Shiels – still ‘no Hoo-Haa’

The men behind one of Australia’s most successful jewellery retail chains reveal the secrets to their success - and their expansion plans. With 15 stores…

The men behind one of Australia’s most successful jewellery retail chains reveal the secrets to their success – and their expansion plans.

With 15 stores in South Australia, 16 stores in WA, eight stores in Queensland and plans to expand into Victoria and NSW in the year ahead, Shiels Jewellers is an indisputable success.

However, despite its obvious popularity with consumers, the company and its founders have not always won the praise of their jewellery industry counterparts for their success or the marketing tactics that have helped “revolutionise’ the local jewellery retail landscape.

Nonetheless Shiels chairman Albert Bensimon, who started his retail empire with the purchase of a small jewellery and gift store in Adelaide’s city centre in 1977, is proud to say that the company was the one to introduce “genuine discounting” in the Australian jewellery industry.

Armed with a degree in marketing and experience selling pharmaceuticals and computer software, Albert and his wife Nyra bought the store, which was established by Jack Shiels in 1945, from his widow in 1977.

The decision to buy an established jewellery store rather than open a new business was purely strategic.

“I bought the store so I could advertise that I had been in business 30 years,” he explains.

“The jewellery business is largely based on trust and such trust can take a long time to build so I thought it would be better to buy an existing business than start a new one – that’s why the business is called ‘Shiels’ and not ‘Bensimon’s’.”

Discount daze

“Building on that trust”, Albert gradually replaced the store’s giftware with jewellery, and became “the first jeweller in Australia to discount diamonds and gold in a meaningful way” with his infamous advertising slogan ‘No Hoo-Haa’.

“We weren’t the first in the market but we were first in the market to discount and that’s what we quickly became renowned for,” he says.

“Jewellery stores didn’t discount in those days but I bought one carat diamonds that were selling for $3000 or $4000 in other stores and sold them for $2500 making $500 instead of $1500 in profit.

“Everyone {other jewellery retailers} was waiting for me to go broke but I didn’t – I was in fact making a lot of money due to the volume of sales.”

Spurred on by his discounting success, Albert then became the “first jeweller in Australia to sell gold by the gram”.

“Everyone was selling gold jewellery by the piece in a little plastic bag and I decided it should be sold by weight so people knew what value they were getting,” he says.

“We then became known for selling gold and diamonds.”

Suburban dreams

Albert then decided to expand his successful business by opening stores in the suburbs.

“I had travelled and seen what happened to city retailers in other countries, particularly Canada where I had worked for Hoffman Laroche in the pharmaceutical field,” he says.
 

“Montreal, Toronto and other major cities took a real bashing as the suburbs and malls slowly took over. It got so bad that you couldn’t buy a nail or screw in the city.

“I thought retailers in Australia would move to the suburbs too. It took a little longer than I thought but it did happen.”

Albert opened his first suburban store in Marion, the Westfield Group’s first shopping centre in South Australia and then “basically went wherever Westfield went” until he had about 10 stores.

Albert believes his decision to expand into the suburbs was critical to his success.

“A lot of my competitors didn’t recognise the potential of the suburbs,” he says, adding that many were held back by a “lack of trust” and a good management system.

“Most people have difficulty trusting anyone with high priced items or cash. They are scared to have people other than themselves looking after half a million dollars in stock located somewhere else but I don’t have a problem with that as I believe most people are basically honest.”

“However, different skill-sets are needed to run one store or run multiple stores,” he says.

“I was a good buyer and seller which is great skill when I had just a couple of stores but when I went beyond three stores I  had to learn a little about  accounting and MYOB,  at five stores I had to learn about human resources, and at 10 stores I had to have a policy manual…”

Yet despite his company’s obvious success in the city and suburbs of South Australia, Albert’s success was not always welcomed by the jewellery industry.
“At one stage in 1980 the JAA tried to kick me out because one of my main competitors thought my discounting would ‘ruin the prestige of the industry’.

“I wanted to stay in the association and couldn’t see why I should get kicked out simply for offering good deals to my customers.”

Fortunately common sense prevailed and Albert even eventually went onto become president of the Association for three years in the early 1990s.

Equally importantly, Albert’s once controversial discounting strategies have now become common practice throughout the industry and retailing in general although Albert himself has bucked his own trend in his other jewellery retail business, Grahams Jewellers, where fixed prices are the norm.

Shiels Today

“When I started out I was known for discounting diamonds but then others came along and copied me, and then I was known for discounting gold and others started to copy me for that too,’ says Albert.

“I then did something that I thought would be harder for others to copy and that was to stock the widest range of jewellery possible.

“I still believe we have that point of difference.”

Today Shiels stocks items with retail prices ranging from $11 to $27,000.

“No other jeweller (high-, middle- or low-end) offers that,” says Albert.

“In addition we always strive to be first to market with new products and innovations like Madagascar rubies.

“A lot of jewellers say Madagascar or created rubies are “inferior rubies’ but we sell a lot of Madagascar rubies because we know some of our customers want a ruby and are happy to buy an enhanced ruby for $500 or $1000 rather than an untreated ruby for $15,000.

“Many jewellers think ‘if a woman can’t afford $15,000 we don’t want her in our shop’ but we think that’s a load of nonsense.

“We sell what people want. We have no issue with Madagascar rubies at all – they fill a gap in the market.”

New Directions

Albert’s attitudes and preparedness to quickly adapt to changing market needs are shared by his son, Toby Bensimmon, the new managing director of Shiels.
Thirty-three-year-old Toby grew up around the family business but nonetheless started “at the bottom” after completing a commerce degree.

“Dad always said it was up to me if I wanted to join the business or not but growing up around jewellery I really did develop a passion for it, so after I finished studying at university I dived headfirst into managing our store in Rundle Mall for a couple of years before moving into our head office and working my way through each department.”

With a thorough grounding in Shiel’s business operations, Toby then spearheaded successful moves into the WA market in 2007 and into Queensland last year, and is now largely responsible for “the evolution of the brand”.

“Competition is now really tough so we are changing to meet the market’s needs,” he explains.

Toby has also implemented a number of changes to meet the tougher conditions including the introduction of a sophisticated stock controlling system and the launch of Shiels website.

He says he invested a lot of time on the latter as “a website is the introduction to a brand”.

“I wanted to ensure that the first point of contact is congruent with our brand,” he says.

“Uninformed customers simply don’t exist anymore  − almost 100 per cent of customers now research products before they walk into a jewellery store, especially if they’re buying an engagement ring or any other significant purchase.

“If your website doesn’t look slick potential customers are going to log onto the next site and that store is going to get your business − they are not going to walk into your store a week later when they’re ready to shop.”

However despite the popularity of Shiels website, Toby is adamant that all online businesses, particularly jewellery businesses, “still need a bricks and mortar store” to back up their online retail presence as “trust is so important when buying online”.

“Stores that are web-only have a harder time establishing trust with customers unless they are extremely large and brands like Amazon and Ebay.
And more bricks and mortar stores are definitely in Toby’s sights.

“Success is exhilarating and fun and it’s certainly something I want to be doing for the rest of my life so yeah expansion will happen but we’re just not really sure of the timeline yet.

“At the moment we’re concentrating on opportunities in Queensland but Sydney and Melbourne are definitely going to happen at some time.

“We are ready to roll and buy when the right opportunities present themselves”.
 

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