Moissanite gemstone maker Charles & Colvard named Marvin Beasley to be its new CEO on Wednesday.
Beasley, who has been on the Morrisville company’s board of directors for the past five years, replaces Randy McCullough, who informed the board that he was retiring on Tuesday after five years as CEO.
Beasley, 71, retired in 2009 after a 44-year career in retailing. He spent nearly 20 years at Helzberg Diamonds, including serving as the company’s CEO from 2004 through 2009.
In an interview Wednesday, Beasley said Charles & Colvard’s challenge is to drive sales growth and reduce the company’s large amount of inventory, which today is about equal to its annual sales.
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He takes over at a time when the company has fallen out of favor with investors. Charles & Colvard’s stock has fallen nearly 70 percent over the past year, and closed Tuesday at $1.18, down 2 cents. Last week the company reported a net loss of $13.1 million, or 65 cents per share, in 2014, compared with a net loss of $1.3 million, or 6 cents per share, in 2013.
Charles & Colvard sells its gemstones to wholesalers and directly to consumers through an e-commerce website, Moissanite.com, as well as through Lulu Avenue, its home party business. Sales through the company’s website increased 37 percent last year, while Lulu Avenue sales rose 252 percent. Beasley said the company will invest in marketing to drive more sales through both of those channels.
He said the company is also focused on building up its wholesale business by getting Moissanite gemstones sold in more retail stores. The wholesale business accounted for 74 percent of Charles & Colvard’s sales last year.
A Moissanite gemstone, which is made using material supplied by Durham LED maker Cree, retails for about 10 percent of the cost of a diamond. The diamond industry views the product as a threat, Beasley said. “The big hurdle to getting it into a retail environment somewhere in a mall setting is it reduces their average ticket,” Beasley said.
To expand its availability, Charles & Colvard will have to convince both consumers and retailers of the product’s appeal.
Beasley, who lives in Kansas City, plans to spend the work week in North Carolina working out of Charles & Colvard’s Morrisville office and fly home on the weekends. The company has about 80 employees.