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<em>Jeweller</em> looks at the <em>Hits & Misses</em> of the jewellery industry in 2015
Jeweller looks at the Hits & Misses of the jewellery industry in 2015

Jeweller's Hits & Misses 2015

After a hectic 12 months and as jewellery retailers get set for what is hoped to be a very busy Christmas and New Year trading season, COLEBY NICHOLSON reviews 2015 with his annual list of the industry’s highs and lows.

From the outside looking in, one could be excused for thinking the jewellery industry would be a quiet, subdued and orderly affair but nothing could be further from the truth. Now in its fifth year, Hits & Misses aims to remind the Australian and New Zealand jewellery industries about the successes and failures of the past year while listing the surprises, shocks and, in some cases, plain idiocy that took place.

Shouldn’t, couldn’t.

The year was again full of important news and events – most of which we reported, often thanks to tips from our readers. There were, however, lots of outrageous rumours and gossip that didn’t make the final ‘news’ cut and were instead kept for Hits & Misses.

For example, was there any truth to the rumour about a brown paper bag of cash being unexpectedly handed to someone in charge of an overseas buying trip? When the recipient questioned the other person he was apparently told it was the ‘traditional commission payment’ on orders.

Oh, and the reason for cash in a brown bag? Well it saved on bank fees and forex charges!

We are confident that a well-organised overseas crime gang operated in Sydney during the International Jewellery Fair and at least one supplier was targeted; however, the police would not confirm our information. In fact, we have reason to believe the NSW Police were on full-scale alert prior to the event, which explained their large presence at the Sydney trade fair.

We never did get to the bottom of last year’s scuttlebutt about a high-profile Sydney jewellery business being raided by the Australian Federal Police. That said, not all the rumours and goss are about ‘serious’ matters.

What’s the story about two well-known industry ‘identities’ agreeing to pre-order matching red Mustangs after a few (too many) drinks one night? If true, I can hear the (very) loud laugh now!

There seems to be some confusion as to whether the Mustangs have been delivered but we don’t believe there is any truth to the rumour that the two cars have ‘Meals on Wheels’ signage on the doors! Mind you, they are a crazy bunch over there, so who knows!

As always, we’ve attempted to report on the important issues affecting retailers and the wider jewellery industry and at the same time have a little fun along the way. We hope you enjoy our last effort for the year before closing for the break.

Without further ado, Jeweller presents 2015 Hits & Misses – and, as I have said before, if you’re left scratching your head don’t fret it’s not lice … it’s simply the jewellery industry!

If we can’t laugh at ourselves who can we laugh at? The Jeweller team wishes you an excellent Christmas and New Year trading and please beware of speeding red Mustangs!

 

CLICK ON THE SUB-HEADINGS FOR FAST-TRACK NAVIGATION

Brien Winther, Pandora Australia president
Brien Winther, Pandora Australia president

 

Biggest surprise

This is one of the easier categories to judge each year because Biggest Surprise pretty much chooses itself. Last year is a good example when Michael Mishevski, CEO of Showcase Jewellers, was asked to stand aside while an investigation was conducted into matters relating to the buying group’s operations. Mishevski had been with Showcase for nearly two decades.

Prior to that Karin Adcock was the winner of Biggest Surprise for two consecutive years – and was only pipped to the post by Mishevski last year – for more farewells than John Farnham and Dame Nellie Melba combined.

Interestingly the Biggest Surprise this year relates to both the buying groups and Karin Adcock and came in February when Pandora announced that it would stop dealing with Australia’s three jewellery buying groups as it moved to introduce standardised trading terms across its retail stockists.

The surprise decision to end the long-standing relationship was met by the heads of each buying group with a combination of shock, disappointment and pragmatism.

Essentially Pandora’s move meant that the three groups, representing more than 800 stores, would no longer receive discounts and/or rebates, thereby affecting each groups’ financial positions.

As if that wasn’t enough to shock the industry in the New Year, Pandora decided to do it again at the end of 2015 with a ‘private and confidential’ email about newcomer jewellery brand Alex and Ani, distribued by Adcock's company House of Brands. 

