Page 1 of 9
Journal for Studies in Management and Planning
Available at http://internationaljournalofresearch.org/index.php/JSMaP
e-ISSN: 2395-0463
Volume 02 Issue 03
March 2016
Available online:http://internationaljournalofresearch.org/ P a g e | 151
Study On Critical Success Factors In Gem Industry in
Beruwala
Musthafa Lebbai Fathima Haseena
Assistant Lecturer,Department of Management, Eastern University,Srilanka.
Email:haseefathima96@yahoo.com
Mohamed Nisam Mohamed Mishkath
Trainee,Goodhope Investment Pvt Ltd,Colombo
Email:mnmmishkath@yahoo.com
ABSTRACT
During the historical times Sri Lanka is world
famous for gems and it was known as the land
of gems. Many valuable gems are taken to
different parts of the world from Sri Lanka.
Ratnapura is world famous precious stones and
gem mining.
Gem industry plays a major role in Sri Lanka’s
economic development. Their contribution to
the national income is high but they are facing
greater challenge in the modern business
environment under tough competition, rapidly
changing new technologies and globalization.
So it is important that they have to clearly
understand the factors which will lead to the
success.
Therefore, this research study intended with
the title “Critical success factors of Gem
industry in Beruwala D.S Division”. Here the
success factors include Good management,
Marketing factors, Finance, Personal qualities,
Education & Training and Experience. The
success factors were analyzed based on the
conceptual framework given by Yusuf Attahir,
1995.
Further 100 gem traders were taken under this
study. The structured questionnaires were used
to collect data and Convenience sampling
method was used to get primary data. The
collected data were analyzed using Univariate
and Bivariate method using SPSS 19.0 package
for convenience and reliability.
This research gives better understanding of the
factors influencing on the success of Gem
business in Beruwala D.S Division. This will
also help gem merchants to clearly identify the
factors that they need to give more priority in
order to success in the business.
In addition to the above, the study offers
suggestions to the gem merchant for their
future survival and success.
Keywords: Good management, Marketing
factors, Finance, Personal qualities, Education
& Training and Experience.
INTRODUCTION:
Sri Lanka‟s gem industry has a very long and
colorful history. Sri Lanka was affectionately
known as Ratna-Dweepa which means Gem
Island. The name is a reflection of its natural
wealth. Marco Polo wrote that the island had
the best sapphires, topazes, amethysts, and
other gems in the world. Ptolemy, the 2nd
century astronomer recorded that beryl and
sapphire were the mainstay of Sri Lanka‟s gem
industry.
Records from sailors that visited the island
states that they brought back “jewels of
Serendib”. Serendib was the ancient name
Page 2 of 9
Journal for Studies in Management and Planning
Available at http://internationaljournalofresearch.org/index.php/JSMaP
e-ISSN: 2395-0463
Volume 02 Issue 03
March 2016
Available online:http://internationaljournalofresearch.org/ P a g e | 152
given to the island by middle – eastern and
Persian traders that crossed the Indian Ocean to
trade gems from Sri Lanka to the East during
the 4th and 5th century.
Sri Lanka, geologically speaking is an
extremely old country. Ninety percent of the
rocks of the island are of Precambrian age, 560
million to 2,400 million years ago. The gems
form in sedimentary residual gem deposits,
eluvial deposits, metamorphic deposits, skarn
and calcium-rich rocks. Other gems are of
magmatic origin. Residual deposits are mainly
found in flood plains of rivers and streams. The
metamorphic types of gems constitute 90% of
the gem deposits in Sri Lanka. Sri Lanka has
the highest density of gem deposits compared
to its landmass. Ratnapura contains the most
gem deposits and derived its name from the
gem industry. Ratnapura means “city of gems”.
The blue sapphires from Sri Lanka are known
as Ceylon Sapphire. Ceylon Sapphires are
reportedly unique in colour, clarity and lustre
compared to the blue sapphires from other
countries.Sri Lanka became known as
RatnaDeepa (The Island of Gems). Some of the
rarest precious stones in the world are found in
abundance in the reach earth under our feet and
the hills above us. Among the Several world
famous gems Sri Lanka‟s blue sapphire
Weighing 466 carats. The largest known
sapphire in the world. Weighing in at 19kg was
also discovered here. Other famous gems
include the Blue giant of the Orient, Weighing
nearly 500 carats and the bluebell of Asia,
which weighs in at 400 carats.
