Brass, Glass & the Dumbing Down of Jewelry

Jeffrey Skaret commented:
I don't think they are calling it a liquidation. They are calling it a "Designer Sample Sale". Think of it in terms of clothing---what does that mean to the average consumer? They have applied that terminology to a sale---in an effort to get rid of old/stale/non-selling merchandise. They are not necessarily closing out the designers they are discounting, rather doing themselves AND the manufacturer a favor by SELLING the merchandise. This generates cash for the jeweler and avoids the negotiating hassles of trying to stock balance or return to the vendor. In which case the vendor would likely require a 3:1 exchange. It is simple, yet brilliant. Especially if it works.
Hey Jeffrey,
My sentiments exactly. This is a brilliant plan......it lowers inventory levels- pays bills-frees up cash to pay bills (which the brands will be happy about.....getting payed and not having to be forced to take back old merchandise) and creates sales. If the ring is the wrong center size, or it cant be sized they have created a normal margin sale..... Really not a new idea, just approached differently and yes, it comes from the fashion industry. Believe me, I dont see Fina going out of the bridal jewelry business. Believe it or not, I was the one that got them started in it correctly some 20 years ago when they were on 47th st........They had jewelry but it didnt matter to them. I told Charles I understood where maybe the engagement ring and other jewelry wasnt a priority for them as their customer was already engaged at the time they shopped there for bridal registry of flatwear and china......but most hadnt made their wedding band purchases yet and this was a business they needed to be in........the rest is history!!

Don't get me wrong. I agree that its a great idea (as i've said before). The terminology might work too for consumers. What i mean by liquidation is selling without the thought of replacing inventory.

I don't think they are calling it a liquidation. They are calling it a "Designer Sample Sale". Think of it in terms of clothing---what does that mean to the average consumer? They have applied that terminology to a sale---in an effort to get rid of old/stale/non-selling merchandise. They are not necessarily closing out the designers they are discounting, rather doing themselves AND the manufacturer a favor by SELLING the merchandise. This generates cash for the jeweler and avoids the negotiating hassles of trying to stock balance or return to the vendor. In which case the vendor would likely require a 3:1 exchange. It is simple, yet brilliant. Especially if it works.

Jeff also commented- How is that ANY different than a normal sale, other than what they have called it? Probably nothing, but it makes the consumer think differently about what they are buying. Another thought here. In my opinion there is a difference between a "normal sale" and LIQUIDATION. Not sure how it applies to the Fina people.

I applaud Fina and wish them success with there inv. reduction, cash generating sale, rather than going BK and leaving the vendors holding the bag.

oops- that last post was mine

Jeff commented "Get better at re-merchandising, re-marketing, or even re-pricing. Michael C. Fina just announced a sale of SAMPLES (in-case pieces they have normally sold off of or had to take order on) What a great idea!! How is that ANY different than a normal sale, other than what they have called it? Probably nothing, but it makes the consumer think differently about what they are buying. It is beautiful---if it fits, you can take it home with you. We need to blow out some stuff---up to 70% off." Yes, I agree. Excellent idea. I'm not sure if the Fina people are looking for revenue to put into more profitable depts. or looking to eliminate some brands or even getting out of bridal altogether. But it creates another use for B/G that i hadn't thought of. The B/G could be used as a bridge for those stores that still want to keep a hand in bridal while "blowing out" merchandise. At this point the store can still track good sellers using the B/G and can take a wait and see attitude to re-merchandise live after the industry sorts things out This use of B/G might keep people who want to "blow out" inventory in the business of bridal. this B/G bridge may be the opportunity to "blow out" and ad new at the same time. The concern with "blow out" is leaving the bridal dept. in shambles and empty. Which may be the goal of some

Just to let those interested know, there was a glitch in the system today and some recent comments may have inadvertently evaporated. You are welcome to re-submit them if this happened to yours. And thanks again for the great discussion.

This BLOG has taken on a life of its own with comments going back and forth between a few solid-hearted and well-meaning commentators. Good to see. I go back to some of my original points in not just this blog, but others. And that is: CONCENTRATION MUST BE PLACED ON SELL-THROUGH. I think there is much to be gained in reviewing by both vendor and retailer, who you are, what you are bringing to the marketplace and why" kinds of policies." Think about it in terms of bridal. If you are a retailer, I find it hard to believe that you are sold out of all the top sellers and everything that may be interesting to a prosective customer. Surely you have some things that are still up to date, in style, and hold the potential for a sale. GET BETTER AT WHAT YOU DO; HOW YOUR PEOPLE SELL AND PRESENT; AND HOW YOUR PEOPLE CLOSE A SALE! Get better at re-merchandising, re-marketing, or even re-pricing. Michael C. Fina just announced a sale of SAMPLES (in-case pieces they have normally sold off of or had to take order on) What a great idea!! How is that ANY different than a normal sale, other than what they have called it? Probably nothing, but it makes the consumer think differently about what they are buying. It is beautiful---if it fits, you can take it home with you. We need to blow out some stuff---up to 70% off. Get used to it folks, but more importantly as a retail jeweler: keep being creative to find ways to move moe merchandise, but similarly you vendors need to continually search for and find ways to become a strong, solid business paartner so your customers know how and why from you. It will translate to more sales.

Abe, I appreciate your comments, by not paying on the sold special orders really is an issue, if the item was sold why not pay the guy that helped them make the sale, we both know several high demand companies are taking all the cash flow without the proper sell thru, not to mention names but high brow watches have become a store image not cash flow.Why can't the retailer stand up to them, why are they afraid of these companies. We both agree our business has changed and will change more. I initially was against B/G, I talked to some very influencial customers, and we agreed with the ones who were interested to give it a try some just said flat out no way. There are stores with out the capital to compete in there market just like mfr's, they will not survive or if they do it will be a specialty custom shop which can be very profitable, there will be alot of retailers wondering were the reps are,the answer, driving by them to see someone else.

dfc50 commented: "Abe, I like the way you only look at one side of the issue. First, our factory is not sitting around, are we busy, no, but steady. We sold the wrong product, they bought it, why was this not an issue then. We sold the wrong stores, in some cases you are right, these stores are not analizing there business and making the proper changes. Re-orders and specials are a major portion of our business, why are they not being paid for on time? Whats is the retailers responsibility in this mix, thats not whining thats reality. We help them close a retail sale and the invoice is now past due, who are they paying? To many non-profitable lines are being supported by the sell thru of other product lines. Do we continue with non productive styles NO, maybe the retailer should do the same. As mfr's and retailers fail, the ones left standing will have to form a better partnership to succeed. This is not about B/G, memo programs or stock balancing, but a mutual understanding of the resonsibilities of both parties. I really believe the retailer not that long ago could sit back and pick and choose there deals, those days are gone." I think I've been looking at both sides of the situation. Writing back and forth is tedious and we're losing something in translation. I agree with you that when they sell a special order, they should pay for it on time. But what I've explained repeatedly is they simply can't. You invoice sits atop a pile of other invoices - it's the classic rob Peter to pay Paul. Except they are just delaying the payable; using the sale of your special order to pay an old invoice. Unfortunately, the reasons behind this behavior is what we are not getting to during this entire discussion. I DO understand all of the points that you and others have made in opposition to alloy samples. Jewelers simply have too much inventory, sucking up all of their cash flow and they cannot buy more inventory. Their current inventory isn't being kept relevant because they cannot add tens of thousands of dollars in additional inventory to an already challenging cash flow problem. My support of the introduction of alloy samples is to allow the stores to increase their selection, minimize the risk of buying more bridal that are merely expensive (live) samples and keep AP down. While the sale of each one of these rings will generate a new invoice, the ring only has to be sold ONCE in order to generate a profit. Your factory should not suffer any setbacks in your regular business, as those orders are still going to be coming in from the inventory you already have placed. However, increase and refresh the inventory among your retail accounts (using alloy) and it should result in ADDITIONAL sales that you currently won't be getting. Finally, let me respond to your point about you selling the wrong product and them buying it, and it not being an issue 'then'. It was an issue, but it was masked by two things; margin and increasing sales. Volume hides a multitude of sins, but when sales decline, as we'll all experiencing now, AND margins decline as well, the problems become evident. The result is our current inventories are too high, yet we cannot do nothing about refreshing our selections. I have no problem going over these things point by point; I spent three hours talking about these things at the RJO show today. We talked about alloy rings and inventory levels and positioning... etc. It's a LOT of information. Call me if you want to discuss it.

Alex, You missed the point all together, you read and hear what you want too. We are providing B/G to those who want to try it, but they also want to stock the best sellers. It seem these retailers do not agree with your idea, some jewelers really do sell from stock, as for orders not a bad week.

dfc50- And i suppose that the 25 TOP accounts you have gave you an order for more sytles to stock while you were discussing B/G..... I'm sure your factory is currently buried with those orders for new that you got....... And i suppose they will re-order when they manage to move one of your "best sellers".... and i suppose you offered them 200 new styles to have on hand? And i suppose none of them owe you money? You may be miss-judging their "non interest" based on what you offered them.... nice try though.

This week I contacted our top 25 accounts, we talked about B/G samples. I had 2 that were thinking about a small collection mixed with live, the others were not interested. They said they would continue to stock our best sellers, so we gave it a try, we will see how this translates to the final judge, the consumer.

dfc50- Am i missing something here? Wasn't one of the points of B/G is that the mfg. can have his line in a store without worrying about getting paid for live goods? May I make a suggestion. Put your samples in a store to try. Tell the owners that when they get an order for one that they need to take a deposit. (which is done in most stores). eg- the retailer takes a $500 deposit on a $2,500 order. Then tell your customer that they should send you that $500 deposit so you can get started making it up......then bill the customer for the balance when it gets delivered. Personally I would have no problem helping out a mfg with his initial costs to make up an item in these tough times. And who said people are not willing to work out mutual understandings and dealings? you feel retailers will no longer be able to pick and choose their deals.... well they will ALWAYS be able to pick and choose who they want to deal with.

