Over 2,000 jewelry stores close down amid losses in domestic, foreign markets
Elif Ergu - ISTANBULAround 2,000 jewelry stores were closed down in Turkey last year as jewelry spending has decreased amid limitations on credit card installments and consumers instead spending on electronics and vacations, according to sector representatives.
The sector has also been losing blood amid dramatic decreases in neighboring countries, including Iraq, Egypt and Russia, they added.
“Our sector has seen a serious contraction. Some 2,000 of 26,000 jewelry stores were closed down last year,” said Emil Güzeliş, the owner of Turkey’s leading jewelry exporter, Zen Pırlanta.
According to Güzeliş, this shrinkage is mainly led by a change in consumer behavior in Turkey.
“Turkish consumers have now flocked to mobile phones, electronics products or holiday reservations rather than jewelries, which were once quite popular,” he said, adding that now buying jewelry rarely comes to mind.
Turkey’s banking watchdog, Banking Regulation and Supervision Agency (BDDK), began allowing the credit card payment of jewelry and gold in four installments as of October 2014, after a ban on installments that lasted around one year. The decision pleased many sector representatives, who have been complaining about decreasing sales due to the number of installments in other sectors being much higher, thus creating competitiveness disadvantages for them.
Installment payments when buying technology are still limited to nine months, but this limit has been increased from 9 months to 12 months in furniture, home appliances and educational payments since the end of 2015.
Güzeliş noted that the sector has been in a disadvantageous position compared to other sectors and said an extensive promotional campaign needs to be launched to increase sales.
The head of the Jewelry Exporters’ Association, Ayhan Güner, said the sector unfortunately lost some of its largest markets in 2014, such as Syria, Iraq, Egypt, Ukraine and Russia. Turkey’s jewelry exports decreased by 14.6 percent in 2015 to around $2.7 billion compared to 2014 with the exception of gold sales.