Jeweller - October 2020

• Balance of power: How retailers can navigate lease negotiations with landlords • Christmas special: Latest offerings to get stock-ready for the holiday season • Refined touch: Benefit from metal refining in the post-COVID environment

• Balance of power: How retailers can navigate lease negotiations with landlords
• Christmas special: Latest offerings to get stock-ready for the holiday season
• Refined touch: Benefit from metal refining in the post-COVID environment


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Balance of power<br />



Christmas special<br />



Refined touch<br />



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Proudly distributed by<br />

(02) 9417 0177 | www.dgau.com.au

Discover the new Christmas Collection from 29 th <strong>October</strong> <strong>2020</strong><br />

Available in Pandora concept stores, participating stockists and pandora.net








OCTOBER MARCH <strong>2020</strong><br />

Contents<br />

This Month<br />

Industry Facets<br />

11 Editor’s Desk<br />

14 Upfront<br />

16 COVID-19 Update<br />

20 News<br />

37 ARA<br />

33<br />

34<br />

39<br />

74<br />

92<br />

NOW & THEN<br />

Holdsworth Bros. <strong>Jeweller</strong>s<br />

10 YEARS AGO<br />

Time Machine: <strong>October</strong> 2010<br />


Jade Part I: Jadeite<br />

MY STORE<br />

Rebus Signet Rings<br />

MY BENCH<br />

Ryan Haddrell<br />


Christmas stocking<br />

Suppliers showcase the latest products and<br />

services on offer in time for the gifting season.<br />

39 LEARN ABOUT<br />

Jadeite<br />

72 <strong>Jeweller</strong>s Showcase<br />

Features<br />

41<br />

51<br />

76<br />


Seeing eye-to-eye: The retail rent review<br />


Christmas showtime<br />

94<br />


Liquid gold: Refining & COVID-19<br />


Helen Thompson-Carter<br />

80<br />


Coronavirus roughs up diamonds<br />

Better Your Business<br />

41 RENT REVIEW<br />

New lease<br />

on life<br />

4<strong>Jeweller</strong> explores how<br />

the COVID-19 pandemic<br />

has tipped the balance<br />

of power between retail<br />

landlords and tenants.<br />

86<br />

88<br />

89<br />

90<br />

91<br />


RICH KIZER and GEORGANNE BENDER explain the power of branding your store.<br />


Maximise your sales by avoiding time-wasters, advises BRIAN JEFFREY.<br />


A member of your staff could be a sales prodigy in disguise, writes DAVID BROWN.<br />


It’s time to create your post-COVID marketing strategy, says BARRY URQUHART.<br />


ALLISON HALL explains how to create ads for Instagram that increase sales.<br />

Balance of power<br />

Christmas special<br />

Refined touch<br />


<strong>Jeweller</strong>s<br />

Showcase<br />

4 Discover which jeweller made this piece.<br />


The new Palloys website and<br />

proprietary ordering system<br />

makes it easier than ever to<br />

manage all your jewellery<br />

needs, from refining to casting,<br />

CAD and finished jewellery.<br />

palloys.com<br />

<strong>October</strong> <strong>2020</strong> | 7


Timesupply<br />

jewellery + watches<br />

p +61 (0)8 8221 5580<br />

sales@timesupply.com.au<br />

coeurdelionjewellery.com.au<br />

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Introducing Notable Gems<br />

This curated collection features gems cut for maximum beauty<br />

and colour impact. The selection includes excellent cuts and<br />

makes, unusual shapes, large sizes, and unique, breathtaking<br />

stones such as our new multicolour Tourmalines.<br />

Notable Gems includes a number of our Earth to Market<br />

gemstones with known origins to give you and your customers<br />

peace of mind.<br />

To learn more visit<br />

Stuller.com/NotableGems and<br />

Stuller.com/EarthtoMarket.<br />

Stuller.com<br />

+1 337-262-7700

Editor’s Desk<br />

What is the future of jewellery?<br />

Is the industry resilient because jewellery is an irrational purchase, or is the industry<br />

robust because consumers are irrational about jewellery? ANGELA HAN explores.<br />

Competition for the consumer dollar has<br />

become ever-more increasing. In recent<br />

years, experience-based purchases such<br />

as luxury travel, fine dining and home<br />

entertainment are some examples of<br />

things that have become more important<br />

to consumers, forcing many in the trade<br />

to question jewellery’s place in the minds<br />

of today’s consumer.<br />

All the while, pandemic-induced<br />

unemployment figures keep rising and<br />

belts tighten as we brace ourselves in<br />

for recessionary times. This begs the<br />

question: What is the future of jewellery?<br />

After all, jewellery is largely just ‘rock and<br />

metal’. Indeed, some would say it’s an<br />

irrational purchase; there have been times<br />

of famine in history where a bowl of rice<br />

was seen as valuable as gold bullion.<br />

In an era where consumer satisfaction is<br />

measured by a product’s performance,<br />

usefulness and eco-friendliness, justifying<br />

a jewellery purchase can feel irrational<br />

and gratuitous, particularly during a<br />

recession.<br />

So it would make sense if people stopped<br />

buying jewellery and jewellers shut-up<br />

shop ... right? Wrong.<br />

When compared to other retail categories<br />

there’s ample evidence that many fine<br />

jewellery retailers have remained resilient<br />

during the COVID pandemic and economic<br />

crisis. Globally, Pandora and Tiffany stock<br />

prices are on the upwards trajectory,<br />

while Hong Kong retailer, Chow Tai Fook,<br />

has seen its shares rocket back to its<br />

2018 heydays.<br />

The shares of both Michael Hill<br />

International and the US chain, Signet<br />

Jewelers, are recovering since the huge<br />

sell off in the depths of the crisis and<br />

LVMH stock prices are back to what they<br />

were last November.<br />

Closer to home, Retail Edge, the jewellery<br />

management consultancy firm, released<br />

reports of increased sales across 450<br />

customers in Australia and NZ.<br />

In fact, there was a 23 per cent increase<br />

in September sales compared to last year,<br />

despite Victoria remaining on Stage 4<br />

lockdown.<br />

While the number of items purchased fell,<br />

the data shows that the value of each sale<br />

increased, which indicated that consumers<br />

weren’t too shy about pandemic spending.<br />

Given the current economic conditions<br />

and consumer sentiment, this is no<br />

ordinary feat.<br />

Recent trends in the increase of jewellery<br />

repairs, along with valuations and<br />

remodelling of a family heirloom, are not<br />

new. The jewellery trade has thrived in<br />

tough times owing to this work and which<br />

few other retail categories can achieve,<br />

with such valuable custom and unique<br />

foot traffic.<br />

It helps that jewellers can also smelt<br />

unused stock - a luxury not afforded other<br />

retail categories! These behaviours and<br />

trends have contributed to the survival of<br />

jewellers for hundreds of years.<br />

Indeed, <strong>Jeweller</strong>’s own State of the Industry<br />

report revealed that Australian fine jewellery<br />

chains have remained resilient over the past<br />

decade despite the saturation of fly-by-night<br />

fashion jewellery chains.<br />

In fact, Australia is home to more<br />

than a dozen jewellers that have long<br />

celebrated their centenary and are older<br />

than Chopard and Bulgari. In the past<br />

100 years, empires and conglomerates<br />

have come and gone, but many local fine<br />

jewellery retailers are still standing today.<br />

So what makes fine jewellery so resilient?<br />

By default, humans yearn to be<br />

surrounded by things that are beautiful,<br />

unchanging and meaningful. This<br />

sentiment seems to be magnified in<br />

turbulent times, which may very well<br />

explain our attraction to fine jewellery that<br />

is an object of permanence flying in the<br />

face of modern-day impermanence.<br />

From a signet ring engraved with the<br />

family crest to a grandfather’s old wind-up<br />

watch, these portable totems take on<br />

significance with each new generation.<br />

In turn, they often increase in<br />

In the past<br />

100 years,<br />

empires and<br />

conglomerates<br />

have come<br />

and gone, but<br />

many local<br />

fine jewellery<br />

retailers are still<br />

standing today.<br />

sentimental value, something that<br />

cannot be measured in dollars.<br />

For example, I recently heard a story about<br />

a specialist watchmaker who was asked to<br />

quote a job to refurbish a customer’s greatgrandfather’s<br />

pocket watch.<br />

Given that the watch had no brand,<br />

was in dire need of major repair, and<br />

parts would not be easily accessible,<br />

the retailer quoted the work at around<br />

$5,000, believing that the owner would<br />

not proceed with the job given that the<br />

watch was only ‘worth’ $30.<br />

Much to the watchmaker’s surprise, the<br />

repair job was approved, and the owner<br />

was ecstatic with the final outcome.<br />

I did say jewellery can be irrational!<br />

While Australia’s population generally<br />

has a high discretionary income, there<br />

is a cultural shift towards recycling and<br />

recycled products, in an attempt to curb<br />

consumption. While this may not bode<br />

well for lower-priced fashion jewellery,<br />

it could be the perfect opportunity to<br />

educate and encourage consumers about<br />

the benefits of locally manufactured,<br />

bespoke fine jewellery.<br />

If there is anything we have learned from<br />

COVID - especially through lockdown<br />

periods - it is that we greatly value<br />

human contact and emotion - these<br />

things only become obvious when you<br />

don’t have them.<br />

So people are looking to make more<br />

meaningful purchases, have more<br />

memorable experiences, and build<br />

stronger relationships. For centuries,<br />

jewellers have been at the forefront of<br />

assisting with these human desires.<br />

COVID will demonstrate that this won’t<br />

change, and may even strengthen these<br />

desires, as we now know what we miss.<br />

From where I’m standing, the future<br />

of the jewellery industry is bright.<br />

Angela Han<br />

Publisher<br />

<strong>October</strong> <strong>2020</strong> | 11

Upfront<br />

#Instagram hashtags to follow<br />

Alpha Order<br />

#bridaljewelry<br />


#clusterring<br />

30,930+ POSTS<br />

#indicolite<br />

111,497+ POSTS<br />

#jewelrylove<br />

721,290+ POSTS<br />

Stranger Things<br />

Weird, wacky and wonderful<br />

jewellery news from around the world<br />

#conflictfree<br />

50,382+ POSTS<br />


Napoleon &<br />

Josephine<br />

Ring<br />

4One of the most iconic engagement rings of all time is<br />

the ‘toi et moi’ ring given by Napoleon Bonaparte to his fiancée,<br />

aristocrat Jósephine de Beauharnais, in 1796. The simple gold<br />

ring features a 1-carat pear-shape white diamond and sapphire.<br />

The ring remained in the Bonaparte family until 2013, when it was<br />

auctioned in Paris by Osenat. It was sold for $US1.17 million –<br />

more than 50 times the high estimate of $20,000.<br />

The Facebook<br />

and Deloitte<br />

consumer trends<br />

report, Digital<br />

Tools in Crisis and<br />

Recovery, was<br />

published on 17<br />

September <strong>2020</strong>.<br />

#diamondsareforever<br />

486,845+ POSTS<br />

#earrings<br />

29.8 MILLION POSTS<br />

Digital Brainwave<br />

#layerednecklaces<br />

131,710+ POSTS<br />

#mensjewelry<br />

817,575+ POSTS<br />

#weddingring<br />


4Facebook has released the findings of<br />

a new study it conducted with Deloitte,<br />

examining the impact of COVID-19 on<br />

consumers’ purchasing patterns and use<br />

of digital tools across 13 markets, including<br />

Australia, New Zealand, the UK, and the US.<br />

Notably, 40 per cent of those surveyed had<br />

increased their use of social media and online<br />

messaging for business recommendations.<br />

Of those who had started shopping at new<br />

businesses, 73 per cent said at least one was<br />

a small business, while 31 per cent planned<br />

to increase their spending with small, local<br />

businesses after the pandemic.<br />

Celebrity Style<br />

4Red carpet glamour had a welcome<br />

return with the Venice Film Festival, as<br />

stars showcased the most prestigious<br />

fine jewellery creations. US supermodel<br />

Taylor Hill (above) stole the show in<br />

Chopard’s ruby suite.<br />

Trend Spotting<br />

4A classic staple of men’s jewellery,<br />

the signet ring is having something of<br />

a renaissance. An ideal gift for men of<br />

all ages, the ring is traditionally crafted<br />

from gold and features a family seal or<br />

coat of arms (above). However, it can be<br />

adapted to suit modern, youthful tastes<br />

– think sterling silver with a skull,<br />

animal, or minimalist logo.<br />

Getty Images<br />

Signet ring: Circle, Melbourne<br />

Can-do attitude<br />

4A US jeweller’s unusual<br />

jewellery pieces – which are<br />

made entirely from tin cans<br />

– have been thrown into the<br />

spotlight after being featured<br />

in Oprah Winfrey’s magazine.<br />

Thomas Paul Althaus started<br />

his jewellery business, Canned<br />

Goods, seven years ago after<br />

creating a set of earrings and<br />

a bracelet for his wife, using<br />

the traditional 10th wedding<br />

anniversary gift of tin.<br />

Fast (food) fashion<br />

4Tasmanian jeweller Emma<br />

Bugg has revealed a brooch<br />

she made from a real fast-food<br />

hamburger is yet to decompose<br />

after four years in her store.<br />

Bugg set the burger – which<br />

has since shrunk by about 10<br />

per cent – in silver claws. “The<br />

lettuce has changed colour to<br />

brown, but aside from that it<br />

looks pretty much the same [as<br />

when I bought it],” she said.<br />

Diamond discovery<br />

4A US man has unearthed the<br />

second-largest diamond ever<br />

found at the Crater of Diamonds<br />

State Park in Arkansas, after<br />

initially mistaking the 9-carat<br />

stone for a piece of glass.<br />

“I almost didn’t have [staff] check<br />

my finds, because I didn’t think<br />

I had found anything,” Kevin<br />

Kinard said. The park opened in<br />

1972; more than 200 diamonds<br />

are found there each year.<br />


Published by Befindan Media Pty Ltd<br />

Locked Bag 26, South Melbourne, VIC 3205 AUSTRALIA | ABN 64 930 790 434 | Phone: +61 3 9696 7200 | info@jewellermagazine.com<br />

Publisher & Editor Angela Han angela.han@befindanmedia.com • Assistant Editor Arabella Roden arabella.roden@jewellermagazine.com<br />

Advertising Toli Podolak toli.podolak@jewellermagazine.com • Accounts Paul Blewitt finance@befindanmedia.com • Subscriptions info@jewellermagazine.com<br />

Copyright All material appearing in <strong>Jeweller</strong> is subject to copyright. Reproduction in whole or in part is strictly forbidden without prior written consent of the publisher. Befindan Media Pty Ltd<br />

strives to report accurately and fairly and it is our policy to correct significant errors of fact and misleading statements in the next available issue. All statements made, although based on information<br />

believed to be reliable and accurate at the time, cannot be guaranteed and no fault or liability can be accepted for error or omission. Any comment relating to subjective opinions should be addressed<br />

to the editor. Advertising The publisher reserves the right to omit or alter any advertisement to comply with Australian law and the advertiser agrees to indemnify the publisher for all damages or<br />

liabilities arising from the published material.

Proudly distributed by<br />

(02) 9417 0177 | www.dgau.com.au

COVID-19 Update<br />

62.6%<br />

increase in online<br />

spending year-on-year<br />

during July <strong>2020</strong><br />

* National Australia Bank Online Retail Sales Index,<br />

3 September <strong>2020</strong><br />

$3 billion<br />

Additional support package<br />

announced for Victorian businesses,<br />

including $15.7 million in export<br />

recovery and funding for SMEs<br />

to access digital programs<br />

19 <strong>October</strong><br />

Earliest date for Melbourne<br />

Step Three restriction easing,<br />

allowing all retail to reopen<br />




“We face a long and uneven<br />

recovery... One of the biggest<br />

challenges for Australia in<br />

2021 and beyond will be how<br />

effectively we can move [on]<br />

from the substantial and I think<br />

very effective income support<br />

that’s been in place.”<br />




“Not only have we had a smaller<br />

contraction than comparable<br />

economies, but our economic<br />

activity has outperformed<br />

where the correlation between<br />

the stringency of the lockdown<br />

and GDP would suggest.”<br />

42%<br />

of retail businesses say they<br />

would not have survived<br />

without JobKeeper *<br />

* Sensis September Business Index<br />

Retail turnover increased<br />

6.9% in August <strong>2020</strong><br />

compared with August 2019<br />

* Australian Bureau of Statistics, Retail Trade<br />

Preliminary report, 23 September <strong>2020</strong><br />

December<br />

A ‘trans-Tasman<br />

travel bubble’ between<br />

Australia and New<br />

Zealand could be formed<br />

Treasurer Josh Frydenberg unveiled a<br />

suite of insolvency reforms to protect small<br />

businesses from the fallout of the COVID-19<br />

pandemic... [allowing] insolvent companies<br />

with less than $1 million in liabilities to<br />

continue to trade while developing a plan<br />

to restructure their debts.<br />




* Smart Company, 24 September <strong>2020</strong> “We remain deeply concerned<br />

about the closure of [Melbourne]<br />

retail until mid-to-late <strong>October</strong><br />

at the earliest – that is simply<br />

too close to Christmas trading<br />

allow viable retail activity.”<br />

Brisbane businesses<br />

are more confident<br />

about the future than<br />

any other capital city<br />

Sensis August Business Index<br />

to<br />

*<br />

KPMG<br />

CIBJO<br />

De Beers<br />

The webinar was<br />

hosted by KPMG’s<br />

Jane Cohen, Matt<br />

Darby, and James<br />

Stewart, with guest<br />

Anthony Heraghty,<br />

CEO Super<br />

Retail Group.<br />

4Professional services firm<br />

KPMG has made its September<br />

webinar, Retail 2021: Home,<br />

But Not Alone!, available to<br />

rewatch online.<br />

The session explores four key<br />

elements influencing retailers,<br />

such as commercial leases,<br />

JobKeeper, and insolvent<br />

trading reforms, as well as the<br />

long-term changes to the retail<br />

sector and shopping behaviour<br />

as a result of COVID-19.<br />

David Kellie, CEO<br />

Natural Diamond<br />

Council, and De<br />

Beers executive<br />

Stephen Lussier<br />

contributed to the<br />

panel discussion<br />

in the webinar.<br />

4The latest edition of<br />

CIBJO’s <strong>Jeweller</strong>y Industry<br />

Voices webinar series,<br />

‘Cultivating Demand for<br />

Natural Diamonds: How<br />

to Do It & Who Should<br />

Pay’, which took place on 1<br />

<strong>October</strong>, is now available to<br />

rewatch online.<br />

It explores the effectiveness<br />

of generic industry<br />

marketing of diamonds – a<br />

particularly important factor<br />

in the lead-up to Christmas.<br />

The Diamond<br />

Insight Flash<br />

Report #4 notes<br />

that consumers<br />

are showing signs<br />

of optimism,<br />

alongside a need<br />

for reassurance.<br />

4Diamond giant De Beers<br />

has released the fourth<br />

edition of its monthly<br />

Diamond Insight Flash<br />

Report series to identify<br />

trends for the upcoming<br />

holiday gifting season as<br />

well as patterns of<br />

consumer behaviour.<br />

The report includes survey<br />

results from 500 US<br />

consumers and diamond<br />

jewellery trend forecasting<br />

by UK firm Adorn Insight.<br />

16 | <strong>October</strong> <strong>2020</strong>

Signature<br />

Style<br />


PO Box 866, Tullamarine, VIC 3043<br />

@wdrings | 03 9338 0091 / 1800 006 388 | sales@worthdouglas.com.au | www.worthdouglas.com

Created by members, for members<br />




Showcase <strong>Jeweller</strong>s was established in 1981 by a group<br />

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Today, Showcase <strong>Jeweller</strong>s is a powerhouse of resources<br />

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Our members have so many resources at their fingertips to<br />

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• In-house loose diamond<br />

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• Extensive supplier<br />

base at both local and<br />

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including the latest<br />

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Alongside these resources, you have the support of an<br />

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provides a community and network in which your business<br />

is supported and will positively thrive. We are enormously<br />

proud of our community and hope to welcome you into<br />

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News<br />

Dates announced for early<br />

2021 jewellery Trade Days<br />

<strong>Jeweller</strong>y businesses integrated into new<br />

Palloys ordering and account management<br />

means our B2B clients now have<br />

the convenience of ordering everything they<br />

need from one company, on one account, with<br />

one statement.”<br />

Multiple employees to make orders through<br />

each business account, improving order<br />

tracking and accountability.<br />

A series of Capital City Trade Days are set to take place in<br />

Brisbane, Sydney, Adelaide and Perth next year, as part of<br />

Expertise Events’ 2021 jewellery industry schedule.<br />

In Expertise Events, the organiser of the<br />

International <strong>Jeweller</strong>y & Watch Fair<br />

(IJWF), has released details of its 2021<br />

Capital City Trade Days which will take<br />

place in February and March.<br />

As previously reported by <strong>Jeweller</strong>, the<br />

Trade Days were developed to help the<br />

jewellery industry reconnect following the<br />

cancellation of the <strong>2020</strong> IJWF, as well as<br />

provide retailers with access to a range<br />

of suppliers without travelling interstate.<br />

Described as “intimate and local focused<br />

events”, the Trade Days offer suppliers<br />

an “easy and affordable opportunity to<br />

connect with local retailers”.<br />

Gary Fitz-Roy, managing director<br />

Expertise Events, said, “We recognise that<br />

in 2021, not everyone will want to or be<br />

able to travel, nor have the time to do so.<br />

“Starting at the beginning of February,<br />

we will have a compact Trade Days format<br />

– two days of trade, plus networking<br />

opportunities. People want to get back<br />

to reconnecting and rebuilding, and this<br />

format is cost-effective for manufacturers,<br />

distributors, and retailers.”<br />

While the Brisbane and Sydney events<br />

will focus on jewellery, the Perth and<br />

Adelaide Trade Days will also include a gift<br />

component to reflect the different needs<br />

of these markets.<br />

Victorian retailers will have the opportunity<br />

to view new products at the dedicated<br />

<strong>Jeweller</strong>y Pavilion within the Melbourne<br />

Gift & Lifestyle Fair, which is scheduled<br />

for 6–8 February 2021 at the Melbourne<br />

Exhibition Centre.<br />

A <strong>Jeweller</strong>y Pavilion will also be present<br />

at the Gold Coast Gift & Lifestyle Fair on<br />

3–5 July 2021, and at the Sydney Gift &<br />

Lifestyle Fair on 18–21 September 2021.<br />

Next year’s IJWF will be held from 28–30<br />

August, themed ‘Be Reconnected’.<br />

People want<br />

to get back to<br />

reconnecting<br />

and rebuilding,<br />

and this<br />

format is costeffective<br />

for<br />

manufacturers,<br />

distributors,<br />

and retailers<br />


Expertise Events<br />

2021<br />

Trade Day<br />

Dates<br />

Brisbane<br />

13–14 February<br />

Brisbane<br />

Convention Centre<br />

Sydney<br />

20–21 February<br />

ICC Sydney<br />

Exhibition Centre<br />

Perth<br />

13–14 March<br />

Perth Convention<br />

Centre<br />

Adelaide<br />

20–21 March<br />

Adelaide<br />

Convention Centre<br />

The new Palloys digital platform provides “endto-end”<br />

services, from diamonds to refining.<br />

<strong>Jeweller</strong>s can now order products and<br />

services from Palloys, AGS PJW, Regentco<br />

and A&E Metals through a ground-breaking<br />

new ordering and account management<br />

platform.<br />

The platform can be accessed through the<br />

redesigned Palloys website and allows<br />

jewellers to place orders for custom finished<br />

jewellery, wedding rings, fabricated metals,<br />

findings, gemstones, and metal refining<br />

through one password-protected account,<br />

invoiced under the Palloys name.<br />

Alison Habbal, assistant operations manager<br />

– jewellery at Palloys, told <strong>Jeweller</strong>, “Bringing<br />

all of our companies together as Palloys<br />

Pandora to close Sydney flagship store<br />

as lease renegotiations fail<br />

After 10 years, Pandora has opted not to renew<br />

the lease on its flagship store in Sydney’s Pitt<br />

Street Mall.<br />

After failing to reach an agreement with<br />

landlord Scentre Group, Pandora Jewelry<br />

will close its Westfield Sydney flagship store,<br />

located in the prestigious Pitt Street Mall<br />

retail precinct.<br />

The company opted not to renew its lease<br />

on the premises – due to expire at the end<br />

of September – following lengthy discussions<br />

with Scentre, which is Australia’s largest<br />

retail landlord and the operator of Westfield<br />

shopping centres.<br />

Pandora has occupied the site since 2010.<br />

Steven Kratsas, marketing manager – jewellery<br />

at Palloys, said, “This new interface took two<br />

years to design and implement, and is intended<br />

to make Palloys a ‘one-stop destination’ for all<br />

jewellery needs and services.<br />

“It is part of our commitment to leading the<br />

industry in innovation and efficiency, and<br />

upholding the highest possible standards<br />

of service and quality,” he added.<br />

One of the most notable upgrades to the new<br />

ordering system is an ‘instant quote’ feature<br />

for finished jewellery, CAD designs and prints,<br />

fabricated metals, findings, and refining<br />

through ABC Refinery, which holds triple<br />

accreditation from the London Bullion Market<br />

Association, Shanghai Gold Exchange and the<br />

New York Commodity Exchange (COMEX).<br />


David Allen, general manager of the Pandora<br />

Pacific division, said, “Over the past six-toeight<br />

weeks we have had extensive discussion<br />

with Scentre Group in an attempt to come<br />

to a mutual agreement in the lease<br />

renegotiation process.<br />

“Unfortunately these discussions did not lead<br />

to a satisfactory outcome for the business and<br />

as such we have made the decision to end the<br />

tenancy at term and close.”<br />

He added, “It was a tough call and certainly<br />

not one that was arrived at lightly, but without<br />

due consideration from Scentre Group, the<br />

trading conditions at Pitt Street Mall are<br />

untenable and unjustifiable for the wider<br />

organisation.”<br />

A 2019 report by commercial real estate<br />

services firm Cushman & Wakefield found<br />

that Pitt Street Mall ranked among the<br />

top 10 most expensive shopping strips<br />

internationally, alongside New York City’s Fifth<br />

Avenue, New Bond Street in London, Tokyo’s<br />

Ginza, and the Champs-Élysées in Paris.<br />


20 | <strong>October</strong> <strong>2020</strong>

#1<br />


LEADER<br />

Reader<br />


GLOBAL<br />





1 jckonline.com 69,848 03:47 USA<br />

2 nationaljeweler.com 173,106 01:58 USA<br />

3 instoremag.com 193,102 02:05 USA<br />

4 jewellermagazine.com 257,849 28:06 Australia<br />

5 professionaljeweller.com 353,450 01:26 UK<br />

6 thejewelrymagazine.com 698,131 00:57 India<br />

7 indianjeweller.in 649,673 01:15 India<br />

8 retailjewellerindia.com 944,527 12:02 India<br />

9 retail-jeweller.com 1,256,596 01:11 UK<br />

10 jewelleryfocus.co.uk 1,898,669 01:29 UK<br />

There are many ways to measure #1, however; when<br />

it comes to media, there’s only one way... readership.<br />

Not only is <strong>Jeweller</strong> the #1 industry magazine in<br />

Australia and New Zealand by far, we are ranked #4<br />

in the world by Alexa, the global ranking system<br />

for analysing website readership.<br />

Your own <strong>Jeweller</strong> is one of the most widely read<br />

jewellery publications in the world and, according to<br />

Alexa, the daily time spent on jewellermagazine.com<br />

is more than 20 minutes while other business-tobusiness<br />

websites average between 2–5 minutes<br />

in engagement.<br />

At the same time, <strong>Jeweller</strong>’s social media presence<br />

dominates and our eMags boast 12 million reads.<br />

It’s our commitment to excellence in reporting, high<br />

quality presentation, and reader engagement that sets<br />

us apart, which is why we say: Follow the Reader!<br />

* Alexa Global Ranking statistics as at 4 <strong>October</strong> <strong>2020</strong>.<br />


News<br />



In Brief<br />

No reserve for 102-carat<br />

flawless diamond<br />

4Auction house Sotheby’s has<br />

auctioned a 102.39-carat D-flawless<br />

diamond without a reserve price.<br />

The stone is one of only eight white<br />

diamonds of that quality and size ever<br />

offered at auction. The diamond was<br />

cut and polished from a 271-carat<br />

rough from De Beers’ Victor Mine in<br />

Canada, and previewed in Shanghai,<br />

New York, and Taipei before being<br />

auctioned in Hong Kong.<br />

NZ jeweller shows at<br />

New York Fashion Week<br />

4Christchurch-based jewellery<br />

designer Sonia Therese was one of<br />

just 10 jewellers chosen to showcase<br />

her work at New York Fashion Week<br />

in September. “I think the technical<br />

term was ‘gobsmacked’,” Therese<br />

said of being selected. Her pieces are<br />

largely made from recycled materials.<br />

“The jewellery is embeded and<br />

infused with soul,” she added.<br />

Movado signs deal with<br />

Calvin Klein<br />

4Movado Group has signed a<br />

five-year licensing agreement with<br />

Calvin Klein to create a new line of<br />

watches and jewellery, to commence<br />

in January 2022. Calvin Klein watches<br />

were previously manufactured by<br />

Swatch Group. However, the Swiss<br />

company chose to let its licensing<br />

agreement expire in <strong>October</strong> 2019<br />

after 22 years, citing “turbulence and<br />

uncertainties” at Calvin Klein.<br />

Israel, Dubai bourses<br />

sign historic agreement<br />

4The Israel Diamond Exchange<br />

(IDE) and the Dubai Diamond<br />

Exchange (DDE) have signed a<br />

collaboration agreement during<br />

a virtual conference in order to<br />

strengthen the trade relationship<br />

between the two bodies.<br />

Ahmed Bin Sulayem, executive<br />

chairman DMCC and chairman DDE,<br />

said, “This agreement paves the way<br />

for further collaboration across a<br />

range of commodities in what is a<br />

very exciting time for development in<br />

the region.”<br />

From the mining<br />

and refining<br />

of the gold, to<br />

the spinners<br />

and goldsmiths<br />

involved<br />

in its final<br />

construction,<br />

the Melbourne<br />

Cup has been<br />

produced locally<br />

from start to<br />

finish taking<br />

over 250 hours<br />

ABC Bullion<br />

Our business<br />

model is simple,<br />

it is transparent,<br />

and ensures<br />

we give our<br />

retail partners<br />

something<br />

back for<br />

supporting IJC<br />


Independent<br />

<strong>Jeweller</strong>s Collective<br />

ABC Bullion to make <strong>2020</strong> Melbourne Cup<br />

trophy from Victorian gold<br />

The <strong>2020</strong> Lexus Melbourne Cup trophy contains 1.65kg of 18-carat gold and valued at more than $200k.<br />