Alex, Right idea, wrong order, you should manufacture it, and let diamondguy merchandise it, and don't be upset when he does not buy or pay you.

Abe, I like the way you only look at one side of the issue. First, our factory is not sitting around, are we busy, no, but steady. We sold the wrong product, they bought it, why was this not an issue then. We sold the wrong stores, in some cases you are right, these stores are not analizing there business and making the proper changes. Re-orders and specials are a major portion of our business, why are they not being paid for on time? Whats is the retailers responsibility in this mix, thats not whining thats reality. We help them close a retail sale and the invoice is now past due, who are they paying? To many non-profitable lines are being supported by the sell thru of other product lines. Do we continue with non productive styles NO, maybe the retailer should do the same. As mfr's and retailers fail, the ones left standing will have to form a better partnership to succeed. This is not about B/G, memo programs or stock balancing, but a mutual understanding of the resonsibilities of both parties. I really believe the retailer not that long ago could sit back and pick and choose there deals, those days are gone.

I've got THE solution... Lets all open a bridal store together. Abe can promote it. Alex can merchandise it. Dfc50 can take orders and whine about it. Diamondguy can blame us all. And Jeff can write about it !!!!! Oh, and I'm thinking that Jeff can also be in charge of the tungsten/stainless dept. (joking of course, its been a pleasure)

dfc50 commented: "After 78 blogs I guess the answer is, place B/G samples, and pay everyone in the factory to sit around and wait for an order." Another helpful (completely useless) statement. Alternatively, keep selling jewelers more inventory and then sit around and wait to get paid. If the folks in your factory are just sitting around now, you've got the wrong inventory in the jeweler's showcases, or you may have sold to the wrong stores, or maybe you're not competitive for today's market. I can't tell since I have no idea who you are. But, it's not selling, they are not reordering your merchandise and it's getting stale. Frustrating, I know. If you've got any SOLUTIONS to this log jam, we're all ears. But then again, we've been asking for other solutions since this blog started. Not sniping or whining, but solutions.

After 78 blogs I guess the answer is, place B/G samples, and pay everyone in the factory to sit around and wait for an order.

posted this just so Abe doesn't get the last word in. HA! HA!

"My goal is to achieve a balance of unique "live" ready to buy bridal teamed with 100's of best selling customizable samples. Its about selection. At the same time add to this taking advantage of a reliable loose diamond dealer network plus the B2B databases such as polygon and rapnet. With those "tools" in place, and with being anxious to move out stale bridal to make way for new, lowering our costs to carry and having effeciences in delivering just what the customer wants.... it is WE who will be in a position to offer a tough to beat price......not the other way around." Alex is spot on. For decades, we have used catalogs to show styles, and still do. We use our supplier's websites to show samples. Some manufacturers have been building websites and just provide the jeweler's home page, but it's really the manufacturer's system. The use of alloy samples is just one more arrow in the quiver, but in this case the customer gets to try it on, rather than just looking at a picture or image. As Alex pointed out, it is just ONE more tool to use. Saying that only retailers who can afford to buy 'live goods' should be in bridal, is just like saying only retailers who OWN all of their diamond inventory should be selling diamonds; if they need memo, they shouldn't be in the diamond business. But catalogs for a long time and websites more recently have become an accepted way to demonstrate product, as has 'we'll get that that diamond in on memo for you'.

diamonguy- The 30 minute to 1 hour in store attempt to educate customers about diamond quality was, is, and always will be a waste of time. Certainly ever since the customer can achieve a much higher degree of education than we can offer with a simple click of a mouse. Yes i agree that there is a slight chance of look alikes. But with the mfg's already providing what they know are proven best sellers in the sample line its goes back to basics in business. And those models are fully customizable to effeciently create a unique product. You already pointed out problems caused by jewelers who were looking for unique products that flocked to brands and designers. Yes it would be nice if all the beautiful bridal made today would be available as samples to try out and search for their market shares. Under cutting prices? My goal is to achieve a balance of unique "live" ready to buy bridal teamed with 100's of best selling customizable samples. Its about selection. At the same time add to this taking advantage of a reliable loose diamond dealer network plus the B2B databases such as polygon and rapnet. With those "tools" in place, and with being anxious to move out stale bridal to make way for new, lowering our costs to carry and having effeciences in delivering just what the customer wants.... it is WE who will be in a position to offer a tough to beat price......not the other way around. Abe has a pulse on the industry and he has already reported early sucess with this concept. Our samples will be arriving soon. (i hope..LOL) If it doesn't work i'm thinking of maybe finding a way to donate the samples to charity, or to local schools...or something..... anyway....stay tuned

Alex come on, this is not about sales reps carrying cz's, and if I have to explain it, oh well. The sales reps are also dealing with jewelers, I think its a little different than explaining diamond qualities to a consumer using b/g. This whole debate is leaning towards a little of both. I also see there will be a need for more mfr's to join this trend otherwise all the sample product will look alike and you will competing against everyone, once again giving someone the chance to under cut a price, and dumb down our industry.

diamondguy-I find it interesting that without knowing my store and my business model and only after a few blog posts you choose to directly criticize my store. Ok, maybe i to have been critical and deserved it - i remain flattered. Second - i also find it interesting that you mfg B/G samples for reps and expect the reps to write orders all day long and yet when a retailer says "hey, maybe its a good idea to put in your samples in our store and see how it goes" And you don't care for the idea even if it represents no risk - no monies owed - abilitly to identify fast sellers and stock those - no balancing requests-little investment etc, etc. Maybe the ability to instantly turn your QUALIFIED retail accounts into "sales reps" for your merchandise is unappealing. its also interesting that you expect retailers to buy from samples, but you don't think consumers will. I guess you (for one) might never know. Although if nothing else I am sensing from you that the idea may be growing on you. And I do understand your feeling of that this is NOT FOR EVERY STORE and have said so in previous posts.

diamondguy: Your points are well taken...I agree 100%, there are no quick fixes. Without writing a book, I think the best way to sum up is that we all choose bits and pieces of what we hear and read and leave alone those things that we don't want to do. While we don't take a dogmatic approach to any one thing, some people do. Stock balancing is just one of those things that will have to change too. Retailers cannot expect the manufacturer to 'eat it' every time. As one manufacturer said to me, 'They bought it, they should man-up and deal with it'. I don't know how we got to a place where we EXPECT the manufacturer to just take back goods that don't sell, but those pushing that agenda as a 'take it or leave it' attitude have to back off. Actually, this is yet another reason to support alloy lines. The investment in the manufacturing process is small compared with the investment in live goods. Recycling these aren't so painful. There are myriad reasons why stores miss their market. It's a HUGE issue for us and we spend time with our consulting clients trying to get them to understand these things. We recommend books on the subject to get their heads in the game. We recommend they do a SWOT analysis on themselves and their competition. It IS remarkable that VERY few retailers can tell us what separates them from anyone else in town. In other words, they have not 'positioned' themselves as unique in any way. We understand this and it's a real dilemma. Since their merchandise mix is based on their own tastes and they may have gotten to a place where they are stuck now, it makes changing their current situation very challenging. This is one of the principle reasons behind my support of the addition of an alloy collection. Merchandising properly and with extensive training, I believe this can breath new life into what has become 10 linear feet of dead inventory for a lot of retailers. As I and others have mentioned, it's very difficult for a retailer to get into bridal the right way due to the investment, relatively slow turns and declining margins in diamonds (which, historically, basically paid for the non-performing inventory). Jewelers who subscribed to ARMS who did not replace their fast-sellers were not understanding the power of replacing inventory. It is, in a way, much like compound interest and just builds and builds over time. However, more and more of them ARE learning how important it is. Our goal is to get them to buy much less and reorder much more and more often. New merchandise should be introduced with a teaspoon but you should back up the truck regarding the replenishment of fast-sellers. Inventory management is boring. Buying is FUN. It's short-term, vs. long-term and if we learn anything from this mess, I hope it will be to be open to making the changes necessary for all of us to do better.

Abe, We have been mfg b/g samples for many years for sales reps, we know how to make them, the real question is do we want to sell them and to whom. If the retailer thinks its a quick fix, NO, to another who can represent B/G to there clients, YES, my company issue is with retailers like Alex, stores that missed there market, over bought and continued to buy the brands and there minumums that put them in an over stock position. What happens when we miss the mark, who do we whine to, we scrap the product take a loss and move on. This reminds me of the ARM's program years back, re-order the quick sellers and stock balance the slow turners, we participated in that program, the majority of the quick sellers were never placed but everyone wanted the stock balance option. Jeffrey has done a great job with this blog trying to bring mfrs, reps and retailers to some mutual understanding, maybe someday.

diamondguy commented: "The retailers overbought, then you are not managing your business, memo just say no, loading up stores its your store? What about all the retailers who drank the kool-aid and stood in line to by designers and so called brands with major buy-ins, thinking they would just drive the customers in, now thats a real reason." This is all true, to a large extent. Many people look to our trade magazines and our peers to give us direction. Merchandising trends, especially the decisions to invest in "brands" that started 20 years ago, worked for a long while - and may work again at some point. But for now, as an industry we are terribly upside down with our inventory levels and especially our price points. This is our reality and we are going to have to address it. I was speaking with a friend of mine the other day who quoting someone else said: "I learned all my best business practices when things were bad, any my worst business practices when things were good." Things had been good for a long time and we ignored the poor business practices. Over-buying, not understanding our financials, not understanding positioning, marketing or how to do an Org Chart; buying what we like, rather than responding to consumer behavior and not trying to get rid of inventory that was aged... The list could go on and on. Since this blog started, I have spoken to several bridal manufacturers who have been selling an alloy product with CZ's this year. ALL OF THEM told me they were doing very well with their programs and the sales were coming in. Jewelers who could not build an adequate bridal department are now able to tell a story and service their community. The sale of one ring pays for their entire investment. This strategy is working in more and more stores. If you're a manufacturer and can't figure out how to do this, you're a little late to the dance, but might still consider it. If you're a retailer, you have to decide if this makes sense for your business. If you are working with a consultant and they are advising against it (as some of them did about carrying lines like Pandora), expand your net and speak with the manufacturers who are doing well and ask them to refer you to the jewelers who are succeeding with these programs.

diamondguy- You seem very good at placing blame on everybody else- frankly I don't care how it happened and I don't blame anyone. its a problem we are all trying to work on. You also point out problems as if we don't recognize them.... frankly i don't see you offering ANY solutions....... If you have no solutions to offer and only want to place blame... I would suggest a different forum than this blog that is trying to come up with solutions. I for one am tired of hearing whining. (no offense meant) Jeff did not start this debate to find people to blame.