Taking an unusual step, Pandora president Brien Winther issued an ultimatum to Pandora stockists that they could not stock both brands. That’s two big surprises for the year … that’s a lay down misère as far as I am concerned.

Stay tuned; I think we are set for an interesting 12 months ahead!

Result: Hit or miss – you decide

Previous winners
2014 - Showcase Jewellers CEO asked to stand aside
2013 - Karin Adcock shock return to the industry
2012 - Pandora’s Karin Adcock calls time
2011 - Indian jewellery company buys Zamels

Tata Consultancy Services: "We ensure the highest levels of certainty and satisfaction"
Tata Consultancy Services: "We ensure the highest levels of certainty and satisfaction"

 

What were they thinking?

We’ve had some classics in this category over the years. In 2013, the winners were the dills who stole $2.4 million from their own store and last year I detailed the Cobra Effect and how it related to the jewellery industry, in particular India's gold market.

Coincidentally, this year’s award winner relates to India again. In October, it was discovered that the GIA’s database was ‘hacked’, with more than 1,000 diamond grading reports being fraudulently altered.

Two employees of Tata Consultancy Services (TCS) – the contractor responsible for supporting the GIA’s databases – were arrested for making the unauthorised changes, and the GIA also suspended the client accounts through which the questionable diamonds had been submitted.

Now, I am no IT expert - I have enough trouble answering my smartphone - and you can call me stupid, but I would have thought that if you have the knowledge and skills to illegally access a database to commit a crime then surely you are aware of things called ‘digital footprints’.

Apparently not! These dills will be facing long-prison sentences.

As an aside, it might be wise for TCS to review its website given that the arrest of its employees was reported internationally. For example, TCS might like to reconsider its ‘Careers’ page, which advises prospective new employees that TCS is, “Looking for top-flight professionals committed to creating and implementing innovative solutions that help transform businesses.”

Well you can’t argue with that, can you? I mean, fraudulently altering 1,046 diamond grading reports is “innovative”, right? And their employees certainly were "committed"!

In addition, the company describes its business as providing, “the highest levels of certainty and satisfaction through a deep-set commitment to our clients, comprehensive industry expertise and a global network of innovation and delivery centers.”

Methinks it’s time for a review.

Result: Miss ... Do not pass go. Do not collect $200, go directly to jail. 

Previous winners
2014 - 
India tackles huge increase in gold smuggling
2013 - Jewellers steal $2.4 million from own store
2012 - Zamels, making the same mistake twice!
2011 - John Abolins and Jewellery World, for making the same mistake twice!

Hatton Garden Safe Deposit Ltd­ - not so safe!
Hatton Garden Safe Deposit Ltd­ - not so safe!

 

WTF OMG

This year we have reported on a large number of jewellery robberies, and while these types of stories are never positive, there was one that definitely made us think "WTF OMG".

The high-profile UK Hatton Garden heist involved about £200 million (AU$418.9 m) in jewellery and other items being stolen from a security deposit business over the Easter weekend. The crime was said to be one of the largest ever committed in the UK – it made international headlines and was likened to the elaborate thefts that appear in Hollywood movies.

The thieves reportedly abseiled down an elevator shaft and drilled through a two-metre-thick, concrete-reinforced vault wall to gain access … pretty impressive but that wasn’t what really made us go WTF OMG.

You see, police eventually identified the culprits and appropriately labeled them “Dad’s Army”. We say appropriate because the crazy thing was that this elaborate heist wasn’t pulled off by a group of fit, young lads but rather eight men with ‘greying’ or ‘white hair’. They ranged in age from 48 to 76 and it was said that one had a limp, while some appeared to be hard of hearing during court proceedings!

[Now, this writer would like to make a confession; assuming I reach the ripe old age of 76 I hope my health and agility would allow me to consider abseiling down an elevator shaft to take part in a jewellery robbery. That’s a mean feat by anyone’s imagination.]