The renowned Sri Lankan Star sapphire is on
permanent display at the Museum of Natural
History in New York, but due to an oversight,
the stone has been called the star of India.
throughout history Sri Lanka‟s gems and
jewellery have adorned the crown jewels of
many a royal family. A gem- a 105 carat cat‟s
eye- discovered in a paddy field in Sri Lanka,
gained fame among the royalty of Britain and
was Successively Admired by Edward VII,
George V, Edward VIII and Queen Elizabeth.
The process of mining for gems is begun at an
auspicious time with a short religious ritual.
The most common methods of mining are in
pits and by tunneling. Surface gemming and
dredging depends on the location and the types
of deposits stones are normally found in a layer
of course, pebbly material, which contains
traces of clay and fine sand. This gravel
containing gems is referred to as “illam” and is
found just below the alluvial deposits.
History of Beruwala Gem Trade Centre
The area known as “China Fort” in Sri Lanka‟s
southern coastal town of Beruwala is renowned
worldwide as a gem trade centre .China fort‟s
gem merchants and the miners of Ratnapura
the Gem City in the Sabaragamuwa Province
have been together in the business for
centuries. Almost the entire neighborhood of
China Fort has been in the gem trade for
generations. Much of the gem world‟s coloured
precious stones are traded through these
merchants.
Beruwala‟s gem trade dates back to the era
when Berber‟s from North Africa‟s Barbary
States-Algeria, Libya, Morocco and Tunisia,
dominated the seas from the Mediterranean to
the Indian Ocean. Berber merchant ships called
at Beruwala (Perhaps named after the Berbers -
Moors).
Page 3 of 9
Journal for Studies in Management and Planning
Available at http://internationaljournalofresearch.org/index.php/JSMaP
e-ISSN: 2395-0463
Volume 02 Issue 03
March 2016
Available online:http://internationaljournalofresearch.org/ P a g e | 153
The place where their vessels anchored came to
be known in later years as Berberyn Harbour
from where the Berbers crossed the length and
breadth of Sri Lanka in search of spices and
precious stones. They also went on
pilgrimmage to “Adam‟s Peak” known to
Buddhist‟s as Sri Pada- helped by guides from
Beruwala.
Their descendants in this island came to be
known as Ceylon Moors who carried on the
gem trade with much dedication. In fact, they
are the ancestors of the majority of present day
Sri Lankan Muslims.
In the early days Sri Lanka‟s natives called the
Moors “Mukkara” and their descendants
“Morokalae” from which “Marakkala” – The
Sinhala term for this community -originated.
Even today a gem cut in the traditional style is
called “Mukkarage” cutting.
Pathea (Beruwala China Fort Gem Market)
Gem Trade Fair
On a daily basis the bazaar is active from
10:00am to 2:30 pm, with thousands of people
coming to Pathea gem market which is
centrally located in the hill top of China Fort.
Gems are brought from all round the country
and also from other parts of the world such as
Madagascar, Tanzania, India, Burma,
Mozambique and Malawi in the rough form.
Buyers from all parts of Sri Lanka as well as
India and Indonesia come here to make their
purchases.
The State Gem Corporation
The State Gem Corporation plays a vital role in
the development of the gem industry of the
island. It annually holds courses in gem
identification and lapidary training.
Among the basic operations of the corporations
are the testing of gems for genuineness,
Certification and assaying of jewelry to
determine the gold content or cartage of the
items. The spectrum of activity of this
institution ranges from the mining stage,
through cutting and polishing to selling the
finished product, which of course includes
exports. It is situated in Colombo.
National Gem &Jewellery Authority
As there was a need to implement
strategies and policy priorities for the
development of the gem and jewellery industry
of this country, National Gem and Jewellery
Act No.50 of 1993 was implemented. With the
implementation of this act on 1st March, 1993
the State Gem Corporation, which survived up
to then, ceased to exist.
PROBLEM STATEMENT
Gem traders play a major role in Sri Lanka‟s
economic development. But they are facing
greater challenge in the modern businesses
environment under tough competition, rapidly
changing new technologies and globalization.
Most of the Gem Merchants start and running
the business only for a very shorter period, they
cannot sustain for a longer period of time. This
is mainly because they did not clearly identify
what are critical success factors for them. So as
a solution to this problem, this research is
carried out to find the critical success factors of
the Gem industry in Beruwala.
OBJECTIVES OF THE STUDY
1. To find out whether Good
Management is important for the
success of Gem business
2. To determine whether marketing
factors are important for the success of