The retailers overbought, then you are not managing your business, memo just say no, loading up stores its your store? What about all the retailers who drank the kool-aid and stood in line to by designers and so called brands with major buy-ins, thinking they would just drive the customers in, now thats a real reason.

diamondguy- who is responsible for unsold inventory? Well with 100's of millions of dollars in a completely overinventoried industry..WE ALL ARE !!!! From retailers who overbought and got oversold...from mfg's believeing their product would get some turn, from pushing memo and loading up stores...etc. Diamonguy - you miss the point entirely- this "sample" product is EXACTLY being thought about to address the over inventory issue - it has the potential of producing only pre-sold inventory for everyone. I think some of the mfg's might be getting nervous about it if they don't have the capabilites of delivering a "just in time special order" product. And I don't think using this product causes anyone to take GIA,IJ0 or RJO off their credentials! Stock what I beleive in you say? Been there done that...just like everyone else.....and I will continue to buy presented with the right merchandise. It may not be a Porsche but Lexus will do just fine. Turning into Home Depot? We could all take lessons from Home Depot. You feel no resposiblity about your share of unsold inventory diamondguy? Ok- blame it on me then.

The question has been raised, who is responsible for unsold inventory,the company who produced it, the retailer who did not present it correctly or just over bought or did not attract there target market. This is a luxury product, sell the benefits, do you think Porsche cares what GM is doing, this goes for the cz sample/catalog/fake/not real but somewhat look alike product, stock what you believe in and make a statement of who and what you are, why are you AGS or GIA, IJO or RJO and stop turning into Home Depot.

Alex, My comment on knockoffs, I am speaking from a mfr's view point. We spend time, money and energy developing new styles just to have them knocked off for 25.00, its just like you spending the time with your customers working up quotes getting memo stones in and having them then go online or across the street to buy with the info and knowledge you provided. I did go on the Unique website they state 10-12 days for a finished piece, is this happening? I noted they also offer custom, no delivery time was notated. I mfr upper end bridal with service, we are having some talk with our customers about this type of program and I want to provide them with the best possible.

Dfc50- No reason to knock off items from vendors who support you..I am more than happy to give them the orders. I am not a wholesaler. If I was worried about taking an order for ANYTHING let alone bridal I wouldn't be in business. Do you think we can survive on just whats in our cases? Our customer service extends WAY beyond that. The service sets us apart. We make sure that there are NO refusals or dissatisfied customers period. (and i've touched upon in previous posts) As far as modifications - both Abe and I have referred you to look at Unique and see their policies- I'm not sure why you haven't taken the time to do so.

Alex, I agree with you, what you do in your store is your business, but this concept of b/g is just resurfacing again and the dumbing down of the concept has already started. As for the knockoffs in the past the mfr would at least have to buy a live piece somewhere and give some profit back to the original mfr, now its basically free to take. What is the retail take on a piece that is refused by the consumer and are your b/g suppliers offering modifications to your samples.

Abe- don't make me blush..LOL besides at the moment "retailer doing well" looks like an oxymoron

"Look, I agree that this might be a silly idea and may or may not work - for me its a simple way of EXPANDING my selection to show customers possibilites I don't see the harm in trying and I've given quite a lot of thought as to the image of my store- no harm there either than i can percieve. At least it sounds better than sitting around doing nothing to look to improve our bridal dept. And to let the lady's play with the jewelry sounds like fun to me." And THIS is why we are spending the time to talk it through. If it doesn't work out, Alex and others can write about what didn't work. I don't know who Alex is, but that he's stepping up to try something new and different, I'll bet he's a retailer who is doing well and will continue to look for the next opportunity.

diamondone commented: To Abe, Why do feel you are the only one with the birdseye view and front row seat. The responses in the discussion have come from mfr's, reps, and retailers. These are the people who are on the front line everyday, with know it all approach you may miss some great ideas along the way. I don't think I know it all, I just get to see a much broader view than any single vendor, rep or retailer. Reps who sell one bridal line don't get to see what's happening in another bridal line let alone what's going on with watches or color. Retailers get to see what's going on in their own business. Manufacturers have no real idea what's happening in the retail world. There are very few people who get to see the whole picture. We've been fortunate in that regard. This week I had the opportunity to spend two refreshing hours with a consultant who has been doing this for 40+ years in jewelry and other industries. He typically works with chain stores and high-volume independents in various fields. He was one of the few people I've met who has the same global view that we do and what was interesting was we were on the same page with all of the issues that we have in common. From understanding the financials to inventory levels to the problems with non-performing inventory, to consumer behavior, to price points being upside-down, very few people get to see the entire landscape, especially spread over $400 million in retail sales. Each of these items has impact on another and it's all intertwined. Which is why a simple discussion about a new concept, B&G bridal for example, isn't as "simple" as talking about the product itself. If marketing and positioning and inventory levels and ROI and the rest are put to the side, retailers cannot make an informed decision. By the way, I asked my new friend if he's ever seen a retail environment like this in his 40+ years. He said he'd never seen anything like it and that we're in a real mess and that there "Must be many changes in the way we run our businesses". I was surprised, as he works with LARGE companies in and outside of our industry. Conversations like that inform my decision-making process and supports the concept of spending a few thousand dollars on sample inventory to see if it works. There are people who make things happen and people who wonder what happened. Dialog like this, whichever decision retailers and manufacturers choose relative to this subject, should lay out all of the issues that impact the thought process.

dfc50- most of your questions can be relayed to the mfg's for answers- As a retailer myself, the question of whether the customer wants to buy the sample is really not your business. Example- what if my customer wants to buy a replica of there ring to wear when they travel? And everything can be knocked off dfc50 Jeff- just because an idea has been tried but has failed in the past doesn't make it a bad (or dumb) idea- timing is everything- thinking it might have been in the wrong hands as well. Also you keep saying that this product is going to the low end cheaper customer- however i think its just the opposite. it seems more designed for the sophisticated client who is looking to have something custom made to order- NOT price point. Also, you seem very against value of tungsten, etc.- my experience is quite different (and i carry a large selection of all kinds of bands)- my best selling tingsten band happens to be one with an inlay of platinum and retails for $985- again i think you miised the boat that the people who buy these alternative metals are buying them because they are cheaper. Look, I agree that this might be a silly idea and may or may not work - for me its a simple way of EXPANDING my selection to show customers possibilites I don't see the harm in trying and I've given quite a lot of thought as to the image of my store- no harm there either than i can percieve. At least it sounds better than sitting around doing nothing to look to improve our bridal dept. And to let the lady's play with the jewelry sounds like fun to me.

Jeffrey, After all of this we still have some very important questions and issues still un-resolved. -Do the mfr's of the b/g lines offer any changes, dia qlty/head shape and size change or any modifications. -What would be a fair policy if the consumer rejects the live ring when delivered. -What is the average delivery time from the mfr. -What type of disclaimer can be put on the b/g item if it were ever sold in error. -What happens if the retailer starts selling the sample pieces just to make a sale. -When it comes to designs, what keeps the b/g piece from being knocked off, the mfr has more than 25.00 invested since they designed, made models etc.. A pretty cheap way to start a wholesale business or add new styles to a line! I am just trying to get the focus back on all sides of this issue.

I appreciate all your input and passion on this, Abe. I truly do. My comments about B&G began as raising questions about possible consequences for the industry, rather than just jumping in and saying it was a good idea because jewelers can't afford new merchandise, are over-stocked in the wrong things, and can't pay their vendors. I tried to consider a broader view and potential longer-term issues associated with this kind of change in the fundamental way jewelry is presented and sold. I'm not saying anyone is stupid for trying. What I AM saying in the "dumbing down" of jewelry is that there is a history in this industry of shrinking away from presenting the VALUE of what we bring to the marketplace---to the consumer---apologizing for prices, losing profit DOLLARS by presenting and selling something cheap (titanium, steel, tungsten wedding rings) and passing them off as "a great alternative that people ask for" because we are afraid they may recoil at the price of gold or platinum. To me, that is "dumbing down" and stupid. Gold and platinum are precious metals and stand on their own. THEY ARE WHAT THEY ARE and many in our industry are afraid to (or can't) sell fine jewelry for what it is. THAT is dumbing down. We are our own worst enemies in many cases and wonder why profits are eroding. My point is that we ALL need to get better at what we do. We need to to become better sales people, better merchants, and better stewards of our industry and be careful not to go down a path we can never return or recover from. My belief is that further commoditizing the undustry, lowering the barriers of entry so that anyone can get in and sell "jewelry" (see B/G or dummy samples) has the potential of harming the industry irreparably. That, too, is the dumbing down of jewelry. I'm not opposed to someone trying the sample inventory theory AGAIN. I think I stated that maybe the time has come for retailers and consumers to be more open to this. Who knows? I know it hasn't worked in this country before, but maybe history is meaningless here. Maybe it is a perfect solution, but my purpose for this entire blog was to raise questions that may not have been previously considered, rather than jumping headlong into something without a full perspective. That's all.

To Abe, Why do feel you are the only one with the birdseye view and front row seat. The responses in the discussion have come from mfr's, reps, and retailers. These are the people who are on the front line everyday, with know it all approach you may miss some great ideas along the way.

