Rumours have been circulating for some time about Chamilia’s performance in the local market and when the high profile brand was a “no show” at last weekend’s Brisbane jewellery fair, the chatter became louder.
An empty Chamilia stand remained unmanned for the fair’s duration.
Jeweller contacted Chamilia’s US head office in Minneapolis where Richard Garrity, chief sales and marketing officer, confirmed that the Australian operation would close.
“I can confirm Chamilia Australia Holdings Pty Limited is ending its operations and subsequently closing its office on 30 April 2013.
“The decision to close Chamilia Australia was the outcome of a strategic review of the company’s global operations and resulting decision for increased commitment to the company’s core markets of North America and Europe,” Garrity explained.
The writing was on the wall for some time given that Australian general manager Mike Russell left in late December last year.
Chamilia first entered the Australian market in 2007 via local distributor Arctic Wolf. That relationship ended in June 2011 when Chamilia decided to take over the distribution reins and opened an Australian office as a wholly-owned subsidiary of its American parent.
At the time of the announcement, Chamilia chief development officer Michael Flaherty visited Australia as part of establishing a local presence and told Jeweller that the brand had identified Australia as a “prime market opportunity”.
A few months later Chamilia’s co-founder and chief design officer, Killian Rieder, along with the company chief executive officer, Michael Paxton, attended the 2011 Sydney International Jewellery Fair as further indication of the company’s intention to grab a stronger foothold in the local market.
Indeed, it was part of a larger international strategy as Chamilia announced it had formed a global venture with Swarosvki to create a co-branded line of jewellery combining Swarovski’s crystal beads with Chamilia’s jewellery.
In October 2011, Mike Russell, a former CEO of both Prouds Jewellers and The Jewellery Group (Zamels), was appointed Australia and New Zealand general manager.
Commenting on his appointment, Russell told Jeweller that Chamilia placed great importance on strengthening the brand across the Australian and New Zealand markets.
“We’ve recognised Australia as our third largest market (behind the USA and Europe) and are prepared to invest heavily,” Russell said. “We plan to be here for a long time. It’s not a sprint for Chamilia, it’s a marathon.”
That sentiment was still being endorsed only last year, when it was announced that Flaherty would be attending the jewellery fair in Sydney. Flaherty, reportedly, had big plans for the brand in the region and the trip was an integral part of putting those plans into action.
Indeed, Chamilia had a large and prominent presence at the Sydney fair just six months ago and was even awarded the Best Large Stand Award.
At the time, Russell said: "We are growing massively and we just want to celebrate every success and this is a milestone for us. We have worked so hard over the last 12 months and the people overseas are putting a lot of support behind us and it is nice to pay them back. We are here to build our brand in the long term in the Australian and New Zealand market, so this [the stand] is about making a statement about who we are."
When Jeweller sought confirmation about the impending closure of the Australian subsidiary, a company representative said that both Michael Paxton and Mike Flaherty were no longer employed at Chamilia and we were directed to the new CEO, Doug Brown.
According to Garrity, Paxton came out of retirement in 2009 to provide executive leadership for Chamilia’s rapid growth but in March 2012 decided to step down as CEO to once again enjoy retirement.
“Mike Flaherty assumed responsibility upon Paxton’s retirement but opted to keep his strategic and leadership role as an active member in the company’s board of directors,” he said.
Garrity later confirmed the fate of the local operation and said, “Chamilia is holding a 50 per cent off inventory liquidation event for its existing Australian and New Zealand customers now through 29th March 2013.”
He added, “Chamilia will continue to service the Australian consumer market via www.chamilia.com”.
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