stronger, more developed consumerist mentality.

“A Diamond is forever.” Or is it really? For about 80 years, the De Beers diamond company has pulled off one of the best marketing schemes a company could wish for. Indeed, how much would you estimate your diamond engagement ring wrapped around your finger? A fair amount would be the right thing to say. However, the compressed carbon stone is worth less than anyone would imagine, which is why De Beers has been so successful, which, thanks to a good use of marketing as well as strategy, has led the entire planet to believe that diamonds are rare, luxurious and expensive stones. They are the leader in their field, as De Beers’ diamond output from their own activities is about 40% of the world’s total rough diamonds. The key to their success

Diamonds are the most expensive and beautiful jewels in the world. Throughout the mankind’s history these desirable, exceptional, and alluring gemstones have been attracting much attention. Uncut stones decorated the armor of knights and faceted ones embellished the crowns of royal persons. The owners of diamonds were adored and envied as crystals were sparkling on noble ladies and fascinated all the people around them. Nowadays, diamonds are viewed not only as symbols of love and betrothal, but also as profitable object of investment. The first such gemstones were found in ancient times in India. However, people do not know the exact date of their discovery. At the beginning of the Renaissance period diamonds appeared in Europe with great fame (Epstein, 1982). For many centuries people had believed that they had some anagogical power like bringing success to their owners, protecting them from diseases and wounds, and giving courage and bravery during the battle. In European countries symbolic interpretation of diamonds was very broad and included steadiness, courage,