Jeffrey, your blog started out asking whether B&G was a good idea. You went on to make the case against it, as far as I could tell, and I thought it was important to take the other side and state the reasons I feel it has merit. I think it's a good idea to bring in B&G sample lines to support a bridal position. It has nothing to do with Balance to Buy or working with any of the suppliers we work with, or any other 'agenda' that people might think I have. I don't mind the disagreements, but when someone posts that I should be ashamed of myself for supporting what I think is a viable strategy, they should sign their name. Remaining anonymous is fine with me in the situation where they are worried about their jobs, and if they want to talk about the reasons they feel this is a bad idea, I have no problem with that whatsoever. But when they put a bag over their head and then claim I have an agenda other than being in support (surprisingly so) of an idea that you started a thread on, well, that's not helping our industry. And it's a bit offensive too, but that's really besides the point. Are jewelers stupid for bringing in B&G samples Jeffrey? Will this be the end of the jewelry industry as we know it? The 'dumbing down of the jewelry industry' is what you named this discussion. You may think it's a dumb idea and I think it has legs and stated a lot of reasons why I thought so. How these discussions get derailed thereafter is just a distraction from much needed debate... and much needed change. I want the retailers and the vendors to succeed. But I have a Birdseye view and front row seat and understand what's wrong with this picture and have been writing about, and speaking about solutions for a decade before there were blogs.

Abe, You were on the Board of the New Jersey Jewelers Association. You already had a high profile. You also were a retailer, a store owner. Your business with your clients or customers would not be adversely affected by what you did within the industry with JCK or GIA, etc. This is a different thing. These people have jobs, or want jobs, or own companies here. There is potential risk for them identifying themselves while voicing heartfelt opinions. Surely you can see that. You have very strong opinions, articulate them well, and have an understanding of the condition of business in our industry today. But also consider that there are many others who may have a pretty good handle on what is happening and what they are experiencing, though their philosophies and ideas may differ from yours. While they may not spend their days crunching inventory numbers, flying from NY to LA, and talking to all kinds of MFRs, they still may know what the industry is about and what it is going through. Abe, you DO have an agenda and it is called "Balance to Buy." It is your business to convince everyone that they need your expertise to solve their inventory problems. No one is accusing you of not knowing what you are talking about, inflating your numbers, or flawed research, even though they may disagree with your conclusions or remedies as they pertain to this disucssion. You've got a lot of information to share Abe. Be careful not to tell everyone else how stupid they are along the way.

dfc50 commented: "Hey Abe, Don't blow a gasket, but you really like to hear yourself blog. Yes I am a rep and owner, I deal everyday with the problems of my customers, my salespeople, and also have the stress of manufacturing and maintaining a profitable business. I have tried to bring out the problems the reps are having as well as the realities of manufacturing. I will not use my or my company name because this is not the place for self promotion." Then spend one hour on line with me. I'll SHOW you the data, talk about why we're in the mess we're in and what I see as some of the solutions. If you still think I'm wrong, then fine, we'll agree to disagree. But until you understand Sell-Through and not just Sell-To, you're not seeing the entire picture. Until you see, with your own eyes, the millions of dollars sitting in jewelers inventories, you won't understand how long this is going to take to fix, nor the reason alternative product solutions will have a place. After seeing what we look at every day, if you disagree, come back on here and tell the world I don't know what I'm talking about... that I have an 'agenda'.

"Hey Abe, I am not using this forum as a personal business adgenda like you. Some of us want to voice our opinions and stay employed." We ALL want you to stay employed. We all want ALL OF US to stay employed. And that IS a business agenda isn't it? I'm very concerned that we have lost an entire GENERATION of professional merchandisers due to the majors cutting those positions more than a decade ago and relying on the manufacturers to do product development! When the jewelers stop buying and the reps stop selling and doors are closing and companies are laying off reps and jewelers and setters, we will talk about why and what we can do about it, if anything. The discussion about B&G as ONE single concept in very rough seas is just that, one SINGLE concept. By the way, this is a newly charged concept that has been around for 20 years, but now it has a number of reasons why it makes sense as part of a solution to some of the issues. This doesn't come close to addressing the rest of the problems, but we take them one at a time. And if you happen to be a sales rep who sells bridal, and no one is buying your goods right now, don't expect that to turn around anytime soon. You can HOPE it does. But HOPE isn't a strategy. Someone pointed out that you can buy these from Unique Settings and you said NO Way! They are not silver, they are alloy, and you might want to take a look at them and the entire program Speak with them about how it's working so far and get yourself a little educated about the subject. If you are a rep, ask them how THEY see this working for the betterment of our industry and for the reps in our industry. I flew from CA to NY to spend a day with the owners of Unique to learn about this a few months ago. I flew up to Canada to visit Spence three years ago to see what that model was all about. I encourage you to see what it's all about too, but from both sides of the aisle and THEN share your informed opinions. Or feel free to call me anytime and I'll walk you through why I think this is a good solution for some jewelers and certainly for manufacturers. Argue with me, if you'd like, but listen to what I've learned, what I see going on, and why I think it's going to be a growing part of our industry in the near future. I'll tell you what I know, the rest is your choice.

Hey Abe, Don't blow a gasket, but you really like to hear yourself blog. Yes I am a rep and owner, I deal everyday with the problems of my customers, my salespeople, and also have the stress of manufacturing and maintaining a profitable business. I have tried to bring out the problems the reps are having as well as the realities of manufacturing. I will not use my or my company name because this is not the place for self promotion.

Hey Abe, I am not using this forum as a personal business adgenda like you. Some of us want to voice our opinions and stay employed. Ah, anonymous again... How about I change my name.. I think I'll use INFORMED as my pseudonym. Nothing I post will change, however. What ARE you using this forum FOR? I don't see ONE solution about how to fix our problems coming from you? In fact, other than disagreeing, which is fine, you have no real understanding of what our issues really are, let alone offer advice on what to do about it. You picked ONE line out of hours of presentation and point to THAT as what this is about? If you have any IDEAS I'm sure there are lots of people who would love to hear from you and from anyone who offers solutions. You guys can complain about the challenges we're facing all you'd like, but the problems are not going away. Time won't fix this one. Don't change anything in your business, that's fine. But there ARE people who do want to and keep showing up to seminars, webinars and blogs to learn something. If you'd like to throw stones, at least have enough self respect to sign your name. If you happen to be a sales rep and you think you won't have to change what you do, then I think that's a subject for another blog... What WILL the reps of the future look like? What skills will be needed and what will that job be worth?

Jeffrey Skaret commented: Abe, With all due respect, I suspect the reason many of these commentors do not use their real names is because they DO have something to fear, and that is their job with their current employer or the state of their business in general. You, on the other hand, have made this type of thing your business and can actually stand to benefit from free exposure of your philosphies, understanding, and businss offerings. I don't think you can compare the two. Jeffrey, when I was in retail and on the board of New Jersey Jewelers Association I wrote a letter to the editor of JCK (George Holmes) in which I took Mike Roman out to the woodshed for pulling the funding of the GIA scholarship program for New Jersey. Until I got on the board, the funds designated for this purpose went largely unused. I made a deal with GIA to bring their extension programs TO NJ, (not NY or PA) so NJJA members could get educated for very low costs. We did 3 classes over two years and sold out each one with 24 students in each. It was the most successful program that NJJA had ever done regarding education. Just when both the state affiliate was gaining momentum in its other programs, largely due to the success of the GIA classes, JA decided to cut off the funding. I wrote the letter to George and he called me to ask if I REALLY wanted him to print it. I did and he did. It was not a very favorable letter about Mr. Roman and he and he was NOT happy that I had written it. But it was signed, Abe Sherman. If someone wants to make a point or doesn't agree with me, that's fine. But if they don't have the guts to sign their name, they get no respect from me. I have things to say, I say it. Your suggestion that I do this for the reasons stated without knowing about me or what else I've signed my name to is a mis-characterization. I ALWAYS sign my name if I have something to say or a point to make.. and have been doing it LONG before I was in the business of helping other jewelers.

dfc50- Abe mentioned one company... Unique Settings out of New York. Check it out!!! YES WAY!!!! If this proves succesful- probably more styles to come. Oh and excuse me i made a slight mistake...its about $25 a sample. I hate to admit that I have the time to follow these interesting blogs...... wish i was busier with customers..LOL

Who is offering quality cz/silver samples for 20.00, the multi-stone micro pieces with intricate metal and stone work. NO Way.

Larry- you equate a vendor making a sample line and charging the merchant a "display" price of about $2k for 100 rings with an investment of probably more than $500,000 in live merchnadise to give out on memo?...and the vendor gives u the $20 paid for the sample the next time you order that item....putting costs at basically 0 ? Cash Flow? I'm sorry but to equate is absurd. (no offense meant) I would ask you as well to follow the memo issue blogs and see what mfg's are saying about memo. In absolutely no way can you compare.

I would argue that the use of memo is NOT functionally different to the retailer than the use of brass and glass "samples", except that it can be delivered. If a customer wants it with vs and pink gold she will just have to wait for the special order to come in, just as she would ordering from a sample made of alloy and cz. In addition, the jeweler's cash flow will not be effected any differently, either way the jeweler sold a piece he does not own and needs to pay for it out of the sale price. The only difference between the two is the manufacturer either chooses to invest in live goods or samples. If the manufacturer has the financial ability and belief in his line to build it live and run a memo program than that is OK with me and my store. Everything being equal I would rather show and sell from live goods.

Hey Abe, I am not using this forum as a personal business adgenda like you. Some of us want to voice our opinions and stay employed.

