OriginallypostedbyTomnickian

THEMANWITHTHEDIAMONDTOUCH

ARTICLE|2NOVEMBER,200712:05AM|BYCLAIREADLER

ClaireAdlerisaLondon-basedluxurygoodsjournalist.

LaurenceGraffispossiblythemostimportantjewellerintheworldtoday.However,asheengagesinasignificantexpansionprogrammeforthebusiness,thesizeofhisfamilyispartofthechallenge,asClaireAdlerdiscovers…

Securingaface-to-faceinterviewwithLaurenceGraffisnoeasytask.WithhomesinLondon,NewYork,CapFerratinthesouthofFrance,Geneva,aFeadshipyacht,aGlobalExpressSRSplane,awineryandvineyardinStellenbosch–theNapaValleyofSouthAfrica–andawell-knownpreferenceforavoidingthepress,Graffissomethingofaninternationalmanofmystery.Thenagain,morethanalmosteveryotherfinejewellerinthebusiness,hesuccessfullypilesheapsofmystiqueontotheeye-poppingdiamondshesells.

Tojewelleryindustryinsiders,hisisahouseholdname.Worthanestimated$2.5billion,Graff,69,hasprobablyhandledmoreimportantdiamondsthananyindividualthiscentury.TheSultanandQueenofBrunei,OprahWinfrey,ElizabethTaylorandDavidandVictoriaBeckhamcountamongGraff'slongstandingclients.

TheGraffempire,whichlastyearpostedaturnoverof$400million,issplitbetweenGraffDiamondsInternational(GDI)andSafdico.GDIincludesallcorporateoffices,jewelleryworkshopsandretailstoresworldwide.Thecompanyhas27Graffstoresglobally,fromLondonandTokyotoKuwaitandLasVegas.Thereisevenastoreonboardtheluxuryfivestarcruiseship,theResidensea.

Safdicoisaworld-classdiamondcompanywithofficesinJohannesburg,NewYork,Geneva,MauritiusandAntwerp.Safdico'sworldwidediamondmarketinganddistributionnetworkspecialisesintop-endextraordinarydiamonds,whichincludetheQueenofAfrica102caratintenseyellowcushiondiamondandtheSafia90.97caratDFlawlessroundbrilliant.

Inareassuringexampleofhowthediamondindustryishelpingthelocaleconomyandgivingemployeesaqualityoflifewhichwouldn'thavebeenavailabletothem,Safdicoemployssixdeafpeoplewhoarebeingtrainedinfancypolishing,whilelecturerscomeandspeaktostaffaboutHIVandprevention.

Laurence'sbrother,Raymond,isproductiondirector,whilehisson,Francois,43,ismanagingdirector.Francoisjoinedthecompanyin1986,aged22.LaurencehasbeenmarriedtoFrancois'Frenchmotherfor45yearsandthecouplehavetwootherchildrenwhohavechosennottojointhefamilybusiness–Stephaneisanartistandwriter,whileKistelleownsridingstables.Laurence'snephewandRaymond'sson,Elliot,managesthedesign,diamondbuyingandmanufacturingofGraffjewellery.

Rawambition
WhentheimmaculatelydressedGraffenterstheairyboardroom,whichissurroundedbyvastpaintingsandaflatscreenswitchedtoBloombergTV,itisimpossibletoforgetthelegendaryjourneyhehasmadetogethere.HespenthisfirstsevenyearsinasingleroomwithhisJewishRomanianmotheronCommercialRoadinLondon'simpoverishedEastEnd.Aged14,hismarksatschoolweresopoor,hisfamilyencouragedhimtofindatrade.

Anewly-releasedcoffeetablebookaboutGraffdocumentshow,aged15,hewassackedafterthreemonthsathisfirstapprenticeshipatajewellernamedSchindlerinLondon'sHattonGarden,wherehisdutiesincludedgoingouttobuysandwichesfortheworkers.ButGraff'sunstoppablepassionfordiamondscombinedwithrawambitionandatalentforbuildingclientrelationshipsbroughthimimmensesuccess,evenatasurprisinglyyoungage.

"IwasveryobservantasayoungboygrowingupintheEastEndofLondonandwantedtolearneverything,"remembersGraff."Iwasbroughtupfromanearlyagewiththevaluesofhonestyandrespectandthesehavestayedwithmeallmylife.IwasmakingjewellerywhenIwas15andwhenIsawmyfirstdiamondthissetoffapassioninmethathastakenmeallthewaytobeingknownasoneoftheworld'sleadingdiamantaires.Eachstonehasapersonality.There'ssomuchgoingoninsuchasmallgem.Theprocessofcuttingandpolishingastonethatcomesfromthegroundisthesameirrespectiveofsize."