Ahead of the <strong>2020</strong> Lexus Melbourne Cup on 3<br />

November, ABC Bullion has announced that<br />

the gold used to manufacture the trophy for<br />

the racing event will be sourced entirely from<br />

Victoria, for the first time in its history.<br />

Valued at more than $200,000, this year’s<br />

trophy – which is also known as the ‘Loving<br />

Cup’ – contains approximately 1.65kg of<br />

18-carat gold mined from Kirkland Lake<br />

Gold’s Fosterville Mine, located about 30km<br />

east of Bendigo.<br />

This year marks the 160th anniversary of<br />

the ‘race that stops the nation’, and also<br />

marks one of the most difficult periods in<br />

recent history for the people of Victoria due<br />

to the ongoing COVID-19 crisis.<br />

A statement from ABC Bullion said, “This year<br />

has proven one of the most challenging yet.<br />

New buying group reaches another<br />

membership milestone<br />

Australia’s newest jewellery industry buying<br />

group, Independent <strong>Jeweller</strong>s Collective<br />

(IJC), has built its membership to 50 stores,<br />

surpassing its target for the year.<br />

IJC was formed in January <strong>2020</strong> and<br />

launched just as the COVID-19 pandemic<br />

began to impact the Australian market.<br />

Its business model promised to give<br />

independent retailers more flexibility than<br />

a traditional buying group, with a focus<br />

on custom-built digital platforms and<br />

“boutique” service.<br />

Josh Zarb, CEO IJC, told <strong>Jeweller</strong>, “We have<br />

been so humbled by interest in our group.<br />

It is genuinely exciting to have been able to<br />

build such a tight community of retailers<br />

and supply partners so quickly. We had set<br />

ourselves a target to be at 50 stores by the<br />

end of June 2021 and obviously, we are well<br />

ahead of this timeline.”<br />

More than ever it is important to hold on to<br />

the familiar, to our traditions.<br />

The <strong>2020</strong> Lexus Melbourne Cup is a beacon<br />

of resilience, when faced with hardship<br />

and adversity.<br />

“From the mining and refining of the gold,<br />

to the spinners and goldsmiths involved in<br />

its final construction, the Melbourne Cup<br />

has been produced locally from start to<br />

finish taking over 250 hours.”<br />

To mark the occasion, ABC Bullion – which<br />

is part of the Pallion group of companies<br />

and has manufactured the Melbourne Cup<br />

since 2016, as part of a deal with Victoria<br />

Racing Club – has released a video about<br />

the creation of the <strong>2020</strong> Cup and its<br />

unique significance.<br />

Zarb said the main driver of membership<br />

with IJC was the “sense of community” and<br />

the experience of the IJC team within the<br />

jewellery industry.<br />

“Retailers are looking for modern marketing<br />

initiatives and a more upmarket look and feel<br />

in external advertising, and this is something<br />

we are supporting in all our campaigns.<br />

“ Our business model is simple, it is<br />

transparent, and ensures we give our retail<br />

partners something back for supporting IJC,”<br />

he explained, adding, “Our technology, our<br />

simplicity of communication, and our bespoke<br />

platforms are some of our biggest strengths.”<br />

Zarb said more than 114 stores had<br />

approached IJC to enquire about its services.<br />

“It is important for us and our existing<br />

retailers to continue to partner with proactive<br />


22 | <strong>October</strong> <strong>2020</strong>

<strong>2020</strong> Argyle Tender Diamonds<br />

revealed ahead of mine closure<br />


The <strong>2020</strong> Argyle Tender has been named ‘One Lifetime, One Encounter’ and<br />

comprises 62 loose diamonds and 12 ‘Petite Suite’ sets. Image: Rio Tinto<br />

Rio Tinto has unveiled the <strong>2020</strong><br />

Argyle Tender of pink, red, and<br />

blue diamonds, which has this<br />

year been named ‘One Lifetime,<br />

One Encounter’.<br />

Described as “one of the final<br />

collections” of Argyle Mine stones<br />

ahead of its closure at the end of<br />

<strong>2020</strong>, this year’s Tender comprises<br />

62 loose diamonds, weighing a total<br />

of 57.23 carats. In addition, 12 sets<br />

of small pink, red, blue and violet<br />

diamonds, collected over the past<br />

five years, will also be offered.<br />

Referred to as ‘Petite Suites’, the<br />

diamonds weigh 13.90 carats in total.<br />

Of the loose stones, this year’s<br />

Tender features six named ‘hero’<br />

diamonds including the Argyle<br />

Eternity – the largest fancy vivid<br />

round brilliant diamond ever<br />

offered at the Tender. Weighing<br />

2.24 carats, the Argyle Eternity<br />

is vivid purplish pink.<br />

Arnaud Soirat, chief executive Rio<br />

Tinto Copper & Diamonds, said,<br />

“Rio Tinto’s Argyle Mine is the first<br />

and only ongoing source of rare<br />

pink, red and violet diamonds in<br />

the world. We have seen, and<br />

continue to see, strong demand<br />

for these highly coveted diamonds,<br />

which together with extremely<br />

limited global supply, supports the<br />

significant value appreciation for<br />

Argyle pink diamonds.”<br />

Commenting on the One Lifetime,<br />

One Encounter collection, Steve Der<br />

Bedrossian, CEO SAMS Group –<br />

which specialises in Argyle diamonds<br />

– said, “The Argyle Tender is always<br />

remarkable and the mine keeps<br />

giving us extraordinary diamonds.<br />

“This year’s Tender is notable as the<br />

‘hero’ stones include the largest vivid<br />

round brilliant cut, the largest vivid<br />

pear shape, the largest purple-pink,<br />

and also a trio of very rare blue and<br />

violet diamonds.<br />

“We have seen, and continue<br />

to see, strong demand for these<br />

highly coveted diamonds, which<br />

together with extremely limited<br />

global supply, supports the<br />

significant value appreciation<br />

for Argyle pink diamonds.”<br />


Rio Tinto<br />

“And of course, this year feels even<br />

more significant as there is the sense<br />

that this will all be history very soon<br />

– in the near future, we will be talking<br />

about ‘the Argyle days’,” he added.<br />

Harsh Maheshwari, director Kunming<br />

Diamonds, shared similar sentiments,<br />

telling <strong>Jeweller</strong>, “It has been quite an<br />

emotional journey for us, from our<br />

first Tender less than a decade ago,<br />

to acquiring the Everlastings<br />

Collection and being appointed an<br />

Argyle Pink Diamonds Authorised<br />

Partner [this year]. Knowing that we<br />

won’t be able to have the opportunity<br />

of seeing such a global phenomenon<br />

in the near future as the mine shuts<br />

is beyond belief.<br />


LVMH and Tiffany & Co. deal<br />

collapses; court battle looms<br />

LVMH has withdrawn from its $US16.2 billion acquisition of Tiffany & Co., with the<br />