Abe- you are spot on and i agree with you. Its one thing to point out problems its another to come up with solutions. Your insights are invaluable. If I ran a seminar I doubt that anyone would show up to hear me..LOL The companies currently offering possible sample solutions are very respected and are first class vendors and they are offering for us to try with very minimal investment. These are vendors who support us. If they say to me Alex, lets give it a try and see what happens its not expensive....I'm in. If Abe says its worth looking into...it is. I wish I had more time to attend Abe's seminars. By the way- my name is Alex Weil and i'm from Martin's Jewelry in Manhattan Beach, CA

Abe, With all due respect, I suspect the reason many of these commentors do not use their real names is because they DO have something to fear, and that is their job with their current employer or the state of their business in general. You, on the other hand, have made this type of thing your business and can actually stand to benefit from free exposure of your philosphies, understanding, and businss offerings. I don't think you can compare the two.

dfc50 commented: "To all retailers, just jump on the latest bandwagon and wonder why your business is moving down the streeet, such a short term re-action. A busy Pandora week equals the one engagement ring sale you lost. If you want it easy open a 7/11 convenience store." I guess that depends on what you consider a busy Pandora week. I spoke with one of our clients this morning... They are on target to do $3 MILLION at retail with Pandora this year. We have a bunch doing between $500K and $1 MILLION. And, I've been on this particular bandwagon for the past 4 years, long before it was as hot as it is now. Pandora is one of our suppliers. I had to beg some of our stores to take the line 3-4 years ago and now those who hadn't are begging me to get it for them. PS. We do not get a commission from our vendor-partners.

"What this industry needs to do is be patient. Let the inventory levels come down (we are getting there) and then smartly get back to business with vendors who are strong. Identifying who the strong vendor partners are will be the key. " And Mr. Fed Up: I'm a bit fed up with people making statements like this with no understanding of what's really happening out there. In our little sliver of the market, we have over $100 MILLION of aged inventory. I speak to manufacturers and jewelers all over the country, every day and suppliers are NOT getting paid and cash flow is TERRIBLE. WE ARE NOT GETTING THERE ANYTIME SOON. "Smartly get back to business"? What does this mean??? I encourage manufacturers to post about what's really happening. The retailers need to hear it.

"Abe Sherman ought to be ashamed of himself for suggesting that retailers consider bringing in more styles! I have been to his seminars at JCK. REDUCE your inventory he said! You have too much inventory, move what you have first. Now he is advocating bringing in fake styles to steal sales from the current inventory retailers can't move. Sounds to me like his buddy who is building a B&G program might be a struggling vendor for BIG." Stuller, Gabriele, Unique Settings, Cobb, Fantasy Diamond. These are just some of the suppliers I know who are building sample lines. We work with two of them, I have not advocated who to buy this product from and resent the implication. But, knock yourself out. Since you have been to my seminars at JCK, you would know that much of the bridal inventory is NOT PERFORMING. There are reasons for this, among which, having an aged inventory with stale styles ranks high. Depending the the store, inventory selections are poor and lots of jewelers cannot afford to bring in a new assortment. So, you are suggesting that they wait until their current inventory is sold down? They simply CANNOT bring in new live goods... they don't have the cash flow. They can, however, spruce up their current assortments by showing samples. The old goods may need to be broken up or traded back (I'd point you to my earlier posts, but they were somehow deleted). Now a personal question. I could have also signed up for these blogs using a screen name. Why don't you guys use your real names? Who are you, really? What are you afraid of? ABE 530-543-1978 - I'm not afraid of telling the truth or who it's coming from. I wrote some VERY long explanations about each of these points, but they didn't make it onto the blog... Shame, there was some really good stuff there.

Cisco Kid (great name)= customers walking into a chain store and seeing only a few styles that the store is looking to turn is EXACTLY why we want to have hundreds of styles to choose from instead...we can try to give the customer a feeling that they have no reason to go anywhere else to get just what they want at the right price. Chain store customers are not our customer and vice-versa. I will repeat my comment of the big difference between people selling jewelry and jewelers. Oh and ur comment "diamond fashion all done in brass and glass"- i don't think diamond fashion in silver is anything new and we see lots of nice styles that are ready to sell in fashion jewelry set with diamonds. Fed up (another great neame)- the practice of memo and its inherent problems are well documented in the industry. As a matter of fact it is currently talked about in many, many blogs going on right now. Check them out and check out Martin Rapaports comments as well as other experts. In my opinion memo has never been a sound business practise and I only use it occasionally to answer a customer request or on a loose diamond for a client. Memo is not interesting for me even though it is available to me. Bridal memo SI under $1,000? yes readily available, but what do you do when the customer says ok, but i want that ring in pink gold with VS quality and with a 1.25 ct rectangular shaped cushion cut center? I'm not Mr. Memo and do much better buying. Now will you stop picking on me..LOL.. i've got work to do Jeff, look what u started

Alex, You can get plenty of great bridal on memo right now! SI quality, well made at under $1000 per carat. Why would you put in B&G samples when you can accomplish your goals of increased selection with product that can be delivered quickly to your customer from your case?

In response to Alex. Its amazing Alex that when you walk into a chain store you don't see hundreds of new styles. They sell what they have and work off of turn. Something the independent is starting to understand. Next you as well as most jewlers give the consumer more credit than they deserve.They don't know what is new or old. If your sales people are trained to sell what you have vs always wanting something new( because they not the consumer are tired at looking at your inventory.) Check out the latest comments from the Professor on instore sales training. I find it very truthful and I am sure many retailers may take offense but the truth always hurts. The note about Pandora and Rebecca: This is fashion and not related to bridal. Oh I have an idea why doesn't some manufacturer come up with a diamond fashion line all done in brass and glass it will complement the other "samples" in a store.

Fed up, your right about the difference betwee Pandora/Rebecca. The samples rather represent to me just buying a display and showing possibilitys to customers. I'm still struggling on how to ramp up our bridal selection without a huge investment into a low volume, low profit category that adds to our carrying costs. This idea and its low risk, low cost way appeals in many ways. And if it catches on I think many, many mfg's will consider doing it to get their products at least in front of customers to try on. We will see. Ultimately I feel there is a big difference between people who sell jewelry and jewelers. This product seems to be geared more towards the jewelers. And yes Jeff, I can also see why he is the "professor". He gets an A from me as well.

Alex, The difference between Pandora/Rebbecca and brass and glass bridal is your not suppose to sell the brass and glass. B&G doesn't hit a price point your not hitting, it is the same price points and same qualities (you hope!) your store is selling now. All B&G gives you is more style selection from a vendor who is so desperate for orders that he has begun building his salesmen sample lines for his retailers on the hope of some reorders. Abe Sherman ought to be ashamed of himself for suggesting that retailers consider bringing in more styles! I have been to his seminars at JCK. REDUCE your inventory he said! You have too much inventory, move what you have first. Now he is advocating bringing in fake styles to steal sales from the current inventory retailers can't move. Sounds to me like his buddy who is building a B&G program might be a struggling vendor for BIG. What this industry needs to do is be patient. Let the inventory levels come down (we are getting there) and then smartly get back to business with vendors who are strong. Identifying who the strong vendor partners are will be the key. Jeffrey is right about the main point of this blog. We don't know the consequences of lower the barrier of entry into this business. Independent hardware stores and pharmacies are things of the past.

Well, I couldn't agree with "Professor" more. All of the points were hit on the continual "dumbing down" of our industry over the years. Everything else seems to go up in price, increase in value, yet we constantly "apologize" for jewelry prices and cave-in to imagined perceptions of the consumer rather than getting better at explaining and overcoming. Amazing. Still, the question of a "live catalog" (as Alex likes to call B&G) remains. There are some real inventory issues in the industry, (as Abe Sherman has pointed out, is working to solve, and build a business around). My firm belief is that everyone---absolutely everyone---has to get better at what we are doing in this industry to make the changes. Agreed: 1)the old ways of doing things will not work or help us move forward. 2) mfrs cannot continue to rely solely on stock orders to drive their business. 3) reps are delusional if they think their job ends when the ink is dry on the order. 4) jewelry is a blind purchase for most consumers, no matter how smart they think they are. They just don't know what you know as an industry professional and it is YOUR job and responsibility to make them realize that in a way that makes them WANT to do business with you. 5) consumers are sheep. If you are good enough to be their shepherd, they will follow you. 6) get better at what you do and stop looking for easy answers that undermine your very business and industry. 7) find other ways to engage your customer and make them feel comfortable and welcome than by caving into the thought that jewelry should be just like everything else they shop for. IT SHOULDN'T! 8) find someone who can really help train your staff to understand and convey what your business is about, what the jewelry means, and why they should do business with you. 9) DON'T just settle for something (or let your customers) because it seems to feel good and be right at the moment. WORK to help the get what they really want by getting better at knowing how to get them to TELL you what they really want. 10) ultimately you are looking to build a business, aren't you? Do you not want to build clientele? Have them tell their friends? Have them come back? Stop thinking about the short-term transaction of the moment and consider how you want to conduct your business in a consistent, well-planned manner that can carry you forward for years to come. I've got to write another blog. Sorry for the length of this.

RE: 100 new bridal samples If I had the financial resources (which I don't) to purchase 100 new "real" bridal rings...wouldn't those new rings compete with my already paid for inventory just the same as if they were "samples"? The question remains with bridal customers spending lots of time searching the web and stopping in an average of 5-6 stores looking at styles, what are the chances of a store having exactly the ring in the right metal with exactly the right shape,size and quality of center at just the right price that they want to buy? how many rings o you need in stock to make a sale? How can we break down the "under glass, locked, hidden price tag, nervous to show" barriers that people experience when shopping for bridal? And how do we make them feel welcome to try on anything they like without any pressure or explaining that we can only show one ring at a time and making it sound distrustful of them? What sort of reaction will we get when people walk into an independent jeweler expecting to see a few nice styles and instead see hundreds? i hear all the naysayers.....and i agree with some.... I'm really not completely sold yet... But some of the remarks (and i don't blame you) sound very prideful...as in "i'm not gonna show fakes!" I too am proud of our 45 year old small business. I don't think this product will make us swallow our pride. I'm thinking out loud here....and PLEASE someone talk me out of putting in this new idea !!!! I'm seeing too many poitives. Great thread by the way appreciate the insight and advise.