According to reports, several suspects have admitted their guilt with some of the stolen loot being recovered. Others, however, are continuing to deny the charges. The trial is ongoing.

Result: Miss

Previous winners
2014 - Jeweller caught trading $2 million of stolen goods
2013 - KFC jewellery store finally unlucky
2012 - Lesbian love triangle
2011 - Stupid online poll

MARTIN RAPAPORT ­calling for heads to roll
MARTIN RAPAPORT ­calling for heads to roll

 

best punch up

We’ve had some almighty punch-ups over the years. Who could forget the Kiwis with their year-long ‘donnybrook’ when the three New Zealand jewellery industry associations – yes there are three! – took it upon themselves to initiate a brawl that resembled the famous Hatfield–McCoy feud that lasted 28 years in the US.

At one stage a Kiwi jeweller said: "We can't even remember why we hate each other!"

And we shouldn’t forget the Australian equivalent either when, in a most unusual move, the JAA decided to beat up itself by encouraging local diamond buyers to source their goods overseas rather than support Australian diamond dealers and/or its own JAA members.

Who better to pick a fight with than yourself, right? You can't lose … or win!

While those winners are now distant memories, this year’s victor of the Best Punch Up award goes to … the 2014 winner!

Yes folks, last year’s Martin Rapaport v The Diamond Industry title fight has gone on to become Martin Rapaport v The World. Mind you, I did predict that the battle would continue in 2015 and wrote at the time, “this brouhaha could go on forever because there isn’t even a referee.”

Most people would agree that Rapaport has been fighting the good fight over the rights and wrongs of diamond grading but the crusade has now been extended to calling for heads to roll in the diamond mining industry.

Rapaport believes that rough diamond prices have been manipulated to artificially high and unsustainable levels and has blamed the situation squarely on the shoulders of De Beers CEO Philippe Mellier.

To date, no heads have rolled and, while originally a Shakespeare quote, I wonder whether next year we will see Martin Rapaport dressed as the Red Queen from Alice In Wonderland shouting, ”Off with his head.

Click to watch video
Click to watch video

 

 

 

 

 

I doubt that Mellier was head over heels with Rapaport’s story calling for his head, but I am sure that this punch up will continue in 2016 and it should be noted that, sometimes, many fights are required in order to win the battle.

Result: Hit ... as in kapow!

Previous winners
2014 - 
Industry called to fight diamond over-grading
2013 - New jewellery group emerges
2012 - Jewellery Association creates its own furore
2011 - New Zealand jewellery industry for a year-long punch up

Jewellery World found its third owner and continued to promote a magazine that had closed
Jewellery World found its third owner and continued to promote a magazine that had closed

 

say what?

The media are supposed to be communication experts – I mean that’s our job, right? To communicate a story to an audience!

It’s true that some stories can be complex and difficult, especially when it involves seeking information from many people, but accuracy is paramount. Given this, I must say it’s a very sad day when the media can’t even accurately report stories about itself or themselves!

So it was though when it was announced that industry magazine Jewellery World would close after 34 years of publication. On 11 May an announcement was issued stating, “Jewellers Trade magazine recently purchased Jewellery World and is proud to announce that the two magazines will become one from July 2015 … For the rest of 2015 the magazine will be released under the masthead ‘Jewellers Trade incorporating Jewellery World’ and will continue to be a monthly magazine.”

That was pretty straightforward right? Well, no, not for our friends at Jewellery World.

Exactly one month later, on 11 June, a second announcement was issued completely contradicting the first: “As I am sure your [sic] are aware Jewellers Trade will no longer be published but will become one with Jewellery World and be published as Jewellery World but now on a monthly basis.”

Say what? These seasoned media professionals were effectively interviewing each other about their own takeover deal, issuing media releases (about their media!) and they still couldn’t get it right!

Could it get worse? At the time of the announcements, it was emphasised that the changes would create an opportunity for both magazines to concentrate on what was “important to our industry”.