US company initiating legal proceedings in response.<br />

Watches: Ellie II<br />

Proudly distributed by<br />

Tiffany & Co. has begun legal<br />

proceedings against Moët Hennessy<br />

Louis Vuitton SE (LVMH) following<br />

the French luxury conglomerate’s<br />

withdrawal from its $US16.2 billion<br />

acquisition deal, with the two luxury<br />

behemoths set to appear in court on<br />

5 January 2021.<br />

The international jewellery company<br />

commenced legal action on 9<br />

September, the same day LVMH<br />

released a statement confirming<br />

that it will not proceed with the<br />

takeover, which was to be the most<br />

expensive in its history, surpassing<br />

the $US13 billion acquisition of<br />

Christian Dior in 2011.<br />

LVMH alleges Tiffany & Co. suffered<br />

“material adverse effect”due<br />

to the COVID-19 pandemic and<br />

mismanaged the crisis.<br />

Material adverse effect is known<br />

as material adverse change under<br />

Australian law, and refers to specific<br />

matters that have a “measurable<br />

financial impact above an agreed<br />

threshold, such as a negative<br />

impact on earnings”, according to<br />

law firm MinterEllison.<br />

A material adverse change clause<br />

usually excludes negative impacts<br />

resulting from general economic<br />

or industry conditions.<br />

Tiffany & Co. recorded a loss of<br />

$US33 million for the first half of<br />

the year, but made a $US32 million<br />

profit for the three months to 31<br />

July, compared with $US136 million<br />

for the same period in 2019.<br />

In addition, Jean-Yves Le Drian,<br />

French European and Foreign Affairs<br />

Minister, reportedly wrote to LVMH<br />

on 31 August requesting that it delay<br />

the final closing date of the Tiffany<br />

deal until after 6 January 2021 in<br />

order to “dissuade” US authorities<br />

from imposing further import duties<br />

on French luxury goods.<br />

Such a delay would breach the<br />

Merger Agreement, which stipulates<br />

a closing date of no later than 24<br />

November <strong>2020</strong>. In addition, the<br />

LVMH statement notes that Tiffany<br />

& Co. separately requested a further<br />

extension of the final closing date to<br />

31 December <strong>2020</strong>.<br />

Tiffany & Co. filed suit in the Court<br />

of Chancery of the State of Delaware<br />

and “seeks, among other things, an<br />

order requiring LVMH to abide by<br />

its contractual obligation under the<br />

Merger Agreement to complete the<br />

transaction on the agreed terms”.<br />

It claims LVMH failed to honour<br />

its obligations, including filing<br />

international regulatory clearances.<br />

It also refutes assertions that it has<br />

breached the Merger Agreement<br />

and that the Le Drian letter is a valid<br />

reason for LVMH to withdraw.<br />

Roger N Farah, chairman Tiffany<br />

& Co., says, “We regret having to<br />

take this action but LVMH has left<br />

us no choice but to commence<br />

litigation to protect our company<br />

and our shareholders.<br />


02 9417 0177 | www.dgau.com.au



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News<br />

Michael Hill announces $3.1<br />

million profit for the year;<br />

launches new digital brand<br />

Michael Hill International has released its financial<br />

results for FY19-20, recording a modest profit of $3.1<br />

million – a decline of 81 per cent, largely attributed<br />

to the COVID-19 pandemic. Revenue was $492.1<br />

million, compared with $569.5 million in FY18-19,<br />

while same-store sales increased 2.7 per cent,<br />

largely driven by New Zealand and Canada.<br />

Daniel Bracken, CEO Michael Hill International,<br />

described it as “a year of two halves”, noting that<br />

sales had steadily improved until the widespread<br />

lockdowns beginning in March <strong>2020</strong>.<br />

Michael Hill stores across Australia, New Zealand,<br />

and Canada were temporarily closed for between<br />

five and 13 weeks; 17 were permanently closed<br />

over the course of the financial year, with one new<br />

opening. Michael Hill International operated 290<br />

stores as at 30 June <strong>2020</strong>.<br />

“While the COVID-19 closures had a severe impact<br />

on headline sales and profit, I was particularly proud<br />

of the determination, resilience, and agility of our<br />

team across the business through the shutdown and<br />

temporary closure periods,” Bracken said.<br />

“The re-opening of our store network saw pleasing<br />

sales recovery despite lower foot traffic, and a return<br />

to strong margin performance against [the] prior<br />

year. This reflected the importance of the strategic<br />

progress we have made over the last 12 months<br />

and the dedication of our team members and loyal<br />

customers,” he added.<br />

Notably, e-commerce increased by 54.7 per cent to<br />

a record $24.7 million, compared with $16 million in<br />

FY18-19. Digital sales now represent 5 per cent of total<br />

sales, an increase from 2.8 per cent in the previous<br />

financial year.<br />

Branded collections also performed well,<br />

representing 37.5 per cent of sales – an increase<br />

from 32.5 per cent in the previous year.<br />

Notably, Michael Hill has since launched Medley<br />

<strong>Jeweller</strong>y, a separate brand only available online<br />

from its own website, and focused on young female<br />

self-purchasers.<br />

Vanessa Brennan, chief brand and strategy officer<br />

Medley <strong>Jeweller</strong>y, said, “There was an opportunity in<br />

the market among a growing customer audience who<br />

have a strong desire for stylish, quality and versatile<br />

jewellery. They want affordable and on-trend pieces<br />

that can be worn across a number of occasions.”<br />

Medley <strong>Jeweller</strong>y currently has five collections<br />

– Alpha Female, The Foundations, Zodiac Hack,<br />

Pearls That Pop and Etched Memories – crafted in<br />

silver, plated 18-carat gold, plated rose gold, and<br />

solid 10-carat gold and priced from $50–$300.<br />

Luxury watch and jewellery box<br />

brand finds new distributor<br />

An image from the Wolf ‘My Legacy’ campaign.<br />

Duraflex Group Australia (DGA) has begun<br />

exclusively supplying European watch and<br />

jewellery box brand Wolf to the Australian<br />

market.<br />

Wolf, which was founded by silversmith<br />

Philip Wolf in Germany in 1834 before<br />

expanding into Sweden and the UK, is<br />

known for its high-quality handmade<br />

jewellery cases, travel accessories, patented<br />

automatic watch winders, and safes.<br />

A statement from Duraflex said, “The Wolf<br />

mark has been a symbol of decades of<br />

innovation and the pursuit of the perfect<br />

Australian <strong>Jeweller</strong>s Supplies<br />

takes over Peekays Findings<br />

Following more than 45 years as a<br />

family-owned business, Peekays Findings<br />

– Australia’s leading supplier of quality<br />

gold and silver findings, settings, and<br />

clasps – has been taken over by Australian<br />

<strong>Jeweller</strong>s Supplies (AJS).<br />

Peekays was founded by Paul Kornmehl in<br />

1973 and his daughters, Anita and Yvonne,<br />

took over the business in the 1990s.<br />

Jim Kornmehl, managing director Peekays<br />

Findings, said, “With Anita Kornmehl<br />

passing some five years ago, the family<br />

recently decided that the business needs<br />

to be taken forward by the industry leader,<br />

Australian <strong>Jeweller</strong>s Supplies.”<br />

He described AJS as “the perfect choice”<br />

as they are also a family-owned business,<br />

with more than 50 years in the industry.<br />

“With nationally located branches, highly<br />

experienced staff and a wonderful online<br />

platform, AJS will certainly take Peekays<br />

to the next level,” Kornmehl added.<br />

Selwyn Brandt, director AJS, said, “Peekays<br />

design. Every day, in beautiful Wolf cases<br />

around the world, centuries-old treasures<br />

live side-by-side with exquisite new designs.<br />

“The five-generation family owned brand<br />

understands that extraordinary objects are<br />

representations of extraordinary moments<br />

in life.”<br />

Phil Edwards, managing director DGA, said,<br />

“The addition of Wolf to the DGA portfolio<br />

complements our existing stable of brands<br />

perfectly. Wolf is a truly unique brand with<br />

an unrivalled product offering that’s a<br />

necessity for our market. We’re delighted<br />

to be the exclusive agent and look forward<br />

to growing this luxury brand locally.”<br />

In addition to the watch winders – which<br />

are compatible with both vintage and new<br />

timepieces – DGA will also supply luxury<br />

watch boxes and jewellery cases, as well as<br />

smartwatch storage trays with integrated<br />

charging.<br />

DGA also distributes Swiss watch brands<br />

Baume & Mercier, Luminox and Mondaine,<br />

and jewellery brands Ania Haie, Thomas<br />

Sabo and Bronzallure, among others.<br />

has been one of AJS’ key suppliers for<br />

many years, and we have always enjoyed<br />

a wonderful working relationship.<br />

“[The take over] was first discussed a few<br />

years ago and since then it has evolved<br />

organically to where it was a natural<br />

decision for both parties.<br />

“We plan to continue the amazing legacy<br />

that Peekays has created over the last<br />

40-plus years as the premier supplier of<br />

quality jewellery findings in Australia.”<br />

Brandt added, “As we are also a longstanding,<br />

family-owned and operated<br />

business, we put the highest value in our<br />

customers and will continue to offer them<br />

a personalised high level of service.”<br />

Kornmehl said, “We think that this<br />

positive change will be better for Peekays’<br />

customers, and they will also be happy to<br />

hear that current employee Raymond Tran<br />

will continue to take their orders and that<br />

Peekays’ phone, email and website will<br />

still operate as it does now.”<br />

26 | <strong>October</strong> <strong>2020</strong>

News<br />

Lovisa profits fall<br />

more than 47 per cent<br />

Second Hong Kong fair<br />

moves online for <strong>2020</strong><br />

Fashion jewellery chain Lovisa has<br />

released its full-year financial results,<br />

revealing net profits slumped 47.8 per cent<br />

over FY19-20 to $19.3 million, largely as a<br />

result of COVID-19 disruption.<br />

Supply chain problems, including freight<br />

bottlenecks and warehouse closures in<br />

China, as well as slower economic activity<br />

and temporary store closures due to<br />

lockdowns, combined to reduce total sales<br />

by 32.2 per cent during the six months to<br />

30 June <strong>2020</strong>.<br />

Despite the trading disruptions, revenue<br />

remained relatively stable for the year,<br />

declining 3.2 percent to $242.2 million.<br />

As a result of lockdown closures, Lovisa’s<br />

e-commerce sales increased by 311 per<br />

cent for the financial year.<br />

Shane Fallscheer, managing director<br />

Lovisa, said, “We are pleased with what<br />

our team has been able to achieve through<br />

the disruptions to our business over the<br />

past six months, and whilst it has had a<br />

temporary impact to sales and profitability<br />

we remain confident in our growth<br />

objectives and have been able to maintain<br />

the balance sheet strength required to<br />

deliver on them. This leaves us very well<br />

placed for the future.”<br />

The company incurred costs related to its<br />

continued international expansion, adding<br />

45 stores to its network – 66 new locations<br />

offset by 21 permanent closures, including<br />

two in Australia – bringing its total,<br />

including 41 franchised stores, to 435.<br />

Notably, Lovisa management took the<br />

decision to permanently close all nine of its<br />

Spanish stores “due to poor support from<br />

landlords through the lockdown period”,<br />

incurring an impairment charge of €2.1<br />

million ($3.4 million).<br />

The company has appointed a “senior<br />

leasing executive based in the Northern<br />

Hemisphere” to oversee future<br />

international store openings.<br />

Over the course of the year, Lovisa pursued<br />

its most aggressive expansion strategy in<br />

the US market, opening 29 new stores for<br />

a total of 48. The country is now Lovisa’s<br />

third-largest market after Australia (152<br />

stores) and South Africa (62 stores),<br />

overtaking the UK (42 stores).<br />

It also opened 13 stores in France, bringing<br />

its total from eight to 21.<br />

<strong>Jeweller</strong>y & Gem World Hong Kong – formerly the September<br />

Hong Kong <strong>Jeweller</strong>y & Gem Fair – will be run as a digital<br />

event this year, before returning to a physical format in 2021.<br />

Organiser Informa Markets has announced that the<br />

<strong>Jeweller</strong>y & Gem World Hong Kong (JGW) – previously<br />

known as the September Hong Kong <strong>Jeweller</strong>y & Gem<br />

Fair – will be conducted as an online event, <strong>Jeweller</strong>y<br />

& Gem Digital World.<br />

The fair had been postponed to 9–13 November from<br />

its original September dates due to the COVID-19<br />

pandemic. However, with an “uncertain” outlook,<br />

the organiser has now cancelled the physical event<br />

in favour of the digital format, scheduled for 27–29<br />

<strong>October</strong>.<br />

The news follows the cancellation of the Hong<br />

Kong Watch & Clock Fair – organised by the Hong<br />

Kong Trade Development Council (HKTDC) – whose<br />

exhibitors will instead be included in the HKTDC<br />

Autumn Sourcing Week Online from 16–27 November.<br />

Informa Markets described <strong>Jeweller</strong>y & Gem Digital<br />

World as a “virtual show experience that seamlessly<br />

integrates digital product meetings with a rich<br />

programme of industry forums, discussions and<br />

practical gemmology workshops”.<br />

It will also include “custom digital catalogues,<br />

assortment management solutions and personalised<br />

showroom technology” for exhibitors.<br />

David Bondi, senior vice-president Informa Markets<br />

Asia, said, “We know how important our <strong>Jeweller</strong>y<br />

& Gem fairs are as powerful platforms where our<br />

community can come together, create strong business<br />

relationships and discover leads to drive up sales.”<br />

A series of webinars focused on the Asian jewellery<br />

industry will be held in the lead up to the event, while<br />

the winners of the JNA Awards will be announced in<br />

a virtual presentation on 27 <strong>October</strong>, the first day of<br />

<strong>Jeweller</strong>y & Gem Digital World.<br />

The next <strong>Jeweller</strong>y & Gem World Hong Kong trade<br />

fair will take place in September 2021, with Bondi<br />

revealing that it will take a “hybrid” structure that<br />

combines physical shows with digital features.<br />


Set with Argyle pink diamonds<br />



E pink@samsgroup.com.au<br />

W samsgroup.com.au<br />

P 02 9290 2199

Diamond organisation launches new<br />

campaign with James Bond actress<br />

Ana de Armas is the celebrity face of the Natural Diamond Council’s latest<br />

campaign, ‘For moments like no other’.<br />


Proudly distributed by<br />

New range<br />

now available<br />

The Natural Diamond Council (NDC)<br />

– previously known as the Diamond<br />

Producers Association – has launched<br />

a new advertising campaign ‘For<br />

moments like no other’ with actress<br />

Ana de Armas, who will star in the<br />

upcoming James Bond film No Time<br />

To Die.<br />

The campaign, which will appear<br />

in the US, UK, Chinese and Indian<br />

markets, comprises a 30-second<br />

advertisement, a variety of shorter<br />

videos, a print media campaign, and<br />

digital advertising.<br />

It is designed to present diamonds as<br />

“not solely the purview of romantic<br />

interests or formal occasions”.<br />

In a statement, the NDC explained,<br />

“[The campaign] was developed to<br />

celebrate the myriad connections with<br />

which natural diamonds are worn or<br />

exchanged, and to bring awareness to<br />

the Natural Diamond Council’s ‘Only<br />

Natural Diamonds’ online platform.”<br />

Kristina Buckley Kayel, managing<br />

director – North America, NDC, said,<br />

“Ana is a true talent… This campaign<br />

redefines traditional diamond<br />

moments, celebrating a variety of<br />

personal connections with these<br />

natural stones.<br />

“It’s a more contemporary approach<br />

to the diamond dream, for meaningful<br />

moments big or small.”<br />

The campaign was filmed in Portugal<br />

in July, and features de Armas in a<br />

variety of settings with friends, family,<br />

and a partner while wearing diamond<br />

jewellery from brands including Anita<br />

Ko, De Beers, Delfina Delettrez,<br />

Jade Trau, Lorraine Schwartz and<br />

Melissa Kaye.<br />

“This campaign redefines<br />

traditional diamond moments,<br />

celebrating a variety of personal<br />

connections with these natural<br />

stones. It’s a more contemporary<br />

approach.”<br />


Natural Diamond Council<br />

Of the campaign, de Armas said,<br />

“This has been a very difficult year for<br />

so many people, and, in considering<br />

this, I was inspired by the idea of a<br />

diamond representing connection,<br />

or reconnection in <strong>2020</strong>’s case, with<br />

our loved ones.<br />

“For moments big and small,<br />

ceremonial to intimate, grand to<br />

spontaneous. There’s beauty and<br />

power but also a sense of familiarity<br />

and ease with natural diamonds.”<br />

The clip debuted during the digital<br />

broadcast of the Emmy Awards on 20<br />

September before being distributed<br />

through TV streaming services; print<br />

advertising will centre on high-profile<br />

consumer publications Vanity Fair<br />

and US Vogue as well as a number of<br />

fashion-focused online platforms.<br />

02 9417 0177 | www.dgau.com.au

News<br />

Rio Tinto executives resign following<br />

destruction of Indigenous site<br />

Mining conglomerate Rio Tinto has<br />

confirmed CEO Jean-Sebastien Jacques<br />

and two other senior executives will leave<br />

the company, with significant implications<br />

for its Australian projects.<br />

The resignations came in the wake of<br />

the company’s internal review into the<br />

destruction of the Juukan Gorge caves,<br />

located in the Pilbara region and described<br />

as having “the highest archaeological<br />

significance in Australia”.<br />

The caves were destroyed by Rio Tinto in<br />

a controlled blast on 24 May <strong>2020</strong> in order<br />

to expand an iron ore mine, against the<br />

wishes of traditional owners, the Puutu<br />

Kunti Kurrama and Pinikura people (PKKP).<br />

Following pressure from Rio Tinto<br />

shareholders – including AustralianSuper<br />

and the Future Fund, Australia’s $166<br />

billion sovereign wealth fund – the company<br />

announced that Jacques will step down as<br />

CEO on 31 March 2021 or when a suitable<br />

successor is found.<br />

Notably, Jacques has been a vocal advocate<br />

for Rio Tinto’s diamond division, which is<br />

facing numerous challenges in the nearterm,<br />

including the closure of the Argyle Mine<br />

at the end of <strong>2020</strong> and ongoing legal disputes<br />

with both its Canadian mining partners.<br />

Expressing his desire to expand the diamond<br />

division in 2017, Jacques said, “On average,<br />

from the time you think there is a good<br />

property to the time you get to diamonds<br />

it’s 30 years, so the exploration people have<br />

been under pressure for a long time. It’s an<br />

exploration game for us.”<br />

Arnaud Soirat is currently chief executive<br />

of Rio Tinto copper and diamonds.<br />

Rio Tinto has also pledged to review its<br />

Land Use Agreements, which could impact<br />

its closure plan for the Argyle Mine; like<br />

the Juukan Gorge, Argyle is located in<br />

Western Australia.<br />

At the time of publication, Rio Tinto was yet<br />

to submit its closure plan to regulators.<br />

Following<br />

pressure from<br />

Rio Tinto<br />

shareholders<br />

the company<br />

announced<br />

that Jean-<br />

Sebastien<br />

Jacques<br />

will step down<br />

as CEO<br />

New international representatives for colour<br />

diamond organisation<br />

in strategic locations around the world to<br />

promote the desire, the beauty and passion<br />

that natural colour diamonds create.<br />

“Our philosophy, transparency, education<br />

and collaborations with our sister trade<br />

groups, labs, and the media gives us the<br />

ability and strength to provide the service<br />

and the right knowledge and information<br />

about natural colour diamonds.”<br />

The Natural<br />

Color Diamond<br />

Association<br />

is proud to<br />

announce that<br />

we are building<br />

a ‘United<br />

Nations’ of<br />

ambassadors<br />

The US-based Natural Color Diamond<br />

Association (NCDIA) is expanding its<br />

international presence, announcing the<br />

appointment of four new ‘ambassadors’<br />

based in different countries.<br />

The ambassadors will assist the NCDIA in<br />

achieving its mission to promote natural<br />

fancy colour diamonds and educate the<br />

broader jewellery industry and consumers<br />

about their unique traits and appeal.<br />

Alan Bronstein, president NCDIA, said, “In<br />

our effort to show a vision of leadership for<br />

the future of the most extraordinary natural<br />

gemstones, the Natural Color Diamond<br />

Association is proud to announce that we are<br />

building a ‘United Nations’ of ambassadors<br />

The new ambassadors are:<br />

Hong Kong and Asia: Ephraim Zion –<br />

trained diamond cutter, founder of highend<br />

jewellery manufacturer Dehres, and<br />

a former governor of the Gemological<br />

Institute of America (GIA)<br />

Singapore: John Glajz – founder of jewellery<br />

brand Glajz, Argyle Partner, and former<br />

managing director Mondial Jewelers<br />

Switzerland: Matthew Aldridge – director<br />

of diamond and colour gemstone trading<br />

business Gemcut and Argyle Partner<br />

Italy: Marco Pocaterra – director of diamond<br />

cutting and polishing business Diamwill and<br />

CEO diamond trading business Diamond<br />

Love Bond.<br />


Natural Color<br />

Diamond<br />


News<br />

<strong>2020</strong> Argyle Tender Diamonds revealed<br />

ahead of mine closure<br />


“We, like many others, carry a sentimental<br />

value with Rio Tinto’s Argyle Mine and the rare<br />

stones.” He added, “We are extremely excited<br />

about <strong>2020</strong>’s Tender and the unique collection,<br />

Petite Suites.<br />

“They always amaze us with marvellous<br />

stones, especially the ‘hero’ stones. It is very<br />

rare to find Argyle Pinks in such sizes, and<br />

they each have a unique attribute to them,<br />

especially the Argyle Eternity.”<br />

Award-winning jeweller John Calleija, whose<br />

namesake brand has boutiques in Sydney, the<br />

Gold Coast, and London, said, “The closure<br />

of the mine is incredibly significant for the<br />

industry and it’s also quite poignant for me<br />

personally as Argyle pink diamonds have been<br />

my passion for more than 30 years.<br />

He added, “This year’s Tender really has some<br />

extraordinary diamonds. Just look at the<br />

magnificent Argyle Eternity, and you’ll know<br />

that you really will have to wait an eternity for<br />

another gem to rival this beauty.<br />

“Having three spectacular blue ‘hero’<br />

diamonds really showcases these precious<br />

gems. Blue diamonds are often forgotten<br />

when their pink and red sisters take centre<br />

stage, but they absolutely deserve their place<br />

in history!”<br />

Michael Neuman, director Mondial Pink<br />

Diamond Atelier in Sydney, said he was<br />

most excited by the selection of violet-blue<br />

diamonds in the Tender.<br />

“The Argyle blues are unique in the world.<br />

All other blues are coloured by the element<br />

boron, whereas the unique, hydrogen-rich<br />

chemical composition of Argyle blues is what<br />

leads to the occasional ‘violetish blue’ or<br />

‘blue-violet’ diamonds which are so sought<br />

after by diamond connoisseurs and collectors<br />

the world over,” Neuman explained.<br />

“As far as we know, these are the only<br />

diamonds which attain this rare and quite<br />

beautiful violet hue.”<br />

Neuman noted that a number of red diamonds<br />

had also been included, continuing a relatively<br />

recent trend in the Argyle Tender.<br />

“This has been one of the main points of<br />

difference of the past 10 years – the inclusion<br />

of straight red diamonds, as opposed to<br />

purplish-red, in each and every one, with<br />

several reds in most.<br />

“There’s probably been an average of less than<br />

one straight red for every year of the Tender,<br />

and more than half of them have appeared in<br />

the last decade,” he added.<br />

Of the Petite Suite sets, Der Bedrossian said<br />

that in previous years, melee tenders often<br />

took place separately in March.<br />

However, including the most striking<br />

smaller diamonds as sets in the main<br />

Tender increased their appeal for jewellers,<br />

as they could create a “special and unique<br />

masterpiece” using all the stones from a set.<br />

Neuman added, “They will enable jewellers<br />

who end up purchasing them to create ‘legacy’<br />

pieces as a testament to the range of colours<br />

available from Argyle and for collectors to own<br />

a ‘set’ of diamonds which had been carefully<br />

curated over the mine’s final years.”<br />

Indeed, Calleija told <strong>Jeweller</strong>, “My passion for<br />

these magnificent gifts of nature will certainly<br />

continue, as Calleija is fortunate to have one<br />

of the world’s finest collections of Argyle pink<br />

diamonds and their beauty will continue to<br />

inspire me for years to come.”<br />

Due to the COVID-19 pandemic, selected<br />

buyers have been invited to ‘virtually preview’<br />

the Tender stones.<br />

Physical viewings will take place later in<br />

the year at the Argyle Mine in the Kimberley<br />

region, and in Perth, Singapore and Antwerp.<br />

Bids close on 2 December <strong>2020</strong>.<br />

<strong>Jeweller</strong>y businesses integrated into new Palloys ordering<br />

and account management platform<br />


There is also a new ‘Diamond Database’, which allows<br />

jewellers to order certified or non-certified stones loose<br />

or set in finished designs, in sizes 0.30-carat to 6-carat<br />

and melee.<br />

“Our jewellery division offers an end-to-end jewellery<br />

service including design, print, mould, casting and<br />

finishing and now we also offer diamonds online. Handmaking<br />

jewellers can also purchase our fabricated<br />

metals, findings and casting granules at the same time,”<br />

Habbal said.<br />

“This new interface took two years to<br />

design and implement, and is intended to<br />

make Palloys a ‘one-stop destination’ for<br />

all jewellery needs and services.”<br />

STEVEN KRATSAS, Palloys<br />

“The instant quoting for CAD files, casting from their<br />

own mould library, fabricated metals and diamonds<br />

allows jewellers to enjoy accurate and instant quotes<br />

they can pass onto their customers, giving the jewellers<br />

the competitive advantage the need to secure a job by<br />

giving the customer a quote on the spot, or eliminating<br />

the guesswork when designing to fit within a budget.”<br />

The platform also has an emphasis on customisation,<br />

with jewellers able to select from more than 245,000<br />

designs and adjust the metals, features, and stone size<br />

according to the customer’s budget. The jeweller can<br />

then view a 360-degree render of the design before<br />

placing the order.<br />

The first version of the site launched on 2 July and the<br />

number of active accounts has since reached nearly 4,000.<br />

Kratsas said the response had been “very positive,<br />

with the vast majority of users speaking highly about<br />

the website and its ability to report live prices in a few<br />

clicks.” He added that more features are planned to be<br />

added this year, including metal accounts and a Palloys<br />

account status.<br />

Pandora to close Sydney flagship store as lease<br />

renegotiations fail<br />


It was the second most-expensive in the Asia-<br />

Pacific region, behind only Causeway Bay in<br />

Hong Kong, and recorded the largest yearly<br />

increase in rent of any location in the top 10.<br />

However, the COVID-19 pandemic resulted in<br />

a dramatic decrease in footfall. An analysis<br />

by Roy Morgan and UberMedia found that the<br />

number of mobile devices in the Sydney CBD<br />

on Sunday 20 September was 8,842, compared<br />

with 24,147 recorded on Sunday 5 January.<br />

When approached for comment on the<br />

Pandora negotiation, a spokesperson<br />

for Scentre Group told <strong>Jeweller</strong>, “We<br />

don’t comment on individual commercial<br />

arrangements with our retail partners.”<br />

The Group – which recorded a $3.6 billion loss<br />

in the first half of the year – recently made<br />

headlines for its rent dispute with long-term<br />

tenant Mosaic Group, which resulted in the<br />

temporary closure of 129 stores. The dispute<br />

was later resolved under confidential terms.<br />

Scentre Group collected 86 per cent of its<br />

monthly rental billings for August, totalling<br />

The decision<br />

to close the<br />

Pitt Street<br />

Mall store<br />

leaves<br />

Pandora<br />

with three<br />

Sydney CBD<br />

locations<br />

$183 million. Pandora is not alone in<br />

permanently closing stores due to failed<br />

landlord negotiations during the COVID-19<br />

crisis. Michael Hill International has<br />

rationalised its store network in Australia,<br />

while fashion jewellery chain Lovisa entirely<br />

withdrew from the Spanish market due to<br />

landlord intransigence.<br />

The decision to close the Pitt Street Mall<br />

store leaves Pandora with three Sydney CBD<br />

locations. Two are company owned, and one<br />

is franchised to “an owner with whom we<br />

enjoy a great partnership,” Allen said.<br />

30 | <strong>October</strong> <strong>2020</strong>

S E CUR E<br />

E A RRI NG B ACK S<br />

P r o u dly d e sig n e d a n d<br />

m a n u fac t u r e d in the U K<br />

<br />

New buying group reaches another membership milestone<br />


retailers that want to learn from each other and share with each other.<br />

We are here for the marathon, not the sprint so we value the close<br />

working relationships we have with all of our stores,” he explained.<br />

IJC also recently held a two-hour Zoom session for suppliers, which<br />

was “well received” and will be conducted regularly in the future.<br />

“We set this buying group up with equal importance placed on our<br />

suppliers and retailers,” said Zarb, adding, “We used this Zoom session<br />

to present our IJC point of difference and delivered a wealth of information<br />

on current retail trends and opportunities, as well as providing numerous<br />

ways in which IJC can support suppliers in this changed [post-COVID]<br />

environment.”<br />

Ahead of the busy holiday shopping season, Zarb said IJC would<br />

continue to offer “hands-on support and expertise” as well as an<br />

exciting Christmas promotion.<br />

LVMH and Tiffany & Co. deal collapses; court battle looms<br />

S A F E<br />

S ECU R E<br />

NON-S LIP<br />




Tiffany is confident it has complied with all of its obligations<br />

under the Merger Agreement and is committed to completing the<br />

transaction on the terms agreed to last year. Tiffany expects the<br />

same of LVMH.”<br />

He added, “We believe that LVMH will seek to use any available<br />

means in an attempt to avoid closing the transaction on the agreed<br />

terms... There is no basis under French law for the Foreign Affairs<br />

Minister to order a company to breach a valid and binding agreement,<br />

and LVMH’s unilateral discussions with the French government<br />

without notifying or consulting with Tiffany and its counsel were a<br />

further breach of LVMH’s obligations under the Merger Agreement.”<br />

“We are not aware of any other French company receiving such a request,<br />

[therefore] it is all the more clear that LVMH has unclean hands.”<br />

LVMH filed a countersuit in the Delaware court on 28 September. In a<br />

statement, it asserted that the COVID-19 pandemic has had a “devastating<br />

and lasting” impact on the jewellery company and that Tiffany & Co. failed<br />

to include a “pandemic or epidemic carveout” clause in the original Merger<br />

Agreement, which would have excluded the COVID-19 downturn from<br />

being considered a Material Adverse Effect.<br />

The filing also states: “Tiffany’s mismanagement of its business<br />

constitutes a blatant breach of its obligation to operate in the<br />

ordinary course,” adding that it was “burning cash”, “slashing capital<br />

and marketing investments” and “taking on additional debt” while<br />

improperly paying dividends to shareholders.<br />

However, Tiffany & Co. said the claims of taking on debt were<br />

“misleading” and that it “has never missed or reduced a dividend<br />

payment” since 1987, including after the September 11 terrorist<br />

attacks and during the Global Financial Crisis.<br />

Proudly distributed by<br />

Reports that the deal was in trouble first surfaced in early June,<br />

when the LVMH board met in Paris to discuss its progress. However,<br />

as recently as 30 June, Antonio Belloni, group managing director<br />

LVMH, said, “We believe that Tiffany is one of the most iconic<br />

jewellery brands. As such, it fully has its place in the LVMH portfolio.”<br />

The four-day trial will be presided over by Joseph Slights III, Vice-<br />

Chancellor of the Court of Chancery of the State of Delaware.<br />

02 9417 0177 | www.dgau.com.au

INSIDE<br />

Now & Then<br />

Holdsworth Bros. <strong>Jeweller</strong>s<br />

Celebrating 136 Years • MELBOURNE, VIC • A moment with Chris Holdsworth, co-director<br />


1884<br />

Hampden William<br />

Holdsworth opens a<br />

jeweller and watchmaker<br />

store at 241a Chapel<br />

Street, Windsor<br />

1891<br />

George Holdsworth<br />

joins his brother in<br />

the business, which is<br />

renamed Holdsworth<br />

Bros. <strong>Jeweller</strong>s<br />

L to R: The first store, located at 241a Chapel Street, Windsor, featuring its original name H.W. Holdsworth<br />

Watchmaker & <strong>Jeweller</strong>; inset, Hampden William Holdsworth | The ‘new’ store at 21-23 Chapel Street in 1923<br />

Holdsworth Bros. <strong>Jeweller</strong>s was<br />

established as H.W. Holdsworth,<br />

<strong>Jeweller</strong> & Watchmaker, on Chapel<br />

Street in the thriving suburb of Windsor,<br />

Melbourne, in the spring of 1884 by<br />

Hampden William Holdsworth.<br />

Hampden was trained as a jeweller in<br />

Geelong, and opened his store at age 24.<br />

His premises replaced that of a parasol<br />

and umbrella maker.<br />

Hampden was rewarded for his choice of<br />

location as this is where he met and later<br />

married a pretty local girl named Ellen.<br />

Later, Hampden asked his older brother<br />

George – also a jeweller – to join the<br />

business and in 1891 they changed the<br />

business name from H.W. Holdsworth<br />

to Holdsworth Bros. <strong>Jeweller</strong>s.<br />

After 20 years the brothers were able<br />

to buy corner premises at 21-23 Chapel<br />

Street. In 1913 they built a beautiful<br />

modern jewellery store and factory,<br />

consisting of a two-storey shop and<br />

dwelling on the site.<br />

That shop is still standing, although it<br />

is now a convenience store.<br />

World War I and the subsequent Great<br />

Depression were major periods of<br />

difficulty. During World War II, the shop<br />

was forced to close as resources were<br />

spent on the war effort and essential<br />

goods and services.<br />

I clearly remember the 1990 recession,<br />

during my father’s time with the business;<br />

we had to sell our family home and the<br />

wholesale side of our business was put<br />

into voluntary administration.<br />

We emerged on the other side with two<br />

stores, Knox and Eastland – which are<br />

the same two we have today – and we<br />

repurchased the wholesale business.<br />

Holdsworth Bros. <strong>Jeweller</strong>s is one of<br />

three original tenants at Eastland.<br />

The curfew and lockdown of Melbourne<br />

during COVID-19 is the first time in 75<br />

years Holdsworth Bros. <strong>Jeweller</strong>s has<br />

been forced to close its storefront, so this<br />

would be the greatest challenge of my<br />

ownership of our family legacy.<br />

Finding your way into the family jewellery<br />

business is not very hard! I started on the<br />

shop floor when I was 14, doing whatever<br />

was needed.<br />

After completing my commerce degree<br />

I took on the bookkeeping and computer<br />

work for the head office, then completed<br />

the Gemmological Association of<br />

Australia courses in Gemmology and<br />

Diamond Technology.<br />

Following that, I travelled the world for a<br />

year with no intention of returning. Dad<br />

died from cancer in 2000, leaving the<br />

business to my mum, so my brother Tim<br />

and I returned to help her. Within five<br />

years she had retired, and Tim and I<br />

were running the business ourselves.<br />

There is an ad I like from the Prahran<br />

Chronicle dated 19 September 1884<br />

announcing the opening of Hampden’s store.<br />

It reads: “<strong>Jeweller</strong>y! <strong>Jeweller</strong>y! H.W<br />

Holdsworth respectfully begs to announce<br />

that he has opened a manufacturing<br />

establishment at the above address where<br />

he is prepared to execute any article in the<br />

1913<br />

The brothers buy the<br />

corner store, 21-23 Chapel<br />

Street, and build a new<br />

modern jewellery store,<br />

factory, and dwelling<br />

1918<br />

Hampden’s sons Roy,<br />

Keith and Wallace<br />

Holdsworth take over<br />

the business after<br />

fighting in WWI<br />

1965<br />

Roy retires and his son<br />

John Holdsworth takes<br />

over the business<br />

1967<br />

John Holdsworth<br />

opens a second store<br />

at the new Eastland<br />

shopping centre<br />

1972<br />

John opens a third<br />

store in Frankston<br />

1985-1989<br />

Stores in Knox City<br />

shopping centre,<br />

Brighton and Highpoint<br />

are opened<br />

1990-1991<br />

Australia falls into<br />

recession; Holdsworth<br />

Bros. <strong>Jeweller</strong>s closes<br />

four stores – including<br />

Chapel Street<br />

2000<br />

John Holdsworth<br />

passes away, leaving<br />

the business to his<br />

wife Anna<br />

2006<br />

Anna retires, with<br />

sons Chris and Tim<br />

Holdsworth taking<br />

over the business<br />

Above: The Eastland store is one of the shopping<br />

centre’s original tenants, opening in 1967<br />

trade that may be entrusted to him at<br />

the lowest charges compatible with good<br />

workmanship and guaranteed material.”<br />

I could print this ad today, 136 years later.<br />

We do a brilliant job of fixing, restoring<br />

and making fine jewellery to an extremely<br />

high standard for a fair price.<br />

The business surviving for four<br />

generations is, I think, a matter of<br />

serendipity.<br />

Holdsworths are notoriously slow<br />

breeders, meaning there were never<br />

more than two generations of the<br />

right age to work together. If there<br />

were more, I imagine that would<br />

have created conflict!<br />

Doing things the same is just as<br />

important as adapting to change.<br />

Maintaining our values and the core<br />

aspects of what we do is part of why we<br />

are still here. However, where we see<br />

advantages to changing the way we do<br />

things, we will take those on board.<br />

Our business is traditional and looking<br />

at photos from our stores in the ‘50s<br />

isn’t much different from looking at<br />

them today. Resisting the changes from<br />

external factors that aren’t in line with<br />

our business model is just as important<br />

as recognising changes in the market.<br />

<strong>Jeweller</strong>y has a history spanning tens of<br />

thousands of years – it is probably the<br />

second-oldest profession! I don’t see<br />

jewellery disappearing in my lifetime.<br />

Read the full length interview<br />

on <strong>Jeweller</strong>magazine.com<br />

<strong>October</strong> <strong>2020</strong> | 33

10 Years Ago<br />

Time Machine: <strong>October</strong> 2010<br />

A snapshot of the industry events making headlines this time 10 years ago in <strong>Jeweller</strong>.<br />

Historic Headlines<br />

4 Pandora gears up to launch IPO<br />

4 Online aid to push Swiss watches<br />

4 Robberies take a nosedive in 2010<br />

4 Georgini expands into bridal market<br />

4 Life after beads for jewellers<br />

Diamond Exchange spirals<br />

into trouble<br />

Prominent online jewellery retailer Diamond<br />

Exchange has been hit by an application to wind<br />

up the company, which resulted in the business<br />

putting trading on hold in September while<br />

it sought to resolve the issue. The shutdown<br />

coincided with a series of consumer and trade<br />

complaints made to the JAA.<br />

Supreme Court documents state that Timothy<br />

Stanford of Morgan Trusscolt Capital – who<br />

is claiming an amount of $235,923.38 against<br />

Diamond Exchange – made the application<br />

Diamond Exchange chief financial officer Simon<br />

Middleton told <strong>Jeweller</strong> he was hopeful the issue<br />

would be resolved that week, without the need<br />

for legal action. The JAA had began working with<br />

Diamond Exchange to expedite refunds.<br />

<strong>October</strong> 2010<br />

ON THE COVER Protea Diamonds<br />

Editors’ Desk<br />

4Fight! Fight! Fight!: “This turf war<br />

[between diamonds and charms]<br />

reminded me of a schoolyard incident.<br />

In one corner was the older student<br />

– the incumbent who considered the<br />

other to be an upstart... not worthy<br />

of the attention they received.<br />

In the other corner was the new kid<br />

at school, wanting to be admired and<br />

trying new things to become popular<br />

and trendy.”<br />


Make Sales Sparkle at Christmas:<br />

“Inventory control is crucial in the<br />

lead-up to the Christmas period, when<br />

over-and under-stocking can have dire<br />

consequences for your annual figures.<br />

Retailers should aim to be more flexible<br />

with their orders over this period.”<br />

O’Neils to pursue growth with<br />

Sapphex acquisition<br />

Brisbane gem wholesaler O’Neils is gearing<br />

up for growth after buying rival Sapphex from<br />

industry veteran Terry Coldham.<br />

Sapphex has two offices; one that trades as<br />

Affiliated Importers in Melbourne, and the<br />

other in Sydney. O’Neils will expand under<br />

the new name of O’Neils Affiliated.<br />

Brendan McCreesh, O’Neils co-owner, said<br />

the acquisition provided both “economies of<br />

scale” and “gives us a whole new scope to<br />

fully develop some of the ideas we’ve been<br />

working on for the last few years.”<br />



Employment rules could catch<br />

out retail jewellers<br />

Retailers are unclear about the distinction<br />

between part-time and casual workers under<br />

the new employment Acts, it emerged at a trade<br />

fair seminar presented by EMA Consultants<br />

principal Rod Reid.<br />

Reid said that if casual staff come to work at the<br />

same time every week and work a predetermined<br />

number of hours, they could be classed as parttime<br />

under the new rules.<br />

He suggested jewellers could sign individual<br />

“flexibility arrangements” with staff, or pay<br />

employees over the Modern Award rate to offset<br />

overtime penalties.<br />

Soapbox<br />

4The One and Only Brand: “A change<br />

in consumer thinking can only be<br />

achieved with a bit more risk-taking<br />

on the part of the jewellery industry<br />

to highlight that not all jewellery is<br />

the same.<br />

Your own brand – your store and<br />

identity – is your personal pot of<br />

gold. It is what will transcend trends,<br />

fashions, and fads. As a result, it<br />

will be most effective when it is a<br />

genuine reflection of you.”<br />

– Natalie Barney, director Deborah<br />

Windfield <strong>Jeweller</strong>y<br />

iPad technology to<br />

transform industry?<br />

Already touted as the future of retail store<br />

service, one jewellery photographer believes<br />

the iPad could revolutionise how suppliers<br />

operate too.<br />

Conrad Vanecek of Jewels Australia, who<br />

catalogues product for jewellery brands including<br />

Opals Australia, Cashelle and Ikecho Pearls, said<br />

the new techology has dispensed with the need<br />

for a paper portfolio, calling it “a game changer”.<br />

With the iPad, a sales rep can update their stock<br />

styles as soon as stock becomes available.<br />

Meanwhile, photos of jewellery appear very<br />

crisp and attractive on the iPad screen, with its<br />

accurate colour calibration and high resolution.<br />

34 | <strong>October</strong> <strong>2020</strong>


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Retail Update<br />

A time for hard work and optimism<br />

The Christmas shopping season is crucial for retailers, and in the lead up to this most important time,<br />

the Australian Retailers Association (ARA) is advocating for our sector to increase government support.<br />

When last we spoke in May I was talking<br />

about the ARA’s Retail Recovery Protocol<br />

– ways for storeowners to stay open amid<br />

the COVID-19 pandemic across Australia.<br />

But as we’ve learned from this event,<br />

anything can happen, and predicting the<br />

future is impossible at the best of times.<br />

Firstly, we are encouraging members<br />

to actively undertake the government’s<br />

subsidised and accredited infection control<br />

training, which the ARA provides.<br />

We are also supporting broader measures<br />

that will enhance safety:<br />

Back then, no-one foresaw the events that<br />

have since occurred in Victoria, where a<br />

second wave of the virus prompted the<br />

imposition of a protracted lockdown.<br />

• The restriction of movement to one<br />

person per household in the same way<br />

we have for essential services<br />

and supermarkets in recent weeks.<br />

It’s a lockdown that is decimating not only<br />

that state’s economy, but also having ripple<br />

effects across the nation given Victoria’s<br />

importance in the supply chain.<br />

The ARA is working with members to<br />

mitigate the impact on the retail sector<br />

there, but unfortunately, what the state<br />

is offering as far as a financial lifeline –<br />

especially to small retailers – is not enough.<br />

In fact, we are sadly anticipating a large<br />

number of small retail operations in Victoria<br />

will not survive, leaving thousands of<br />

employees out of work.<br />

And it may take as long as a decade to see<br />

the once bustling and vibrant shopping<br />

districts of Melbourne regain their full glory.<br />

At the federal level, we are encouraged by<br />

the extension of the JobKeeper program,<br />

which has proven to be a vital tool in<br />

supporting retail spending.<br />

But as the economy continues to worsen,<br />

we will see more people unemployed, and<br />

for those on JobSeeker, we don’t believe it<br />

is fair that their social safety-net returns to<br />

below-poverty levels.<br />

COVID-safe shopping<br />

This is a critical time of the year for<br />

retailers, particularly those in the<br />

discretionary categories where as much as<br />

two-thirds of their revenue is made in the<br />

summer shopping season.<br />

As of 1 September <strong>2020</strong>, the ARA had<br />

277 members from the jewellery sector,<br />

representing 1,208 stores.<br />

We realise how important this time of year is<br />

particularly for jewellers. Hiring extra casual<br />

workers and bringing in new inventory is<br />

a difficult task when shops are closed, so<br />

leading up to the holidays, each day counts.<br />

The longer the wait to fully reopen, the more<br />

difficult it will be to cash-up and fill the<br />

coffers before the end of the year.<br />

We believe a progressive opening up of the<br />

retail space – in a safe manner – is the most<br />

important first step in Victoria.<br />

Shopping is safe – COVID-19 transmissions<br />

within retail remain extremely low, with a<br />

recent survey of ARA members across the<br />

country indicating that 93.4 per cent had<br />

no cases of COVID-19 transmission in their<br />

stores or distribution centres.<br />

From a practical point of view, there are<br />

many steps retailers throughout Australia<br />

need to take to not just create but maintain<br />

a COVID-safe environment.<br />

We realise how<br />

important this<br />

time of year is,<br />

particularly for<br />

jewellers. Hiring<br />

extra casual<br />

workers and<br />

bringing in new<br />

inventory is a<br />

difficult task<br />

when shops are<br />

closed<br />

• Mandatory mask wearing by both<br />

customers and staff to help protect<br />

and mitigate any risk of transmission.<br />

• The introduction of COVID marshals,<br />

consistent with the South Australian<br />

approach, for larger retailers.<br />

• Extra COVID-safe measures identified<br />

by the Victorian government to avoid<br />

strict lockdowns.<br />

Hope springs eternal<br />

I understand the pain many of our retailers<br />

are feeling right now, but I also know how<br />

resilient and innovative we are. To see so<br />

many businesses successfully adapt from<br />

a pre-COVID environment to a post-COVID<br />

environment is very heartening.<br />

The bricks-and-mortar shops that adapted<br />

to online delivery and/or click-and-collect,<br />

and the clothing brands that made masks<br />

fashionable to wear, there are countless<br />

stories about how retail businesses have<br />

transformed since COVID.<br />

Yet there is still much work to be done<br />

as we embark on the rebirth of retail.<br />

Paul Zahra is CEO of the Australian<br />

Retailers Association. As a leading retail<br />

expert, he has worked in the industry for<br />

nearly 40 years, from ASX-listed companies<br />

to small businesses. retail.org.au<br />

The Australian Retailers Association (ARA) is the largest association representing the country’s $310 billion<br />

retail sector, which employs more than 1.2 million people. Providing expert advice across multiple disciplines<br />

including leasing and wage rates, the ARA’s mission is to ensure retail success by informing, protecting,<br />

advocating, educating and saving money for members.<br />

<strong>October</strong> <strong>2020</strong> | 37

Completing my Diploma in<br />

Gemmology has benefited<br />

me as a jeweller in more<br />

ways than I ever expected.<br />

I have always had an interest<br />

in gemstones and found<br />

the course was not only<br />

informative and challenging<br />

but immensely rewarding.<br />

Studying with the GAA has also<br />

allowed me to meet like-minded<br />

people from many facets of the<br />

jewellery industry and grants me access<br />

to resources that I will continue to use<br />

throughout my professional career.<br />

Emma Meakes FGAA<br />

<strong>Jeweller</strong>, John Miller Design - WA<br />

Diploma in<br />

Gemmology<br />

Enrolments now open<br />

For more information<br />

1300 436 338<br />

learn@gem.org.au<br />

www.gem.org.au<br />

Be<br />

Brilliant<br />

Gem-Ed Australia<br />


Passionately educating the industry, gem enthusiasts<br />

and consumers about gemstones


Gems<br />

Jade Part I: Jadeite<br />

L to R: Yewn High <strong>Jeweller</strong>y earrings | Tiffany & Co. pendants | Wallace Chan brooch<br />

Below: Artisan Jewelry Ring, Lydia Courteille ring<br />

The lustrous texture and luminous colours<br />

of polished jade have been prized for<br />

thousands of years. Ancient cultures in<br />

North, Central and South America, New<br />

Zealand, Asia and Europe valued jade<br />

for its beauty, hardness and durability;<br />

properties that made it suitable for use<br />

in implements, jewellery, regalia and<br />

decorative items.<br />

Wearers believed jade endowed them with<br />

long life, good health and fortune, and today<br />

jade jewellery still has strong traditional<br />

associations in many cultures.<br />

The name ‘jade’ is the commercial term<br />

used for jadeite and nephrite. Despite their<br />

similar appearance, these minerals have<br />

distinct gemmological properties.<br />

Both are silicates; jadeite is a sodium and<br />

aluminium silicate, while nephrite is a<br />

calcium and magnesium silicate.<br />

Both are polycrystalline in structure, with<br />

many interlocking microscopic crystals,<br />

making them some of the toughest<br />

materials in the gem world.<br />

So, what is the difference between the two?<br />

This month, we focus on jadeite.<br />

Typically, the name jadeite is associated<br />

with a rich deep green colour, but the gem<br />

is found in many hues – pale green, deep<br />

green to black, shades of mauve and blue,<br />

as well as white, red, brown and yellow –<br />

and is often mottled. The richer and more<br />

even the colour, the higher the value.<br />

In China, jadeite of fine green colour<br />

and translucency was once reserved<br />

for the Emperor’s court and is known<br />

as ‘imperial jade’.<br />

‘Tomb jade’ is the name used for reddish<br />

brown jade, while ‘icy jade’ or ‘water jade’<br />

denotes the colourless, almost transparent<br />

form of the gem.<br />

Jadeite has a hardness of 6.5-7 on Mohs’<br />

scale, making it suitable for use in a range<br />

of jewellery. However, it is the gem’s tenacity<br />

and capacity to be carved and fashioned,<br />

along with its vitreous lustre, that makes it<br />

attractive to jewellers and gem carvers.<br />

As with many other gemstones, jadeite is<br />

treated to improve colour and lessen the<br />

appearance of blemishes.<br />

A classification system based on the type<br />

of treatment applied to the gem is used<br />

to describe the quality (and hence value)<br />

of jadeite.<br />

The system uses the letters A, B and C, and<br />

was developed by traders in Hong Kong<br />

where much of the world’s jadeite is traded.<br />

‘A’ refers to untreated jadeite; however, it<br />

may be waxed and as this is a removable<br />

treatment that affects only the surface of<br />

the gem, it does not have to be disclosed.<br />

Jadeite<br />

From the French<br />

translation of the<br />

Spanish phrase piedra<br />

de ijada, meaning<br />

‘stone of the side’<br />

Colour: Many, from<br />

pale and deep green<br />

to pink, lavender,<br />

and black<br />

Found in: Myanmar<br />

(Burma), Guatemala,<br />

and Russia<br />

Mohs Hardness: 6.5–7<br />

Class: Pyroxene<br />

Lustre: Subvitreous<br />

Formula: NaAlSi 2<br />

O 6<br />

‘B’ jadeite has been treated with acid to<br />

remove stains and noticeable inclusions.<br />

This treatment can damage the gem’s<br />

surface, making it fragile. Consequently, a<br />

further treatment using resin to impregnate<br />

the gem is used to enhance its durability.<br />

The classification ‘C’ refers to ‘B’ jadeite<br />

that has been also been dyed to improve<br />

the gem’s colour.<br />

Both ‘B’ and ‘C’ jadeite must be disclosed<br />

as treated gems.<br />

Given that the prices of ‘A’ jadeite can be<br />

in the millions of dollars whilst ‘C’ jadeite<br />

can be a few dollars for the same sized<br />

piece, it is helpful to be able to distinguish<br />

between them!<br />

There are many simulants sold as jadeite.<br />

Some gems that can look similar and are<br />

sold to confuse the buyer include bowenite,<br />

aventurine, prehnite, chrysoprase and<br />

chalcedony. Standard gem testing will<br />

identify simulants quite easily.<br />

Key sources today of quality jadeite are<br />

Myanmar (Burma), Guatemala and Russia.<br />

Susan Hartwig FGAA combines her love<br />

for writing with a passion for gems and<br />

jewellery through her gemmology blog,<br />

ellysiagems.com. For more information<br />

on gemmology courses and gemstones,<br />

visit gem.org.au<br />

<strong>October</strong> <strong>2020</strong> | 39


Retail Rent Review<br />

SEEING<br />

EYE to EYE<br />


The COVID-19 pandemic has caused the bubbling tension between<br />

retailers and landlords to boil over – but the crisis has cleared the way<br />

for a new paradigm, writes ARABELLA RODEN.