Diamondone,Jon Response about sales reps. The old way of selling is gone. New reps need to learn on how to be a business person vs a slepper. The new rep needs to learn how to work with the stores turn of his merchandise He needs to learn how to do stock balancing and understand that even though certain stock balancing needs to be done its not his or his companies responsibility to guarantee sales and success to stores. That's the owner managers job. What the new rep needs to master is how to sell a merchandising concept that will work in an independant store. Yes, being a sales rep on the road is a tough and dangerous job.Just because someone graduates from college does not mean have they have the talent, resilence,agressiveness or the dedication to do this job. Most kids coming out of college all think they are going to get great jobs and opportunities some do and most don't. Today most need to go to college to get a simple high school education of 30 years ago. Yet there are those who do not fit into the college mold and therefore when applying for jobs other than Mc Donalds or a blue collar job get a blind turn down by HR departments.HR departments looks for degrees not brains and talent. Therefore they miss some of the best people available. I have continually meet and hired great sales people selling shoes, carpet shampooing,cars, cosmetics that never attended of finished college. They are highly intellegent individuals willing to work hard and learn.These are the people that have a natural ability to sell. Something they don't teach in college. Some of them today earn $150,000 to $200,000 a year. Alot more than the average college grduate. So don't think for one minute that no one is interested coming into this industry. How do they learn? A number of jewelry manufacturers think all they have to do is find a breathing individual thats been around the jewelry industry a while, hand them a bag and they will make money for them. They are saddly mistaken. The bigger issue we have in this business is finding sales managers who know what they are doing, understand how to train and bring along a 1099 rep so the manufacturers isn't sending sales reps through revolving door. Then we have manufacture owners that think they know how to run a sales force and continully fail because they don't have a clue as to what they are doing nor do they listen they know everything. They forget that even though they may be paying a draw,that over 50% of that draw is being spent in expenses to build their business. So the bottom line issue is ; 1. There are excellent sales reps available. 2. There is a lack of knowledgable sales managers in this industry that understand this industry. Outside managers from other industries do not work well in this industry. 3. Most owners do not have a clue on how to run a sales force. Where do you find sales managers? Look around they are available but the good to great ones are not cheap to hire. So some manufacturers take the easy cheap route make brass/ silver samples do a mass mailing to stores and then wait for the big bucks to roll in. How long will it last? Will it work ? How many customers will they lose? Probably not for long. but some jewlers believe if its cheap, I'm in! Good Luck

To all retailers, just jump on the latest bandwagon and wonder why your business is moving down the streeet, such a short term re-action. A busy Pandora week equals the one engagement ring sale you lost. If you want it easy open a 7/11 convenience store.

LOL @ cisco kid For years we have been trying to justify prices based on us telling customers the commodity value of what they are buying from us. I'm not sure where the resposiblity of buying back ANYTHING from a customer came from. Can they take back a sweater, or pants, or appliances or products like that and get money from the person who sold it them?...(and please understand that i really, really feel for those people that are selling for groceries) I'm trying to think outside the box here. Does tungsten sell?- yes (in some stores) Cisco - have you looked at the financial statements of Emitation? You might be surprised Is it not amazing that the hottest selling items in our industry right now is PANDORA- and how about the beautiful jewelry of REBECCA which is made of plated brass and is carried in some of the finest stores in america? These retailers took a chance and are reaping the rewards from lines like these. Does jewelry have to be made from gold/platinum to be beautiful or worth anything? Tell that to the Rebecca lovers of the world. Ask a company like Stuller if their sample line-up helps out their accounts? They have been succesfully doing it for years. Final thought for today- BETTER TO HAVE TRIED AND FAILED THAN TO NOT HAVE TRIED AT ALL.

Re: 100 new silver bridal samples. Right Alex and you just put in 100 styles that now compete again your already paid for inventory. nothing like competing against yourself, no different than the memo Kings and Queens out there.

Whow...Jeff I bet JCK is happy they signed you up. Finally a person who adresses the hard questions.Rather than the blog or editorial types who always play the political side of this business and never say anything worthwhile. Jeff,keep up the great work. There is so much stuff written in this blog where does one start? In 40 years I have seen it all,when gold was $100.00 an oz. Jewelers were clamoring for 10k. They came ungluded that a 1 carat VS was selling for $900. wholesale. Only in this business do we eat our young. Diamond prices go up...we have to lower our quality ..need to sell it cheaper.. gold prices go up we have to go to alternate metals to sell it cheaper. Gold goes up more and we have to go to silver rhodium samples with CZ's. All under the guise of "the people can't afford it!" In the meantime the most expensive American car in 1976 was selling for $10,000 now the same brand of car is selling for $60,000." A Chevy pickup sold for $4000.today $30,000. Meantime jewelers are still trying to figure out how to sell it cheaper and then wonder why they can't pay their bills.Payroll, utilities,insurance,and rent, all are up well over ten fold since 1976 and most jewelers are still trying to keep the same price point as 30 years ago. Take tungsten for example... Alex wrote; "Your comment that tungsten etc.that it is worthless?..what does a customer get for his gold or platinum band when he scraps it?.... nonesense " Right Alex, lets put Tungsten in the same league as Gold and Platinum, that's the right thought process. How many jewelers are buying gold and platinum scrap from people in need of buying groceries. Alex how many jewelers are buying back Tungsten??? None! Right because its worthless. Oh but we have to keep the price point! We are our own worse enemy, we shoot ourselves in the foot everytime. There is no easy way... there is no silver bullet. This whole thing about brass and glass silver samples, whatever you want to call it, is not a new concept. It has traditionally failed every time. Christian Bernard thought they had a brainstorm when they had the old Wright and Lato make them brass wedding rings and bridal sets for their whole store. IT FAILED. For those that remember the Paramount ring company, they had brass sample wedding rings. Failed!! There was a company in the 90's out of Texas, now OOB, started with a V, can't remember the name with brass sample wedding rings.. Failed! Spence Diamond "The Brass Sample CZ store" out of Canada did some research in doing the same in the USA from what I hear, their trial program didn't do that great. Then there are stores out there that sell CZ and silver products(Emitation) you see them in the malls, gosh, they should have taken over the jewlery indusry by now, since this concept is so great. Whoever wrote it in this blog he was right when he said ( not a direct quote) that the barrier of entry for a new jeweler starting up with brass and glass was non existant. So all you jewelers out their who believe in this concept won't mind when some guy or gal opens up with no inventory just two catalogs from the two big wholesales and brass and glass samples from all you nice manufacturers making this stuff so you don't have to carry inventory. Guess again, stop drinking the Kool Aid on this one.

Maybe I should explain. The B&G samples represent an opportunity to expand our bridal selection without adding insurance and without a big investment in more styles to have on hand. Bridal is about having a big selection. In now way would i propose having ONLY samples on hand. Picture a nice showcase of bridal that is ready and "live" along with a seperated display of "samples" used to expand the selection for the customer. For less than the cost of a 1.00 ct. certified round to have in stock we can now add 100's of bridal styles without increasing risks or adding insurance costs. Another possiblity would be to show customers "live" rings by appointment to further cut insurance issues. Why am i not worried about the finished? We have alot of experience with special orders. Looking to add a nice ring to inventory whether its just purchased or comes from some sort of a rejection does not diminish the feeling of always looking to add to our bridal selection. The internet has achieved slight success because of the huge selection to browse. Why not let them browse in your store along with your help? I will say this though... this "Brass & Glass" (terrible term)..is DEFINETLY NOT FOR ALL STORES. especially those not profficient in custom orders....... I wonder how many styles of bridal independents have on hand to show customers? What sort of a selection do you have on hand Eastern Jlr?

What??? What do you mean "samples (and live)" isn't that defeating the purpose of lowering your inventory costs? Also keeping a rejected piece? Isn't that defeating the purpose of lowering inventory levels? I don't get it. How are you not worrying about the finished product?

Diamondone, If the customer rejects, then i simply have a beautiful custom made piece in my inventory and they would be welcome to choose another. If they reject and the Mfg doesn't take it back, the materials can be used to remake something else. My experience is to take the customer by the hand and make sure everyone is on the same page as far as the order. Having the samples (and live) is EXACTLY positioned to make sure that there are no surprises at pick up time. They get an excellent look at the finished piece before they order Also its kind of a tough question for me to answer because very, very few special orders get rejected. The mfg's might also have some policies about rejections but i see no reason to put them on the spot. Having the samples makes it much easier to not have to worry about the finished product. It gives the customer confidence in my opinion. The policy of a satisfied customer is crucial to our business.

My question to Alex, what would be the policy if the consumer rejects the live piece when it comes in for what ever reason? Does it now become a problem for the mfr who produced piece, who eats the loss, who guarantees the consumer will accept the live piece?

Interestingly enough I am on the fence on this one......I do feel there is a place for this. In the past when gold and platinum was much lower priced and the economy was doing better and turn was higher I would have said no way......what a difference a few years makes. I do believe its only place in a jewelry store would be in merchandise that needs to be ordered custom which is rings and primarily bridal (wedding bands and engagement rings). Instead of jewelers sizing their bands (which turns out to usually be their best sellers and now they are out of business in that style) the will keep the proper assortment. Today the samples arent that of yesteryear....they can be made almost to similar weight and better metal to look more like the real thing. On engagement rings the styles that conumers are demanding have integral heads which most times then have to be ordered for head size, diamond shape, and finger size (how many jewelers mangle a ring so they can sell it out of stock only for the customer to bring it back with stones falling out!) So what I am saying is this isnt the answer for total inventory....but in certain product types and styles it can supplement (cost effectively) a jewelers selection. Again this is my opinion. Now on to the thing about more professional and knowledgeable sales reps.......as I have stated in previous blogs and as it has been suggested above.....good luck. When companies take salesmen that have built up 3 million dollar territories for companies and basically brought them to the dance and put them on the map.....and fire them because they are making too much money (are you freaking kidding me......you have a territory producing 3 million dollars because of this guy) only to hire someone for a small base salary to service "their" customers who wouldnt even be their customers if it wasnt for this lazy, doesnt want to work sales rep.....you tell me how there are going to be more educated, professional, top knotch salepeople coming into this business.

