Selim Chidiac steered L’azurde from a private equity firm into a public company. Now he is expanding the jewelry business with niche brands and there are golden opportunities ahead.
“In this part of the world, frankly, there’s no jewelry brand that compares to L’azurde,” says Selim. “We understand what the Arabic woman wants.”
Rooted in the region and with a 40-year heritage of luxury and craftsmanship, Selim has a point. The brand undertakes research every year to best understand the products that are required for different occasions, from weddings and Eid celebrations, to gifting and Valentine’s Day, and is continuously developing new products adapted for the requirements of the Arabic lady.
Always seeking perfection and precision, L’azurde excels in the art of jewelry design, and prides itself on being able to transform any inspiration into a unique masterpiece. With an uncompromising focus on quality and craftsmanship, the brand has evolved to become the largest gold and jewelry designer, manufacturer, distributor and retailer in the Middle East, and one of the largest jewelry manufacturers worldwide.
Selim joined L’azurde in 2010, from the role of CEO for Red Bull North America. Never one to sleep on an opportunity, his arrival came just after a buyout of the formerly family-owned company by a private equity consortium.
“I came because I wanted to be part of the transformation of a family business into a strong corporation with state of the art systems, processes and corporate governance,” he says, “and this offered the perfect opportunity.”
Leading the transformation of the company, Selim spearheaded the development of corporate governance and implemented growth strategies to grow topline – as well as increasing net income to make it more efficient. Subsequently, L’azurde was listed on the Tadawul after completing its IPO in 2016.
“I concentrated on developing the organization and getting much more out of the existing employees in the company and the leaders in place,” says Selim. “We also did a refocus on our key customers and key products and worked a lot on optimizing our financing costs and strengthening relationships with the lenders. Now, our business collaborates with six major financing institutions in Saudi Arabia.”
In just seven years, the company translated from private equity into a publicly listed company. It is now entering a new phase of acquisitions, acquiring the franchisee for global fashion jewelry brand TOUS in Saudi Arabia for 188 million Saudi Riyals – the biggest ever – and potentially only – acquisition happening in this domain.
Selim says: “TOUS is playing into what we call the affordable fashion jewelry segment, which is the fastest growing segment globally and also rapidly growing in the region. Already a leading brand in Saudi Arabia, it perfectly complements our existing assortment with more accessible price points of between 500 and 2,500 Saudi Riyals, whereas entry-level pricing at L’azurde starts at 3,000 Saudi Riyals. Most importantly, TOUS has major potential to grow here. The population is extremely young – with 70 per cent below 35 years old – and there is a strong bonding between Arabic women and gold and diamond jewelry.”
Indeed, there is plenty of room for development at L’azurde across the board, with many new collections launched in Saudi Arabia and Egypt, the source of 80 per cent of company revenues. Additionally, there is export demand for the brand, both within the region and internationally and Selim’s plan is to look at adding further brands to the portfolio.
“The jewelry industry is highly fragmented, with many niche segments that cannot possibly be covered by one brand,” says Selim. “Consumers habits are changing. They have different needs to previous generations and are looking for lighter, less formal pieces that they can wear every day. That’s why our strategy consists in acquiring few strong brands to help us develop the company.”
Internal developments are also expected, with the next 12-18 months forecast as an exciting time. The group employs some 2000 people and takes its human capital very seriously. It is now focused on employing more Saudis and developing them. It invested in a full-time staff, dedicated to furthering the potential of all employees. Little wonder then, that most employees spend more than 15 years with the company on average.
Selim explains: “We have a very comprehensive, sophisticated scorecard where we can track almost everything in the company, from production efficiencies and sales capabilities, to the productivity of employees, and benchmark as much as possible to other publicly listed companies whenever the information is available. We always seek enhancement and efficiencies in our operations and financing costs. At the same time, we also focus heavily on employee development, performance and retention. Many companies underestimate the potential of investing in employees. For me, this is not a cost, it’s an investment.”
Promoting pioneering attitudes to the workplace goes hand-in-hand with L’azurde’s spirit of innovation. Fifty per cent of the company’s yearly revenue comes from new products, and it works incessantly to inspire and delight its consumers, often working at the forefront of technology to achieve this; L’azurde was one of this first in its industry to benefit from 3D printing, for example. Supply chain competency is intrinsic to supporting this philosophy and smooth operations, and Selim highlights “regular communication, transparency, sharing of information and focus on the 80/20,” as core to how the company deals with suppliers. Every month the company welcomes technical and design consultants to understand its requirements and adapt new machines or develop new technologies for its own production. It is fully integrated, not just with third-party suppliers for manufacturing in Saudi, but with players in Italy, Germany and Japan. L’azurde doesn’t deal with middlemen, preferring to go directly to source, securing the best outcome at the best prices.
There’s another future forecast that Selim sees as hugely relevant to the business. He says: “With the economic reforms and developments happening now in Saudi Arabia and across the region – women working more, becoming more independent and the general overall employment of Saudi nationals in the region – I believe the jewelry industry can only benefit.”