Retail Reality<br />

Leasing premises is one of the highest<br />

fixed costs associated with traditional<br />

retail, alongside staff. Yet unlike staff<br />

contracts, lease agreements are largely inflexible<br />

– often with fixed minimum terms of five years<br />

– and can increase beyond inflation for years<br />

at a time regardless of trading conditions,<br />

demanding tenants sacrifice margin or<br />

constantly increase sales.<br />

During good economic times, these fixed terms were<br />

somewhat tolerable for businesses. However, the retail<br />

environment has become increasingly challenging in<br />

recent years; changing consumer habits, shrinking<br />

margins, and increased competition have all served to<br />

erode profitability.<br />

Simon Fonteyn, managing director of retail leasing data<br />

firm LeaseInfo Group, says, “Over the past five years, there<br />

has been an increasing amount of capital required for<br />

retailers to do business. In terms of leasing structures,<br />

rents have generally been outstripping sales. Typically,<br />

rents have escalated between 4–5 per cent per annum,<br />

whereas retail sales have increased by, on average, 2 per<br />

cent per year.”<br />

Fonteyn says there was already a “shake-out” occurring<br />

in the sector prior to the COVID-19 pandemic, pointing to<br />

the high-profile collapse of several fashion and footwear<br />

retailers – such as Bardot, Ed Harry, and Ziera – in 2019.<br />

The arrival of the virus in January <strong>2020</strong> “accelerated<br />

and amplified cracks that were already visible” in the<br />

retail sector, according to the KPMG white paper Beyond<br />

COVID-19: The Shifting Foundations in Retail Property,<br />

which was published in June <strong>2020</strong>.<br />

“Retail precinct footfall had been in decline for years as<br />

e-commerce penetration grew – recording 8.1 percent in<br />

cumulative footfall losses over the three years to <strong>2020</strong>.<br />

Retailer profit margins and retail landlord yields were<br />

being squeezed since 2017 and consumer confidence had<br />

been in decline for most of 2019,” the paper’s authors note.<br />

By mid-year, the Australian economy was in recession for<br />

the first time in nearly three decades, and the effective<br />

unemployment rate had reached 13 per cent, according<br />

to Federal Treasurer Josh Frydenberg.<br />

Consumer spending see-sawed, with the Australian<br />

-8.1%<br />

retail precinct<br />

footfall decline,<br />

2017–2019<br />

KPMG, Beyond COVID-19:<br />

The Shifting Foundations of<br />

Retail Property<br />

4–5%<br />

average yearly<br />

increase in retail<br />

rental cost<br />

Simon Fonteyn<br />

analysis<br />

1,338<br />

shopping centres<br />

in Australia<br />

The Retail<br />

Doctor Group<br />

5.1%<br />

vacancy rate in<br />

shopping centres,<br />

June <strong>2020</strong> – a<br />

20-year peak<br />

JLL Australia<br />

12%<br />

proportion of<br />

Australian retail<br />

sales that took<br />

place online in<br />

March <strong>2020</strong><br />

Australia Post, <strong>2020</strong><br />

eCommerce Industry Report<br />

Bureau of Statistics (ABS) recording the most precipitous<br />

fall and meteoric rise in retail trade figures consecutively<br />

in April and May. At the same time, foot traffic at shopping<br />

centres and retail precincts collapsed by up to 80 per cent,<br />

leaving businesses out in the cold.<br />

In the midst of the unforeseen and turbulent conditions<br />

precipitated by the virus, Paul Zahra, CEO of the Australian<br />

Retailers Association, notes that some landlords have<br />

been unwilling to accept this new reality.<br />

“The challenges endured by retailers over the course of<br />

the pandemic have put a spotlight on the high cost of<br />

rents,” he explains.<br />

“Unsustainable annual increases to rent have been<br />

a persistent problem for some time now, with rents<br />

far outpacing revenue growth amid a changing retail<br />

environment. We expect many stores will require ongoing<br />

rent relief to help them recover – and when retailers win,<br />

landlords win.<br />

“Unsustainable annual increases to rent have<br />

been a persistent problem for some time now,<br />

with rents far outpacing revenue growth amid<br />

a changing retail environment.”<br />

PAUL ZAHRA, Australian Retailers Association<br />

“Landlords need to remember that we are in a recession.<br />

It’s a false economy for landlords to try to extract rent from<br />

retailers that need cash reserves to survive,” he adds.<br />

Indeed, Scentre Group, Australia’s largest shopping centre<br />

landlord, recorded a $3.6 billion loss in the first half of<br />

the year, including a $4 billion reduction in the value of its<br />

property portfolio.<br />

Negotiations with long-term tenant Mosaic Group – which<br />

owns Rivers, Katies, and Noni B – collapsed in August,<br />

resulting in the temporary closure of 129 stores by Scentre<br />

Group. The dispute was resolved under confidential terms.<br />

In September, Scentre Group’s negotiations with Pandora<br />

Jewelry over its Pitt Street Mall flagship store also<br />

collapsed. Pandora opted not to renew the lease and close<br />

the store, which had been operating at the Sydney CBD<br />

site for 10 years.<br />

Peter Ryan, director of retail strategy firm Red<br />

<strong>October</strong> <strong>2020</strong> | 41


Australia’s<br />

Largest<br />

Retail Property<br />

Groups by Gross<br />

Lettable Area<br />

Communication, predicts that retailers will be in ‘survival<br />

mode’ for at least the next two years as a result of the<br />

pandemic. “Foot traffic is down, there has been a ‘forced’<br />

shift to online retail, and sales and margin are under<br />

enormous pressure,” he says.<br />

“As household disposable incomes succumb to economic<br />

pressure, stores will be subjected to intense pressure –<br />

some of it appropriate, a lot of it unwarranted. Lease costs<br />

and inclusions must be reduced or they run the risk of<br />

becoming uneconomic.<br />

“No retailer will be able to support high rents any longer<br />

and therefore renegotiating terms is a critical success<br />

factor both in terms of survival and growth,” Ryan says.<br />

It’s a conclusion supported by the KPMG paper, which<br />

notes, “Even if COVID-19 is quickly resolved, retailers<br />

and landlords will need to ‘lean in’ to create a new and<br />

more sustainable retail business model, which in turn<br />

will require adaptations to the property model.”<br />

Given the impact of the pandemic, two questions remain:<br />

what will the retailer-landlord relationship look like, post-<br />

COVID, and how can retailers shift the balance toward<br />

more favourable terms?<br />

Examining the retail landscape<br />

According to analysis by the Retail Doctor Group’s Brian<br />

Walker, Australia has 1,338 shopping centres, which<br />

comprise 85 per cent of stores and attract 85 per cent<br />

of overall shopping visitation.<br />

These shopping centres are, in the main, owned and<br />

operated by real estate companies including Scentre<br />

Group, Vicinity Centres, and Stockland, many of which<br />

are publicly traded.<br />

85%<br />



Ideally, the relationship between retailer and landlord<br />

is one of mutual benefit; while the latter collects rental<br />

income, the former is meant to enjoy increased and highquality<br />

footfall as well as reduced occupancy cost.<br />

ASX: SCG<br />

37 shopping centres in<br />

Australia and 5 in NZ<br />

Approximately<br />

3.8 million sqm<br />

lettable retail space<br />

ASX: VCX<br />

64 shopping centres<br />

Approximately<br />

2.5 million sqm<br />

lettable retail space<br />

ASX: SGP<br />

35 shopping centres<br />

Approximately<br />

1.02 million sqm<br />

lettable retail space<br />

QIC Global Real Estate<br />

Government-owned<br />

26 shopping centres and<br />

retail precincts<br />

Approximately 1.42 million<br />

sqm lettable retail space<br />

ASX: GPT<br />

12 shopping centres<br />

Approximately<br />

960,800 sqm<br />

lettable retail space<br />

Yet it is not always so.<br />

Frank Salera, director Salera’s – a jewellery chain which<br />

has been dealing with landlords since 1953 and operates<br />

20 stores across Victoria and Queensland – observes,<br />

“The key challenge is that landlords seek to maximise<br />

the returns to their shareholders, who expect year-uponyear<br />

increases – and this objective is irrespective of the<br />

challenges of increasing retail performance, which is<br />

often declining.<br />

“This results in a situation where now, more than ever,<br />

retailers are required to ‘throw the keys on the table’ [threaten<br />

to vacate] before the landlords will consider a rent that affords<br />

the retailer a minimum return on investment.”<br />

“The key challenge is that landlords seek to<br />

maximise the returns to their shareholders,<br />

who expect year-upon-year increases –<br />

and this objective is irrespective of the<br />

challenges of increasing retail performance,<br />

which is often declining.”<br />

FRANK SALERA, Salera’s<br />

It’s a perspective shared by Balaji Sambasivam, chief financial<br />

officer of large chain The <strong>Jeweller</strong>y Group (TJG), which<br />

operates 67 stores under the Mazzuchelli’s and Zamels<br />

brands. Notably, TJG’s store count has decreased dramatically<br />

since 2010, when it operated more than 120 stores.<br />

When asked about the challenges of negotiating leasing<br />

agreements, he said, “Landlords were unilaterally<br />

considering only their property valuation and returns, with<br />

less scope to look at the retailer’s commercial viability of<br />

operating the store.”<br />

He added, “There was lots of pushback in negotiating the<br />

multiple stores as one portfolio, as they were stating that<br />

each store has different cost dynamics and the owners’<br />

expectations were different.”<br />

When negotiating the terms of a lease, retailers have<br />

historically been at a disadvantage, with Ryan noting<br />

that they must often supply trading information to<br />

landlords “only for them to turn around and use that<br />

information to negotiate onerous terms based on a<br />

percent-of-sales formula”.<br />

42 | <strong>October</strong> <strong>2020</strong>

Retail Rent Review | STRATEGY FEATURE<br />



If current trends continue unabated, without<br />

a flexible and reasonable response from<br />

landlords, the retail landscape in Australia<br />

could look dramatically different in the<br />

coming years.<br />

Overall, retail footfall has been in decline<br />

since at least 2017 and at an accelerating<br />

rate – which will likely continue as<br />

e-commerce penetration increases.<br />

Yet over the same period, rents have<br />

increased, on average, by 4–5 per cent<br />

per year, according to LeaseInfo Group<br />

managing director Simon Fonteyn.<br />

Tellingly, the vacancy rate across Australian<br />

shopping centres reached its highest rate in<br />

more than 20 years – 5.1 per cent – in June<br />

<strong>2020</strong>, according to data from commercial<br />

real estate firm JLL Australia.<br />

For CBD-based shopping centres, the<br />

vacancy rate is at more than 10 per cent.<br />

Shopping precincts and strips have fared<br />

even worse; an analysis by real estate<br />

advisory firm Plan1 Project Management<br />

found that Melbourne’s Chapel Street had<br />

a vacancy rate exceeding 20 per cent<br />

in June <strong>2020</strong>.<br />

Across the city’s 11 major retail strips, the<br />

vacancy rate was 12.3 per cent, an increase<br />

of more than 4 per cent when compared<br />

with 2018.<br />

Speaking at the Australian Financial<br />

Review’s Virtual Retail Summit earlier this<br />

year, Julia Forrest, a portfolio manager at<br />

investment firm Pendal Group, speculated<br />

that vacancy rates would likely increase<br />

further, and that more retailers would opt<br />

for holdovers – month-to-month contracts –<br />

rather than long-term leases.<br />

Peter Ryan, director of retail consultancy<br />

RED Communication, says “The economic<br />

reality is that we face an extended period<br />

of poor market conditions with some<br />

economists suggesting the impacts could<br />

last a decade or more and that we have not<br />

seen the worst of it yet.”<br />

“The economic reality is that<br />

we face an extended period of<br />

poor market conditions with some<br />

economists suggesting the impacts<br />

could last a decade or more<br />

and that we have not seen<br />

the worst of it yet.”<br />

PETER RYAN, RED Communication<br />

However, Ryan believes “online is only part<br />

of the solution” and that stores will “regain<br />

their position as the centre of the customer<br />

relationship – [but] when that happens<br />

though is the critical question.”<br />

Without a sustainable reduction in rent,<br />

Ryan says retailers will face increasing<br />

pressure to exit tenancies.<br />

Meanwhile, Fonteyn argues that shopping<br />

centres will not disappear from the<br />

Australian landscape – but that they will be<br />

“forced to change”: “Their model is getting<br />

shoppers in, getting them to spend, and<br />

getting them to stay as long as possible.<br />

“After<br />

COVID-19,<br />

that has to be readjusted.<br />

There will<br />

be another iteration of<br />

different types of use within<br />

shopping centres.”<br />

He adds that shopping centre<br />

owners are constrained by strict<br />

planning laws. “It’s not that easy to<br />

introduce new shopping centres.<br />

“There have been a couple of new centres<br />

built [in the past 10 years], but the majority<br />

have been there for decades and have<br />

simply expanded their trading area.”<br />

However, the shift toward mixed-use,<br />

including residential, offices, services, and<br />

lifestyle, may be hampered as consumers<br />

increasingly opt to avoid crowded spaces<br />

due to safety concerns.<br />

Additionally, the KPMG white paper Beyond<br />

COVID-19: The Shifting Foundation of Retail<br />

Property notes that ‘destination shopping’<br />

at large-scale centres is in decline, with<br />

consumers increasingly preferring to<br />

spend locally in what is referred to as<br />

‘village shopping’.<br />

At the same time, replacing tenants has<br />

become “increasingly difficult”, with<br />

landlords “having to work much harder to<br />

attract new tenants and repurpose their<br />

centres to make them relevant to their<br />

communities.”<br />

In order to justify rental costs, the report’s<br />

authors suggest that landlords provide<br />

“supporting infrastructure” for retailers<br />

who are moving toward omni-channel<br />

sales, such as “kerb-side pick-up zones,<br />

dark stores/floors, shared click and collect<br />

counters, or parcel lockers”.<br />

If these changes do not occur, the value<br />

of shopping centre assets will continue to<br />

decline – as will the Australian retail sector.<br />

<strong>October</strong> <strong>2020</strong> | 43

1<br />

0%<br />

0% Investments by retailers and landlords in<br />

Australian retail footfall had been in decline for years - 1%<br />

1<br />

before COVID-19<br />

the shopping Investments experience Australian by retailers had been and consumer landlords in confidence<br />

- 1% working to the reduce shopping the experience rate of footfall had been decline<br />

12 month rolling average YoY growth rate<br />

- 2%<br />

Index (>100 = positive outlook)<br />

1<br />

STRATEGY FEATURE | Retail Rent Review<br />

working to reduce the rate of footfall decline<br />

Jan 2017 – Mar <strong>2020</strong><br />

- 2%<br />

Jan 2017 – Apr <strong>2020</strong><br />

- 3%<br />

1<br />

- 3%<br />

- 4%<br />

150<br />

1<br />

0%<br />

- 4%<br />

Australian retail<br />

Investments by retailers and landlords in<br />

- 1%<br />

- 5%<br />

140<br />

1<br />

footfall had been<br />

the shopping experience had been<br />

- 5%<br />

working to reduce the rate of footfall decline<br />

in decline for years<br />

- 6%<br />

- 2%<br />

- 6%<br />

130<br />

before COVID-19<br />

- 7%<br />

- 3%<br />

- 7%<br />

120<br />

12 month rolling average<br />

2017 2017 2018 2018 2019 2019 <strong>2020</strong> <strong>2020</strong><br />

YoY growth rates from - 4%<br />

110<br />

January 2017 – March <strong>2020</strong><br />

2017 2017 2018 2018 Positive 2019outlook<br />

<strong>2020</strong> <strong>2020</strong><br />

- 5%<br />

-3.9% -3.9% -6.7% 100-6.7% -8.1% -8.1% -11.7% -11.7%<br />

Source: KPMG report,<br />

Negative outlook<br />

using ShopperTrak data,<br />

- 6%<br />

90<br />

Jan 2017-March <strong>2020</strong><br />

. .<br />

- 7%<br />

80<br />

Consumer confiden<br />

2017 2018 2019<br />

<strong>2020</strong><br />

Cumulative Cumulative % growth % in growth footfall in footfall since 2016 since 2016<br />

70<br />

deteriorating prior t<br />

Zahra describes another “information imbalance”:<br />

“Smaller retailers, in particular, don’t fully know<br />

their rights and what they can ask for. Landlords<br />

are in the business of collecting rent, whereas<br />

for retailers, rent is just one of many parts of the<br />

business they need to manage.”<br />

Additionally, many Australian states and territories<br />

have required a minimum five-year term for<br />

commercial leases. While providing stability for<br />

retailers and security for landlords, these terms<br />

have made it more challenging for retailers to<br />

respond to downturns.<br />

As a result, several states have taken steps to<br />

amend the legislation governing commercial<br />

leases.<br />

“In NSW, which accounts for about a third of all<br />

Australian retail, there used to be a requirement<br />

of minimum five-year terms, but that has now<br />

changed [with legislation passed in 2017],”<br />

Fonteyn explains.<br />

In South Australia, amendments to the Retail<br />

And Commercial Leases Act came into force<br />

in June and have streamlined the process for<br />

acquiring a certified exclusionary clause to<br />

shorten a lease term.<br />

The changes also provide added protection and<br />

reduce confusion for small and medium retail<br />

tenants. John Chapman, South Australian Small<br />

Business Commissioner, explains that the<br />

amendments resulted from a lengthy period of<br />

consultation and an independent judicial review.<br />

“Some of the changes that have flowed through<br />

2017 2018 2019 <strong>2020</strong><br />

Notes: (1) Based on ShopperTrak 60 data, ShopperTrak uses in-store foot traffic counters to collate foot traffic data;<br />

-3.9% -6.7% -8.1% -11.7%<br />

Notes: (1) Based on ShopperTrak data, ShopperTrak uses in-store foot traffic counters to collate foot traffic data; (2) G<br />

Sources: Livewire Markets, Chart of the day: foot traffic for Australian retailers; AFR, Weak retail spending an un<br />

Sources: Livewire Markets, Chart of the day: foot traffic for Australian retailers; AFR, Weak retail spending an uninten<br />

include that landlords will be required<br />

2019; ANZ - Roy Morgan Australian consumer confidence; KPMG analysis (<strong>2020</strong>)<br />

2019; to provide ANZ - Roy Morgan in Australian penalties consumer for parties confidence; “not KPMG providing analysis (<strong>2020</strong>) the right<br />

10<br />

prospective tenants with a disclosure statement information or doing the right thing, or seeking<br />

.<br />

and a draft lease as soon as negotiations<br />

information they are not required to,” according to<br />

commence,” Cumulative % growth Chapman in footfall says. since 2016<br />

Chapman. These 2017 penalties had not been 2018 updated 2019<br />

since 1995.<br />

“What that is aiming to do is make sure people<br />

have as much information up front so they can<br />

Notes: (1) Based on ShopperTrak data, ShopperTrak uses in-store foot traffic counters to collate foot traffic data; (2) Growth rate from previous to current year’s 12-month average (e.g. Jul 16<br />

Sources: Livewire Markets, go Chart away of the and day: think foot traffic about for Australian it early. retailers; That provides AFR, Weak retail spending an unintended consequence of the banking royal commission; Savills Research Qua<br />

2019; ANZ - Roy Morgan Australian consumer confidence; KPMG analysis (<strong>2020</strong>)<br />

transparency around the stages of negotiation.”<br />

“Shopping centres have tried, generally,<br />

to change the mix to ‘experiential’<br />

retailing – lifestyle precincts, casual<br />

dining precincts, gyms – and away from<br />

more traditional retail... Unfortunately<br />

that has backfired during COVID-19<br />

because experiential retail has been<br />

hardest hit.”<br />

SIMON FONTEYN, LeaseInfo Group<br />

Additionally, the South Australian Small Business<br />

Commission has produced a Retail Commercial<br />

Leasing Guide, which is now required to be<br />

provided to prospective tenants.<br />

“This document is very much aimed at helping<br />

tenants understand their obligations and what<br />

a lease may contain, with frequently-askedquestions<br />

and indeed tips on what to look out for,”<br />

Chapman says.<br />

Other changes include a “significant increase”<br />

In the past five years, Fonteyn notes that shopping<br />

centre landlords have also made significant<br />

efforts to improve footfall, namely by shifting the<br />

retail mix toward services and lifestyle.<br />

“Shopping centres have tried, generally, to<br />

change the mix to ‘experiential’ retailing – lifestyle<br />

precincts, casual dining precincts, gyms – and<br />

away from more traditional retail like apparel<br />

and footwear.<br />

“Unfortunately that has backfired during<br />

COVID-19 because experiential retail has been<br />

hardest hit,” he explains.<br />

“Centres have also become more ‘all hours’ –<br />

opening early and closing late – and they appeal<br />

to different types of shoppers throughout the day.”<br />

It’s a trend Salera has also observed: “With or<br />

without COVID, the centres have spent the last<br />

few years in considering how to maintain centres<br />

as a hub of consumer activity.<br />

“In the past, specialty retailers and department<br />

stores formed the basis of attracting shoppers to<br />

centres, which then created a demand for food<br />

and lifestyle – such as cinemas.<br />

“The apparent trend is that now landlord owners<br />

are focusing on food and lifestyle as the primary<br />

attraction for consumers, who will then frequent<br />

the specialty stores.”<br />

7.5%<br />



RATE, JUL ‘20<br />

82.5%<br />




RETAILERS, APR ‘20<br />

80%<br />



FOOTFALL, Q1 <strong>2020</strong><br />

44 | <strong>October</strong> <strong>2020</strong>

Retail Rent Review | STRATEGY FEATURE<br />

As Fonteyn notes, the viability of the lifestyledriven<br />

strategy has been significantly hampered<br />

by COVID-19, at least in the short-term.<br />

Whether footfall will recover to previous levels<br />

remains to be seen, given that COVID-19 has also<br />

accelerated another major retail trend of the past<br />

five years: e-commerce.<br />

Facing the headwinds<br />

COVID-19 dealt a devastating blow to the<br />

Australian economy, plunging it into recession<br />

and increasing the official unemployment rate to<br />

7.5 per cent, its highest level in 22 years.<br />

At the same time, shopping centre footfall<br />

declined by more than 80 per cent in <strong>2020</strong>, when<br />

compared with 2019, during the nationwide<br />

lockdown. It remains about 20 per cent lower<br />

in states that have emerged from restrictions,<br />

according to data from ShopperTrak.<br />

The KPMG white paper notes, “The higher the<br />

footfall, the more time consumers dwell and the<br />

more confident consumers are in their financial<br />

wellbeing, the more money they spend with<br />

retailers, who can then pay rent to landlords and<br />

make a profit.<br />

“The COVID-19 physical distancing measures<br />

and the resulting recession work against all<br />

three of these value drivers – footfall, dwell times<br />

and consumer confidence.”<br />

For practical reasons, consumers increasingly<br />

turned to e-commerce while under lockdown and<br />

have adapted to its convenience.<br />





Since 2015, several major trends have<br />

been noted in shopping centres. These<br />

have occurred as a result of changing<br />

consumer behaviour as well as external<br />

pressures on specific categories within<br />

the retail sector.<br />

Foot traffic has been driven by different<br />

factors: The number of department<br />

stores and discount department stores<br />

in shopping centres has shrunk.<br />

Meanwhile, supermarkets – such as<br />

Woolworths – and lifestyle businesses,<br />

such as gyms, as well as cinemas<br />

have been making up some of that lost<br />

foot traffic.<br />

Shopping centres have become<br />

more ‘all hours’: Early opening and<br />

late closing has increased in order to<br />

appeal to different types of shoppers<br />

throughout the day.<br />

A move toward mixed-use<br />

development: Shopping centre<br />

landlords have shifted their model<br />

to include a combination of retail,<br />

residential, and offices. In the future,<br />

this mixed-use model could also<br />

include hotels.<br />

Instability in the discretionary retail<br />

sector leading to changing tenancy<br />

mix: Retailers, particularly in fashion<br />

and footwear, have been vulnerable<br />

to increased competition from large<br />

international entrants to the market, as<br />

well as online-only fast retailers. This<br />

has led to a ‘shake out’ of such tenants.<br />

The Australian Financial Review reported that in<br />

August <strong>2020</strong>, e-commerce sales increased 56 per<br />

cent for omni-channel retailers when compared<br />

with April 2019. For online-only retailers, the<br />

figure was 109 per cent.<br />

That shift – however temporary – away from<br />

bricks-and-mortar shopping has placed significant<br />

pressure on retailers and landlords alike.<br />

Vicinity Centres – which operates 60 shopping<br />

centres across Australia, including Melbourne’s<br />

Chadstone and Chatswood Chase in Sydney – was<br />

recently forced to launch a $1.4 billion capital<br />

raising to mitigate the decline in rental income,<br />

while its overall real estate portfolio declined in<br />

value by $1.8 billion for the first half of the year.<br />

While retail sales fell a record 17.7 per cent in<br />

April due to widespread lockdowns, the figure<br />

rebounded 16.3 per cent in May as government<br />

stimulus flowed through to consumers and<br />

businesses, before stabilising in June.<br />

However, the spending was largely concentrated<br />

in necessities such as groceries, hardware, and<br />

homewares. Fonteyn said the jewellery category<br />

had been “heavily impacted”, though urban areas<br />

had again borne most of the brunt.<br />

With bricks-and-mortar retailers across<br />

discretionary categories in dire straits, the<br />

necessity of rent reductions, waivers, and<br />

deferrals became clear.<br />

“Meeting rental obligations is a significant<br />

concern for retailers, with many stores still<br />

suffering diminished revenue, particularly<br />

17.7%<br />


SALES, APR ‘20<br />

12.3%<br />

16.3% 2%<br />



SALES, MAY ‘20<br />

OF MAJOR<br />






<strong>October</strong> <strong>2020</strong> | 45

STRATEGY FEATURE | Retail Rent Review<br />


The Response<br />

to COVID-19<br />

When it comes to<br />

assessing the impact<br />

of COVID-19 on<br />

shopping centres,<br />

Simon Fonteyn,<br />

managing director<br />

of retail data firm<br />

LeaseInfo Group,<br />

argues that the<br />

figures paint a<br />

nuanced picture.<br />

“[The impact is]<br />

location-specific,<br />

sector-specific,<br />

geographically<br />

specific – and within<br />

shopping centres,<br />

certain categories<br />

are doing better than<br />

others. Generally<br />

speaking, the<br />

smaller shopping<br />

centres – what we<br />



% change<br />

by precinct<br />

format<br />

Sm all shopping<br />

centres<br />

Large format<br />

stores 2<br />

Medium<br />

shopping c entres<br />

Major<br />

retail strips<br />

Large shopping<br />

centres<br />

Me lbourne<br />

CBD<br />

Outlet<br />

precincts<br />

Reference periods<br />

A vs. BA vs. C<br />

27/01 –1 6/03 27/01 –2 7/04<br />

-20%<br />

-10%<br />

-19%<br />

-30%<br />

39%<br />

-47%<br />

14%<br />

-32%<br />

-39%<br />

-45%<br />

-59%<br />

-66%<br />

-87%<br />

-87%<br />

Impact of COVID-19 on shopping centre<br />

footfall by type. Source: KPMG/GapMaps.<br />

term Neighbourhood centres – have been the least impacted<br />

because customers are tending to spend and shop locally,<br />

particularly for groceries. The most impacted have been<br />

CBD shopping centres, for obvious reasons: the lack of office<br />

workers and no international tourists,” he explains.<br />

“In between those, in general the bigger the shopping centre,<br />

the more impact has been felt, usually because of what their<br />

mix entails. The exception to that rule would be shopping<br />

centres in regional areas, which have not been impacted to<br />

the extent of metro areas.” Fonteyn’s analysis is supported by<br />

data from KPMG and GapMaps (see chart, above).<br />

In terms of shopping strips or precincts, Fonteyn says the data<br />

point to even more of a “mixed bag”.<br />

“Some have been devastated by COVID-19. As an example, I<br />

was recently at a strip mall in northwest Sydney which used to<br />

be very busy, and the number of vacancies astounded me. Strip<br />

malls have been affected because a lot of the businesses that<br />

tend to go there are SMEs [small and medium enterprises] and<br />

they have been hit really hard.”<br />

“There are also high vacancy rates in Oxford Street in Sydney<br />

and Chapel Street in Melbourne – the fashion districts – and<br />

that gives you an idea that it’s really a mosaic.”<br />

This information should be taken into account when predicting<br />

how centres may recover in the medium- and long-term.<br />

Paul Zahra<br />

Australian Retailers<br />

Association<br />

“Many landlords are treating<br />

the Code’s minimum<br />

provisions for rent relief as<br />

their maximum requirement,<br />

and are unwilling to offer<br />

rent abatement higher than<br />

50 per cent of the total rent<br />

relief. However, it is unfair to<br />

be entirely critical, as we’ve<br />

also received a lot of positive<br />

feedback.”<br />

Peter Allen<br />

Scentre Group & Shopping<br />

Centre Council of Australia<br />

“We all accept that<br />

retail leases are legal<br />

obligations and enshrined<br />

in the laws of the states and<br />

territories, yet we are also<br />

commercial people and we<br />

understand there needs to<br />

be many factors taken into<br />

consideration as we come to<br />

an agreement.”<br />

John Chapman<br />

South Australian Small<br />

Business Commissioner<br />

“The vast majority of the<br />

[mediations have been]<br />

successful with the parties<br />

in agreement. We don’t<br />

expect a lot to go to court.<br />

What we are finding is that<br />

a lot of people, once we go<br />

to the other party, come to a<br />

resolution. They go away and<br />

start talking again, and that’s<br />

a great outcome.”<br />

discretionary retailers and stores in CBD or tourist-dependent<br />

locations,” Zahra says, adding that retailers would also incur<br />

costs due to COVID-19 safety requirements.<br />

On 7 April, the National Cabinet released a Commercial<br />

Tenancy Code of Conduct to guide good-faith rent<br />

renegotiations between retailers and landlords.<br />

At the time, Peter Allen, CEO Scentre Group and chairman<br />

of the Shopping Centre Council of Australia (SCCA), said,<br />

“We all accept that retail leases are legal obligations and<br />

enshrined in the laws of the states and territories, yet we are<br />

also commercial people and we understand there needs to<br />

be many factors taken into consideration as we come to an<br />

agreement on temporary arrangements.<br />

“Our aim is, in a proportionate and measured way, to share<br />

the financial risk and cash flow impact during the COVID-19<br />

[pandemic] with the interests of all our stakeholders.”<br />

“It is in our commercial interests as well as the<br />

broader economy that SMEs have longevity within<br />

our centres as they provide products and services<br />

our customers want and support local jobs.”<br />

ANGUS NARDI, Shopping Centre Council of Australia<br />

Between March and May, SCCA members were able<br />

to complete more than 6,400 revised rent agreements<br />

with small and medium-sized retailers, representing<br />

approximately 45 per cent of those who had requested relief.<br />

As of 14 August, the SCCA’s assistance extended to retail<br />

tenants totalled $1.6 billion.<br />

Angus Nardi, executive director SCCA, said, “Our industry<br />

has provided substantial rental assistance to both SME<br />

[small-and-medium enterprise] and non-SME retailers...<br />

We have strived<br />

to strike a balance between helping those who need it while<br />

at the same time confronting our own financial pressures in<br />

the face of ongoing disruptions to regular trading to protect<br />

public health.”<br />

He added that SCCA members would continue “working closely<br />

and co-operatively” with SMEs, saying, “It is in our commerical<br />

interests as well as the broader economy that SMEs have<br />

longevity within our centres as they provide products and<br />

services our customers want and support local jobs.”<br />

46 46 | <strong>October</strong> | August <strong>2020</strong> <strong>2020</strong>

