Indian company joins Bevilles, stores to close

In a media statement, Bevilles CEO Michelle Stanton said, “This strategic alliance will provide Bevilles with a wide range of product, sourcing and operational efficiencies as well as a more enhanced IT infrastructure. 

“It allows Bevilles to have direct relationships with diamond site holders and remove several steps from the product sourcing process which benefits will flow through to our customers,” she said. 

 

When contacted by Jeweller to explain the term “alliance”, Stanton was not available for comment. However, sources familiar with the agreement have told Jeweller it means the Indian company has acquired a stake in Bevilles.

In an official notice to other suppliers obtained by Jeweller, Tara Jewels was described as having been “a long standing supplier to Bevilles and is a leading designer.”

The supplier notification also outlined new shipping and payment details to begin next month adding, “From 4 February 2013, all suppliers will be required to ship orders directly to the Indian jeweller’s Hong Kong office for consolidation and transhipment to Bevilles.”

The Indian company, which was established in 2006, conducts a vertical business model operating in both the manufacturing and retail channels. Currently, it has 30 retail stores in India and has quickly expanded its jewellery manufacturing and retail business to include a presence across five continents and more than 20 countries. 

Tara Jewel’s website lists a sales and distribution office in Sydney.

The new deal will result in a number of local store closures. Bevilles Jewellers, which was founded in 1934, will reduce its current retail sites from 29 to 23. 

In her media statement, Stanton said, “As part of this new alliance and an increased focus on the jewellery offer, we will be exiting from a large range of giftware products offered in store. This exit plan involves us moving to more appropriate store formats over the next few years and closing down stores that are non-contributors.”

The six stores ear-marked to close are Doncaster, Greensborough, Moorabbin and Southland in Victoria, and Elizabeth and Marion in South Australia. 

Like many Australian retailers, the economic climate has been tough on Bevilles and caused the closure of its two Brisbane stores in July last year. 

At the time, Stanton told Jeweller that the decision was made because the stores – in Chermside and North Lakes – were not achieving adequate turnover, despite impressive foot traffic. 

Bevilles also closed its high-profile Bourke Street Mall store in Melbourne in August 2011 after the mega international brand Swarovski outbid it on a new lease deal. 

This is not the first time an Indian jewellery company has acquired an Australian retail chain.

After much speculation throughout 2011, Jeweller reported that one of the world’s largest jewellery manufacturers M Suresh Group DMCC had purchased The Jewellery Group (TJG) from private equity firm Quadrant. 

The Mumbai-based company bought TJG, which operated the Zamel’s and Mazzuchelli’s retail brands, for an undisclosed amount. Sources close to the negotiations, however, said the price tag for the 129-store business was between $18-$19 million. 

Zamel’s and Mazzuchelli’s stores continue to operate under their respective brand names however, unfortunately for M Suresh, Zamel’s recently hit the headlines after being found guilty by The Federal Court for misleading consumers regarding savings made on jewellery. 

Although the conviction and $250,000 fines relates to the former owner of the Zamel’s chain, M Suresh suffers the bad publicity from the ACCC action.

Tara Jewels was recently listed on the Mumbai Stock Exchange and the National Stock Exchange of India. The Mumbai-based company has four manufacturing facilities and exports from India to retailers in the US, UK, Europe, China, South Africa, UAE and Canada. 

It lists itself as a major supplier to the US retailer Zale Corporation, which has more than 1900 retail locations throughout US and Canada, and in the UK Sterling Jewellers, which has 1300 UK retail locations. Tara also supplies retailing giant Wal-Mart in the US. 

Ironically, having outbid Bevilles on the Bourke Street Mall location two years ago, Swarovski, through its affiliate Chrystalon Finanz AG, is a major shareholder in Tara Jewels.