Interestingly, the news that Jewellery World was closing as a stand-alone publication and that the magazines were merging was not announced on either of the magazine websites. Mind you, the last story posted to the Jewellery World website was on 15 April – eight months ago; so much for reporting on what’s important to the jewellery industry!

And if you think it couldn’t get worse (or more confusing) … it does.

Imagine what Jewellery World readers thought when they received the magazine only to find it carried full-page ads (image above) with a special offer for Jewellers Trade readers long after Jewellers Trade had closed!

Say what? Months later these seasoned media professionals still couldn’t get their own media message right!

To top it off, Steven Haywood was surprised to find that the article he wrote for the Jewellers Association of New Zealand’s (JANZ) monthly column in Jewellers Trade suddenly appeared without notice in Jewellery World. Haywood was also bewildered because Jewellery World had listed him as JANZ chairperson, which he is not. 

Normally these sorts of mishaps would be identified and corrected by an editor whose job it is to maintain the editorial integrity and standard of a magazine however, Jewellery World doesn’t have an editor or at least doesn't list or name one. As if that isn’t unusual in itself, the magazine does list the names of two advertising sales reps – so is it any wonder confusion about the magazine still continues under it's third owner! 

Astute industry observers will not find any of this surprising given that it’s coming from the same people who named a jewellery business that had collapsed in its “Top 100 Supplier” awards then, to top it off, couldn’t count to 100 anyway!

Result: Miss, as in mistakes and mishaps galore

Previous winners
2014 - Diva jewellery stores shutting down, or maybe not!
2013 - Jewellery World Top 100 List only includes 70!
2012 - Man swallows diamonds at trade fair
2011 - Second place to Kiwis

Bausele, Australian-designed, Swiss-made watches
Bausele, Australian-designed, Swiss-made watches

 

new product

Each week we showcase the latest and greatest jewellery and watch products hitting the market and in 2015 well over 300 were featured from a wide range of suppliers, both large and small.

As has been the case in previous years, while the high profile international brands like Pandora, Thomas Sabo, Endless Jewelry and Nikki Lissoni featured well; smaller home-grown brands often caught our readers’ attention.

Indeed, this year’s most popular new product was a watch by Bausele Australia.

It should be remembered that the list is compiled by gauging reader interest via online views and is not indicative of anything other than reader curiosity. It is not a measure of sales but it nevertheless does show the wide range of product that captures our readers’ interest.

The Top 10 were:

  1. Bausele Australia
  2. Ikecho Pearl Company
  3. Fabuleux Vous
  4. Stones & Silver
  5. Miglio Designer Jewellery
  6. TWM Co
  7. Monaco Court
  8. Mark Milton
  9. Coeur de Lion
  10. Himalayan Treasures

Previous winners
2014 - TWM Co
2013 - X by Trollbeads
2012 - Pandora
2011 - Ice-Watch

* The measurement process also takes into account the length of time each story has been published on jewellermagazine.com and attempts to be a statistically relevant measure of reader interest.

JANZ letter of apology but won
JANZ letter of apology but won't tell members

 

weird & crazy stuff

We’ve had some crazy winners of this award and I thought it would be hard to beat last year’s first place holder – the intriguing jewellery industry identity and journalist known as the “backyard chicken farmer and avid cat lover and jewellery maker”. However, this year may take the cake.

Unmistakably, the weirdest conversation I had in 2015 was with Greg Winegar, president of the Jewellers Association of New Zealand (JANZ). I decided to call him when a number of Kiwi readers pointed me to the official monthly JANZ report published in Jewellers Trade/Jewellery World where Winegar made some odd and rather bizarre comments about Jeweller and I.

It was a confusing article because it was about politics in the Kiwi jewellery industry and not only did the topic have nothing to do with Australia, Jeweller or myself, it raised issues of ‘bias’ without explanation or logic.

Given the article was completely bizarre, I called Winegar to seek clarification. At first he denied making the allegation until I read his own words back to him. After the long silence I asked him whom I was biased against. He said he didn’t know. I asked him why he thought Jeweller was biased; he didn’t know that either.

