Posted May 17, 2016 | By Coleby Nicholson • Managing Editor
The recent dispute
between Pandora and Alex and Ani has again brought into question the
relevance of the JAA. COLEBY NICHOLSON says the ‘peak industry body’
needs to rethink its purpose.
What does the JAA stand for? I wonder if you know because I no longer have any idea.
The
recent Pandora-Alex and Ani dispute demonstrated to me that the JAA has
continued to lose its way and is close to becoming irrelevant. By
remaining silent over the Australian Competition and Consumer Commission
(ACCC) investigation into Pandora’s anti-competitive behaviour, the JAA
seems to stand for nothing. Well, at least nothing important.
I’ll
come back to that issue but let’s first attempt to understand the
current state of the JAA and what its function is supposed to be.
JAA
membership has been declining for several years and current numbers may
well be at an all-time low. I can’t recall a period when more retailers
and suppliers have abandoned the association by not renewing
membership. The JAA refers to such retailers and suppliers as having
‘resigned’.
Not only is the number of resignations quite
significant this year but the names of the businesses resigning also
tell a sad tale. I know of many people who have resigned after
supporting the JAA for decades because they believe that there is no
longer any financial benefit, that the JAA’s reason for existing is no
longer relevant, and/or because they are tired of petty politics.
The
JAA seems to believe the only reason people are abandoning the
association is because of the state of the economy and while that is
partly true, it’s not the sole reason. In fact, I think this makes up
only one small part of the overall decision to not pay membership fees
that help fund an industry association.
For example, it hasn’t
helped that over the last few years the JAA has damaged its own
reputation and in some cases divided the industry. Who could forget
foolhardy episodes like the JAA promoting international diamond trading
company
RapNet?
The association effectively advised local retailers to buy from an
overseas internet platform rather than support its own members and
Aussie diamond dealers.
Yes, this occurred several years ago and
yes, the JAA eventually apologised for its thoughtless actions, but it
left many people scratching their heads. In more recent times, I have
had complaints about a wide range of issues ranging from lack of member
benefits through to the
cancellation of the 2016 JAA Australasian Jewellery Awards.
While
the JAA blamed a lack of industry sponsorship funding for the
‘postponement’ of this year’s biennial design competition, it’s well
known that the 2014 awards program was fraught with problems.
Indeed,
not only did one sponsor tell me on the night that he would never
support the awards again but jewellers who attended, including some
entrants, commented that the night was such a shambles they would never
go again.
The disappointment about the event continued for weeks
so it came as no surprise to me that this year’s awards were cancelled
because of a lack of industry support. Nevertheless, the news did come
as a surprise to many, with one very disappointed jeweller asking me,
“How could the JAA announce the awards in January and then cancel them
in February?”
It’s a fair question, as is the question of whether
it’s time to review the purpose of the awards … but back to what the JAA
stands for.
Stand up and be counted
If there was ever a
reason or cause for the JAA to stand up and be counted by the Australian
jewellery industry it was during the Pandora-Alex and Ani fight when
Pandora threw its considerable weight around to stop jewellers stocking a
competitor’s product.
One of the reasons – if not the
main
reason – for the existence of the JAA is to represent and support
independent jewellery stores. The big chains don’t need the JAA and yes,
there are also supplier members, but without buyers there can be no
sellers and without a vibrant retail sector the need for an industry
association falls by the wayside.
Jeweller reported
earlier this year that a number of jewellery retailers had lodged formal
complaints with the ACCC about Pandora’s anti-competitive behaviour.
That is, many small jewellers, including JAA members, complained that
Pandora’s actions were unfairly affecting their businesses by
disallowing them to stock the newly launched Alex and Ani jewellery
range.
Putting aside the complex legal issues surrounding
Pandora’s stance, it should be noted that the JAA remained silent prior
to and throughout the ACCC’s investigation. It should also be noted that
something can be considered anti-competitive but not illegal, and so it
was that the ACCC eventually concluded that Pandora’s action
did not breach Australian Consumer Law and Pandora’s demands on retailers had not substantially lessened competition.
The
ACCC decision meant that Pandora could continue to take action against
its competitors, and small jewellers would have to choose between the
two products. So what did the JAA do after the ACCC announced its
decision?
Nothing! Not a word.
Let me reiterate: this was an
industry dispute affecting hundreds of jewellery stores – many of which
are JAA members – and the JAA made no comment about the matter prior
to, during or even after the ACCC’s findings.
