Ashraf Ahmed, of Diamond Infinity in Dubai, says that investing time in your customers will lead to bigger profits down the track.
Money&Me: Nurture relationships to build up your business
Ashraf Ahmed is a merchant for Diamond Infinity, a company he set up at the Dubai Multi Commodities Centre. The Briton, who lived in the UAE as a child before returning in 2005, sells the precious gems to jewellers in the Emirates, as well as privately to collectors and individuals.
Describe your financial journey so far.
I first realised the value of money when I was a freshman in college in Florida. My dad only gave me enough money for the tuition and the boarding fees and so, to earn more, I sold hairbrushes and surgeon's T-shirts at a flea market and worked for Domino's delivering pizzas in the evenings. It was a pretty hectic time. I was being bred to enter the banking field because a lot of my family are in banking, but when I graduated in 1985, my dad left his job and we opened up some retail outlets in Orlando, Florida. We started with one and ended up with five. It was a great first introduction to business. I managed the whole outlet, including the staff, the pricing and all the marketing for the tourists coming in - something that has helped me here in Dubai, where we also cater to tourists.
Why did you become a diamond merchant?
Ten years ago, I was in the property business and while I was always interested in diamonds, you need quite a bit of capital to enter the market as a dealer. One of my friends was a diamond dealer and talked to me about setting something up. So, when I felt I'd sold enough property, we started working together in Hatton Garden, the diamond district of London. We opened here in September 2005. I've been in the business about nine years and I love it. You come into contact with wealthy people and it's a nice, clean business.
Are you a spender or a saver?
I come from a pretty wealthy background, but my father always said, "You've got to save" and I'd say, "Yeah, yeah dad, things have moved on". But now I have kids, a daughter, 11, and a son, six, and have to pay for their education and their holidays, I have converted from a spender to a saver. I watch every penny because, frankly, I have to.
What is your philosophy towards money?
Value it. During the global crisis, sales we took for granted died and it was up to us to enter new markets. If you look on Google, we are second or third on the world rankings right now and that has brought me a lot of business - probably about 10 to 15 enquiries a day. It took a lot of effort from us because Google monitors every negative feedback, so we have to be careful not to oversell or undersell.
What has been your most valuable financial lesson?
How to deal with losses. I've bought a lot of property in London and Dubai and my assumption was that property would always go up. But I failed to understand that Dubai was an immature market and during the crisis, unlike in the UK and the US, prices here fell by over 50 per cent. Dubai just bombed, but that's what woke me up and taught me to be careful. I live in my villa in Dubai Marina, had four other properties, of which I've sold three at a profit, and another villa in Ras Al Khaimah, which is stilll under value.
Have you experienced any financial difficulties along the way?
Money is something that never comes easily to me. As well as losing a lot in property, I also lost money on the stock market in the early 1990s, when I first got married. I've always had to work really hard for my money, whereas others earn loads and work less. I questioned what I was doing wrong and then this life coach came into my life eight months ago and she tells me it's an internal block and I make it hard for myself because I believe in no pain, no gain. She's told me to think about money as a magnet, with money flowing in. It's weird, but it's slowly shifting that way for me now.
What has been your biggest financial challenge?
To venture out on my own without a business partner. My partner was based in the UK and while I have always been very optimistic about Dubai, he didn't feel the same way. So in December last year, I sold him one company and kept this on my own. It took a lot of courage, but I'm doing very well.
What do you like to invest in?
Creating long-lasting relationships. When a client comes to me, it's not just about the money they are going to hand over. It's about how they feel and the rapport you create with them - all that leads to money at the end. If you come across as somebody who can't be trusted, the sale will die.
Are diamonds a good investment?
I had clients from Russia, a nice old couple, who came to me in 2009 and bought six two-carat diamonds for US$150,000 (Dh550,995). They said they had lost faith in their currency, didn't trust the banks and planned to sell the diamonds after two years. Even though the market went through a correction last year, those diamonds have gone up in value by 25 per cent. I collect diamonds myself as well. I foresee a big increase in the diamond price over the next 10 years because supply is going down. Diamonds are not as erratic as gold; it's a very docile investment.