Retail Rent Review | STRATEGY FEATURE<br />

Top 3 retail categories offered<br />

rental assistance<br />

26%<br />

21%<br />

14%<br />







Approaching<br />

Negotiation<br />

Meanwhile, Grant Kelley, CEO Vicinity Centres, has drawn ire<br />

for suggesting that lease agreements could include base rent<br />

plus a variable component based on retailers’ e-commerce<br />

sales, justified by bricks-and-mortar stores acting as<br />

‘showroom and fulfilment channel’.<br />

Across the retail spectrum, the ARA’s Zahra reveals that<br />

renegotiation results have been moderately successful:<br />

“We have heard from retailers that the majority of landlords<br />

are sticking strictly to the provisions specified by the National<br />

Cabinet’s Code of Conduct, however some landlords are<br />

extending better offers than the code requires which is<br />

welcome feedback.<br />

“Disappointingly, we have heard that many landlords are<br />

doing as little as possible under the law. Many landlords<br />

are treating the Code’s minimum provisions for rent relief<br />

as their maximum requirement, and are unwilling to offer<br />

rent abatement higher than 50 per cent of the total rent<br />

relief,” he says.<br />

“However, it is unfair to be entirely critical, as we’ve also<br />

received a lot of positive feedback. One medium-sized<br />

landlord wrote to all tenants to advise them of a six-month<br />

holiday for rental payments to affected tenants.”<br />

The most potent and visible example of the conflict between<br />

retailers and landlords has been the public campaign of Premier<br />

Investments, Australia’s largest retail tenant and the owner of<br />

brands such as Peter Alexander, Just Jeans and Smiggle.<br />

Led by chairman Solomon Lew and CEO Mark McInnes,<br />

Premier refused to pay rent during a six-week shutdown in<br />

the first wave of the pandemic, and has since advocated for<br />

a percentage-of-sales-only model.<br />

Prominent chains, such as jeweller Michael Hill and fashion<br />

retailer City Chic, chose to rationalise their store network<br />

and close locations due to the intransigence of landlords.<br />

In the jewellery category, Salera said his business was offered<br />

the opportunity to renegotiate with landlords, but the terms<br />

were “not acceptable”.<br />

In contrast, Sambasivam said The <strong>Jeweller</strong>y Group’s<br />

landlords were “by and large more than willing to discuss<br />

the opportunities to defer, renegotiate or waive rent”.<br />

On the state level, support has been extended by various<br />

governments to assist retailers. The Victorian Government’s<br />

lCommercial Tenancy Relief Scheme, which includes a<br />

moratorium on evictions for SME tenants meeting certain<br />

criteria – has been extended to 31 December <strong>2020</strong>.<br />

Judy O’Connell, Victorian Small Business Commissioner,<br />

Judy O’Connell<br />

Victorian Small Business<br />

Commissioner<br />

“We want to help tenants and<br />

landlords negotiate the best<br />

possible rental outcomes, so<br />

they have one less thing to<br />

worry about and can focus on<br />

coming out of this pandemic<br />

in good shape. We’re<br />

confident the new reforms<br />

to commercial tenancy laws<br />

will give tenants and their<br />

landlords the much-needed<br />

support and security they<br />

need during these incredibly<br />

tough times.”<br />

Jane Cohen<br />

KPMG<br />

“I don’t necessarily think<br />

retailers will be able to get<br />

more out of the landlords,<br />

but both will be able to<br />

create more value if they<br />

shift to a more collaborative<br />

approach.”<br />

Peter Ryan<br />

RED Communication<br />

“The problem about<br />

renegotiating rent is one of<br />

fairness to both parties. A<br />

landlord must get a return on<br />

investment or the asset will<br />

become starved of capital<br />

and operational expenditure<br />

– and that includes<br />

promotions which attract<br />

customers.”<br />




Assessment<br />

Examine your business model and decide whether it is<br />

viable for the long-term: what is the existing occupancy<br />

cost, and what is a sustainable rent going forward? How<br />

expensive is the store fit-out and how long will it take to<br />

amortise the cost?<br />

Analyse market trends and uncertainty to determine<br />

whether a short, flexible lease is preferable to a longer term<br />

Analyse the performance of your store and the shopping<br />

centre or precinct: is it in the best possible location in terms<br />

of the centre’s retail mix, and delivery of quality foot traffic?<br />

Would it be better suited to another area, or even moving to a<br />

shopping strip?<br />

Given the changes in consumer behaviour, how is the<br />

shopping centre management planning to support retailers<br />

and drive foot traffic over the next two to five years?<br />

Education<br />

Seek advice from your buying group or industry<br />

organisation, such as the Australian Retailers Association:<br />

inform yourself about the landlord’s obligations, what you are<br />

entitled to as a tenant under legislation, and what you are not<br />

required to provide – such as cash flow projections or financial<br />

statements<br />

Refer to the relevant retail tenancy legislation in your state<br />

– several have been updated in recent years with increased<br />

protections and flexibility for tenants<br />

Check your relevant Small Business Commissioner’s<br />

website for guidelines and frequently asked questions<br />

regarding commercial tenancies<br />

Negotiation<br />

Bring an attitude of fairness and good faith to the<br />

conversation, but recognise that the survival of your business<br />

is paramount<br />

Be honest with the landlord about what you can afford<br />

The Australian Retailers Association recommends retailers<br />

avoid signing a non-disclosure agreement, as this limits<br />

their options for collective bargaining<br />

If you are unable to come to an agreement, seek support<br />

from your state or territory’s relevant Small Business<br />

Commissioner, as many are equipped to provide mediation<br />

services at low or no cost<br />

August <strong>October</strong> <strong>2020</strong> <strong>2020</strong> | | 47 47

STRATEGY FEATURE | Retail Rent Review<br />

KEY<br />

TRENDS<br />

FOR<br />


told <strong>Jeweller</strong>, “We want to help tenants and<br />

landlords negotiate the best possible rental<br />

outcomes, so they have one less thing to<br />

worry about and can focus on coming out<br />

of this pandemic in good shape.<br />

“We’re confident the new reforms to<br />

commercial tenancy laws will give tenants<br />

and their landlords the much-needed<br />

support and security they need during<br />

these incredibly tough times.”<br />

By July, O’Connell’s office – the Victorian<br />

Small Business Commission – had received<br />

825 applications to resolve rent disputes;<br />

of those that were finalised, 96 per cent<br />

resulted in rent relief for the tenant.<br />

Meanwhile, South Australian Small<br />

Business Commissioner Chapman said,<br />

“The vast majority of the [mediations<br />

have been] successful with the parties in<br />

agreement. We don’t expect a lot to go to<br />

court. What we are finding is that a lot of<br />

people, once we go to the other party,<br />

come to a resolution. They go away and<br />

start talking again, and that’s a great<br />

outcome,” Chapman said.<br />

He added, “There will be those periods for<br />

businesses who were shut down and a lot<br />

of them have already come to agreements<br />

with their landlords.<br />

“There will be others that haven’t. There will<br />

be those that open up and landlords saying,<br />

‘Well, you’re open now, I want all my rent.’<br />

That is not realistic in some cases and there<br />

will be a lot subject to negotiation.”<br />

Indeed, the need for negotiation and<br />

managed expectations – on the part of<br />

both retailers and landlords – is critical<br />

in the post-COVID period.<br />

Bridging the gap<br />

For retailers, the COVID-19 pandemic<br />

dramatically rebalanced the value<br />

equation with landlords, most notably by<br />

the decrease in footfall, the increase in<br />

e-commerce trading, and the rising<br />

number of store vacancies.<br />

“Since the early 2000s at least, supply has<br />

always exceeded demand for shopping<br />

centre space. As a result of COVID-19, with<br />

the number of retailers that have gone out of<br />

business, you are seeing a situation where<br />

demand exceeds supply,” Fonteyn explains.<br />

“Retailers can’t afford now to hold any space<br />

that is not making money. Large groups<br />

may have one or two stores that they are<br />

prepared to take a loss on, but the majority<br />

will have to be profitable or breakeven. The<br />

pandemic has simply created a seismic shift<br />

in supply and demand – and hence, rent.”<br />

“There will be [consumers] who<br />

jump straight back to the way<br />

they were, but even if just a small<br />

percentage move [their shopping<br />

patterns], it makes such a difference<br />

on these fixed-cost businesses – both<br />

the landlords and the retailers.”<br />

Jane Cohen, KPMG<br />

Indeed, at the Australian Financial Review’s<br />

Virtual Retail Summit, held on 25 June, Ian<br />

Bailey, managing director Kmart Group,<br />

confirmed that 10–20 year leases and<br />

yearly increasing rents would no longer be<br />

acceptable to large anchor retailers.<br />

“None of us are going to be signing anything<br />

like that in the future because what this<br />

period of time has told us is things can<br />

happen where sales decline completely<br />

outside of the control of the retailer – and<br />

rents do not,” he said.<br />

Jane Cohen, a partner at KPMG Australia<br />

and co-author of the white paper, observes<br />

that consumer behaviour has been<br />

drastically changed by the virus and those<br />

trends are likely to continue, placing more<br />

pressure on both landlords and retailers to<br />

create a more sustainable framework.<br />

“There will be people who jump straight<br />

Higher vacancy<br />

rates means<br />

there is less<br />

competition for<br />

retail space, both<br />

in centres and<br />

precincts<br />

Economic<br />

uncertainty<br />

creates a good<br />

environment for<br />

negotiating a<br />

new, better deal<br />

as landlords<br />

look for repeat<br />

income<br />

Large shopping<br />

centres are still<br />

beholden to<br />

shareholders,<br />

putting upward<br />

pressure<br />

on rents<br />

The consumer<br />

shift to ‘village<br />

shopping’<br />

makes smaller<br />

centres more<br />

appealing for<br />

retailers<br />

As e-commerce<br />

grows, shopping<br />

centres must<br />

adapt to offer<br />

infrastructure<br />

for omni-channel<br />

retailing<br />

back to the way they were, but even if just<br />

a small percentage move, it makes such a<br />

difference on these fixed-cost businesses –<br />

both the landlords and the retailers,” she says.<br />

It’s a conclusion supported by Fonteyn, who<br />

says, “Post-COVID, it’s a whole new world.<br />

People are preferring to work from home,<br />

at least part of the time, because they don’t<br />

have to bother with the commute and it’s<br />

convenient for them.<br />

”That means the consumer behaviour will<br />

change; they might shop more locally, so<br />

there will be less demand in the CBD.”<br />

Salera notes, “Landlord’s expectations of<br />

achievable rent will need to change. In the<br />

short run, the only way that landlords will<br />

accept the possibility that they will generate<br />

less rent from sites is when they get an<br />

increased level of vacancy.<br />

“This may well escalate in the years<br />

immediately after the end of the COVID<br />

financial support as more businesses<br />

are very likely to close their doors due to<br />

unsustainable rent.”<br />

Zahra adds, “If retailers fall over due to<br />

rental costs, landlords may not be able to<br />

replace them – it’s better to have a tenant<br />

with reduced rent than an empty store. It<br />

would make more sense to come to an<br />

arrangement that allows that tenant to<br />

continue to trade profitably.”<br />

For retailers, the balance of power has<br />

tipped slightly in their favour. In addition to<br />

further regulatory protections and free statebased<br />

mediation services, the Australian<br />

Competition and Consumer Commission<br />

(ACCC) issued a draft determination granting<br />

new collective bargaining powers to the ARA<br />

and its members.<br />

“The ACCC’s draft determination will help<br />

our members exchange information and<br />

collectively bargain with landlords to achieve<br />

more productive outcomes during this<br />

uncertain time,” Zahra says.<br />

“The provision is time-bound, and is<br />

48 | <strong>October</strong> <strong>2020</strong>

Retail Rent Review | STRATEGY FEATURE<br />

scheduled to elapse on 1 September<br />

2021, which will provide retailers with a<br />

crucial opportunity to inform themselves<br />

and understand what is going on in the<br />

marketplace. This will help press the reset<br />

button on future lease agreements.”<br />

Meanwhile, Sambasivam predicts that “the<br />

valuations and cost structure of operating<br />

the stores will come to realistic levels, and<br />

landlords’ objective at this point in time is<br />

ensuring that more stores are open for trading.”<br />

When it comes to the timing of a negotiation,<br />

Fonteyn observes that landlords have been<br />

“very accommodating” for his clients and<br />

have presented the most favourable terms<br />

in 10 years.<br />

“Landlords are desperate for certainty or<br />

repeat income, so the next year or two is a<br />

great time to negotiate if you are due for a<br />

lease renewal,” he says, adding the caveat<br />

that with so much uncertainty retailers may<br />

instead take a ‘wait-and-see’ approach.<br />

He notes that many commercial tenants are<br />

“on holdover” – paying rent month-by-month:<br />

“They are dealing with all the COVID-19<br />

legislation and paperwork, so most are not<br />

even thinking of renewals at the moment, they<br />

are just getting through to September.”<br />

In the long-term, Fonteyn predicts rents will<br />

adjust in line with the retailer’s sales:<br />

“Retailers can’t continue to run businesses<br />

that are not profitable. It’s going to be<br />

much more about what’s sustainable for<br />

“If retailers<br />

fall over due<br />

to rental costs,<br />

landlords may<br />

not be able to<br />

replace them<br />

– it’s better to<br />

have a tenant<br />

with reduced<br />

rent than an<br />

empty store.<br />

It would make<br />

more sense<br />

to come to an<br />

arrangement<br />

that allows<br />

that tenant<br />

to continue<br />

to trade<br />

profitably.”<br />

Paul Zahra,<br />

Australian<br />

Retailers<br />

Association<br />

that business – and if the business is<br />

profitable, then the rent should align more<br />

broadly with the average for that sort of<br />

category,” he explains.<br />

While jewellery stores have previously<br />

been “in the crosshairs of shopping<br />

centres” to pay a higher rate per square<br />

metre for premium sites, Fonteyn advises<br />

that jewellers will be less receptive, as the<br />

vulnerabilities of the category have been<br />

laid bare.<br />

Speaking at the Virtual Retail Summit,<br />

Julia Forrest, a portfolio manager at<br />

investment firm Pendal Group, said,<br />

“We’re looking at it as an opportunity for<br />

rents to be reset to sustainable levels<br />

and once they’re at sustainable levels it<br />

will give us the confidence to put a high<br />

multiple on those earnings as retailers<br />

and sales improve.”<br />

She rejected a Premier Investments-style<br />

model as unacceptable to shareholders.<br />

Salera views the future of retailer-landlord<br />

negotiations through a pragmatic lens:<br />

“There are certain lease parameters that<br />

landlords have considered to be nonnegotiable,<br />

and I doubt that we will see a<br />

situation where small to medium retailers<br />

will be able to vary these core terms.<br />

“However, I believe that landlords will be<br />

inclined to be more lenient in areas where<br />

they have greater latitude to negotiate,<br />

rent being one such area.”<br />

Those sentiments were echoed by<br />

KPMG’s Cohen, who said: “I don’t<br />

necessarily think retailers will be able to<br />

get more out of the landlords, but both<br />

will be able to create more value if they<br />

shift to a more collaborative approach.”<br />

Sambasivam reached a similar<br />

conclusion, saying, “I am sure the<br />

relationship will be more amicable with<br />

more mutual benefits, rather than it being<br />

a ‘my way or highway’ approach.”<br />

Meanwhile, Ryan cautions both retailers<br />

and landlords against dismissing the<br />

requirements of the other. “A landlord<br />

must get a return on investment or the<br />

asset will become starved of capital<br />

and operational expenditure – and that<br />

includes promotions which attract<br />

customers. A retailer needs the lowest<br />

rent possible to survive,” he explains.<br />

“It is not landlords’ job to subsidise a retail<br />

business, but lease costs should reflect<br />

what is being delivered to the retailer.<br />

If it is the wrong type of foot traffic or a<br />

low level of foot traffic, then the onus<br />

falls to the landlord to either improve the<br />

outcome or reduce the rent.”<br />

With realistic and flexible terms in place,<br />

retailers can thrive in the new trading<br />

environment – and landlords can expect<br />

stable profits over the long-term. The<br />

result is mutually assured success,<br />

rather than destruction.<br />


Victorian Small Business Commission<br />

13 87 22<br />

NSW Small Business Commissioner<br />

South Australian Small Business<br />

Commissioner<br />

Small Business Development Corp. (WA)<br />

13 31 40<br />

Queensland Small Business<br />

Commissioner<br />

1300 312 344<br />

Business Tasmania<br />

1800 440 026<br />

Tenancy Unit, Consumer Affairs (NT)<br />

1800 019 319<br />


Australian Retailers Association (ARA)<br />

1300 368 041<br />

National Cabinet Mandatory Code of Conduct<br />

Australian Treasury<br />

KPMG Beyond COVID-19: The Shifting<br />

Foundations in Retail Property<br />

<strong>October</strong> <strong>2020</strong> | 49




Proudly distributed by<br />

02 9417 0177 | www.dgau.com.au

<strong>2020</strong><br />

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<strong>October</strong> <strong>2020</strong> | 51

Holiday Stock Special<br />


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and special look. This iconic GeoCube set features<br />