I have covered the
Australian and New Zealand jewellery industries for more than a decade
and I can’t recall a more important industry-wide issue and yet the JAA
had nothing to say. Further to this, the matter is not short term; the
negative impact on jewellers is ongoing.
No comment
Why
the silence? Well, the JAA’s view is that after various complaints were
lodged, nothing it said or did would change the outcome of the consumer
watchdog’s investigation and the matter would be reviewed on the basis
of law and not the number of complainants.
That might be true – but it misses the point.
The
JAA may well have been “disappointed” at the ACCC’s findings and may
also be disappointed at Pandora’s actions against its retail members as
well as Alex and Ani – another member – but it made no comment to that
effect.
As an association that purports to represent its members,
why would the JAA not make a statement about the Pandora-Alex and Ani
issue given its negative impact on many retailers? The JAA could have
come out and informed the industry that it did not support Pandora’s
actions to reduce competition and consumer choice, even if those actions
were ultimately deemed legal.
It’s a simple matter – either
Pandora’s actions were positive for the wider jewellery industry or they
weren’t. Consumers should either have the widest choice of jewellery
product available to them or they shouldn’t.
What did our so-called ‘peak industry body’ think about this dispute? Who knows!
What’s
more, after the ACCC investigation the JAA could have issued a
statement along the lines of: “While the JAA recognises that Pandora has
not broken the law, we hope that the company will review and cease its
policy to restrict choice by retailers and ultimately consumers for the
good of the wider industry.”
Pandora would have surely ignored
such a statement – it resigned from the JAA this year – but no harm in
making your views known, right? It’s like the episode never happened.
A
stance from the JAA might not have affected the outcome of the problem
in any way; however, the JAA would have been seen as acting for its
members. It chose not to do so and was conspicuous in its absence.
Failing to represent
So I come back to my original question: What does the JAA stand for?
According
to its website, the JAA’s mission is to be “the peak industry body that
represents greater than 75 per cent of industry participants”.
Fail...
remaining silent is not representing anything or anyone! Furthermore,
with a year-on-year decline in membership – and nothing in sight to
reverse that trend – the chance of representing more than 75 per cent of
the industry looks almost impossible.
When given the perfect
opportunity to stand up and be counted, the JAA went into hiding, so is
it any wonder that more and more members are abandoning the association?
The matter gets worse. I note the second item on the JAA’s mission is to be “the first point-of-contact for thought leadership”.
Apart
from the fact that the use of weasel words (managerial drivel) such as
‘thought leadership’ has increasingly crept into JAA vernacular, I ask:
If the JAA wants to be seen as a thought leader (whatever that is!) why
did it not
lead and tell us what it
thought?
Think
about it – it was the JAA that listed its two most important aims as
wanting to represent more than 75 per of the industry and as being
recognised as ‘thought leaders’, yet when offered a prime opportunity to
be seen as fulfilling both of its own aims, it remained silent.
I’m
reminded of the legal saying, “Not only must justice be done; it must
also be seen to be done.” The JAA was seen to be doing nothing.
Another
of the JAA’s aims is to be “recognised and respected as an organisation
for excellence and trusted leadership of the jewellery industry”.
Readers will conclude for themselves whether the JAA’s silence demonstrates
leadership of any kind and whether its silence is to be
respected. Jewellers will also continue to vote with their membership wallets as to whether the JAA
represents anyone or anything.
Not one known for staying silent, I’d like to leave you with
my
thoughts: on current trends, it would seem that each year, more people
lose respect for the JAA compared with those who see it as a body that
offers benefits or takes principled stands, and that’s a shame.
Before
it takes umbrage at this view and before it jumps in to shoot the
messenger, as it’s often prone to do, if the JAA requires further proof
that the large membership drop-off has little to do with the economic
climate it need only turn to its
own website.
A page
headed ‘Loyal long-term members’ displays businesses that have held
membership for 10 or more consecutive years; however, the list is not
current.
Sadly, the page includes a long list of well-known names –
some with 20 to 30-year memberships – who have since abandoned the JAA
by ‘resigning’. That has little to do with the economy, which leads us
to wonder whether it speaks volumes for the JAA’s relevancy.
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ABOUT THE AUTHOR
Coleby Nicholson • Managing Editor
Managing Editor • Jeweller Magazine