Ahh, but what if the samples DO have the look and feel of the finished? And what if they were displayed next to a selection of live merchandise as well? And what if the customer is offered countless custom options? And what if the customer was guaranteed satisfaction with the ordered piece? How many rings are custom made and not just bought out of a case? (especially in bridal). Are not us independents constantly making special orders? (especially in bridal). We often feel lucky that we have a ring on hand that the customer wants to buy. Have we not been ab le to satisfy customers on ordered rings for years and years now? I think its all a matter of set-up and presentation. But the issue of the quality, feel and finish of the samples is the biggie. Emotional selling? Hey, they are already in love....what more can we ask.

I can imagine very few instances where an engagement ring is ordered out of a catalog or off the internet, other than the possibility of a solitaire. Maybe I don't see or know that business. Maybe my view and experience of fine jewelers and jewelry is far different than most others. I just have a hard time imagining a bride-to-be feeling comfortable committing her heart-felt desires and betting her cherished future on a sample ring which doesn't really look, feel, or fit like the one she will be getting a few weeks down the road. I think most of the brides-to-be (and their presenting fiancee's) are far more involved and concerned about the end result than what is being talked about here. I'm not saying there aren't possible ways around that, but what happens when the ring gets manufactured, shipped, the customer is called, and it isn't what they thought it would be? What happens then? It is difficult enough to know what goes on inside someone else's head, but we are in a visual and tactile business folks. The ultimate goal is helping the customer get what they want, yes, but most don't REALLY know what they want until they are presented with the breadth of possibilities accompanied by compelling reasons which tap their emotional buttons. We are not selling commodities like widgets, nuts, and bolts. Jewelry, of any kind, satisfies an emotional desire to please, commit, commemorate, or celebrate. Rarley is it a need-based "must have" kind of thing. THAT is the business we are in if you strip away all the issues of inventory costs and over-stocked showcases. And I'm not saying that isn't a problem.

Hey Jeff!!..how goes it? another term for B&G...how about "live catalogue"? I'm not sure where it is written that a wedding band must be made out of gold or platinum....my experience from selling all of them is that the custoner chooses the alternative metals because they like them, no because they are cheaper in price. And why is not having any ability's or salesmanship and still making sales a bad thing? Is making a sale not the point? Our vendors stand behind their products. And who said that gumball machines don't make a profit??..LOL (great idea by the way) Don't get me wrong...we will not transform ourselves into a "junk" store. It is all about expanding the selection without a huge investment. And if the samples, etc. are not of a decent quality for presentation it has no chance in our store. I'm thinking lower insurance costs-showing items with no worries about theft-letting people play a bit and be more interactive. If we add a diamond database to these samples then it looks like we could become like the internet but better as far as selection goes. And as far as the Costco's, Walmarts, of the world.....the last time i looked they already have jewelry dept's going on anyway...... do we sit here and worry what they are doing? Its up to us independents to provide the good customer service that they or the internet can't. Its what sets us apart. Its possible that if we don't offer all these new styles in an efficent andinexpensive (to us) way...we might be missing an opportunity to further enhace that same customer service. By the way, whats your favorite gumball flavor?

I am happy to say I do business with many of the top independents in the country the 7 figure stores, not one of them is talking cz/silver, the average retailer might be interested in how the best got there. Jon, my point was the mfr must re-think there compensation to attract these young guns, and who is going to train them and help them build a customer base and territory, not to mention how long to you give them to succeed. Lets get real, the upcoming class of sales and marketing grads are chasing the money thats there motivation and passion.

Excellent point, GiselleMarie! Why wouldn't a customer ask that and why wouldn't some jeweler sell it? We have already "dumbed down" the industry by presenting things like titanium, tungsten, and steal as 'real' wedding rings, so why can't we sell sterling and CZ as something just as acceptable? You can bet there will be those who will. It's EASY. And you are still making a sale and after all, isn't that what good retailing is all about, Jeff? Oh wait a minute, there was another imitation tried in recent years with a lab grown diamond called Moissanite? How has that been going? By the way, I worked for a company many years ago who had dabbled with putting in brass samples as wedding rings and ordering off of them. People hated it. The brass turned color under the heat of the showcase, customers had no idea what the real ring they were getting would feel like, and the costs of manufacturing brass samples was more hassle, time, and money than they thought. They couldn't charge enough for the brass samples to make it work and jewelers did not want to pay for them. And there were consumers who wanted to buy the samples because they were cheap, had never worn jewelry before, and couldn't see spending a lot of money on a wedding ring. The dumbing down of jewelry.

Jeff, lets take it one step in the other direction. In visiting a store last week, they offered a small collection of bridal sets in B&G. The sales girls told me that they were only to be special ordered, no delivery made. I asked why, she said"these are silver and CZ samples only"...so I asked if I could buy it that way. She had no comment. Now, why wouldn't the retailers sell it that way to make whatever they can today? I think they would.

Brass and glass may sound like a deal breaker to many, however I think that the advantages offered far outweigh the negatives. Margins on most of the products sold by retailers have gotten smaller, inventory turn is down too. Gem and metal cost are in flux, All these factors point to inventory problems. So why live and die with the inventory that you bought with the HOPE it would sell. Prototype selling will be a change for the industry and as you noted. What keeps your "average Joe" from starting a jewelry store? I guess with 1400 jewelry stores out of business last year...maybe some will give it a go. Maybe some of those "average Joe's" will realize that good retailing is good retailing. Helping people get what they want, when they want it, regardless of the kind of inventory....that's good retailing and that's what keeps customers coming in the door. The jewelry business in changing we need to change with it, not cling to old paradigms.

Hi Alex. "Brass and Glass" is not MY term. It was used in a meeting reported by Rob Bates in a recent blog. What should we call it? I used a few different terms like "silver and CZ" and "dummy samples". Also, I didn't totally disparage the experiment, did I? I merely pointed out a failed attempt in the past in the US and tried to lay out some potential pitfalls or unintended consequences of doing something like this. I am all for change and know that something needs to. I don't claim to have all the answers, but I do have a lot of questions as to how change will affect the industry. I don't use this space to try to promote an agenda, as some have in their commentary at different times. This is not a place for a commercial, or an advertisement by a reader, as "RoadWarrior" pointed out in another of my blogs today. I stand by my comments about tungsten, steel, titanium etc. They are worthless metals being sold as something of value. It is an easy way out to make a sale with that because "they are cheap in tough times". Give me a break. Sell a wedding ring as a wedding ring. Get better at what you do and how you do it. If not for yourself and your business, do it for your customer. They'll appreciate it in the long run. Here's and idea for you. Get yourself a gumball machine with all the little plastic cases. Put the tungsten, titanium, and steel rings in it. When a customer asks if you have them, say "Sure. They are right over here in the gumball machine. You can select whichever one you want and I can order it in your size." That is all they are worth and it doesn't take ANY ability or salesmanship to sell them.

Diamondone, Yes they are, indeed, hard to find; many fewer than in years past but, they are still out there. That includes 'young guns'. In such strenuous times as these, many forget that there are people who work in the jewelry business mostly, because they have a passion for the jewelry business. Finding those people is not easy. In fact, it's getting tougher but, that's why this firm exists.

Brass & Glass- small investment for all to (at least) try something new to add to the already mix of fine. If it doesn't work you toss, donate, or give to children to play dress-up. Your comment that tungsten etc.that it is worthless?..what does a customer get for his gold or platinum band when he scraps it?.... nonesense tungsten, silver, samples, etc- have a great potential of making money in tough times. And they are viable products. And please don't call it "brass & glass" when its neither. Its simply a better way of showing a catalogue. By the way Jeffrey, do you have a better idea to get something new in stores? Would love to hear it.

Jon, Where is this new breed of salesman coming from, as a 30yr professional rep. our current industries compensation has not and will not attract the qualities you seem to think is needed, even my children after college wanted nothing to do with our business even with the opportunities I could give them. They both are professional reps with Fortune 500 companies, great salaries, medical benefits, expenses, 401k's, your dreaming if we can attract these young guns.

I was speaking with a manufacturer of a diamond jewelry line this morning and he was telling me about this new collection he just launched, all CZ's and sterling, as samples for the stores. I sent him the link to this blog; perhaps he will post his well-thought out reasons why this is necessary.

Perhaps there was a glitch in the system over the weekend, but there was quite a long dialog on this subject that is no longer available for viewing.

Yet another thought provoking piece, Jeff. Well done! And some excellent insights shared between you and Abe. For those readers who haven't been staying close to the topic, you both certainly got them interested now. Abe is right on in his comment about the new breed of rep to come. As I've commented before, independents are becoming more sophisticated and, therefore, more demanding in what they expect from the lines they carry. The new rep will have to concern themselves with sell-through as much as sell-in; maybe more so on sell-through. I have to add however, my favorite comment came from Luis de Agustin. It reminds of the 'ham & cheese sandwich sent by Neiman-Marcus' story...

