Forever: de Beers & Us Anti-Trust Laws Essay example
Case Study Presentation
Group 9 – The Explorers
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 …show more content…
Historically owned 85% share of the diamond market, is now facing challenges from new found mines in Africa, Russia and Australia. This clearly calls for a change in their business model and the need to venture into the US market. However, legally, De Beers is in violation of the U.S. antitrust laws and is therefore being prohibited from selling directly in the U.S. market. The problems have been identified and recommendations for the same have been made to help them move into the U.S. market and finally conclude with implementation steps for the solutions that have been recommended.
1Source: World Diamond Council
The De Beers Way of Doing Business
Majority of diamonds from mines were sold to De Beers. External buying offices would compete with purchasers buying from outside. De Beers sold them 10 times a year at