Strong relationships have helped buying group DiGem to register one of its best years in the last three decade.
Article by: Carlos Weigle
Photography by: Katie Huisman and Brian McLoughlin

A t the end of the day, selling is a matter of connecting. Connecting with your customers, of course, yet also connecting with your peers in the industry and staying in touch with the way business is going. Success is almost guaranteed when those connections are made. Therefore, an organization that facilitates those connections can make the difference between staying in business – and even thriving – and closing the doors. DiGem is one of those organizations.

When it started, back in 1971, the main goal was to be able to get discounts independent stores wouldn’t be able to negotiate on their own. Bob Jewell – of Mitchell & Jewell, in Reed Deer, Alta. – was one of those pioneers. Dick, his son, recalls those early days: "It was just a matter of the small independent stores looking at the competition of the larger department stores, the bigger players, and saying how can we play on an even keel? There were precedents in both the hardware and drugstore businesses. Our goal, as businesses, was to be able to compete heavily or more so or create more profitability." Dick was on DiGem’s board of directors for more than 10 years, and adds that the organization "has constantly been part of my business life."

Multi-generational
For many, being part of DiGem has always been a family affair, one that is passed on to the younger retailers joining the industry. That’s certainly the case with Susan Cartwright-Coates, current president of the buying group. “We’ve been with DiGem for 25 years,” she says. “My father was very involved with it at one point. I am a third generation jeweller, and there’s already a fourth generation working at the store. Looking at DiGem’s membership, I can say that more than 70 per cent of our members include two or more generations, and that we actually have several three or four-generation businesses with us.”

Discounts are great, yet what is the main factor that keeps members engaged in the organization? According to Cartwright-Coates, “it’s to be able to converse with like minds. It’s about the relationships that are developed.” In practical terms, “it means that when you want to run a promotion or run across a situation in your business that you have never handled before, you can guarantee that somebody among your peers has already experienced it and is certainly willing to share that information. I don’t go to any of my DiGem meetings without taking all of my computer reports with all of my mark-ups and top-selling items, because that’s what we’re about, sharing that information.”

Connie Kitagawa, DiGem’s current CFO, couldn’t agree more: “The key to our success is that our members do a lot of networking. So they might say, ‘go to this company to get such and such, because I’ve had great success with it.’ More people will come onboard and, before you know it, the whole thing has skyrocketed. Last year and the previous one were tough years for some of our jewellers, particularly in Northern Alberta, but I’ve seen that totally flip now and that’s really good. “

Best year ever
How good? “We’ve come off the best year we ever had in the last 30,” says Kitagawa, a surprising and encouraging statement for anyone trying to keep afloat in the current market. “I’m not saying all our jewellers were having a fantastic year, but certainly the good majority of them were.”

DiGem currently groups 30 members and 42 stores. It also has 45 suppliers. It’s mostly a Western Canada organization, even though it doesn’t limit itself geographically and is open to any retailer across the country who’s interested in joining. The reason why it still remains pretty much a Western organization is that its biggest events still take place in that part of the country.

In that sense, the Western Canadian Jewellery Expo (WCJE) in Edmonton is still the highest point in their calendar. That’s where the “An Evening of DiGem Decadence” takes place. The annual extravaganza allows for all members and suppliers to reward the best ones in the industry and get together for a good cause: raising funds for cancer research. For the past four years, DiGem has raised almost $62,000, and is looking
forward to a record-breaking event this coming summer, when it celebrates its fifth edition.
Spread the Knowledge
DiGem also wants to play an important role in terms of education. “We’ve put together seminars with Brad Huisken (a well-known retail sales and management consultant), both in Calgary and Red Deer,” says Kitagawa. “Everybody walked away feeling very satisfied. In fact, a lot of our members have hired Brad on their own, to come to their store and take it one step further. That initiative has been a very positive step for us.”

Yet sometimes the best advice you can get is from someone who’s been in your shoes. That’s where mentorships come in. Jewell explains it: “Two of us will go to another member’s store, by invitation, and give them a critique, suggest a dozen things they could do that would help them.” Respect, in those cases, is crucial.
“We tell them not to be miffed if they
don’t like what we have to say, and implement as many suggestions as they want, to improve their business. By increasing their sales and professionalism they are also helping our organization. We all learn something every time.”

Cartwright-Coates highlights another initiative along the same lines, where members are put into groups of four or five, according to region and affinities, and get together periodically on a conference or Skype call. “The questions they ask,” says Cartwright-Coates, “can be as simple as ‘how was your Christmas season?’ or ‘how much are you charging for that item?’ or even ‘have you repriced your gold?’ We have a set of predetermined questions; however, after they get answered, the conversation is about whatever the jewellers want to talk about.”

