DiGem buying group disbanding

by eyetee | March 31, 2014 2:56 pm

[1]After more than four decades, DiGem is dissolving.

In a letter sent to suppliers, the Western Canada buying group announced it would be closing down its operations April 30.

“We would like to thank you for the longstanding relations we have enjoyed over our 43 years together,” wrote DiGem president and chief executive officer (CEO), Ron Caine.

“We appreciate your commitment to DiGem and our members look forward to continuing this relationship with you directly.”

When contacted by Jewellery Business, Caine said the decision came as a result of dwindling membership. Although it once boasted 55 members, that number is now down to 23, with 33 stores. Caine was quick to point out the group is not bankrupt or going into receivership.

“We had been looking at the long-term viability of the group for a while now. Like all independent jewellers, we were finding more and more that there’s less and less of us out there,” said Caine, a 14-year member of the group and third-generation jeweller.

“We could have carried on operations, but from the board’s perspective, our mandate is to look after the welfare of the group and we were coming up to a point in its lifespan where revenue and membership were decreasing. We obviously didn’t have the critical mass to carry on in terms of the size of the membership.”

Caine said the board had been looking for ways to increase membership for the last year and a half, and it wasn’t until after January that it recommended dissolution to the group.

“It was a decision none of us wanted to make,” he noted. “The value of the group is in the networking and in the contacts, and DiGem really has been a family for years and years. People were disappointed it had come to this, but they understand the future was different from how we operated in the past.”

The group’s dissolution may be a symptom of the changing landscape of the jewellery industry, particularly in North America, Caine said.

“There a certain amount of attrition in the industry just because you’re not seeing those multi-generational stores anymore and there are not really a lot of new independents opening,” he said.

Although there are other buying groups operating and viable in Canada, Caine said that may be partly due to geography.

“When you’re out West, your store may be hours from the next closest independent,” he said. “For an organization like the Canadian Jewellery Group (CJG), you have a wider pool in a narrower geographic area from which to recruit membership.”

Now that the group has disbanded, Caine said DiGem’s members are free to join other groups and it is helping to facilitate any member wanting to do so.

CJG general manager Beth Saunders says she’s already received inquiries from a few DiGem members.

“We find the networking they’re able to do [appeals to retailers], as well as having the opportunity to work with a supplier they wouldn’t be able to and to still be a Mom and Pop operation,” explains Saunders, whose group includes 95 retailers with 117 locations across the country.

Caine says DiGem’s annual charity gala at CJ EXPO Edmonton will also cease to be held.

“It was a great event,” he said. “We raised a lot of money for a lot of great causes, but I suspect there will be other organizations that will step up and take part in making sure those kind of charitable events continue.”

The show’s owner, Phil Payne, said the group’s disbanding will have little to no effect in attendance. However, he did note its charitable work will be missed.

“They were a formidable western Canadian buying group and they were really noted and different in that they supported several very worthwhile charities, so that part of it will certainly be missed,” he added.

Source URL: https://www.jewellerybusiness.com/news/digem-buying-group-to-disband/

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