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2019 Was A Great Year for Jewelry, But Now What? | January 15, 2020 (0 comments)
Encinitas, CA—The 2019 Christmas selling season was one that we as an industry can be excited about. It has been a while since we could speak with enthusiasm about strong retail sales, but this Christmas delivered in a big way.
We saw a mixed bag as to exactly when the sales hit, as many jewelers were upping their game and pulling dollars out of the marketplace early with strong November events. However, it was clear when looking at sales performance over the entire selling season that things were good, and for many, very good!
Jewelers were one of the few retailers who did not feel the pains of online shopping. The fear that jewelry sales will suffer because of online threats is proving to not be as big of a concern as many had feared. Consumers, as we had thought, still want to touch and feel their jewelry purchases and appreciate the personalized and in-person service that a traditional retailer offers. Embracing this renewed thought process, consider a few things in the new year:
Related: 2019 Holiday Is Luxury Jewelers’ Strongest Ever, But Not Because Of Millennials
How will you position yourself in 2020? Are you ready to dive in and commit to doing something different? To make the changes that you know have been needed but just didn’t want to take on? Or, are things running smoothly and all systems are “GO”? Are you ready to conquer not only the local competition but your marketplace?
In any case, there is always room for improvement and, optimistically, this year could be the one to take your business to the next level. Because it is an election year--which has a history of stirring things up—it’s important to set your course of action early in the year and follow through, even if the waters get choppy. We challenge you to ask yourself several questions and respond with answers that will help set you on the right course for 2020 and the decade to come.
Start by taking a fresh look at your store. Ask yourself these questions:
- Who is my competition and where do I rank among them?
- If I’m not the most dominant jeweler in the market, why not? If I am, how do I ensure I’m going to stay in this position?
- What does my financial position look like? Are my accounts payables current? Does my cash flow work?
Next, review your history: where have you been, and where are you today? Are you on the upward climb or have things begun to slip? Take the temperature of your business to see how healthy you really are. Examine the following numbers for the past five years, this data will tell you what direction you are headed:
- What were your total sales for each of the last five years?
- What were your total number of transactions (are you growing your customer base)?
- What was your average sale?
- What was your gross margin?
You should find that each of these numbers has increased for you, if for no other reason than you are still in business. If not, that is a signal of an area to be addressed this year. U.S. retail stores continue to close at an even higher rate than we saw just five years ago. More and more independents are reaching retirement age without a “next generation” to take over. This leaves great opportunity for the committed retailer to grow their business as the competition lessens.
Ask yourself, “Who is my customer?” This is the new question jewelers are asking themselves. It would seem most retailers are continuing to prosper from customers in the 50+ age bracket. This is not surprising, as these often “empty nesters” now have the discretionary funds to spend on themselves. Although they are comfortable using Amazon for a majority of purchases, they still appreciate the personalized sale experience that you can offer. Let’s face it, you don’t have to try very hard to give EXCEPTIONAL service in today’s market.
If you plan to grow your business over the next 10 years, now is the time to begin to develop a plan of action. Millennials don’t seem to value the luxury of jewelry as much as the generation before them, but they certainly enjoy experiences.
Position yourself to compete. It is more important than ever to approach your business with a solid plan. If you position your business correctly, you can increase market share and dominate your market. Be the one to tap into the next generation’s spending as your baby boomers’ purchases begin to decline. Consider what you can do now to make yourself the jewelry store of choice: Do you need a more high-tech offering? How can you make a visit to your store a true “experience?” Should your merchandise assortment begin to shift to better cater to what your new customer wants, rather than what you have done successfully over the last many years? These are just a few of the many questions you should ask yourself about your business.
As we enter this new decade, ask yourself where you want to be in 2030. There will be continued changes for the retail environment and many as unexpected as some we have seen this past decade, such as, same day delivery and lab-grown diamonds. Invest your time and be brave enough to think outside the box to posture yourself for continued and future success.
Dan and Lori Askew of Vantage Group strategically examine each area of business and address concerns efficiently to make the greatest impact on cash flow, merchandise planning, inventory control, advertising, and store management. www.VantageGroupinfo.com