At17,makingStarsofDavidinhisfreetimeatabenchinhisparent'shousetoselltofriends,LaurenceGraffcouldnothaveimaginedthathewouldopenover20storesgloballyandreceivefourQueen'sAwardsforEnterprise.Duringhis20s,GrafftravelledtotheFarEast,holdingbi-monthlyexhibitionsatSingapore'sdepartmentstore,Robinsons,forgingrelationshipswithMalaysian,IndianandChineseclientswhohaveremainedloyalclientseversince.

In1974GraffopenedhisfirstmajorretailstoreinKnightsbridgewherehewelcomedclientsfromallovertheworld."TheSultanofBruneicameintothestoreandsodideverymemberoftheSaudiArabianroyalfamilyandotherMiddleEasternfamilies,"remembersGraff,whowasalreadyapersonalfriendoftheSultanofBrunei'sbrother,PrinceSufri.

GraffroutinelyhelpedhisnewlywealthyArabclientsfindtheirwayinLondon,connectingthemwithdoctorsanddrivers.WhenSaudiprincessesreturnedfromtheirshoppingtrips,theywouldchangeintotheirnewclothesinGraff'soffice.Oneunforgettableday,SaudiPrinceTurkibinAbdulAzizwalkedinunannouncedandboughtouttheentireshopincludinga14caratdiamond.

In1987themostsuccessfuljewelleryauctioneverwasheldinGenevaforthejewelsbelongingtoWallisSimpson,DuchessofWindsor.GraffboughttheWindsorYellows,apairoffancyyellowpear-shapeddiamondsof51.01and40.22caratsrespectively.Graffalsoboughtthemosthistoricandsentimentalpieceofall–theDuchessofWindsor's19caratemeraldengagementring."ItisoneofthefinestemeraldsIhaveeverseen,'hewasquotedassayingatthetime."I'vegottheoriginaljeweller'sinvoicewhichwasmadeoutto'TheKing'."Graffgavetheringtohiswifefortheir25thweddinganniversary.

Lastyear,whenthe15thlargestroughdiamondeverdiscoveredcametolightintheMalutiMountainsofLesotho,thepresidentofLesothohimselftelephonedGraffimmediatelywiththenews.Withindays,diamondexpertsfromSafdico,Graff'smanufacturingandtradingarm,wereinLesotho.

InAntwerp,biddingpartieseachspentfourhoursexaminingthe603caratroughstone.Twodayslatertheyhadpresentedtheirsealedoffers.Atarecord-breaking$20,500percarat,Graffsecuredthestoneformorethan$12million.

InMay2007,thefirstcutwasmade,markingthestartofastressful,timeconsumingandpreciseyear-longoperationtotransformthishugeroughcrystalintomagnificent,flawlessdiamonds.Thereisnotry-before-you-buywithroughdiamonds,soGraffdevelopedcuttingedgesoftware,toolsandcuttingmachinesspeciallyfortheLesothoPromise,asitwasnamed,andithassinceyielded26stones.

Integratingbusinessandfamily
Graff'sbusinessbecamethefirstinthediamondindustrytobeverticallyintegrated–ie,takingadiamondallthewayfromacquiringitintheroughthroughtosellingjewelsinhisownshops.VerticalintegrationcontinuestogiveGraffaleadingedgeintheindustry,andthebenefitsmeanthecompanycanproduceatamorecompetitiverateandofferamoreexclusiveselectionofthefineststonestoclientsworldwide.Theintegrationofmanufacturing,craftsmanshipandretailmakescommercialsenseandcallsfornewskillstocomplementtraditionalones.

GraffbuysdiamondsintheroughfromminesinCanada,Australia,RussiaandSouthAmericabutthemajoritycomefromAfrica.ManyarefromthePremierMine,oneofSouthAfrica'soldestminesstillyieldinghighqualitystones.GraffisalsoaDTC(DiamondTradingCompany)sightholder,whichmeansitisoneof93selectedcompaniesin33countriesentitledtobuyroughdiamondsfromtheDeBeerssalesandmarketingarm.

Today,inordertomakethisverticalintegrationcompleteandcapitaliseonthebenefitsthiscouldbring,Graffiskeentobuyamine.LastyearhisattempttoacquiretheLesotho'sLetsengminefellthroughjustweeksbeforetherecord-breakingLesothoPromisewasdiscovered.Graffwillnotsaywhereelseheissearchingforaminetopurchase,butitisclearthatowningamineisahugeandexpensiveinvestmentandsometimesunpredictable–thesupplyofdiamondsneedstobeconsistenttojustifythecost.

