Mines to Market

Mr. Yoav Efrat Sarine India Pursues Flawless Consumer Confidence with AI. Mr. Yoav Efrat, who joined Sarine Technologies 7.5 years ago, has a broad background in technology. During most of his career at Sarine, he has worked closely with diamond manufacturers and retailers, gaining deep insights into their operation and needs. One year ago, Mr. Efrat took on the role of Director at Sarin India. He spoke to Mines to Market on the recent opening of Sarine’s lab in Mumbai, and the improvements it expects to bring to the Indian diamond industry. He also briefly reflected on the impact Sarine has made in the Indian diamond industry so far, and the purpose of Sarine’s new digital report app. As he noted, “Sarin India is a large company, which is very proud of its contribution to the Indian diamond manufacturing industry. We have witnessed a remarkable change in diamond manufacturing in India during the past 20 to 30 years, and are grateful to be part of it through our technological products that are part of almost every plant... We see our role as partners of the Indian diamond manufacturers, supporting them in building their businesses into modern mega factories using the very latest technologies.” “Our latest activities cover three different areas. First, we aim to keep on providing products that bring value to the manufacturing process. Second, to provide value-added solutions to the downstream market of the diamond pipeline. And third, to see how we can connect the entire pipeline with our new Diamond Journey™ reports that tell the diamond story from rough stone to polished diamond in the jewelry setting.” What is your objective for the Sarine Technology Laboratory in Mumbai? The lab provides enhanced diamond grading reports that help to strengthen the brand and better communicate with consumers in today's changing retail environment. The Sarine reports include the traditional 4Cs, and also advanced imaging, light performance, the diamond journey, which tells the story of the diamond from mine to jewelry, and more. As the pricing of diamonds is derived from the parameters that are graded in labs, it is essential that the reports be as accurate as possible. We are proud to bring a new level of accuracy by grading diamonds with AI-based technologies. Mumbai is the world’s largest diamond manufacturing hub, which means it is the most efficient place to grade the majority of the world’s diamonds. Therefore, Sarine Technology Lab in India has a major role and significant importance. How will this lab support your overall presence in India? The lab is a natural step for Sarine that has a strong presence in India for the past fourteen years, since the establishment of Sarin India a fully owned subsidiary of the Sarine group. We believe that with these additional services, we can give our customers added value for a broader range of needs. The connection between the manufacturers and the end consumer is getting closer, and we are excited to be part of this process. Our vision has always been to support our customers with services that answer their needs today and tomorrow. We are also starting to offer cost-effective solutions to document a diamond throughout the manufacturing process - presenting the diamond's journey A core advantage that we have in doing it is based on the fact that we have a very big install base of products from rough planning throughout polish scanning at our Indian customers' facilities. What market gap are you addressing with your reports that include the broadest range of polished diamonds parameters available today? First and foremost, it is important to note that the Sarine lab is a digital, technology-based lab, so Cut grading, Clarity grading and Color grading, is done by machines. Of course, we also have gemologists who supervise the process and ensure no errors occur. However, the concept is one of an AI-driven lab, the first of its kind in the world. These advanced technological capabilities are what makes it possible for us to provide such a comprehensive range of diamond parameters beyond the 4Cs, and even to improve on the 4Cs grading processes that exist today. The development of AI-based diamond grading is a unique breakthrough for Sarine. AI is the most advanced way to tackle a problem that has multiple variants and dimensions, which is what makes it such a good fit for the complex issues surrounding Clarity grading. AI effectively trains the machine as if we are training a gemologist. With machine learning, the more diamonds analyzed by the technology, the smarter it becomes. In addition, AI technology can maintain levels of consistency that are simply impossible for any human being. The same grading will be applied whether it’s in Tel Aviv, in New York, or in India. But the advantages go beyond grading and trade to the retail environment too. Our Sarine Profile™ diamond reports are designed to engage the end consumer – visually, intellectually and emotionally – with the facts about the diamond, presented in an incredibly intuitive digital format. So, to sum up, we try to bring digital solutions that solve problems both in the trade and retail sectors, primarily by building up customer confidence. Speaking of AI-based grading services, how will it deal with today’s market challenges? One of the market challenges today is to create the most accurate and repeatable grading that will instill confidence in consumers. Now, we know that technology can achieve this. A good example is the Cut grade, which used to be very inconsistent, but since the advent of automated Cut grading in the 1990s, it is now taken for granted that Cut grading is very consistent. The biggest challenge with Color and Clarity grading is that a linear system could not provide a good-enough solution that is consistent on the one hand, yet able to imitate the complex and difficult manual aspects of grading on the other. After many years of research, we have reached the conclusion that the only way to tackle this challenge is through AI-based technologies – the development of machine learning products, which actually learn how to grade diamonds in a similar way that professional graders do. This is a very exciting and revolutionary step, and we are delighted to say that the results have so far are very satisfying and significantly better than human grading. How do you view your global expansion plans? In today's market, we must be able to give customers a global offering that addresses their flexibility and efficiency requirements. Sarine Group operates throughout the diamond industry worldwide, both directly and indirectly, including labs and service centers in the world’s key diamond trading hubs and manufacturing centers. The definite plan is to add more labs around the globe. Having said that, we do see India as the main hub for diamond grading, and this will not change in the foreseeable future. Any comments on the expected revenues from this lab in FY2018-19? As a public company, we do not share our forecast with regards to revenue of certain activities. What is next from here, in India? The Sarine Technology Lab is just in its initial stages. Strategically, we intend to broaden our offering so it will solve many of the issues that the market is currently struggling with. For example, Sarine introduced Light performance solution to measure real actual light return of a diamond. This approach brings a total different way to grade a diamond that is both objective and very different from the traditional 4C triple X commodity that everybody sells. One of the new to come out is the Sarine Diamond Journey™, a digital experience that shows the whole process from mines to market. At the end of the day, the B2B2C trade must become more efficient, and diamond grading must advance in a way that will allow such evolution. If not, it will become harder for the diamond industry to compete with other luxury goods markets that are advancing very quickly.

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