Conversation flows
Keeping those conversations going is fundamental to the continuing success of DiGem’s members. So much so that the organization is in the process of relaunching its website in order to, among other things, accommodate a members-only section, where they will be able to keep talking to each other in a continuous, more fluid way.
That, of course, is just a reflection of the direction the industry is heading. Cartwright-Coates says, “I don’t believe bricks and mortar are going anywhere. Yet the research that is done online is tremendous. Personally, we updated our store’s website just before Christmas, and the amount of comments from customers through the front door that went to the site, for a variety of reasons, is quite astonishing. In addition to that, the ones who tell you they went online are just a fraction of the ones who actually visited your website.”

Another factor that will keep retailers in the industry talking is how to
face some of the mass marketers that are selling jewellery, oftentimes at lower prices. Jewell thinks that, “We need to be better at what we do to make it work, whether that’s a combination of service, knowledge, product – price should actually be last thing on the list. Pick your battles and areas where you can succeed.

Cashing in and out
“Also interesting is the fact that in most cases those big chains don’t contribute to the communities that people live in. They cash in and cash out. Yet, as a small independent, my donation to the community is probably 10 times what theirs is. And those stores probably have 100 times my revenue. So that’s another way that we as independents can work with our community and succeed.”

Cartwright-Coates agrees: “The best that we can do is to make our customers understand that we’re jewellers, not just sellers of jewellery, and I think there is a very distinct difference between the two. If that is conveyed well to the customers and you create a relationship with them, then I think that we can continue to grow and thrive.”

As DiGem is not the only buying group in the jewellery industry in Canada, knowing what makes it unique is a very valid question. Kitagawa explains: “I guess because we’re smaller, members really get the chance to interact with each other, we don’t have members who don’t know anybody. And because we’re so close-knit, anybody can phone anybody at any given time. They might ask for help or share something one on one that they don’t want to share with the whole group.”

Strong relationships
Other advantages of belonging to a buying group are well known, such as discounts, annual rebates (which amounted to $203,364 in 2011), single billing and the ability to reach suppliers that wouldn’t be readily available otherwise. Those are obviously good enough reasons to join in. However, Cartwright-Coates believes they might not be the most important ones: “The massive discounts we used to get are gone, they’re gone for everybody, not just for us. So if you think that the only reason to join a buying group is because you are going to get the best discounts, then I think you may be joining for the wrong reasons.”

She adds that “I believe the biggest strength DiGem has to offer is amazing relationships, including with our suppliers.”   [CJ]

DIGEM LOCATIONS IN CANADA
British Columbia      
Cartwright Jewelers Ltd.; New Westminster
Creative Jewellers; Prince Rupert
Delta Jewellers; Campbell River
Enderby Jewellers; Enderby
Gregory’s Fine Jewellery; Vernon
Jason Goldsmiths Ltd.; Kelowna
Jewellery Artists 3D International Inc.; Vancouver
Preston Jewellers; Campbell River
Sean David Jewellers; Quesnel
Woodland Jewellers; Williams Lake

Alberta          
Blackburn Jewellers Ltd.; Pincher Creek
Caine’s Jewellers Ltd.; Rocky Mountain House
Carman Goldsmiths Ltd.; Devon
Diamonds for you; Vermilion
Expressions; La Crete
E. Gelmici & Son Ltd.; Edson
G.T. Ingham & Son Jewellers Ltd.; Innisfail
The Gold Poke; Drayton Valley
Jewellery Box; Fairview, Manning, Grimshaw, Peace River
Marlo Jewellers Ltd.; Calgary
Sean David Jewellers; Whitecourt
Merchant Jewelers; Westlock
Mitchell & Jewell; Red Deer
McLean’s Jewellers; Athabasca
Prairie Gold Jewellery & Gift; Grande Prairie
Slave Lake Jewellers; Slave Lake
Stevens Jewellers Ltd.; Olds
Trochu Jewellery & Gift Ware; Trochu
Walker’s Jewelers (1996) Ltd.; Wainwright
Wares Jewelers Ltd.; Stettler

Saskatchewan           
A&A Jewellery; Estevan
Assaly Mark & Hopkins; Melfort
Assaly Mark & Hopkins; Nipawin
Brothers Fine Jewellery; Tisdale
Humbolt Fine Jewellery by Sandor; Humbolt
Jewellery Connections Inc.; North Battleford
Markwart Jewellers; Tisdale
Scotts Jewellers; Kindersley
W.J. Scott & Son; Rosetown

Manitoba       
Jewellery Ltd.; Morden, Winnipeg, Steinbach
Don Johnson Jewellers; Thompson
Lloyd’s Jewellers Ltd.; Swan River
McCallum Jewellers Ltd.; Brandon
Nemeth Jewellers Ltd.; Winnipeg