gorgeous soft purple amethyst, soft green<br />

aventurine, pastel pink rose quartz and white howlite,<br />

interspersed with sparkling Swarovski crystals.<br />

coeurdelionjewellery.com.au<br />

Dansk Copenhagen<br />

Timesupply<br />

The spring/summer range introduces<br />

new finishes in earthy matte grey and<br />

gold, with statement earrings and<br />

pendants, such as these softly looping<br />

tiered earrings and pendants from the<br />

Tabitha collection.<br />

danskcopenhagen.com<br />

52 | <strong>October</strong> <strong>2020</strong>

Athan<br />

Athan introduces the Italian-made<br />

adjustable double-loop trace chain,<br />

with lobster clasp. Available in<br />

9-carat and 18-carat yellow, white,<br />

and rose gold, and in lengths 42cm–<br />

45cm and 50cm. Also available as a<br />

standard chain.<br />

For more than 20 years, Athan<br />

has supplied the jewellery industry<br />

with the highest quality 18-carat<br />

Italian-made tennis mounts. In<br />

addition to the classic four-claw<br />

diamond cut style in a variety of sizes<br />

and settings, Athan now offers the<br />

traditional wire-prong style in sizes<br />

3pt to 20pt.<br />

athan.com.au<br />

Blush Pink Diamonds<br />

SAMS Group Australia<br />

Each Blush Pink Diamonds piece<br />

is created with certified pink<br />

diamonds from the Argyle Mine<br />

and carefully crafted in 18-carat<br />

gold with fine white diamonds.<br />

pinkkimberley.com.au<br />

Diamonds by DGA<br />

Duraflex Group Australia<br />

DGA is proud to<br />

partner with one of<br />

the world’s leading<br />

diamond jewellery<br />

manufacturers to bring<br />

you high-quality pieces<br />

at exceptional price<br />

points. Our diamonds<br />

are all ethically sourced,<br />

natural stones. The<br />

range includes 9-carat<br />

and 18-carat gold bridal<br />

sets, wedding bands,<br />

and fashion earrings,<br />

bracelets, rings and<br />

pendants. New designs<br />

now available in rose<br />

gold. dgau.com.au<br />

Proudly distributed by<br />

02 9417 0177 | www.dgau.com.au

Holiday Stock Special<br />


Fabuleux Vous<br />

The Le Ombré Crown Necklace<br />

sits on a 45cm wheat chain and<br />

is made from sterling silver,<br />

with the coin pendant oxidised<br />

to create an intriguing shadowed<br />

effect. The matching Le Ombré<br />

Crown Earrings feature the same<br />

striking oxidised effect, and sit on<br />

sterling silver hooks.<br />

fabuleuxvous.com<br />

Hurst<br />

Miln & Co.<br />

Hurst hinged silver bangles are<br />

handmade and hand-engraved<br />

in New Zealand. The 5mm EN<br />

5G S/S Bangle (far right) is set<br />

with five red garnets, and is<br />

also available with sapphire,<br />

amethyst or emerald.<br />

milnco.com.au<br />

Proudly distributed by<br />

02 9417 0177 | www.dgau.com.au<br />

Ichu <strong>Jeweller</strong>y<br />

Freshwater pearl is the centrepiece<br />

of Ichu <strong>Jeweller</strong>y’s new sterling<br />

silver and gold-plated collection.<br />

The elegant Twisted Pearl Necklace<br />

frames a single freshwater pearl,<br />

coupled with a fine cable chain –<br />

perfect for layering or solo wear<br />

and paired with the matching<br />

earrings. Available in white pearl<br />

with sterling silver, white pearl with<br />

9-carat gold plated, and lavender<br />

pearl with sterling silver.<br />


S&S<br />

Georgini<br />

West End Collection<br />

The newly-released Lusso<br />

Earrings are a standout<br />

feature of the Georgini Luxe<br />

Collection. Featuring 4.5<br />

carats of cubic zirconia,<br />

the earrings make a<br />

statement and are ideal<br />

for bridal and other special<br />

occasions. With new Georgini<br />

collections released every<br />

two months, the range<br />

remains contemporary and<br />

fresh all year round, catering<br />

for seasonal influences and<br />

celebrated dates.<br />

georgini.com.au<br />



Create Special Memories<br />

KL Diamonds<br />

KL Diamonds is the home of all the incredible Argyle<br />

natural fancy colours, from light champagne to the<br />

deepest pinks. Locally made with a lifetime warranty,<br />

KL Diamonds jewellery makes for the perfect Christmas<br />

gift. The beautifully crafted Argyle Champagne Rain Drop<br />

Pendant (left) features a stunning champagne centre<br />

stone surrounded by white diamonds, while the Argyle<br />

Pink Moon Ring (above) sparkles with a blush Argyle<br />

pink set with sparkling white diamonds.<br />

kldiamonds.com.au<br />

Mark McAskill<br />

New to the Mark McAskill range this year, these<br />

bold E730 Shepherd Hook Drop Earrings<br />

feature a pair of octagonal radiant-cut London<br />

blue topaz in 8x5mm size. Eight round brilliant<br />

cut diamonds in three claw settings highlight<br />

the centre stones, totalling 0.10 carats. Also<br />

available in morganite and peridot.<br />

with the perfect Christmas gift for that<br />

special young lady she will treasure forever.<br />

The stunning new Penelope Diamond Ring<br />

can be worn alone as a striking dress ring or<br />

paired with a variety of engagement ring styles.<br />

The dainty design features both marquise and round<br />

brilliant cut diamonds in claw settings, styled to create<br />

a crowned effect, totalling 0.18 carats. Available in<br />

9-carat or 18-carat white gold, or platinum.<br />

markmcaskill.com.au<br />

FREE gift box included<br />

Ph: +61 3 9587 1215<br />

Email: info@stonesandsilver.com.au<br />


Holiday Stock Special<br />


Nomination<br />

Composables<br />

Timesupply<br />

New from Nomination is<br />

a collection of fun and<br />

enticing composable links. From<br />

cheeky little boys and<br />

cute puppies to double links<br />

for super mums, or 18-carat<br />

gold links with crystal 18, 21,<br />

30 or 40 numerals – perfect for<br />

celebrating a milestone birthday<br />

– the latest links make for the<br />

perfect gift or self-expression.<br />

nomination-jewellery.com.au<br />

DGA diamonds are all natural and<br />

ethically mined. The range includes<br />

9K and 18K gold bridal sets, wedding<br />

bands, fashion earrings, bracelets,<br />

rings and pendants.<br />

New season designs now available.<br />

Paterson Fine <strong>Jeweller</strong>y<br />

Given the high gold price, it is an ideal time<br />

to think of platinum for a strong fully-lined<br />

men’s signet ring – one of this season’s<br />

biggest trends. From classic minimalist<br />

rings ready to be engraved, to stylish<br />

designs set with natural gemstones, these<br />

pieces are a must for your Christmas stock.<br />

pfj.com.au<br />

Proudly distributed by<br />

Qudo<br />

Timesupply<br />

New from Qudo are the gorgeous<br />

shimmering Swarovski Crystal Delite<br />

interchangeable tops in Royal Blue,<br />

Royal Red and Laguna Turquoise –<br />

bright, vibrant colours perfect for the<br />

warmer months. Also just released is<br />

the new Aurora Boreale Sesto top (top<br />

left), which picks up the colours around<br />

it and changes as the light reflects.<br />

Alongside the exciting fresh colours are<br />

new shapes, including the softly rounded<br />

10mm Sesto top. Meanwhile, the new<br />

Canino Deluxe 10.5mm is a smaller,<br />

flatter style, surrounded by crystals.<br />

timesupply.com.au<br />

02 9417 0177 | www.dgau.com.au

Holiday Stock Special<br />


Nomination Instinct<br />

The new Instinct Collection from<br />

Nomination offers beautiful natural<br />

stone bracelets in stylish designs,<br />

ideal for layering and representing<br />

excellent value for money. The<br />

perfect unisex gift, these pieces<br />

look great layered together or<br />

with the Composable bracelets.<br />

nomination-jewellery.com.au<br />

Pandora<br />

Pandora helps to celebrate the<br />

holidays with elegant, hand-finished<br />

jewellery that makes every moment<br />

shine a little brighter. From<br />

sparkling sterling silver to Pandora<br />

Rose pieces, the Pandora Timeless<br />

collection is designed to elevate and<br />

celebrate. Give the gift that shows<br />

loved ones how special they are.<br />


Holiday Stock Special<br />


Stones & Silver<br />

Introducing the new Zodiac Range of rings<br />

and stud earrings, made from 925 sterling<br />

silver and measuring 10mm diameter. All 12<br />

zodiac star signs are available. An ideal gift<br />

for Christmas and all year round.<br />

RAS<br />

Timesupply<br />

New to Australia and New<br />

Zealand, RAS delivers the<br />

best in Spanish design<br />

and craftsmanship, with<br />

a unique and artistic feel.<br />

These beautiful earrings<br />

from the Orange Bouquet<br />

collection feature a<br />

brightly coloured enamel<br />

florals, perfect for a fresh<br />

summer look, with a<br />

matching pendant.<br />

timesupply.com.au<br />

The signet ring is an iconic piece of<br />

jewellery for men, but these accessories are<br />

also being embraced by women. Simple and<br />

timeless, this feminine heart-shaped signet<br />

ring is crafted from 925 sterling silver set with<br />

a small sapphire. Also available in 14-carat<br />

yellow gold plated and rose gold plated with<br />

either a pink cubic zirconia or ruby.<br />

stonesandsilver.com.au<br />

Pink Kimberley<br />

SAMS Group Australia<br />

Argyle pink diamonds are beyond rare, and among<br />

the most precious in the world. Pink Kimberley<br />

jewellery is crafted from an exquisite blend of white<br />

diamonds and natural Australian pink diamonds<br />

from the Argyle Mine, located in the East Kimberley<br />

region of Western Australia. An Argyle Pink Diamond<br />

Certificate accompanies all Pink Kimberley pieces<br />

containing pink diamonds greater than 0.08ct.<br />

pinkkimberley.com.au<br />

Platinum<br />

Mens Signet Rings<br />

Order now<br />

to get in time<br />

for Christmas!<br />

Go platinum for a strong fully-lined men’s signet ring.<br />

Don’t miss out on sales and ensure you’re keeping stock<br />

of this season’s most trending item.<br />

03 9555 9344<br />



Thomas Sabo<br />

Duraflex Group Australia<br />

Discover the new Charming Collection from<br />

Thomas Sabo! A limitless variety of dainty and<br />

fun necklaces, bracelets, rings, pendants and<br />

earrings awaits. Express your personality – stack<br />

and layer sterling silver and gold plated designs<br />

to create your own mix-and-match looks.<br />

thomassabo.com.au<br />

Simply<br />

Better<br />

Iconic. Swiss. Sustainable.<br />

Worth & Douglas<br />

Worth & Douglas is inspired by all things Australian<br />

with the latest addition to the Memento line, the<br />

Australiana Collection. From kookaburras to koalas,<br />

these pendants are available now in silver or gold,<br />

and each comes with Memento box and chain.<br />

Signet rings are<br />

enjoying a revival<br />

right now as a key<br />

jewellery accessory for<br />

all genders and price<br />

points, and sales are<br />

on the rise. Worth &<br />

Douglas’ new sleek and<br />

solid signet designs are<br />

available in all precious<br />

metals and optionally<br />

set with white and blue<br />

diamonds.<br />

wdrings.com<br />

The stop2go<br />

collection<br />

This timepiece stands for<br />

quality, precision and style.<br />

The stop2go has the unique<br />

functionality of the Original<br />

Swiss Railway Clock: Whilst<br />

the second hand temporarily<br />

halts at 12:00, the minute hand<br />

gracefully jumps to the next<br />

minute in time. Since 1944,<br />

this unchanged design offers<br />

perfect readability day and<br />

night thanks to the patented<br />

BackLight design.<br />


Maleras<br />

Shillcombe<br />

Maleras – formerly known as<br />

Mats Jonasson – is internationally<br />

acclaimed for crystal sculptures of<br />

wildlife, flowers and folklore themes.<br />

It has been in production since<br />

1890 at the glassworks in southern<br />

Sweden’s ‘Kingdom of Crystal’<br />

region. Using techniques such as<br />

casting, glassblowing, hand painting<br />

and engraving, Maleras reflects a<br />

sustainable artisan tradition. Each<br />

piece is a collectable work of art.<br />

maleras.se/en<br />

Proudly distributed by<br />

02 9417 0177 | www.dgau.com.au

Holiday Stock Special<br />


Baume & Mercier<br />

Duraflex Group Australia<br />

The Clifton Baumatic Day-Date,<br />

Moon-Phase creates a new<br />

aesthetic for the Clifton range,<br />

exceptionally crafted in a solid<br />

block of rose gold or steel.<br />

It features a new, smaller<br />

complication with a unique<br />

look as well as a self-winding<br />

movement with five-day<br />

power reserve. In addition<br />

to functional excellence, the<br />

timepiece exemplifies Baume &<br />

Mercier’s pursuit of proportion<br />

and harmony in the choice of<br />

materials and colours.<br />

baume-et-mercier.com<br />

Citizen<br />

The Citizen Promaster<br />

BN0158-18X is proof that a<br />

dive watch can be fun and<br />

functional. Equipped with<br />

Eco-Drive technology, it is<br />

powered by light and never<br />

needs a battery. Featuring<br />

a one-way rotating elapsed<br />

time bezel and screw<br />

down crown, it is stylishly<br />

understated with its<br />

dazzling emerald green<br />

dial. It take you to your<br />

limits and is the perfect<br />

companion for a life of<br />

adventure.<br />

citizenwatches.com.au<br />

Classique<br />

SAMS Group Australia<br />

Classique was created<br />

to provide quality Swiss<br />

timepieces to the<br />

world, and now proudly<br />

boasts the widest range<br />

of watches in Australia.<br />

We create innovative<br />

timepieces whose<br />

components are of the<br />

highest quality and<br />

possess a distinctive<br />

and unmistakable<br />

personality. Fashions<br />

may change, but<br />

Classique watches<br />

retain their uniquely<br />

timeless quality.<br />

classiquewatches.com<br />

EasyRead Time Teacher<br />

Standard<br />

EasyRead Time Teacher<br />

EasyRead’s best-selling standard<br />

watches feature a Seiko movement,<br />

fabric strap and a special teaching<br />

dial that children find very easy to<br />

understand and remember. Mums and<br />

dads will love this watch as it makes<br />

teaching this skill simple and fun.<br />

EasyRead Time Teacher<br />

Waterproof<br />

EasyRead Time Teacher<br />

This high-quality waterproof watch<br />

from EasyRead Time Teacher is<br />

perfect for the active child. Milled<br />

from a stainless-steel billet, with a<br />

stainless screw-in back plate and<br />

four O-rings at the crown, it has<br />

a toughened glass lens recessed<br />

0.5mm for protection, and houses a<br />

Seiko movement.<br />

easyreadtimeteacher.com<br />

Maserati<br />

West End Collection<br />

Maserati tells a story<br />

about the past and future;<br />

about a brand that<br />

became an icon of<br />

elegance, uniqueness<br />

and power. West End<br />

Collection is extending<br />

the incredibly popular<br />

Maserati watch range<br />

this year with the<br />

Gentleman’s Accessories<br />

Collection of Maserati<br />

pens, bracelets and<br />

cufflinks, to answer that<br />

all-important question:<br />

what do you give a man<br />

who has everything?<br />

maseratistore.com/au_en<br />

Mondaine<br />

Duraflex Group<br />

Australia<br />

Carrying through<br />

Mondaine’s<br />

distinctively<br />

modern style,<br />

the Official<br />

Swiss Railways<br />

Essence 41mm<br />

watch is the ideal<br />

Christmas gift for<br />

the minimalist in<br />

your life. As stylish<br />

and smart as it is<br />

bold and casual, this<br />

is the ultimate goanywhere<br />

timepiece.<br />

mondaine.com.au<br />

Pierre Lannier<br />

Heart & Grace<br />

The perfect balance<br />

between glamour<br />

and minimalism,<br />

this timepiece<br />

is designed with<br />

beautiful Swarovski<br />

crystals around<br />

the dial. The watch<br />

features a stainless<br />

steel case and silver<br />

face, paired with a<br />

genuine white leather<br />

strap. Elegant, chic<br />

and inspired by<br />

haute couture, it is<br />

the perfect gift this<br />

summer.<br />

60 | <strong>October</strong> <strong>2020</strong>

Cluse<br />

Heart & Grace<br />

An extension of<br />

Cluse’s elegant<br />

Feroce range, the<br />

Feroce Petite features<br />

a smaller case size<br />

for a delicate and<br />

feminine look.<br />

The gold mesh<br />

strap and blue<br />

mother-of-pearl dial<br />

add to the watch’s<br />

uniquely stylish<br />

finish. Packaged in<br />

a limited-edition gift<br />

box, it is the perfect<br />

addition to the<br />

Cluse collection.<br />

cluse.com<br />

The simplest time teaching<br />

system for children<br />

Be Smart | Be Cool<br />

12 months warranty<br />

JAG<br />

Duraflex Group<br />

Australia<br />

JAG is internationally<br />

renowned as an iconic<br />

Australian brand. The<br />

new JAG fashion watch<br />

collection offers a range<br />

of styles for men and<br />

women with a casual<br />

urban feel.<br />

jag.com.au<br />

Luminox<br />

Duraflex Group Australia<br />

The Bear Grylls Survival<br />

3749 timepiece is designed<br />

for the extreme, combining<br />

the legendary ability<br />

of Luminox watches to<br />

withstand the elements<br />

with special new details<br />

from Bear Grylls. Whether<br />

it’s the countdown<br />

dive zone, the SOS in<br />

Morse code or the 300m<br />

water resistance, these<br />

timepieces will be your<br />

trusty companions and<br />

help you conquer any<br />

conditions. Also available<br />

with an orange strap<br />

equipped with a compass.<br />

luminox.com.au<br />

Bright Colours • Interchangeable Straps<br />

Cool Designs • Perfect Gift Idea<br />

Their parents are<br />

your existing customers.<br />

Made and<br />

designed in France<br />

with an automatic<br />

movement, this<br />

statement-making<br />

watch has been<br />

crafted so that<br />

you can see the<br />

intricate movement<br />

through the glass.<br />

A classically stylish<br />

yet striking addition<br />

to any man’s wrist,<br />

the watch features a<br />

stainless steel case<br />

and matching link<br />

strap with a black<br />

skeleton dial.<br />

pierre-lannier.com<br />

Police<br />

Duraflex Group<br />

Australia<br />

The Batur model<br />

from Police,<br />

pictured with blue<br />

dial and dark blue<br />

silicon strap, is<br />

equipped with both<br />

analog and digital<br />

time display. The<br />

large 48mm case<br />

and bolt-and-screw<br />

designs add to the<br />

tough masculine<br />

feel. Water<br />

resistant to 50m.<br />

policelifestyle.com<br />

EasyRead fashion watches feature a<br />

unique time teacher dial that children<br />

understand, with a step by step system<br />

they can easily remember.<br />


Speak to Roger on 0418 970 214<br />

info@easyreadtimeteacher.com<br />






ONLY RRP $119 .00<br />

(normal RRP $169)<br />

Holiday Stock Special<br />


Sekonda<br />

Duraflex Group Australia<br />

The SK1845 Men’s Watch<br />

(right) features a stainless steel<br />

case with a stylish blue and<br />

champagne bezel, with matching<br />

blue dial and baton time markers<br />

and a date function. Meanwhile,<br />

the SK40035 Ladies’ Watch (far<br />

right) boasts elegant, feminine<br />

details including a white motherof-pearl<br />

dial with crystal halo<br />

and time markers, paired with a<br />

classic fine mesh strap.<br />

dgau.com.au<br />

TW Steel<br />

Duraflex Group Australia<br />

The limited-edition ACE403 (left)<br />

offers the highest quality at an<br />

exceptional price. Powered by a<br />

Swiss chronograph, it features antireflective<br />

sapphire crystal, Swiss<br />

Super Luminova hands and time<br />

markerts, water resistance to 300m,<br />

and a five-year worldwide warranty.<br />

Meanwhile, the Canteen TW1013<br />

gives the original Canteen timepiece<br />

a fresh new look. It combines a<br />

steel case with shiny bezel and<br />

anti-reflection sapphire crystal with<br />

a stylish dark grey strap of crocodile<br />

leather lined with black rubber.<br />

au.twsteel.com<br />



RRP $203 .95<br />

And receive a<br />

Trucker hat for free<br />

VALUED AT RRP$34.95<br />

• 100m Water Resistant<br />

• Screw In Crown<br />

• Screw Down Back<br />

• Stainless Steel<br />

• Day / Date Indicator<br />

• Anti Smash Glass Protection bezel<br />

@RingersWestern<br />

www.RingersWestern.com<br />

@ringerswestern<br />

Duraflex Watch Bands<br />

Duraflex Group Australia<br />

This stainless steel link watch<br />

band with steel buckle is the<br />

perfect companion for your dive<br />

watch. dgau.com.au<br />

Hirsch Straps<br />

Duraflex Group Australia<br />

Embodying classic style, the<br />

18mm Crocograin Exotic<br />

Embossed Leather Strap in<br />

Brown adds a sophisticated<br />

touch to your timepiece.<br />

hirschstraps.com<br />

E orders@samsgroup.com.au<br />

W samsgroup.com.au P 02 9290 2199

Holiday Stock Special<br />


K&K Export Import<br />

With Australia’s widest range of gemstones, K&K can<br />

assist you with all your coloured gemstone needs.<br />

Lively blue and teal shades, minty greens, warm peach<br />

and pink gems are our current favourites for their<br />

brightness and cheer. Natural fancy colour diamonds<br />

are also available in a variety of sizes and hues, as well<br />

as rose cuts and salt-and-pepper diamonds.<br />

Discover a rainbow of possibilities with K&K.<br />

03 9654 4449<br />

Argyle Pink Diamonds<br />

SAMS Group Australia<br />

When thinking pink, look no<br />

further than SAMS Group<br />

Australia. With one of the largest<br />

ranges of Australia’s most<br />

precious Argyle Mine diamonds, all<br />

SAMS Group pink stones are cut<br />

and polished by Argyle, with Argyle<br />

certificates and lot numbers.<br />

pinkkimberley.com.au<br />

ATHAN<br />


(03) 9663 2321<br />



Holiday Stock Special<br />


Fabuleux Vous<br />

Featuring Forté, a classic sterling<br />

silver collection representing all<br />

things strength & courage.<br />

Kimberley Rough Diamonds<br />

Established in 2011, Kimberley Rough Diamonds<br />

specialises in uncut, natural diamonds straight<br />

from the Argyle Mine. Explore your creativity and<br />

try a rough diamond in your jewellery design.<br />

kroughdiamonds.com.au<br />

Kunming Diamonds<br />

The Argyle Tender is<br />

a beguiling treasure<br />

of nature that many<br />

aspire to see and few<br />

get to collect. Kunming<br />

Diamonds, an Argyle Pink<br />

Diamonds Authorised<br />

Partner, presents this<br />

4PP diamond – one of<br />

only 124 round brilliant<br />

cut Fancy Intense<br />

Purplish Pink diamonds<br />

offered at the Tender.<br />

Rarity meets<br />

exquisite beauty in<br />

this pear-shaped VS2<br />

pink diamond, which is<br />

part of a finite supply<br />

of Argyle stones.<br />

represents a rarity of its<br />

gems. Its colour is 5P<br />

on the internationally<br />

acknowledged pink<br />

grading system, placing<br />

it firmly among the elite<br />

ranks of iconic pink<br />

diamonds.<br />

Blue diamonds<br />

represent less than one<br />

per cent of all fancy<br />

colour diamonds. This<br />

Fancy Intense Blue<br />

oval-shape diamond in<br />

VVS clarity has a unique<br />

combination of shape,<br />

colour saturation and<br />

intensity that only 1 out<br />

of 60,000 fancy colour<br />

diamonds displays.<br />

Kunming is proud to<br />

have this stunning blue<br />

stone in its collection.<br />

Yellow diamonds<br />

have an illuminating<br />

quality that reflects the<br />

radiant brilliance of the<br />

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Price in<br />

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The Sherlock<br />

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Local Talent<br />


Hand Carved Pearl &<br />

Diamond Pendant<br />

Metal: 18-yellow gold<br />

Gemstones: Baroque<br />

Australian South Sea<br />

pearl, white diamond<br />

Alan Linney<br />

Perth, WA<br />


Alluvial Three-Piece Suite –<br />

Bangle, Cocktail Ring & Pendant<br />

Metals: 18-carat white and yellow gold<br />

Gemstones: White, yellow, cognac,<br />

and champagne diamond<br />

Jodi Penfold<br />

Broome, WA<br />



Waves Ring<br />

Metal: 18-carat<br />

white gold<br />

Gemstones: White<br />

diamond<br />

Berj Ohanessian<br />

Sydney, NSW<br />

Australia and New Zealand are not only home to some of the<br />

rarest gemstones in the world, but also the most talented jewellers.<br />

<strong>Jeweller</strong> showcases a tapestry of local masterpieces that have been<br />

meticulously crafted with great artisanship, right here on home soil<br />


Le Dragonfly En Tremblant Brooch<br />

Metal: 18-carat yellow gold<br />

Gemstones: Blue topaz, peridot, green,<br />

blue and pink tourmaline, Ceylon<br />

sapphire, white diamond<br />

Julian Bartrom<br />

Auckland, NZ<br />


Gatsby Ring<br />

Metal: Platinum<br />

Gemstones: Ceylon sapphire,<br />

white diamond<br />

Rod Valenz<br />

Melbourne, VIC<br />

72 | <strong>October</strong> <strong>2020</strong>


Samos Earrings<br />

Metal: 18-carat white gold<br />

Gemstones: Turquoise,<br />

London blue topaz,<br />

blue topaz<br />

Roselee Modica<br />

Sydney, NSW<br />



Tane Pendant<br />

Metal: 18-carat<br />

yellow gold<br />

Gemstones: Pink and<br />

purple sapphire, paua,<br />

baroque South Sea pearl<br />

Ian Douglas<br />

Wellington, NZ<br />


12-Carat Ring<br />

Metal: 18-carat yellow gold<br />

Gemstones: Brown and white<br />

diamond, violet sapphire<br />

David & Michael Robinson<br />

Gold Coast, QLD<br />


Cerelia Mint Tourmaline Ring<br />

Metal: 18-carat rose gold<br />

Gemstones: Mint tourmaline, vivid<br />

fancy colour diamonds<br />

John Calleija<br />

Gold Coast, QLD<br />



Heliodor, Diamond<br />

& Ruby Earrings<br />

Metal: 18-carat yellow gold<br />

Gemstones: Heliodor, ruby,<br />

white diamond<br />

Matthew Ely<br />

Sydney, NSW<br />


Kaleidoscope<br />

Earrings<br />

Metals: 18-carat<br />

white gold<br />

Gemstones: Blue,<br />

purple, pink, orange,<br />

and white sapphire<br />

Gerard McCabe<br />

Adelaide, SA<br />


Casablanca Ring<br />

Metals: 18-carat white<br />

and rose gold<br />

Gemstones: Ceylon<br />

sapphire, pink and<br />

white diamond<br />

Olivar Musson<br />

Sydney, NSW<br />

<strong>October</strong> <strong>2020</strong> | 73

INSIDE<br />

My Store<br />

Rebus Signet Rings<br />

LONDON, UK with Emmet Smith, founder and managing director • SPACE COMPLETED January 2018, following a five-month renovation<br />

4Who is the target market?<br />

The Rebus customers are a diverse bunch – young,<br />

old, male, female, traditional, hip, traditionally-hip,<br />

and many from overseas too.<br />

I did not design the store with a particular<br />

focused demographic in mind; I just went with<br />

my gut and created an environment that I wanted<br />

to spend time in – and one that my staff were<br />

also proud to be part of and in which they could<br />

feel comfortable.<br />

The ambience feels warm, like a relaxed, welcoming<br />

members’ club. This is achieved through the colour<br />

palette, gold fixtures and details, and inviting<br />

furniture. I figured if I could get the basics right and<br />

my staff felt good, then this would naturally translate<br />

to our customers, who we think of as guests.<br />

4Which features encourage sales?<br />

I’ve never had the attitude of ‘encouraging sales’.<br />

I’ve always felt very proud – even protective – of my<br />

craft, which is hand-engraving, so I want to display<br />

and communicate the processes Rebus craftsmen<br />

go through to create our jewellery.<br />

So, our display cabinets are not stuffed full of<br />

product. Instead, I like to be a bit more considered<br />

and tell a story by displaying things that pose<br />

questions and conversation. ‘Communicate<br />

and celebrate’ is our ethos. The bar helps<br />

with that as well!<br />

4What is the store design’s ‘wow factor’?<br />

The people. Downstairs, the Rebus workshop<br />

has 10 incredible craftsmen.<br />

To the unfamiliar eye, it appears crammed with all<br />

sorts of strange-looking objects – chisels, arcane<br />

heraldic imagery, jars of liquids and powders, gas<br />

torches burning, and Victorian reference books.<br />

Introducing our guests to this environment<br />

and the Rebus team is a pleasure which<br />

everyone appreciates.<br />

74 | <strong>October</strong> <strong>2020</strong>


Refining Stock<br />

LIQUID<br />

GOLD:<br />


& COVID-19<br />

Booming precious metal prices, coupled with lower<br />

jewellery spending, have increased demand for<br />

refining services in <strong>2020</strong>, writes ARABELLA RODEN.


