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Nick Smith: Making sales over the Tasman

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While Dermot Kelly manages the business, design is in the hands of ex-wife Pauline Kelly.  Photo / Richard Robinson
While Dermot Kelly manages the business, design is in the hands of ex-wife Pauline Kelly. Photo / Richard Robinson

Is doing business in Australia really so different? Not for this jewellery company.

To an outsider, distinguishing between Australians and New Zealanders must be like trying to differentiate between Vegemite and Marmite. Of course there are subtle variances between the two yeast spreads, but try explaining those to an Indian or Chinese businessman and see how far you get.

To everyone else we seem the same, agrees Dermot Kelly, managing director of esteem, a direct seller of jewellery in Australia and New Zealand. Everyone warned him that business across the ditch was different but he found few problems. In fact, 95 per cent of turnover is generated in the Lucky Country.

Even so, "the Australian ladies are more positive and outgoing; they tend to spend more - the average presentation is 20 per cent higher in Australia," Kelly says. "They have a slight preference towards bling jewellery, the bigger pieces, but you get them together with the New Zealand girls and they all love the jewellery."

The women may adore the bling, but men, whether Kiwi or Australian, seem less enamoured.

Kelly recalls a time when he insisted the company expand its wares to include cufflinks and tie clips. "Nobody wanted them," he says, noting that his ex-wife, business partner and jewellery designer, Pauline Kelly, likes to remind him of his sole foray into the creative side of the business.

The pair have been separated 10 years but get on famously well, he says: "I like to joke we're the happiest divorced couple in New Zealand." But he now knows his place and that's running the business, not design and marketing.

The major problem with men's jewellery is that esteem's business model is based on presentations to groups of women, who seem disinclined to splash out on the significant others in their life.

Also, the company is built around the camaraderie of women - the 300 sales representatives and their clients - and there is no place for men (aside from Kelly and "finance guru" Doug Lennon) in this workplace dynamic.

About 10 per cent of the reps are in fulltime managerial positions, essentially running small businesses, but the rest are part-time and, Kelly says, esteem has provided a fulfilling job where personal relationships are valued and women can maintain control over work hours.

"They are looking for something different in their lives. There are 300 women and there's a great opportunity for them to empower each other," he says. "Most importantly, they get recognition [for sales excellence], which many aren't getting at home."

It is for this reason that the company was named esteem and, Kelly says, the success of the company is based on these relationships.

Formed in 1996 by the Kellys and third shareholder Lennon, esteem is now a multimillion dollar business that enjoyed annual revenue growth of 25 per cent last financial year and expects 30 per cent growth in the year ending June 2013, he says.

Part of that growth is driven by the high price of gold, which has increased nearly five-fold in the past decade. The company's jewellery may be high-end design but it is gold-plated, making it affordable for the female target audience.

New Zealand is where 95 per cent of the esteem range is manufactured, providing valuable employment to setters, assemblers and platers. The jewellery is double-plated to ensure longer life.

But the growth spurt is also due to a refocusing of head office management: "We returned to our core beliefs and worked out why women want to be part of our organisation and just focused on that, rather than the jewellery, and that made a huge difference," Kelly reports.

"We feel very responsible to those 300 ladies out there.

"You've got to get the home team right if you expect the field to perform."

Kelly admits he let the domestic market slip, a failing he is addressing now with a relaunch of the esteem brand and a redesigned website, which will increase the company's geographical reach in its existing territories and carve out new territories across the globe.

"We've employed a New Zealand sales manager and we've managed to secure Sarah Breslin, a very dynamic woman," he says of the brand relaunch, "and she's really excited about getting us re-established in our home market."

The website represents a significant investment - Kelly says about $500,000 - but has the potential to boost sales by 25 per cent.

Once those changes are bedded in, esteem will look to employ a representative in Britain, probably in 2015, and develop that market.

"We've got an Australasian [revenue] target to hit and once that's hit, that gives us the green button to go to England. If we get England right, that will open up the rest of Europe to us."

- NZ Herald

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