Michael Hill Jeweler’s recently announced decision to exit the U.S. market and close its nine stores here was perhaps not surprising, given that division’s mixed results and consistent history of losses.
Last night, I reached out to company CEO Phil Taylor to find out why the company was never able to make a mark here. These are his responses:
Effectively marketing the business in the U.S. was challenging given our scale with only nine stores across three cities. This impacted our ability to increase brand awareness on a mass scale and resulted in foot traffic being lower than required to make the model viable.
We believe our store design, product range, and people were the equal, if not superior, to our main competitors. However, a lack of brand awareness and foot traffic was difficult to overcome.
We understood the company could not continue in its current form and that the level of capital required to scale up the business would have been significant and come with increased financial risk.
When also factoring in the broader retail challenges in the U.S. and the company’s other growth opportunities, in particular the repositioning of our Emma and Roe [charm] brand and the completion of store growth in Canada, the best option forward was to exit the market.
We will now explore all options to exit the business in the most cost-efficient manner, including sale to another party interested in entering the market or expanding their current footprint.