After a few more questions of which he couldn’t answer, he said the comments came from others on the JANZ committee. Who? He didn’t know that either!

But wait … Winegar then admitted he was not a subscriber to Jeweller and therefore could not offer an explanation about anything to do with the magazine even though he made allegations in the JANZ report.

He did, however, promise to seek further information from Brenda Chalmers, JANZ’s trade group executive about his own article! 

As if this situation wasn’t already weird, long-time readers will know that, when it comes to accuracy, Chalmers has her own ‘form’. In 2011, it was established that claims she made in an email to JANZ members were untrue and resulted in the resignation of the then JANZ president, Mark Beckett, out of disgust.

But back to the current president … after a few more emails, Winegar offered a formal apology because he agreed that, not only was Jeweller totally irrelevant to the issue being debated in his report but he also couldn’t offer an explanation as to why he made the comments.

Winegar was keen to end the matter so we could “work together and move forward”, which was fine by me. Normally when errors of judgment occur in the media, the apology is published to the very same audience that read the original offensive/defamatory remarks.

Well, not in this case! You see it would appear that JANZ didn’t want the error and mea culpa exposed to members or, perhaps, suffer the embarrassment of the two competing associations knowing what happened – given the original article was proposing goodwill, peace and harmony in the jewellery industry (Oopsie!).

JANZ refused to publish the apology to its members or advise them about the saga and its error even though my logic to Winegar was very simple: You published allegations for members to read so you should broadcast the correction to the same members, admitting the error and providing your members with the full facts.

But no, in all its wisdom JANZ believed it would be better for its members not to be informed about the problem, which begs questions about good corporate governance.

Maybe JANZ should review itself given that its website proudly proclaims, “To provide an organisation that promotes good practice within the industry and to encourage members to operate within the Jewellers Association of New Zealand Code of Ethics.”

Ethics? Good practice, ha!  Is this the action of a responsible industry association?  Is this what you call transparency and good corporate governance? 

Ken Raumati might be proud of you but JANZ, you should be ashamed of yourselves.

Read: JANZ apology letter to Jeweller.

Result: Miss, by a long shot.

Previous winners
2014 - The backyard chicken farmer and avid cat lover!
2013 - Australian thief swallows diamond ring
2012 - Ellani Collections gaining 1,000 Facebook fans
2011 - Who is Ken Raumati?


 

a good number

3,000,000. That’s a good number!

In fact, as far as we were concerned it was the only number this year that could be considered for this year's award. With all the doom and gloom pervading the current retail market it was very pleasing to report of an independent jeweller who transformed his store into a vibrant and profitable business after facing closure two years ago.

When we first became aware of the jeweller’s dire financial predicament in September 2013, the business had an annual turnover of around $1.6 million and was facing liquidation; however, two years later he had turned the business around and was approaching $3 million in revenue while generating healthy profits.

It confirms the saying, 'If you are not part of the solution then you're part of the problem.' 

Result: Hit!

Previous winners
2014 - Jewellery merger creates world's largest retailer
2013 - Jewellery chain collapses owing $3 million
2012 - Ex Pandora man to launch “clicks and mortar” stores
2011 - Young Jewellers Group

 

births, deaths & marriages

Births:
Endless Jewelry
Alex and Ani
Miglio Designer Jewellery
Le Corone
Apple Watch (at long last)

Deaths:
Smith and Smith

Marriages:
Chrysalis/Nordic Jewellery
byBiehl/Tribe Trading

Divorces:
Pandora/Leading Edge Jewellers, Nationwide Jewellers, Showcase Jewellers

 

Click for More reading - 2011 - 2014




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ABOUT THE AUTHOR
Coleby Nicholson • Managing Editor

Managing Editor • Jeweller Magazine


Coleby Nicholson is publisher and managing editor of Jeweller magazine. He has covered the jewellery industry for more than a decade and specialises in business-to-business aspects of the industry.






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