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Jewellers Association needs a Brexit

It’s time for the Australian jewellery industry to bring about its own Brexit. With the upcoming AGM scheduled for 15 November, I believe current Jewellers Association of Australia (JAA) president Selwyn Brandt must leave (exit) the board if the industry is to become united and cohesive.

There can be no doubt that the JAA’s decision in May 2016 to transform the member-based association into an organiser of trade fairs fractured the industry and created unprecedented turmoil.

The JAA has endured other inglorious periods over the past decade – all self-inflicted – however I can’t remember a greater period of upheaval and dispute than the past 18 months.

The doomed decision to launch a trade show competing directly with the International Jewellery Fair (IJF) not only split the industry but also resulted in great change at the association – JAA executive director Amanda Hunter quit on the same day the association cancelled its trade show and three of six JAA board members have since resigned.

The JAA’s problems don’t end there; internal bickering among the JAA’s state branches is allegedly worsening. Of greater concern, Hunter divulged when resigning on 8 May that the JAA had faced a “large loss” that would “eat into retained earnings”.

No doubt a subsequent decline in membership and the expenses lost in the trade show venture – including legal fees – have all compounded the JAA’s dire financial state. The association has since closed its stand-alone office in York Street, Sydney and relocated to a shared office complex.

There have been questions already raised about its solvency. Retail and supplier members have already quit the association en masse, including Australia’s largest buying group Nationwide Jewellers and, if the talk at the recent Sydney (IJF) is any indication, more will be quitting next year.

That is, a number of large suppliers, who chose to support the JAA this year, have told me that they would not renew their membership unless major change was implemented in 2018. The problem is made worse for the JAA because the membership fee of one supplier is often 2-3 times larger than one retailer.

Troubled future

The main discussion at the Sydney fair focused on the failed trade-fair venture and the JAA’s current financial state, and there were three schools of thought emanating from the industry:

  1. The JAA should be kept alive and nurtured back to representing a unified industry
  2. The JAA should be left to wither away given its disastrous decisions
  3. The JAA brand is irreparably damaged and a new association should be created in its place.

Almost six months have passed since Hunter resigned and there is still no announcement of when or if she will be replaced. If JAA membership numbers continue to fall and given the board can no longer rely on the lucrative, 25-year sponsorship deal it held with Expertise Events, then its future does not look bright.

I am hoping the JAA can be kept alive and nurtured back to health; however, many believe that only an entirely new board – one with fresh ideas and one not tainted by the disastrous decisions of the past – stands any chance of achieving this.

Selwyn Brandt, JAA president
Selwyn Brandt, JAA president

In June I wrote, “It was great to see JAA president Selwyn Brandt recently calling for a ‘single united voice’ to represent and lead the jewellery industry. I couldn’t agree more. It is now time for the industry to put the past 12 months of division and turmoil behind and to start working together again. The problem is that it won’t happen while Brandt is president.”

I also noted that industry harmony wouldn’t be possible until such time as Nationwide rejoins the JAA and that this won’t happen until an apology is made to former board member Colin Pocklington.

How can the JAA claim to be the peak industry body if it is at war with the largest retail membership group! Its reputation was tarnished well before the trade show debacle.

Five months ago, I wrote that the Australian jewellery industry would remain fragmented for years to come if the JAA, and specifically Brandt, remained in denial about how Pocklington was treated and refused to apologise to the Nationwide managing director.

That situation remains.

I also noted that I hoped Brandt’s legacy would be remembered for 15 years of outstanding service to the industry, rather than for the mistake of starting the JAA Jewellery Tradeshow. What is done is done and Brandt alone must decide if he is part of the solution and one way to achieve this is to step aside and allow new blood and a new approach to rebuild the JAA.

Since my commentary in June, Brandt has not declared his position or discussed his future with the JAA; however, from my many discussions with industry participants, including senior JAA supporters, it’s clear that there are plenty of people unhappy about a range of issues separate to the trade show debacle.

It is also true that other industry ‘partners’, including financial sponsors, have been unhappy with the JAA.

Fresh faces

Only a completely new board can hope to achieve a resolution with Nationwide, and other high-profile retailers and suppliers who have already quit the association, and ensure that more financial backers don’t abandon it. Therefore, it’s my opinion that all board members, including those new board members who recently filled vacated positions and who played no part in the division and turmoil of the past 18 months, must not stand for re-election.

Only a new board can deliver full transparency about the losses incurred on the failed trade show venture, which presumably include large and unbudgeted expenses such as non-refundable venue deposits and legal fees caused by the JAA’s allegations about Pocklington and Nationwide.

Colin Pocklington, Nationwide Jewellers managing director
Colin Pocklington, Nationwide Jewellers managing director

At the root of the JAA’s financial issues is the fall-out with Expertise Events over sponsorship income – the JAA chose to walk away from a minimum royalty of $100,000 per year, believing it was better to start its own show. Again, any costs incurred in the resulting legal actions between JAA and Expertise Events must be detailed to members also.

Background reading: Sorry state of (jewellery) affairs

Such a report should address not only the losses incurred up to 30 June this year but also include an estimate of unbudgeted expenses (losses) that will be incurred in the current financial year. It should also detail any payout to its former executive director.

After all, current and former members have a right to know the ultimate cost of the ill-fated trade show venture, given that it was their membership fees put at risk. It’s perfectly reasonable for any current, or prospective, member to know whether they are throwing good (membership) money after bad by the JAA ‘coming clean’ on the whole debacle.

It must put everything on the table before it can move on.

The JAA will need to release its 16/17 financial report in time for the November AGM and one hopes that it doesn’t raise more questions than it answers. The association can’t afford further membership decline because of a lack of transparency and accountability.

Any attempt by the new board not to be fully transparent on the losses and mistakes made over the past 18 months will further affect the JAA’s credibility, something it can ill-afford.

I hope the current board can look beyond the poor decisions and industry politics and help put the past behind us by moving aside for a fresh, new approach with new directors. The industry needs to see substantive change, and if the association is to have a future, then we require six new people sitting around the boardroom table.

There is a very strong belief that the entire JAA board should step aside in the best interests of the Australian jewellery industry. If they do not, it could have far greater ramifications than they imagine.
 

More reading
It’s time for Brandt and JAA to move on
Amanda Hunter resigns; 2017 JAA jewellery tradeshow cancelled
Buying groups call for unity: urge industry to support one jewellery fair
Another JAA board member resigns
Showcase pledges support for Expertise Events jewellery fair
Nationwide, Leading Edge make 2017 jewellery fair decision
Sydney jewellery fair organiser hits back at JAA
More industry division over two jewellery fairs












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.









Sunday, 19 November, 2017 09:24pm
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