Precious Metal<br />

Trends<br />

During times of economic uncertainty,<br />

conventional wisdom dictates<br />

that precious metal prices rise;<br />

this is attributed to increased demand from<br />

investors, who flock to ‘safe haven’ assets<br />

which historically hold their value.<br />

This trend has held true during the current global<br />

health crisis due to COVID-19. “Metal prices had<br />

already been trending positively pre-COVID-19. The<br />

pandemic has lead to ‘binge-buying’ of investment<br />

bullion which has, in turn, affected metal prices for<br />

the jewellery industry,” says Chris Botha, operations<br />

manager Pallion.<br />

Peter Beck, managing director of Adelaide-based<br />

company Peter W Beck, which refines gold, silver,<br />

platinum and palladium, notes, “We have observed<br />

that precious metal prices at this point in time are<br />

strong. However, we are not sure if this is directly<br />

related to the COVID-19 pandemic or the general<br />

uncertainty of the world’s economic position [due<br />

to other factors].”<br />

“Metal prices had already been trending<br />

positively pre-COVID-19. The pandemic has<br />

lead to ‘binge-buying’ of investment bullion<br />

which has, in turn, affected metal prices<br />

for the jewellery industry”<br />


Pallion<br />

One of those factors may be the ongoing trade<br />

tensions between the US and China.<br />

“Precious metals have always filled that [safe-haven]<br />

role,” says Richard Hayes, CEO The Perth Mint, which<br />

is owned by the Government of Western Australia and<br />

refines the majority of gold mined onshore, in addition<br />

to gold and silver scrap.<br />

At the same time, restrictions on retail trading, rising<br />

unemployment, and plummeting consumer confidence<br />

have combined to flatten discretionary spending on<br />

luxury items, depressing jewellery demand.<br />

The combination of higher prices for metals and lower<br />

demand for finished jewellery makes metal refining an<br />

attractive option for jewellers.<br />

Darren Sher, director Chemgold, says, “While the<br />

impact of COVID-19 has been devastating for us all,<br />

$2,048<br />

gold price per<br />

ounce in US Dollars,<br />

August <strong>2020</strong> –<br />

a record high<br />

Source: World Gold Council<br />

46%<br />

decline in global<br />

demand for gold<br />

jewellery, H1 <strong>2020</strong><br />

Source: World Gold Council<br />

27%<br />

second-quarter<br />

decline in<br />

platinum jewellery<br />

demand<br />

Source: World Platinum<br />

Investment Council<br />

$29<br />

silver price per<br />

ounce in US<br />

Dollars, August<br />

<strong>2020</strong> – a sevenyear<br />

high<br />

Source: Stockhead<br />

$2,229<br />

palladium price<br />

per ounce in<br />

US dollars,<br />

September <strong>2020</strong><br />

Source: Kitco<br />

the one positive aspect for the jewellery industry is<br />

that precious metal stock can be refined, and jewellers<br />

can then get the fine metal back, receive payments, or<br />

pay their accounts.”<br />

He adds, “With the major increase in the gold price<br />

in the last few years, in some cases, there may be<br />

minimal loss on the original cost of the metal they<br />

purchased years ago.”<br />

The potential is not limited to gold, however – it also<br />

applies to other major refining metals, including<br />

silver, platinum, and palladium.<br />

Golden opportunity<br />

The gold price reflects myriad factors beyond mere supply<br />

and demand, as it is frequently used as a financial “hedge”<br />

against currency fluctuations, inflation, and interest rate<br />

cuts, as well as geopolitical instability.<br />

Notably, the gold price has been rising for nearly a<br />

decade – and has increased by 30 per cent this year<br />

alone. In July <strong>2020</strong>, it surpassed its previous high of<br />

$US1,921 – reached in 2011 – and in August broke<br />

through the $US2,000 per ounce threshold.<br />

Hayes explains that the price of gold has also been<br />

“turbo-charged” in Australian Dollar terms, due to<br />

the exchange rate with the US Dollar.<br />

“While the impact of COVID-19 has been<br />

devastating for us all, the one positive<br />

aspect for the jewellery industry is that<br />

precious metal stock can be refined, and<br />

jewellers can then get the fine metal back,<br />

receive payments, or pay their accounts”<br />


Chemgold<br />

At the same time, demand for physical gold has been<br />

constrained by the pandemic.<br />

“The global gold market has been turned on its head<br />

by the novel coronavirus [COVID-19], with demand in<br />

China and India collapsing due to lockdowns while<br />

in the West investors rushed to buy bullion as a safe<br />

asset to weather a period of financial turmoil,” noted<br />

a recent Reuters report.<br />

Indeed, the World Gold Council’s Gold Demand Trends<br />

Q2 <strong>2020</strong> report, published 30 July, revealed that global<br />

gold jewellery demand had fallen to half its 10-year<br />

average, and tumbled 46 per cent in the first half of<br />

<strong>2020</strong> compared with the same period in 2019.<br />

<strong>October</strong> <strong>2020</strong> | 77

REFINING FEATURE | Liquid Gold<br />


Notable<br />

Trends<br />

“Q2 saw a continuation of the hostile<br />

global environment for gold jewellery<br />

demand. Lockdown restrictions<br />

shuttered many markets, and<br />

consumers faced the challenging<br />

consequences of economic downturn<br />

at a time when gold prices were<br />

moving from strength to strength,<br />

making affordability an issue for<br />

many,” the report explained<br />

During the same period, platinum<br />

jewellery demand fell 27 per cent,<br />

according to The World Platinum<br />

Investment Council (WPIC)’s most<br />

recent Platinum Quarterly report.<br />

“Lockdown restrictions<br />

shuttered many markets,<br />

and consumers faced the<br />

challenging consequences<br />

of economic downturn at a<br />

time when gold prices were<br />

moving from strength to<br />

strength, making affordability<br />

an issue for many”<br />

– Gold Demand Trends Q2 <strong>2020</strong> report<br />


Platinum jewellery manufacturing<br />

saw sharp declines in China and India,<br />

alongside a collapse in demand in the<br />

US and European retail markets.<br />

Meanwhile, silver jewellery<br />

fabrication is predicted to decrease<br />

by 7 per cent in <strong>2020</strong> – its most<br />

significant contraction in four years.<br />

Yet Hayes points out that despite<br />

reduced demand from the jewellery<br />

sector, the silver price has mirrored<br />

gold’s upward trajectory.<br />

“Silver has very much followed gold,<br />

but in the last couple of weeks silver<br />

prices have strengthened more<br />

strongly – they have outpaced the<br />

gold price increases [in the first<br />

quarter of <strong>2020</strong>],” he says.<br />

Adam Van Sambeek, treasury<br />

manager at Morris & Watson in<br />

Auckland, notes that alongside<br />

increased demand from investors,<br />

“supply constraints brought on by<br />

trade and production restrictions<br />

have also pushed gold and silver<br />

prices higher”.<br />

These factors – ‘safe-haven’ appeal<br />

57%<br />

increase in<br />

palladium price<br />

per ounce, 18<br />

March – 22<br />

September <strong>2020</strong><br />

50%<br />

capacity of South<br />

African gold,<br />

platinum and<br />

palladium mines<br />

under COVID-19<br />

restrictions<br />

Peter W Beck.<br />

360k<br />

ounces reduction<br />

in platinum supply<br />

due to COVID-19<br />

restrictions<br />

Source: World Platinum<br />

Investment Council<br />

7%<br />

decrease in<br />

silver jewellery<br />

fabrication<br />

throughout <strong>2020</strong><br />

Source: The Silver<br />

Institute<br />

and reduced supply – assisted gold,<br />

silver, platinum and palladium prices<br />

to a robust recovery from an initial the<br />

coronavirus demand shock, which saw<br />

prices plunge in March as the pandemic<br />

peaked in the US.<br />

“Silver has very much followed<br />

gold, but in the last couple<br />

of weeks silver prices have<br />

strengthened more strongly –<br />

they have outpaced the<br />

gold price increases [in the<br />

first quarter of <strong>2020</strong>],”<br />


Perth Mint<br />

In particular, palladium – a key agent in<br />

creating white gold, aside from nickel<br />

– fell 43 per cent from its February<br />

peak of $US2,754, driven by a dramatic<br />

decrease in demand from the Chinese<br />

automotive industry.<br />

However, by 22 September, it had<br />

recovered to $US2,229.60.<br />

Indeed, palladium has been the best<br />

performing commodity for the past two<br />

years, according to Forbes, with prices<br />

increasing by more than 85 per cent<br />

between August 2018 and March 2019.<br />

The pandemic’s impact on platinum<br />

is less dramatic, and prices have<br />

also stabilised. The WPIC report,<br />

published 8 September, noted, “Due<br />

in part to supply issues unrelated to<br />

the pandemic, plus the robust nature<br />

of physical investment demand, the<br />

potential efects of the pandemic on<br />

platinum’s market balance are far less<br />

negative than previously expected.”<br />

It predicts supply and demand will remain<br />

relatively balanced for the remainder of<br />

<strong>2020</strong>, with declines of 14 per cent and 11<br />

per cent respectively.<br />

The lower volumes are largely<br />

attributed to COVID-19 closures and<br />

restrictions in South Africa, the largest<br />

producer of the metal. South Africa is<br />

also also a key producer of gold and,<br />

notably, palladium, alongside Russia.<br />

Russian palladium mines have been<br />

largely unaffected by the pandemic, and<br />

its production of the metal is expected<br />

to increase by 2.5 per cent for <strong>2020</strong>,<br />

according to an analysis by data firm<br />

Fitch Solutions.<br />

The world’s largest palladium producer,<br />

Nornickel, has not changed its <strong>2020</strong><br />

guidance, with operations chief Sergey<br />

Dyachenko saying, “We expect saleable<br />

metal production volumes to recover<br />

during the rest of this year.”<br />

Refined strategy<br />

With precious metal prices remaining<br />

high and jewellery demand subdued,<br />

jewellers have an opportunity to create<br />

liquidity through refining.<br />

“In terms of normal working stock,<br />

having stuff just sitting around –<br />

especially if you’re paying lease costs<br />

on it – is relatively expensive.<br />

“So having it refined and turning it into<br />

cash, so that you can recycle that cash<br />

into additional manufacturing stock,<br />

would tend to make a lot of sense at<br />

this stage,” says Hayes.<br />

“This period of strong precious<br />

metal pricing and difficult<br />

trading is an opportunity<br />

for jewellers to manage any<br />

precious metal stock, in either<br />

finished or unfinished form,<br />

through refining... It is possible<br />

that precious metal value alone<br />

will return more than the<br />

original purchase price of the<br />

product”<br />


Peter W Beck<br />

At Chemgold, Sher observed that when<br />

COVID-19 restrictions came into effect,<br />

“The demand for our refining services<br />

increased substantially. <strong>Jeweller</strong>y<br />

retailers and manufacturers sent in<br />

large amounts of scrap and lemel to<br />

ensure they could have extra funds if<br />

needed.<br />

“We also found an increase in the number<br />

of sweeps received. With restrictions<br />

easing, we have found the demand is back<br />

to its normal level,” he adds.<br />

At Pallion, Botha says, “Our refinery<br />

facilities refine next to half of Australia’s<br />

precious metals output and have<br />

continued to work round the clock to<br />

meet marketplace demand since the<br />

pandemic. We have seen record-high<br />

refining jobs coming through [from] the<br />

jewellery industry.<br />

78 | <strong>October</strong> <strong>2020</strong>


Key Points<br />

“Many jewellers during these trying<br />

times have been conducting spring<br />

cleans and sending their lemel scraps<br />

for refining to assist them to weather the<br />

storm. This was also compounded by the<br />

upcoming end of the financial year.”<br />

Meanwhile, Van Sambeek says,<br />

“Temporary [store] closures as a<br />

result of COVID-19 gave our clients an<br />

opportunity to do some long overdue<br />

house cleaning.<br />

“Due to the high gold and<br />

palladium prices, high-carat<br />

and white metals containing<br />

platinum and palladium are<br />

the best to refine first”<br />


Morris & Watson<br />

“The high gold price, in conjunction<br />

with economic uncertainty, has seen an<br />

increase in refining, with many clearing<br />

old or slow-moving stock, surrendered<br />

for cash or metal.”<br />

Beck has also noticed a “definite increase”<br />

in demand for precious metal refining in<br />

recent months. “We believe this is mainly<br />

to act as a source of cash flow for both<br />

retail and manufacturing jewellers in these<br />

difficult times,” he explains.<br />

“This period of strong precious<br />

metal pricing and difficult trading is an<br />

opportunity for jewellers to manage any<br />

precious metal stock, in either finished<br />

or unfinished form, through refining.”<br />

Beck recommends jewellers begin by<br />

refining old stock that has been in store<br />

for more than four to five years.<br />

“Because of the current strong precious<br />

metal prices, it is possible that precious<br />

metal value alone will return more<br />

than the original purchase price of the<br />

product,” he adds.<br />

Meanwhile, Sher says jewellers should<br />

refine “fairly regularly” as fees are low<br />

in proportion to the payments received<br />

for precious metals.<br />

“The advice is to, where possible,<br />

keep all your metals separate in these<br />

categories: silver, yellow gold, white gold<br />

and platinum,” he adds.<br />

“This can make refining charges more<br />

economical as two-metal refining (gold/<br />

silver) is less expensive than four-metal<br />

(gold/silver/platinum/palladium) and<br />

platinum-only. We provide guidance on<br />

how to separate metals to ensure fees<br />

are as low as possible.”<br />

Van Sambeek advises, “Due to the high<br />

gold and palladium prices, high-carat<br />

and white metals containing platinum<br />

and palladium are the best to refine<br />

first.”<br />

“But as most metal prices are up, any<br />

refining will help release funds quickly<br />

during this time,” he adds.<br />

And when choosing a refiner during<br />

the uncertainty of COVID-19, Hayes<br />

recommends taking a careful approach,<br />

pointing to several US refiners who<br />

have declared bankruptcy in recent<br />

years, leaving their customers’ metal<br />

in the general creditors’ pool.<br />

“Avoid taking unwanted credit risks –<br />

especially if there are financial<br />

liability issues,” he<br />

advises.<br />

Botha<br />

adds,<br />

“There are very<br />

few true ‘refiners’ in Australia – many<br />

who claim to be refiners are merely<br />

aggregators. Make sure you send your<br />

refining job to an entity that actually<br />

refines; otherwise all you are doing is<br />

paying a middleman.<br />

Peter W Beck.<br />

“We are the only independent London<br />

Bullion Market Association (LBMA)<br />

and Shanghai Gold Exchange (SGE)-<br />

accredited refinery in Australia and you<br />

can take a virtual tour of our refining<br />

facilities on YouTube.”<br />

Indeed, stock management is a critical<br />

component of retail even in periods<br />

of growth, but the importance of<br />

generating cash flow by refining – where<br />

appropriate – is vitally important during<br />

the current crisis.<br />

As jewellers begin to reopen their doors<br />

and consumer spending on discretionary<br />

items increases throughout the second<br />

half of <strong>2020</strong>, a solid refining strategy<br />

strengthens a jewellery business’<br />

position – and gives it a better chance<br />

to survive and thrive.<br />

Precious metal<br />

prices have<br />

increased<br />

Economic<br />

uncertainty<br />

has pushed<br />

investors towards<br />

‘safe havens’<br />

<strong>Jeweller</strong>y<br />

demand has<br />

declined<br />

Falling consumer<br />

confidence<br />

and retail<br />

restrictions due<br />

to COVID-19 have<br />

combined to<br />

reduce jewellery<br />

sales<br />

Refining can<br />

financially<br />

benefit<br />

jewellers<br />

In the short-term,<br />

refining can assist<br />

in maintaining<br />

liquidity<br />

Stock<br />

management<br />

is critical<br />

Post-crisis,<br />

refining ensures<br />

jewellers have<br />

fresh stock<br />

and resources<br />

<strong>October</strong> <strong>2020</strong> | 79


Diamond Industry Update<br />




The coronavirus has forced shutdowns at every stage of the diamond ‘pipeline’, from mines<br />

to bourses, the polishing centre of Surat, and retailers. Yet, the pandemic may represent an<br />

unlikely opportunity to rebalance the supply chain, writes ARABELLA RODEN.


Impact on<br />

the Diamond<br />

Industry<br />

The unprecedented challenge of the<br />

COVID-19 pandemic has added<br />

another burden to the already fragile<br />

international diamond industry, producing<br />

concurrent shocks to both demand and supply.<br />

“We’ve never had an environment where commercial<br />

activity right across the whole pipeline, let alone the<br />

whole luxury goods industry, has simply come to a halt,”<br />

David Prager, executive vice-president corporate affairs, De<br />

Beers, said earlier this year.<br />

Most significantly, the virus has crippled the retail sector in the<br />

US, which is the world’s largest diamond jewellery market and<br />

has been the epicentre of the pandemic since late March.<br />

Limitations on social interaction, as well as widespread<br />

unemployment, financial uncertainty, and reduced<br />

confidence saw the country record a 7.5 per cent reduction<br />

in consumer spending in March, followed by a 12.9 per cent<br />

decline in April.<br />

While the ensuing months have seen a modest recovery,<br />

the lost ground is yet to be regained.<br />

Examing retail by category, a New York Times analysis<br />

of data collected by market research firm Earnest Data<br />

– which tracks the debit and credit card purchases of 6<br />

million Americans – found jewellery spending was 75 per<br />

cent lower in the week to 1 April than it was in 2019.<br />

Notably, publicly-listed US-based jewellery company Tiffany<br />

& Co. reported a 45 per cent decline in US revenue for the<br />

first half of the year.<br />

This was, in part, responsible for French luxury<br />

conglomerate Moët Hennessy Louis Vuitton SE (LVMH)’s<br />

decision to pull out of its planned acquisition of the jeweller.<br />

Even with many US states easing lockdown restrictions,<br />

industry experts note that the retail jewellery sector’s<br />

recovery will not be immediate.<br />

The JCK State of the Industry Report <strong>2020</strong>, published in<br />

September, surveyed nearly 1,000 retail jewellers, with 58<br />

-75%<br />

US jewellery retail<br />

spending in the<br />

week to 1 April<br />

Source: Earnest Data<br />

$US3.9bn<br />

Indian polished<br />

diamond exports<br />

Apr. - Aug. <strong>2020</strong>.<br />

A decline of<br />

41 per cent on 2019<br />

Source: GJEPC<br />

58%<br />

US jewellers who<br />

predict a recovery<br />

to 2019 levels will<br />

take eight months<br />

or more<br />

Source: JCK State of the<br />

Industry Report <strong>2020</strong><br />

66%<br />

decline in polished<br />

imports to Antwerp,<br />

June <strong>2020</strong><br />

Source: Antwerp World<br />

Diamond Centre<br />

per cent predicted a recovery of their business to 2019<br />

levels would take eight months or more; 11 per cent put<br />

the figure at two years.<br />

With the US struggling, some industry experts pinned hopes<br />

for a robust recovery on the Chinese market; in April, Kent<br />

Wong, managing director of Chow Tai Fook – China’s largest<br />

jewellery company – predicted it would take “three or four<br />

months” for the company to be “back to normal”.<br />

“We’ve never had an environment where<br />

commercial activity right across the whole<br />

pipeline, let alone the whole luxury goods<br />

industry, has simply come to a halt”<br />


De Beers<br />

However, its quarterly report for the three months to June<br />

30 indicated sales had declined 20.2 per cent compared<br />

with the same period in 2019; same-store sales declined<br />

by 75.5 per cent in Hong Kong and Macau, and 11.2 per<br />

cent in Mainland China.<br />

The results were even more dismal for major jewellery<br />

retailer Luk Fook, which also operates stores throughout<br />

the Chinese mainland, Hong Kong and Macau. Revenue<br />

was down 60 per cent during the June quarter, while<br />

profits slid 80 per cent.<br />

Matters of the midstream<br />

Alongside retail, the diamond midstream has also<br />

suffered. In Antwerp, polished imports fell 71 per cent<br />

in March and exports 51 per cent.<br />

The trend continued in June, with only a marginal<br />

improvement: imports declined 66 per cent, and exports<br />

44 per cent, according to figures from Antwerp World<br />

Diamond Centre.<br />

In India, where approximately 90 per cent of the world’s<br />

Otober <strong>2020</strong> | 81

CORONAVIRUS ROUGHS UP INDUSTRY | Diamond Industry Report<br />

L to R: <strong>Jeweller</strong>y retailers around the world are hoping for consumer confidence to return<br />


Mined Over<br />

Matter<br />

diamonds are cut and polished, the<br />

manufacturing industry was already<br />

under pressure even before the<br />

pandemic reached its shores.<br />

The sector has also<br />

been embroiled in an<br />

ongoing liquidity crisis<br />

since 2018, attributed<br />

to lack of demand and<br />

tightening of lending<br />

criteria.<br />

Dinesh Navadiya,<br />

Gujarat regional chairman of the<br />

Gem & <strong>Jeweller</strong>y Export Promotion<br />

Council (GJEPC), stated, “The industry<br />

has already witnessed [a] $US846<br />

million fall in exports in February <strong>2020</strong><br />

compared to the same month last year,<br />

and the crisis is deepening further<br />

and could get worse than what was<br />

witnessed during the 2008 [crisis].”<br />

A GJEPC provisional report for the<br />

April–August quarter noted that cut<br />

and polished natural diamond exports<br />

totalled $US3.9 billion, compared with<br />

$US8.3 billion for the same period in<br />

2019 – a decline of 41 per cent.<br />

Rapaport reported that US polished<br />

diamond imports “fell 50 per cent, to<br />

$US806 million, in July” – a steeper<br />

decline than in June. Approximately 39<br />

per cent of Indian-cut diamonds are<br />

exported to the US and 41 per cent to<br />

Hong Kong and Mainland China.<br />

With sluggish demand from these<br />

markets, Indian manufacturers have<br />

been left with a significant amount of<br />

excess inventory – to the point that<br />

trade organisations have called for<br />

members to stop importing rough.<br />

“A good part of the inventory is not<br />

moving, and the trade should be<br />

cautious and take steps to reduce<br />

inventory further,” the GJEPC said<br />

in a statement issued in August.<br />

Diamond industry analyst Chaim<br />

Even-Zohar previously recommended<br />

the Indian government discuss a threeor<br />

even four-month moratorium on<br />

diamond imports.<br />

He posited that implementing such a<br />

measure would rebalance supplies,<br />

clear the glut of material in the<br />

midstream, and avoid a price collapse<br />

similar to the current oil crisis.<br />

Indeed, Navadiya recently confirmed,<br />

“The GJEPC’s move to call for a<br />

voluntary ban on rough imports for<br />

a couple of months has helped clear<br />

the diamond pipeline, which, in turn,<br />

has generated some liquidity for<br />

manufacturers.”<br />

Colin Shah, chairman GJEPC, added,<br />

“As there are orders coming from the<br />

US, Hong Kong and parts of Europe<br />

for certain types of polished goods, the<br />

sector is on the path of recovery. The<br />

upcoming holiday season in the western<br />

100%<br />

deferrals offered<br />

to De Beers<br />

sightholders at<br />

mid-year Sights<br />

Source: De Beers<br />

56%<br />

De Beers revenue<br />

decline H1 of<br />

<strong>2020</strong> compared<br />

with 2019<br />

Source: De Beers<br />

$179.4m<br />

Alrosa rough<br />

diamond sales<br />

increase, July<br />

<strong>2020</strong>–August <strong>2020</strong><br />

Source: Alrosa<br />

28–31m<br />

Alrosa revised<br />

<strong>2020</strong> diamond<br />

production target<br />

Source: Alrosa<br />

countries, would further boost the demand for<br />

gems and jewellery.”<br />

“The situation at the start and at the<br />

end of our trading session in March<br />

was completely different – that is<br />

why we had to adjust and offer<br />

more flexible sales terms”<br />


Alrosa<br />

As of 11 September, approximately 5,000<br />

diamond manufacturing firms had reportedly<br />

returned to operation following lockdown,<br />

at 70 per cent of capacity to accommodate<br />

social-distancing guidelines.<br />

A rough matter for mining industry<br />

With diamond manufacturers unable –<br />

or unwilling – to build inventory due to<br />

suppressed retail demand in the first half<br />

of the year, mining companies were forced<br />

to offer unprecedented flexibility to sight<br />

holders.<br />

These terms have included 60-100 per<br />

cent deferments, lifting mandatory buying<br />

requirements, and buying back up to 30 per<br />

cent of inventory.<br />

Sergey Ivanov, CEO of Russian mining<br />

conglomerate Alrosa – the largest diamond<br />

producer by volume – noted how quickly the<br />

situation changed.<br />

82 | <strong>October</strong> <strong>2020</strong>

CORONAVIRUS ROUGHS UP INDUSTRY | Diamond Industry Report<br />

Above: De Beers Rough Diamond Sales, Cycle 1 2019 to Cycle 2 <strong>2020</strong>.<br />

“In this turbulent environment, the<br />

situation at the start and at the end of our<br />

trading session in March was completely<br />

different. That is why we had to adjust and<br />

offer more flexible sales terms on the go,”<br />

he said.<br />

“The uncertainty in February was followed<br />

by severe restrictions and even the<br />

suspension of trading because of border<br />

closures and quarantine measures across<br />

the world. Needless to say that this has had<br />

an extremely adverse effect all along the<br />

diamond pipeline,” he added.<br />

In April, Alrosa’s rough diamond sales<br />

fell 96 per cent compared to March and<br />

remained subdued throughout May, June,<br />

and July. However, August saw sales figures<br />

almost entirely recover to pre-pandemic<br />

levels, increasing from $US22.7 million in<br />

July to $US202.1 million.<br />

Meanwhile, De Beers’ rough diamond sales<br />

revenue declined by by $US1.3 billion –<br />

56 per cent – compared with 2019.<br />

The average realised price per carat<br />

declined by 21 per cent, compared with an<br />

8 per cent decline in the overall average<br />

rough diamond price index.<br />

Indeed, De Beers has recently reduced<br />

prices by 5–10 per cent for rough below<br />

1 carat.<br />

However, like Alrosa, its sales results for<br />

the period of 19 August–10 September<br />

appeared promising; it recorded a<br />

provisional result of $US320 million,<br />

compared with $US287 million during the<br />

same period in 2019.<br />

Bruce Cleaver, CEO De Beers Group, said:<br />

“Diamond markets showed some continued<br />

improvement throughout August and<br />

into September as COVID-19 restrictions<br />

continued to ease in various locations, and<br />

manufacturers focused on meeting retail<br />

demand for polished diamonds.<br />

“Overall industry sentiment has become<br />

more positive as jewellers in the key US<br />

and Chinese consumer markets gained<br />

confidence ahead of the important yearend<br />

holiday season, supported by strong<br />

bridal diamond jewellery demand across<br />

markets.”<br />

Notably, the volume of diamonds entering<br />

the pipeline also declined due to mandated<br />

closures as a result of the pandemic.<br />

De Beers’ overall rough diamond production<br />

decreased by 27 per cent in the six months<br />

to 30 June; it has reduced its <strong>2020</strong> forecast<br />

by 20 per cent, to 25–27 million carats, while<br />

Alrosa indicated in May that it would reduce<br />

its output by up to 17 per cent, to 28–31<br />

million carats.<br />

Concluding perspective<br />

Beyond coronavirus lockdowns, the<br />

diamond industry must maintain prices by<br />

managing ongoing supply and<br />

demand shocks.<br />

Even-Zohar pointed to the necessity of<br />

diamond mining companies to support<br />

the midstream by complying with import<br />

moratoriums, should they be put in place,<br />

and even offering credit in order to “share<br />

the financial burden of their customers”.<br />

“Producers need the Indian cutters, and<br />


Key Points<br />

Optimism<br />

following<br />

retail<br />

decline<br />

Some signs of<br />

improvement<br />

in the critical<br />

US and China<br />

markets<br />

Clearing<br />

out the<br />

midstream<br />

Inventories<br />

clearing due to<br />

flexible terms<br />

from miners<br />

Mining<br />

companies<br />

in recovery<br />

Robust sales in<br />

August despite<br />

lower prices<br />

Demand and<br />

supply may<br />

rebalance<br />

Reduction in<br />

supply coupled<br />

with holiday<br />

demand augur<br />

well for price<br />

stability<br />

there is no alternative to India. Over the years<br />

the Indian industry has produced enormous<br />

wealth for them… Now the shoe is on the other<br />

foot,” he says.<br />

“Once the diamond supply chain<br />

begins to reopen... trading volume<br />

will gradually begin to normalise<br />

and prices will likely find a more<br />

sustainable and reliable level”<br />


Diamond industry analyst<br />

Meanwhile, diamond industry analyst Paul<br />

Zimnisky noted in April, “Once the diamond<br />

supply chain begins to reopen, which will<br />

require the opening of borders, retail outlets<br />

and manufacturing and trading hubs globally,<br />

trading volume will gradually begin to normalise<br />

and prices will likely find a more sustainable<br />

and reliable level.”<br />

At the time of publication, it appeared his<br />

prediction was coming to fruition. The Zimnisky<br />

Global Rough Diamond Price Index appears<br />

to have plateaued over the past six months,<br />

following a precipitous drop between January<br />

and March.<br />

Further down the pipeline, the RapNet Diamond<br />

Index has shown continual improvement over<br />

the past three months, across virtually all<br />

sizes of polished diamonds from 0.30-carat<br />

to 3-carat.<br />

This improvement has indeed been attributed to<br />

a rebalancing of supply and demand: “polished<br />

supply gaps” and “improving holiday orders”.<br />

Thus it appears that, while presenting<br />

significant challenges in the short term, the<br />

coronavirus pandemic may yet solve the<br />

persistent problem of the unbalanced diamond<br />

supply chain and at last deliver the price<br />

stability that is crucial to all in the pipeline.<br />

84 | <strong>October</strong> <strong>2020</strong>

We Are Here For You


Retail Strategy<br />



Target Innovation Strategy Marketing Story Advertising Awareness Quality Loyalty<br />

Brand aid: how to build brand equity<br />

for your business<br />

The way your business is perceived by potential customers can be the difference between making a sale or losing it to<br />

a competitor – and the key to controlling that perception is branding, advise RICH KIZER and GEORGANNE BENDER.<br />

Branding is a buzzword that’s been around<br />

for a long time, and with good reason;<br />

your brand and its perception in your<br />

community are critical to your store’s<br />

success. But along with that branding<br />

buzz, there is also a lot of confusion.<br />

The good news is that branding isn’t hard to<br />

implement – it is easy once you understand<br />

what it is, and what it is not.<br />

Defining your brand<br />

You may have spent hours designing the<br />

perfect logo for your store – or paid for<br />

someone else to do so – but that’s not your<br />

brand. You know the ‘swoosh’ that appears<br />

in every Nike ad? It’s a logo, not a brand.<br />

Your brand is more than your website, your<br />

blog, or your presence on social media. It’s<br />

more than your ads, brochures, business<br />

cards, bags and everything else you use to<br />

put your store name out there. Your brand is<br />

even more than the name you chose to hang<br />

over your front door.<br />

Each of these things are critically important<br />

to your brand identity, but they are the<br />

components used to build your brand, not<br />

the brand itself.<br />

A brand is the emotional connection – the<br />

physical reaction – customers feel when<br />

they hear your store name, see your logo,<br />

visit your website or walk in your front door.<br />

It’s the space you occupy in the mind of the<br />

customer, and the experience they can get<br />

only from you.<br />

The best way to describe a brand was<br />

coined by Adrienne Weiss, CEO of branding<br />

and marketing business Adrienne Weiss<br />

Corp: “A brand is a country with its own<br />

unique language, customs and traditions.”<br />

Using this definition, here is a checklist of<br />

things to do to help you build your brand.<br />

Step 1: Write your store’s story<br />

It’s hard to write about the things that got<br />

you to where you are today, but you have to<br />

do so. Start with why you decided to open a<br />

store, then write about what makes you and<br />

your store unique; talk about how you make<br />

a difference in your customers’ lives and in<br />

your community.<br />

Make it a fun adventure people will want<br />

to read. If you get stuck, ask your family and<br />

staff – and maybe even customers – for help.<br />

A brand is<br />

the emotional<br />

connection –<br />

the physical<br />

reaction –<br />

customers<br />

feel when they<br />

hear your store<br />

name, see your<br />

logo, visit your<br />

website or<br />

walk in your<br />

front door<br />

When your story is finished, spread the<br />

word about who you are through your instore<br />

signage, on your website, your social<br />

media channels, marketing, advertising –<br />

anywhere and everywhere you can.<br />

Step 2: Create an ‘elevator pitch’<br />

We used to kick ourselves after someone<br />

asked us what we do and we’d reply, “We’re<br />

professional speakers.”<br />

Afterwards, we’d think of all the ‘cool’<br />

things we should have said. Now we say,<br />

“We are consumer anthropologists. We<br />

study consumers in their natural habitats<br />

and share what we find in our keynote and<br />

seminar presentations.”<br />

If you’ve ever answered, “I own a jewellery<br />

store” when asked what you do, then you<br />

know that feeling of missed opportunity.<br />

Write a 60-second condensed version of<br />

your store’s story – known as an ‘elevator<br />

pitch’ – and you’ll never find yourself in that<br />

position again.<br />

Step 3: Create a unique look<br />

Branding requires discipline and<br />

consistency. Every single thing – from the<br />

smallest details like bags to fonts, need to<br />

86 | <strong>October</strong> <strong>2020</strong>

Retail Strategy<br />

be properly tell your brand story.<br />

Weiss says the brand itself should act like a<br />

water filter.<br />

With that in mind, think about who you are<br />

and what you want representing your store.<br />

If the item, or service, you are considering<br />

is in alignment with your store’s story and<br />

would easily pass through your brand filter,<br />

then go ahead and use it.<br />

Here’s an example: Bunnings is widely<br />

known for using the colour dark green, so<br />

if a supplier offered employee aprons in<br />

yellow, even at a great price, would they fit<br />

through Bunnings’ brand filter? No.<br />

Tiffany & Co. has trademarked its unique<br />

shade of robin’s egg blue, and McDonald’s<br />

has the golden arches.<br />

Any other colour in each of these examples<br />

would be unacceptable because they would<br />

never make it through the company’s filter.<br />

Branding tips<br />

Expanding on Step 3, here are some of the<br />

things you need to ‘filter’ to ensure they<br />

properly represent your brand:<br />

• Select a signature colour, or colours, and<br />

use everywhere – We once met a retailer<br />

whose signature colour was red. Her store<br />

was well known for its bright red shopping<br />

bags; people saved them and carried them<br />

around town, and they became walking<br />

billboards for her store.<br />

One Christmas, she decided it would be<br />

fun to try silver shopping bags. It was a big<br />

mistake as no-one in her town recognised<br />

that the bags came from her store.<br />

As a result, she had to rebuild that part of<br />

her brand identity.<br />

• Choose your fonts carefully – It’s a good<br />

idea to use both upper- and lower-case<br />

letters in your branding as all-caps can be<br />

tough on older eyes.<br />

Additionally, make sure that your font is<br />

easy to read – some that look great in a<br />

14-point become hard to read when blown<br />

up on signs.<br />

that’s not who you are.<br />

You can always add your signature colour<br />

to good quality plain bags with inexpensive<br />

custom stickers, and the same thing goes<br />

for boxes.<br />

Get creative with your gift cards too; we<br />

have encountered a lingerie retailer who<br />

nestled gift cards in scented tissue paper<br />

inside a shiny box.<br />

• Bring your brand to the sales floor – Your<br />

sales floor is your largest brand-building<br />

element. There isn’t a single part of your<br />

store (restrooms included) that’s not part of<br />

your brand identity.<br />

Take an objective look around: Have you<br />

included your signature colours? Are you<br />

using quality fixtures? Is the merchandise<br />

well-signed and do the signs incorporate<br />

your brand’s font? Are sales staff easily<br />

identifiable?<br />

• Create one-of-a-kind in-store<br />

experiences – Customers will stay close<br />

to your store if you give them a reason.<br />

Classes, in-store events and loyalty clubs<br />

are all good reasons.<br />

Build your brand and your visibility by<br />

hosting one major and two to three minor<br />

in-store events each month – note that<br />

even in the midst of a pandemic, you can<br />

do virtual events or a combination of virtual<br />

and physical.<br />

A major event attracts new customers to<br />

your store; minor events, like classes and<br />

demonstrations, attract smaller numbers<br />

of shoppers. Both are important.<br />

• Build a strong brand presence online –<br />

In the past, shoppers let their fingers do the<br />

walking through the phone book; today they<br />

visit your website.<br />

These days a website is not an option.<br />

You need a real website that is easy to<br />

remember, as in www.thenameofyour<br />

store.com.<br />

Websites have become the equivalent of<br />

business cards, and your homepage is also<br />

your ‘greeter’.<br />


BASICS<br />

Define<br />

yourself<br />

Articulate the<br />

story, values, and<br />

‘personality’ of<br />

your business<br />

Create<br />

a brand<br />

language<br />

Use visual<br />

and verbal<br />

cues –such as<br />

slogans, colours,<br />

and fonts – to<br />

reinforce your<br />

brand<br />

Be consistent<br />

and cohesive<br />

Monitor your<br />

brand frequently<br />

and allow<br />

enough time<br />

for it to be<br />

established<br />

The photos and information you post on<br />

your website, social media and emails also<br />

represent your brand. Think about what you<br />

post before you post it. Check your spelling<br />

and test links to make sure they work.<br />

Even your email address says a lot about<br />

who you are and is useful in building<br />

your brand. Create an email address that<br />

comes from your own domain name, as in<br />

yourname@thenameofyourstore.com.<br />

• Become a shameless self-promoter –<br />

Other than word-of-mouth, the cheapest<br />

way to build your brand is through PR –<br />

public relations. That’s why you should send<br />

out a press release for everything of interest<br />

that you do.<br />

The media wants and needs your input. Did<br />

you know that the majority of stories that<br />

appear in your local media came from a<br />

one-page press release sent by someone<br />

like you who had a story to tell? You can<br />

build brand equity simply by tapping “send”<br />

in an email.<br />

If you’re too busy to handle the public<br />

relations by yourself, then promote a staff to<br />

the position of ‘PR manager’.<br />

They will act as the media contact person,<br />

who will collect the names of local editors<br />

and reporters, write and distribute press<br />

releases, be your store ambassador at<br />

local functions and Chamber of Commerce<br />

events, and more.<br />

• Be patient – You will likely to get sick<br />

and tired of your brand before it begins to<br />

automatically register with your customers<br />

or potential customers.<br />

The ‘marketing rule of seven’ says that a<br />

person must see or hear your message at<br />

least seven times before they take action or<br />

even remember you.<br />

So, resist the urge to change your logo,<br />

colours or tagline – anything that is<br />

considered part of your brand identity –<br />

and give it time to stick.<br />

• Customise bags, boxes and gift cards<br />

– You run a unique and upscale store, and<br />

while it might be easy to purchase plastic<br />

bags similar to those used in supermarkets,<br />

Make sure that it’s consistent with your<br />

brand image, and a good example of<br />

what shoppers can expect when they visit<br />

your store.<br />


are retail strategists, authors, and<br />

consultants. Visit: kizerandbender.com<br />

87 | <strong>October</strong> <strong>2020</strong>


Selling<br />

Stop talking to PWOTs and use your<br />

sales time effectively<br />

The art of maximising sales centres on weeding out those customers who are a PWOTs – a ‘potential waste of time’<br />

– and instead identifying the shoppers who actually want to buy from you, writes BRIAN JEFFREY.<br />

