Elephant Hunting

This year JCK observes its 140th anniversary. To celebrate, we will be mining our substantial archives to find items of interest—some serious, some humorous, some illustrating how far we’ve come in 140 years, and some that show how little has changed in that time. For our first look back, see page 44.

Here is an interesting passage from forebear Jewelers’ Circular and Horological Review, at the close of its ninth year in January 1879:

“Our aim has been to cater to the best intelligence in the trade, and to seek its best interests at all times. There have been times when it would have been to our pecuniary advantage to have taken the opposite course, and to have made the Circular the apologist for fraud and deception, but we are thankful that we have had the strength to resist these temptations. We may have made errors of judgment, but the integrity of the Circular is unassailable.”

Those words still ring true 140 years later. On matters of fraud and deception, of course there can be no equivocation. But what about practices that are the proverbial elephants in the room? In other words, practices that shouldn’t exist but do—and that nobody will discuss openly.

Let’s name a few of the herd: Suppliers reneging on promises of territorial exclusivity. Retailers copying pieces from brands they don’t carry. Suppliers yanking a line from a longtime retail partner without warning and giving it to a competitor. Retailers who know they’re going to file for bankruptcy but don’t return memo goods before filing.

I’ve personally been witness to every one of these situations, and many more.

For example, I was standing at the counter of a jewelry store on Philadelphia’s Main Line, when a customer asked if the jeweler carried Scott Kay.

“No, but if you bring in the ad with the ring you want, I can make it for you,” he replied. This jeweler knew who I was yet had no shame in making that offer in front of me. Maybe I was appallingly innocent, but I was truly shocked that a jeweler with a good reputation blatantly and openly offered to do something that is not only unethical but also potentially illegal. I asked around and learned the practice is rampant, so I ran a JCK retail panel survey on that subject. Almost 40 percent—40 percent!—of respondents not only acknowledged having done likewise but also didn’t see anything wrong with it! A good percentage more felt it was “OK as long as I change the design a little.”

No, it’s not OK. It might pass legal muster if the design is changed to a certain degree, but that doesn’t make it right. Most retailers never get caught because the chances of the supplier finding out are small—and it’s generally not worth the effort to sue one store over one piece. (That particular jeweler, incidentally, is now out of business.)

I’ve seen many a retailer upset when a big brand opened a competing account well within the geographic limits they’ve agreed not to, and I remember visiting a prominent TOLA-region jeweler who, while proudly showing me around his new store, boasted that he had just lured a major watch line away from his major competitor. I asked the competitor—another old-line, high-end, well respected jeweler—about it the next day, and he was livid over the years of effort and money he had invested to build the brand in that market only to have another jeweler cash in on it without getting a chance from the brand to keep it.

I also watched more than a few suppliers just about burst into tears last year when news broke that a major retailer was filing for Chapter 11, taking substantial amounts of their costly merchandise into lockdown. This retailer must have known they were in difficult straits long before they actually filed. Could they not have called their suppliers—many of whom were longtime friends—and said, “Come get your goods” before court proceedings tied up all the memo pieces?

Retailers and suppliers both have enough reasons to be angry with each other, though thankfully that seems to be the exception in the industry rather than the rule. Still, the old adage about people who live in glass houses is true, and since we all can see the elephant through a glass window, there’s no point in pretending it’s not there.