Despitethesedifficultiesassociatedwithexpansion,Graffadmitsthefirstmajorchallengehefacesisfindinggoodpeople."Takingapersonintoyourcompanyisliketakingsomeoneintoyourfamily,"hesays."Itdoesn'tmatteraboutthereferences,thetruthprevailsintheend."

Graffinsiststhattheworkingrelationshipbetweenfamilyandnon-familyisgood,buthesays:"Themainproblemwithworkingwithfamilyisthattherearen'tenoughofthem.SometimesIwishIwasanIndianwithahugefamilyaroundmetojointhebusiness.Jewellerybusinesseshavetraditionallybeenfamilybusinesses.Whenyousellsuchexpensiveitems,trustiseverything."

GrafffullyintendstohandthebusinessovertosonFrancoisoneday."Thegoodpartisthatafamilymemberknowsintheirheartthatonedaytheywillpossesssomethingveryspecial.Butwhenthingsgetdifficult,familymembersarehardertofire.It'salsoeasiertoloseyourtemperwithfamily,"hesays.

Thesecondmajorchallengeisfindingexceptionalstonesandbalancingthestockintheboutiquesroundtheworld."Diamondsareminedeveryday,butqualitydiamondsarenot,"saysGraff.

BurgeoningdemandfromChina,IndiaandRussiahascontributedtoanincreasedshortageofdiamonds.ButGraffdoesn'twanttodelveintotheissueofhowheplanstofindenoughdiamondstokeephisshopsbrimmingwithtreasures.

GraffisnowconcentratingonAsianexpansionduetosoaringgrowthinrecentyearsoftheChineseandIndianeconomiesandtheincreasingnumbersofmiddleclasseswithdisposableincome.

EverypieceofjewelleryatGraffisaone-off.ThesameGraffadvertisingimagesareusedinbothEasternandWesternmarketsanditisnotunusualforGrafftoseethesameclientsatdifferentlocations.Hiscustomerskeeponreturningforhisrarediamonds,timeless,classicaljewelleryandworld-classcraftsmanship.

Yetdespiteseveralnewstoreopenings–TokyoandHongKongthisyear,GenevaandNewYorkin2008,andmoretofollowinShanghaiandBeijingin2009–haven'tsomeofGraff'smostseriousbuyersofhighendjewellerytakenahitoverthesummer?

"Therearemorepeopleouttherewithmoremoneythaneverbefore,"maintainsGraff."ThesurgehasbeenboostedbynewmoneyfromRussia,ChinaandIndiawhichinitselfisreshapingtheveryhighendofluxuryevenasglobalmarketstakeaslighthit.Newmoneyisspentmoreeasilythanoldmoney.Thereisanexpression,'Makeiteasily,spenditeasily'.Ibelieveweareinaboomnow."

Anartform
Askmostjewellerstodaywhoorwhattheirrivalsare,andmostciteholidaysorhighspecelectronicgoods.YetGraffsuggestsart,hisself-confessedsecondlove,isarivaltojewellery.WithanaveragecustomerspendatGraff"ofatleastsixfigures"accordingtoGraff,he'sprobablynotfarwrong."Wehavepiecesfor£5,000allthewaytoseveralmillions,"hesays.

Graffhimselfownsamodernandcontemporaryartcollectionestimatedat$250millionandelementsofitadorntheGraffofficesonAlbemarleStreet,Mayfair,includinganacrobaticwhitesculptureofsupermodelKateMossatthereception.

ThevastmajorityofGraff'sjewelleryproductiontakesplaceinGraff'sheadquarters,intwoadjacent18thcenturytownhousesinMayfair,acoupleoffloorsbelowthecompanyboardroom.Here,inaworkshopthoughttobethelargestintheworldforhandmadejewellery,diamondsettersandpolisherssurroundedbythemostadvancedlaserweldingmachinesonthemarketandtopqualityLeicamicroscopessitinanairy,spotlessroom.Between400and600piecesareproducedheremonthly.

Morethananyotherjeweller,Graffalignshimselfcloselytotheartworld,andtoartcollectorsinparticular,byexhibitinghisjewelseveryFebruaryattheprestigiousInternationalFineArt&AntiquesFairinPalmBeach.ForGraff,thelinkbetweenjewelleryandartisnatural."Iconsiderdiamondcuttingoneofthegreatestartformsthereis,"hesays.

FEATUREDINISSUE:

Lawrence Graff is now 81 years, with estimated worth around $4.8 billion USD

So he survived the GFC.

bbd.