If you’re going to sell anything, you must<br />

deal with real customers, and your<br />

challenge as a salesperson is to separate<br />

the real from the unreal.<br />

While it’s not difficult, too few salespeople<br />

do it – and end up wasting their time trying<br />

to sell to people who have no intention<br />

of buying.<br />

Why do so many salespeople spend time<br />

on customers who are PWOTs – ‘potential<br />

waste of time’? In some cases, they haven’t<br />

learnt to recognise one. In other cases,<br />

they don’t have anyone else to talk to and<br />

would rather spend time with a PWOT<br />

than with no-one.<br />

Another problem with spending time with<br />

PWOTs is the opportunity cost: you’re not<br />

spending your time with someone who<br />

might actually buy something from you.<br />

And if you think a PWOT is bad, try dealing<br />

with his close cousin, the DWOT – a ‘definite<br />

waste of time’!<br />

The attraction of the PWOT<br />

A lot of sales staff are heavy-duty ‘people<br />

persons’; they really enjoy talking and<br />

socialising with others. Often, this means<br />

their focus is on developing the relationship<br />

and less on developing business. As a result,<br />

they spend too much time with other nice<br />

people persons who just want to have a chat.<br />

Salespeople who have the ‘amiable’<br />

personality type need to be particularly<br />

sensitive to this. People with an amiable<br />

personality are known as ‘shopkeepers’ and<br />

their strength is building relationships.<br />

Unfortunately, sometimes they are so<br />

keen on being friendly that they forego<br />

the unpleasantness of actually having to<br />

ask someone to buy something for fear of<br />

upsetting the relationship.<br />

Identifying time wasters<br />

As mentioned previously, some sales staff<br />

fall into the PWOT trap because they simply<br />

don’t know how to recognise them.<br />

Here are some clues to help you detect<br />

real customers from the unreal ones – aka<br />

PWOTs and DWOTs:<br />

Failing to keep appointments and ignoring calls are sure signs of a PWOT.<br />

Disguising their lack of power – PWOTs and<br />

DWOTs often try to create the impression<br />

that they wield more purchasing influence<br />

than they really do, and they will often evade<br />

questions regarding money or funding.<br />

Resenting you for asking questions – your<br />

questions put them in danger of exposure<br />

as time wasters, so they give vague or<br />

dissatisfying answers to your specific<br />

enquiries regarding their needs and<br />

intentions. They won’t make it easy for<br />

you to sell to them.<br />

Showing little respect for your time and<br />

effort – these people will often fail to keep<br />

appointments, hide behind their voicemail,<br />

and don’t return your calls, emails, or texts.<br />

Trying to get you to alter your standard<br />

operating procedures – PWOTs and DWOTs<br />

will try to muddy the waters to delay the<br />

ultimate non-decision; they will quibble on<br />

price, product, terms, and more.<br />

PWOTs and DWOTs are not all bad or<br />

thoughtless people; often, they are fine<br />

individuals who simply can’t say no to a<br />

salesperson because they don’t want to<br />

hurt his or her feelings. On the other hand,<br />

sometimes they are ego-driven individuals<br />

who live in a make-believe world.<br />

Focus on real customers<br />

The opposite of PWOTs and DWOTs are<br />

real customers or potential customers.<br />

PWOTs often<br />

try to create the<br />

impression that<br />

they wield more<br />

purchasing<br />

influence than<br />

they really do,<br />

and they will<br />

often evade<br />

questions<br />

regarding<br />

money<br />

These people are where you and your sales<br />

staff should focus your efforts in order to<br />

maximise results.<br />

Here are some key characteristics:<br />

Questions are welcome – these customers<br />

or shoppers know you need to get certain<br />

information if you are to help them make an<br />

informed buying decision.<br />

Realistic about money – simply put, these<br />

people are not trying to buy two dollars’ worth<br />

of business for a dollar, and they understand<br />

the concept of cost versus value. For those<br />

bigger purchases, they have a budget in<br />

mind, and know the difference between<br />

wished-for money and money in the bank.<br />

Clear decision-making process – these<br />

customers know what they want to buy,<br />

and they know that the sooner they make a<br />

decision, the sooner they will get that item<br />

or service.<br />

Demonstrate value for their time and<br />

yours – interactions with real customers are<br />

respectful and professional, and they will<br />

hesitate to make an appointment if they feel<br />

it would be a mutual waste of time.<br />

Cut your losses<br />

Real salespeople want to spend their time<br />

with real customers, so make sure you find<br />

out who’s who and start qualifying your way<br />

to even greater sales success.<br />

Learn to differentiate the real from the<br />

unreal and focus your efforts where it<br />

counts. You’ll find your sales going up and<br />

your frustration going down.<br />

If you suspect you’re dealing with a PWOT,<br />

extradite yourself from the situation as<br />

quickly and courteously as possible and<br />

move along. You may end up keeping them<br />

as friends or acquaintances – just don’t let<br />

them eat up your valuable selling time!<br />

Replace your PWOTs with real buyers and<br />

put more money in your pocket.<br />

BRIAN JEFFREY has more than 40<br />

years’ experience in sales management,<br />

training and business consulting.<br />

Visit: quintarra.com<br />

88 | <strong>October</strong> <strong>2020</strong>


Management<br />

Do you already have a sales prodigy<br />

working in your business?<br />

While natural skill can play a part in anyone’s success, the element that makes the biggest difference<br />

comes down to another factor entirely – the willingness to learn, explains DAVID BROWN.<br />

We’ve all met those people who are<br />

blessed with skills that the rest of us<br />

don’t have.<br />

Whether it be in business, playing the<br />

piano, memorising information, or even<br />

excelling at golf, these people exhibit their<br />

skills with effortless ease while the rest of<br />

us flap around like fish on a jetty!<br />

We tend to credit them with exceptional<br />

natural skill – and for many of them skill<br />

is an important factor, but not always as<br />

much as you would initially think.<br />

In his book Outliers, author Malcolm<br />

Gladwell introduces us to the ‘10,000<br />

hours rule’ – the transformative impact<br />

of spending 10,000 hours of concentrated<br />

learning on a specialised task.<br />

Gladwell credits much of the success<br />

of many famous people to the time they<br />

spent developing their craft as much as<br />

their natural talent.<br />

With 10,000 hours of training, he<br />

maintains, most people can achieve a<br />

world-class level in a particular field,<br />

simply by putting in the time to hone<br />

their skills.<br />

This is backed up by Matthew Syed in<br />

his book Bounce.<br />

Syed focused on the high percentage<br />

of young men and women, including<br />

himself, who lived on the same street<br />

and achieved national level success in<br />

table tennis.<br />

The odds that one street in an English<br />

city could possibly have such a high<br />

statistical probability of generating so<br />

many champions, in a relatively lowprofile<br />

sport, is low.<br />

Clearly the environment, which included<br />

a table tennis facility which was open 24<br />

hours a day, along with a local coach who<br />

excelled at teaching the sport, played a<br />

significant role.<br />

Nature and nurture<br />

Hungarian behavioural psychologist<br />

Laszlo Polgar studied the impact of<br />

starting early and subjecting a child to<br />

Practice –and patience – makes perfect when it comes to business.<br />

intensive training in a particular field.<br />

He based his conclusions on the family<br />

history of 400 famous child prodigies.<br />

Eventually, Polgar decided to test his<br />

theories on his own family.<br />

He deliberately chose a partner – his<br />

Russian-born wife – who was willing to<br />

go along with his plan to turn their future<br />

children into prodigies.<br />

They selected chess as their avenue<br />

for learning and, upon the birth of each<br />

of their three daughters, subjected them<br />

to intensive training.<br />

All three went on to become world-class<br />

players, despite the fact that women are<br />

noticeably underrepresented in the elite<br />

levels of the game.<br />

So, what does all of this mean for your<br />

retail business?<br />

You may not share the intensity of Laszlo,<br />

but evidence tends to show that you can<br />

teach yourself, and your staff, whatever<br />

skills you wish.<br />

The key to success is whether or not you<br />

are willing to commit the time and energy<br />

required to get results. Now, this does<br />

not mean you need to start hiring five-<br />

The staff<br />

member who<br />

seems unable to<br />

sell diamonds<br />

could become<br />

your best<br />

diamond seller<br />

if you are<br />

willing to invest<br />

the time in their<br />

training and<br />

support<br />

year-olds to get them up to speed by a<br />

reasonable age!<br />

Nor does it mean you have to spend<br />

10,000 hours to master a new skill –<br />

which equates to six hours of practice<br />

a day for 4.5 years – or expect that from<br />

your staff.<br />

The central point of both Gladwell and<br />

Syed’s books is that expertise and skill<br />

can be learned rather than innate –<br />

anyone can master a skill with sufficient<br />

desire and willingness.<br />

The staff member who seems unable to<br />

sell diamonds could become your best<br />

diamond seller if you are willing to invest<br />

the time in their training and support.<br />

Foster your skills<br />

At the same time, business success itself<br />

says less about talent and more about your<br />

ability to embrace the topic and spend the<br />

time understanding the skills you need.<br />

Understanding numbers is a case in<br />

point. Many business owners feel that<br />

handling their company’s financial affairs<br />

is something that only a select few can do,<br />

but this is not the case. No-one is born an<br />

accountant!<br />

Getting your head around your finances<br />

and overall business performance is<br />

about taking the time to understand the<br />

different factors involved.<br />

While some have an innate ability to<br />

grasp numbers, for the vast majority it is<br />

something that is learned – and the more<br />

you expose yourself to the necessary<br />

lessons, the quicker you will comprehend<br />

the data required.<br />

So, in order to be successful, take the<br />

time to develop your skills – and those<br />

of your staff – in the areas of expertise<br />

that will pay the highest dividends for<br />

your business.<br />

DAVID BROWN is is co-founder<br />

and business mentor with Retail<br />

Edge Consultants. Visit:<br />

retailedgeconsultants.com.<br />

89 | <strong>October</strong> <strong>2020</strong>


Marketing & PR<br />

Adapting marketing strategies to the changing<br />

patterns of consumer behaviour<br />

During and post-COVID, consumers have been exhibiting unfamiliar buying patterns. For retailers, it’s a case of<br />

same, same, but different – and the approach to marketing should reflect that, says BARRY URQUHART.<br />

They’re back: in every state and territory<br />

in Australia, bar Victoria, consumer foot<br />

traffic in key shopping centres and prime<br />

retail precincts is reportedly at around 86<br />

per cent of the levels recorded in March,<br />

immediately prior to the declaration of the<br />

COVID-19.<br />

And in nearly every way, the consumers<br />

are the same as before; the faces<br />

are familiar, addresses have not<br />

changed. Neither have the credit<br />

and debit card details.<br />

Loyalty cards are still valid and<br />

accumulating points – however,<br />

there appears to be little consumer<br />

commitment to the businesses<br />

issuing them.<br />

Advertising messages are eliciting fewer,<br />

and slower responses, while promotional<br />

activities are generating less interest,<br />

fewer responses and attendances.<br />

Customers are, quite simply, exhibiting<br />

differing buying patterns. So, what is a<br />

retailer to do in this new ‘COVID normal’?<br />

Scouting the landscape<br />

First, let’s examine those marketing<br />

strategies that have been ineffective in<br />

the wake of COVID-19.<br />

Big price-discounting campaigns are,<br />

seemingly, not increasing revenues as<br />

the price savings are being accepted –<br />

if not expected.<br />

However, volumes do not reflect the<br />

enhanced value offers.<br />

Consumer loyalty and repeat business<br />

with individual stores and brands<br />

appears to be tenuous at best.<br />

Relationships are founded on each<br />

transaction, alongside competitive<br />

pricing, payment options, and incentive<br />

post-purchase services, yet those<br />

relationships are now fractious,<br />

hard-earned, and short-term.<br />

At the same time, online sales have<br />

not proven to be the saviour for all<br />

stores, particularly those with a bricksand-mortar<br />

presence alongside an<br />

Post-COVID, consumer psychology has seen a profound shift.<br />

e-commerce offering. Indeed, during<br />

June, total national online sales declined<br />

by some 2 per cent for the first in more<br />

than seven years.<br />

Analysis shows this was an expression<br />

and qualification of consumer<br />

dissatisfaction with poor, slow and<br />

variable delivery standards.<br />

As it turns out, delivering the e-commerce<br />

promise – which Australian consumers<br />

were already more reluctant than most to<br />

embrace – is both difficult and expensive.<br />

Closing the gap<br />

Many bold statements and declarations<br />

by corporate management about their<br />

‘customer-focus’, ‘customer-driven<br />

service’ and ‘customer-centricity’ have<br />

been found to be shallow over the course<br />

of the past few months.<br />

The recognition of customers has<br />

frequently been limited to demographic<br />

profiles and historic buying patterns –<br />

such are the characteristics and typical<br />

deficiencies of algorithms and artificial<br />

intelligence.<br />

Advertising<br />

messages are<br />

eliciting fewer,<br />

and slower<br />

responses, while<br />

promotional<br />

activities are<br />

generating less<br />

interest, fewer<br />

responses and<br />

attendances<br />

Intuitive reasoning, understanding and<br />

responses are sparse. The nuances<br />

inherent in the spoken word and bodylanguage<br />

are seldom recognised,<br />

comprehended and appreciated.<br />

In the offline channel, the allure of<br />

personal contact with in-store sales<br />

and service providers has remained for<br />

consumers, yet sadly the expectations<br />

and promises have often fallen short<br />

because of rationalised staffing levels.<br />

Put simply, the large capital investments<br />

in social, digital and online capacities<br />

have not been matched by complementary<br />

and contributing capabilities of<br />

experienced, qualified and enthusiastic<br />

team-members.<br />

From a marketing perspective, it appears<br />

too many eggs have been placed in the<br />

wrong baskets – especially now that<br />

stores, for the most part, have reopened<br />

their doors.<br />

The physical presence of consumers has<br />

been, and continues to be, conspicuous.<br />

However, their psychological perceptions,<br />

aspirations, expectations and purchase<br />

criteria have changed, often substantially.<br />

Each is a consequence of lockdowns,<br />

social isolation and inhibited mobility. Yet<br />

looks can be, and often are, deceiving.<br />

Converting sales and fulfilling needs<br />

requires closer analysis, understanding<br />

of the ‘new’ consumers, and refinements<br />

to business practices and promises.<br />

When strategising for the next period,<br />

it is advisable to start wholly from<br />

scratch, rather than assuming the same<br />

marketing incentives will be as effective<br />

as they were before.<br />

At the same time, it is critical for<br />

businesses to learn from the mistakes<br />

of others in adapting to COVID-19, and<br />

determine where their energies are<br />

best spent in attracting and retaining<br />

customers.<br />

BARRY URQUHART is managing<br />

director of Marketing Focus. He has<br />

been a consultant to the retail industry<br />

around the world since 1980. Visit:<br />

marketingfocus.net.au<br />

90 | <strong>October</strong> <strong>2020</strong>


Logged On<br />

How to create an Instagram ad that increases sales<br />

Instagram advertising is an important and efficient tool in building your business, writes ALLISON HALL –<br />

but it is essential to have the correct strategy in place to make the most of this social media platform.<br />

Small business owners – particularly<br />

independent retailers – are told time and<br />

time again that they ‘should’ be advertising<br />

on Instagram. Yet it can be challenging<br />

to harness the true power of this social<br />

media platform.<br />

Instagram advertising is like a magnetic field<br />

that attracts customers to your business.<br />

According to Instagram’s figures, it has<br />

400 million active daily users who create<br />

80 million posts each day. This means your<br />

advertising has the ability to reach a very<br />

large number of people.<br />

At the same time, you can also create very<br />

targeted ads to maximise your chances for<br />

converting sales.<br />

Paying for Instagram ads need not be a<br />

large financial commitment, and the types of<br />

ads you create can be tailored to your budget<br />

– whether it is $10 per day or $10,000.<br />

Most importantly, Instagram ads are<br />

extremely effective. Some digital marketing<br />

experts say that Instagram ads are twice as<br />

cost-effective as Facebook ads due to the<br />

higher number of clicks they receive.<br />

Developing a strategy<br />

Once you decide to create an Instagram ad,<br />

the first step is to determine your objective.<br />

Some of the most common goals include<br />

driving traffic to your website, increasing<br />

sales, gaining more social media followers,<br />

and increasing engagement to build brand<br />

recognition.<br />

Don’t try to ask a viewer to both follow you<br />

(increase your follower count) and make a<br />

purchase (increase sales). The total viewing<br />

time of your ad will be short, so the goal<br />

needs to be succinct and attainable.<br />

The next step is to decide who your audience<br />

is. Instagram’s targeting options can be<br />

broken down into three categories:<br />

• Core Audiences – The app’s default option<br />

• Custom Audiences – Numerous data<br />

sources are used to pull a group of users who<br />

have previously interacted with your brand<br />

• Lookalike Audiences – Data is analysed<br />

Instagram is more than a popularity contest – it’s a powerful sales tool.<br />

to create a group of users who have similar<br />

characteristics to your existing customers<br />

or followers<br />

Look at your Instagram page’s Insight tab in<br />

order to find out the demographics of your<br />

pre-existing followers.<br />

Alternatively, you can make decisions based<br />

on the type of person who is going to be<br />

interested in your specific product or service.<br />

Creating the content<br />

Once you have your objective and audience<br />

in mind, the next step is to determine which<br />

type of Instagram ad would be the most<br />

effective to achieve your goal.<br />

You can choose from single photo ads,<br />

carousel ads – that is, multiple photos that<br />

users ‘swipe’ through – video ads, Instagram<br />

Stories ads, and ads on the ‘Explore’ page.<br />

There are different benefits to each type.<br />

For example, static photo ads are visually<br />

compelling, and users can ‘Save’ and return<br />

to the post.<br />

Video ads can be up to one-minute long<br />

which allows you to tell the story of your<br />

business, present a problem and solve it,<br />

or go in-depth about how a product works.<br />

When you create an Instagram video<br />

ad, optimise it for mobile viewing.<br />

Natasha Courtenay-Smith, CEO of digital<br />

One of the best<br />

approaches<br />

to avoid being<br />

skipped over<br />

is to make<br />

your Instagram<br />

ad look like a<br />

post created<br />

by a friend<br />

marketing firm Bolt Digital, says this means<br />

incorporating movement in the first three<br />

seconds. The audio of the Instagram video<br />

will also be muted by default, so it is crucial<br />

to add text or captions to let viewers know<br />

what is going on.<br />

Meanwhile, carousel ads allow up to 10<br />

images or videos and give you the ability<br />

highlight multiple products, or ‘deep dive’<br />

into the details of a single product with<br />

multiple angles and styling options.<br />

The most important thing is to grab the<br />

attention of the consumer immediately.<br />

There is no time to waste – studies show an<br />

ad needs to compel a viewer to stop within<br />

milliseconds.<br />

Holding attention<br />

One of the best approaches to avoid being<br />

skipped over is to make your Instagram<br />

ad look like a post created by a friend. In other<br />

words, make the ad not appear to be an ad.<br />

We see this increasingly with cosmetic and<br />

skincare companies, such Glossier.<br />

These advertisements are effective because<br />

they blend into an Instagram feed and<br />

therefore are not immediately ignored.<br />

They also feel authentic, approachable and<br />

familiar – and can make it appear as if the<br />

products are recommended by a user’s peers,<br />

instead of being promoted by a business.<br />

Finally, decide on your call-to-action button.<br />

For example, do you want the viewer to<br />

immediately purchase your product or call<br />

you to make an appointment? Choose the<br />

option which caters to your goal, and then<br />

create visuals which compel them to click.<br />

By following this guide to brainstorm your<br />

Instagram advertising strategy, you will put<br />

yourself on track for a focused, successful<br />

campaign that persuades potential shoppers<br />

to act.<br />

ALLISON HALL is a marketing and<br />

public relations specialist at Three Girls<br />

Media, an award-winning agency based<br />

in Seattle. Visit: threegirlsmedia.com<br />

91 | <strong>October</strong> <strong>2020</strong>

My Bench<br />

Ryan Haddrell<br />

Clayfield <strong>Jeweller</strong>s, Brisbane QLD<br />

Age 42 • Years in Trade 25 • Training Four-year apprenticeship, and 21 years of learning every day. • First job Hungry Jacks kitchen hand! My first job in the<br />

jewellery trade was as an apprentice training under Mal Gray at Richardson’s <strong>Jeweller</strong>s, then Doug Morris <strong>Jeweller</strong>s shortly after. • Other Qualifications Gem setter,<br />

CAD designer, laser operator, and karate black belt<br />




This piece is a favourite of mine. It’s a platinum solitaire<br />

engagement ring set with a 1-carat oval-cut diamond and<br />

20 smaller diamonds in the band. I really enjoy it because the<br />

setting gives the ring a great look – maximum sparkle with<br />

minimal metal. It features a flow-up style band, micro-set<br />

shoulders and arrowhead claws. I used our laser welder for<br />

soldering to fuse the metal with no pitting or dragging from<br />

the joints. To create the micro-set shoulders, I used a twist<br />

drill, fissure burr, ball burr, hart burr and saw frame. It lives<br />

up to the name ‘Simple Sophistication’.<br />

4FAVOURITE GEMSTONE Parti sapphire because<br />

I love the beautiful combination of colours –<br />

greens, yellows, blues, etcetera, mixing together<br />

to create very unique looks.<br />

4FAVOURITE METAL 18-carat yellow gold.<br />

It’s very easy and ‘friendly’ to use; it’s great for<br />

drawing wire and forging. Simple to solder. I also<br />

love the yellow colour of 18-carat gold.<br />

4FAVOURITE TOOL Laser welder. It gives<br />

me abilities that I would have loved to have<br />

had in the first half of my career. I handle<br />

heat-sensitive stone with much more ease than<br />

in the days of soldering in a sand pit.<br />

I can pinpoint solder 0.4mm spots in very awkward<br />

positions in seconds. I also do not use binding wire<br />

any more and can tack things together very quickly<br />

with no tongs or tweezers.<br />

4BEST NEW TOOL DISCOVERY X-ray scanner.<br />

The days of acid testing are over and it’s awesome<br />

to get a fast and accurate breakdown of exactly<br />

what is in the metal I am working with.<br />

4BEST PART OF THE JOB Being creative and<br />

getting to help people in our own way, such as<br />

helping a customer create their dream jewellery<br />

piece from an idea or old gemstones – that could<br />

mean the world to them. Or, on a more practical<br />

note, cutting a customer’s ring off to get back<br />

some blood flow!<br />

4WORST PART OF THE JOB Sitting down – a lot.<br />

4BEST TIP FROM A JEWELLER Measure twice,<br />

cut once.<br />

4BEST TIP TO A JEWELLER Plan your work.<br />

Get all the numbers and information on paper<br />

before you start a complex project and never<br />

assume details, where possible.<br />


Eyes and lungs. There are lots of hot and sharp<br />

things that can go into your eyes, so wear eye<br />

protection please! For lungs, we must concern<br />

ourselves with mainly polish dust and plating<br />

fumes. It’s essential to wear a good quality mask.<br />

4LOVE JEWELLERY BECAUSE It’s art. The vast<br />

possibilities of what you can create when you try<br />

to master an art form is very fulfilling.<br />

92 | <strong>October</strong> <strong>2020</strong>

Add Rapid to your Bench.<br />

Are you looking for a professional, reliable,<br />

fully trackable casting company?<br />

Traditional and Digital Casting Professionals!<br />

www.rapidcasting.com.au<br />

We Make Rubbers<br />

RTV & Vulcanised that you own.<br />

Wax Injection Service<br />

Send us your rubber moulds.<br />

Trackable casting and jewellery CAD/CAM services. Visit our website for instant quotes and ordering.<br />

C A D<br />

+61 2 9557 9468<br />

info@rapidcasting.com.au<br />



Soapbox<br />

The importance of kindness post-COVID<br />

When figuring out a strategy to survive the new reality of retail, the jewellery industry’s greatest<br />

strength is in our kindness and loyalty to each other, writes HELEN THOMPSON-CARTER.<br />

You are probably, like me and everyone<br />

else in the world, wondering when<br />

COVID-19 will be stopped in its tracks.<br />

Unfortunately, it is not looking likely<br />

any time soon. The feeling is more that<br />

we now need to embrace life within a<br />

global pandemic, and everything that<br />

comes with it.<br />

New Zealand went ‘hard and fast’ back<br />

in March. Many businesses – outside of<br />

those deemed essential services – saw<br />

limitations imposed on trade, both instore<br />

and online.<br />

Our approach was one of the strictest in<br />

the world, and the impact on businesses<br />

was extreme. Yet for some retailers, April<br />

and May were as good as Christmas in<br />

terms of sales and revenue.<br />

Then we emerged from this six-week<br />

lockdown straight into a euphoric frenzy<br />

of retail spending.<br />

It was great for our jewellery industry –<br />

the repairs, remakes, and watch battery<br />

replacement jobs piled up, and the<br />

consumers came out to treat themselves<br />

to something new and beautiful.<br />

However, the emergence of customers<br />

with money in their pocket was shortlived.<br />

Now it has all come home to roost<br />

– financially, for many people things are<br />

tough and tight. Economically, things<br />

have slowed down.<br />

But in our jewellery industry, it is not<br />

‘over and out’.<br />

We have a Prime Minister whose favourite<br />

saying during the COVID period has been,<br />

“Be kind.” If I can take this slogan and<br />

apply it to our industry right here and<br />

now, it is indeed a time to be kind.<br />

It is a time to shift the thinking of, ‘What<br />

can you do for me?’ to ‘What can we<br />

do together?’<br />

Retailers need a supply chain and the<br />

supply chain needs the retailers.<br />

It has become difficult to conduct<br />

international business, particularly with<br />

countries such as India, which is an<br />

integral part of the jewellery supply chain.<br />

So, more than ever, we need to support<br />

local and foster those long-term supplier<br />

relationships – and local includes our<br />

trans-Tasman friends.<br />

I, like most suppliers, understand that<br />

retailers need to be cautious, stock needs<br />

to be turned, and risks mitigated, while<br />

sitting on a sizeable emergency fund for<br />

those ‘just in case’ times which seem to<br />

be occurring more and more frequently.<br />

Yet some retailers have taken this to<br />

the extreme, thinking in the short-term<br />

without planning for the long.<br />

The downside is that this has the potential<br />

to be catastrophic to the industry supply<br />

chain. Adopting a ‘no buy’ attitude could<br />

very well kill us, and retailers too.<br />

Fresh stock is important. Retailers need<br />

to keep their loyal customers happy,<br />

as well as tempt new customers, by<br />

re-ordering the best-selling lines and<br />

ordering new and exciting products.<br />

Yet if their regular suppliers disappear,<br />

retailers will have to search for stock from<br />

unknown sources. In doing so, they risk<br />

purchasing lower-quality products and<br />

sacrificing the deals they currently enjoy<br />

as a result of long-term relationships.<br />

To quell some of the fear jewellers are<br />

To succeed<br />

in this new<br />

environment<br />

also requires us<br />

to strengthen<br />

our support for<br />

each other –<br />

and have faith<br />

in what we<br />

have, and do,<br />

every day<br />

feeling, it’s important to remember the<br />

things jewellery represents, celebrates<br />

and signifies won’t disappear because<br />

of COVID-19 or a recession.<br />

Birthdays, weddings, engagements,<br />

anniversaries, and other special<br />

occasions will still happen every year,<br />

and we are lucky to be in an industry<br />

where customers turn to us to help<br />

them mark these wonderful events!<br />

Yet there is no denying that we are going<br />

to have to work harder for what we get,<br />

developing a deeper understanding of the<br />

ways in which consumers are searching,<br />

shopping, and spending in this post-<br />

COVID environment.<br />

We will need to adjust our offering<br />

accordingly to suit their needs.<br />

For most in the jewellery industry, that<br />

means being more digital, more engaging<br />

and more present, being a better<br />

storyteller, and being far more proactive<br />

in selling the virtues of fine jewellery.<br />

To succeed in this new environment also<br />

requires us to strengthen our support for<br />

each other – and have faith in what we<br />

have, and do, every day.<br />

So, let’s be COVID kind. Support local,<br />

support those within the industry who<br />

have supported you, keep that support<br />

close to home, and together let’s make<br />

sure our beautiful industry continues<br />

to shine.<br />

Name: Helen Thompson-Carter<br />

Company: Fabuleux Vous<br />

Position: Founder and director<br />

Location: Auckland, NZ<br />

Years in Industry: 10<br />

94 | <strong>October</strong> <strong>2020</strong>


to a city near you!<br />

ewellery<br />

• TRADE DAYS •<br />

Gift<br />

<strong>Jeweller</strong>y<br />

• TRADE DAYS •<br />


SYDNEY<br />

PERTH<br />


February 13 – 14, 2021<br />

Brisbane Convention Centre<br />

Southbank<br />

February 20 – 21, 2021<br />

ICC Sydney<br />

Darling Harbour<br />

March 13 – 14, 2021<br />

Perth Convention<br />

& Exhibition Centre<br />

March 20 – 21, 2021<br />

Adelaide<br />

Showground<br />

We are ready to get back to business and recognise the importance<br />

to reconnect quickly and efficiently.<br />

Introducing the Retail Trade Days, giving wholesalers an easy and affordable opportunity to connect<br />

with local retailers, easy access to an event, with a cross section of suppliers in their own state.<br />

The Retail Trade Days will be a marketplace of leading jewellery suppliers, all trading from a trestle table<br />

with a maximum cap of 2 tables. It is designed to ensure that participants focus their offer on samples of<br />

their latest new releases, or dead stock they are looking to clear. With exhibitor packages starting at<br />

only $1,100, don’t miss out on bouncing back with these intimate and local focused events.<br />

Get in touch!<br />

If you have any questions, or want to secure your involvement contact the team at Expertise Events.<br />

Phone: (02) 9452 7575<br />

Email: jewelleryfair@expertiseevents.com.au<br />

Organised by:<br />

Est. 1990

Automatic & Mechanical<br />

Classiquewatches.com<br />

www. Classiquewatches.com<br />



E orders@samsgroup.com.au W samsgroup.com.au P 02 9290 2199

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