"2) How do you propose a mfr deals with a jlr who has inventory of his goods and now they try to sell them on B/G? What does the mfr or jlr do with the live goods that haven't sold? " I'll address this one by itself. The billions of dollars of live inventory that is sitting in stores need to be moved out. Right now, like no other time in our industries history, there is a great incentive for manufacturers to work WITH their retailers to help them move their inventory. Have you ever had a call from a manufacturer asking you if you have an item in stock that they can sell to another jeweler? Inventory that you might be sitting on for 2 years but an order came in from a jeweler in California? No? Of course not. They don't do it. So they buy more metal, diamonds and labor and make it for the guy in CA while yours sits another year. They pay cash for each of those costs and then wait months and months to get paid and all the while their not-so-friendly banker is on their backs about their aging AR. And while they are making a new one, 30 of that same item is sitting in stores across the country and will continue to sit there. We only have two things to work with in every retail store - space and money. Where do you put it and how do you pay for it? Were manufacturers to start working WITH their retail-partners and help them move their non-performing inventory out, even one piece at a time, this issue will s_l_o_w_l_y start working itself out. Easy? No. Fun? Not at all. But we had better sit around the table and work it out or it will be a very long time before things get 'back to normal'. As of today's data, Sales for the past 12 months in our database was $376MM with a COGS of $190MM. There is $217MM on hand and $105 MILLION of that, or 48% is at least one year old. Just in our tiny sliver of the jewelry industry, there is over $100 MILLION of aged inventory. For any of you suppliers who need merchandise to fill orders but you can't due to cash flow, call me. There may be a chance that some of our clients have it in stock. Take it back, sell it to the next guy and get paid. I live this data every single day and have been trying to find solutions for a long time. This specific topic is especially challenging and the issue that Jeffrey raised in this thread needs serious consideration as it does address a myriad of issues. As more stores close... as more manufacturers close, as more inventory is liquidated (boy am I in the wrong business), there will be increasing pressure on margins and this cycle will continue until the non-performing merchandise moves out. It's just like the real estate industry right now... it's deflationary. The difference is the home builder can't ask you to ship back the house. The goal here is to reduce the financial burden on all levels of the industry, increase the merchandise selection in the stores and offer a 'custom made' piece each and every time... These rings are made for THAT customer. There IS something very compelling about this idea. I didn't think it up, but I see its place. Manufacturers only know Sell To, not Sell Through.. they have no idea how much of their inventory is still sitting in their customer's stores or which items... I think if they did, they would understand the need to participate in the solution. And if you, Mr. Jeweler, (or you, Mr. Manufacturer) want to take a tour of our data, just let me know... and we'll set it up. Abe Sherman, Buyers International Group (BIG) and Balance To Buy (inventory analysis and merchandising) 530-543-1978 Take an hour to see what we see every day and then let us know how to fix it. This needs to be a collaboration and I'm all ears.

Mr. Jeweler (sorry, I don't know your name), The difficult part is already done... the money has been spent, the showcases are full of inventory, cash flow is terrible, manufacturers still waiting to get paid from 2008, are not getting orders for new goods nor are they opening many new accounts and both jewelers and manufacturers are closing all over the country. There is NOTHING easy about our problems, and there will be nothing easy about the fixes. You are very fortunate that you have 5 bench jewelers and can do much of the work in-house... However, there are thousands of retailers who are not as fortunate and have to rely on special ordering bridal while their OWNED showcase goods sit. And if they owe the supplier money right now, they can't even get the special order. The supplier's banker cut him off if the account is past due. Period. You are also fortunate that you have a strong working relationship with your suppliers and can swap back items that are in stock for inventory that your customer needs. So many retailers are not in that position or their suppliers are not in the position (or are just not interested) in swapping a stock ring for a sold special order. What would THEY do with all of those rings that come back? Sell them again? Not likely. Not right now. We are stuck... like it or not. We work with dozens of manufacturers and over 100 retail doors, some of whom are among the highest volume retailers in the country, and I get to see exactly what's working and more importantly where our problems are. Nearly $400 MILLION worth of annual sales data with an average selling price of just under $1,000... we look at a lot of data. Believe me, in my 30 years in retail, I never would have thought I would be advocating carrying B&G samples. But as someone who has been looking at our industry under a microscope for the past decade and analyzes this down to the category and SKU level, I find our current situation untenable. Our industry needs some out of the box thinking and viable long term solutions. Our ever-increasing inventories, declining margins (especially in diamond-heavy businesses) and anemic cash flow requires we look at other options. Unless someone were to open a Samples-Only store, I am not an advocate of a jeweler carrying B&G exclusively, but as a way to expand their selection and minimize their financial risk going forward. At $25 per copy, a store can stock 100 samples at what ONE RING would cost him. 1,000 samples for what you would pay for a single tray of live goods. As to the supplier surviving the next few years, well, they are in exactly the same boat as the retailer. IT'S A MESS, but what would you suggest we do? Keep buying MORE? There is no more room a the Inn for more. I don't agree with the notion that the corner drug store can sell bridal from samples... you still need an educated staff. But hey, 25 years ago, I didn't think selling jewelry on television was going to work either. So, I might be wrong about the drug store selling bridal. The facts are the facts. I don't rail against brands for the sake of railing. I have explained (started 4-5 years ago by the way) that the practices of some of them were dangerous and would have a negative impact on our industry... the increasing inventory levels were not sustainable. Well, the horse has left the barn, the damage is done and we are ALL left with a very difficult set of circumstances. We may as well have been working on Wall Street, selling mortgage backed securities. The heavy-handed hubris of some of these manufacturers are going to put some of them out of business for demanding their retail-partners STEP UP. Well many did and they are stuffed with merchandise right now. Merchandise that isn't selling. Money was cheap. Credit was cheap and we were all dancing like it was 1929... and now the music has stopped. What would YOU suggest we do to fix this? I know what you say you do in YOUR business and again, I applaud your success, but how would you propose we fix these problem? Hey, if you want a tour of a typical jewelers inventory and cash flow situation, just call me and I'll take you through inventory after inventory (without names of course) and then you can let me know how to fix this. We have a multi-BILLION inventory mess on our hands and we need solutions. The fact that I have gone to Canada to visit an extremely successful model in this arena speaks to my desire to understand it. If you've not gone, you might want to take Jeffrey with you. Then post about what a bad idea it is. Actually, they're coming to Houston, no need to get out that passport.

Mr. Sherman, You talk about "unsalable bridal" and "exit strategy" so I would like to address those two points and raise a couple of questions. #1. As a jeweler I can tell you that there are very few instances I can't make something work size-wise, head-wise, etc. to accomodate the sale of an engagement ring. I have vendors who will trade out if necessary to make a sale. That is the kind of arrangements I have made and the kind of relationships I have. And I have 5 good bench jewelers who know what they are doing. And guess what? I sell BRANDS too. The exact kind of company you rail against in your responses above for causing much of the problems in the industry. #2. While it is easy to admit there is a problem with many in the industry being over-inventoried in various things, I (like Jeffrey indicated) see a real problem for manufacturers moving to brass and glass and being able to survive the transition. Questions: 1)How do you propose a jeweler begins to move from selling finished, real jewelry--something a business has been built on--to presenting sample dummys? 2) How do you propose a mfr deals with a jlr who has inventory of his goods and now they try to sell them on B/G? What does the mfr or jlr do with the live goods that haven't sold? 3) How does a mfr survive the next few years, building B/G without making any real volume sales, hoping the B/G product building in jlrs' cases begins to produce re-orders? 4) What happens to the point Jeffrey made about further commoditization of the jewelry industry if everybody is trying to peddle the same thing? It all gets down to price doesn't it? What chance do I have as an independent jlr who has built a certain reputation and foundation over many years? You make it all sound so easy.

I wouldn't be pointing to CB as an example of having a failed attempt at a strategy. Rather, look to the successful multi-store, multi-million Canadian company who has built their business model on this concept and is now coming to the States with the very same plan. But, addressing your point about the retailer not being able to sell the real thing... this isn't the problem. The problem is that much of their inventory is NOT salable, since either the head size is wrong (in fixed-head situations), the ring can't be sized to fit or the customer wants it in platinum instead of 14KW. In effect, the ring is a sample, just a much more expensive sample than the B&G samples we are discussing here. Also, I'm afraid that manufacturers or retails who just expect to put this inventory in the showcases without a significant amount of training and marketing support will not find this a successful program. As someone who analyzes this every day, I can tell you that the overwhelming majority of bridal inventory is aged - there is hundreds of thousands of dollars invested in this inventory and cash flow is terrible. A well evolved B&G program will relieve a portion of the investment issue, while allowing a broad selection of merchandise.

If the retailer can't sell the real thing how are they going to sell brass and glass, this issue is a real problem for the mfr who is hoping for re-orders off samples and placing the success and future of his business in the hands of the retailer who may or may not show, explain and close sales. The last attempt at this was Christian Bernard and where are they now.

Jeffrey, the posters so far do a great job of fleshing out your original post, so I’d like to just answer a question you pose (perhaps rhetorically) that I always find interesting: “After all, what is really the difference between a wedding ring and a washer for a bolt? Is it where it is sold, how it is sold, or what it is made of which makes the difference?” Hands down, where it is sold. Take the bolt washer example, presented at J. J’s Jenkstown Jewelers, and it’s “something the electrician must of forgot in the showcase.” The same item in a vitrine on 57th and 5th becomes a designer piece handled with esteem, and sure to add class and enhance elegance in the wearer. Luis de Agustin

Please go back and read my blogs from the very beginning to get a full understanding of my views on all of the above. I believe I have been quite consistent and thorough on my presentations of these things...even on the role of sales reps. I am well aware of your efforts, understanding and passion, Abe, and have even applauded them here in my blog space. Keep up the good work. I have also been to a Spence store and know that somehow it is working for them as they have cultivated clientele and markets to accept their way of doing business. In fact, there is a jewelry retailer right here in my home town adopting that model as we discuss these things. I raise questions and thoughts to provoke other thought and promote discussion. Thanks for your input.

Continued: "If you have been following my writings the past several weeks you would have also noted the tenor of my conversation on manufacturers and reps. We all know there is a need for change and that many will have to move onto other jobs and undustries as jewelry continues to evolve. And I have made my point time and again on how vendors need to be a more active participant in managing their customers' inventory from them. I just don't think switching it all to brass and glass is the answer the industry is looking for---especially the consumer. " Jeff, I agree that Vendors have to be more proactive in helping the jewelers AND jewelers need to cooperate with their suppliers in this regard. But, let's not just put this on the backs of supplier or retailer, but also bring the sales rep into the discussion. The future of 'sales reps' in our industry will not be about guys showing up, writing an order, and then heading down the road to their next stop. Sales reps will need to be far more educated and participate in the process of inventory analysis and merchandising. There will be a place for a new breed of sales reps who understand their product, but also how to manage the inventory among the stores. The supply chain should include them as well and we had all better learn how to cooperate in this process.

Jeff wrote: "You fail to address the main point of my discussion, which is how the independent jeweler will survive if the industry moves to unsaleable (undeliverable) samples in the showcase. They will not be able to compete on that playing field because they will not be able to sell it cheaply enough." Sorry to rush through these responses... I felt compelled to continue the dialog... it's an important subject. As you know Jeff, the world I live in is largely about how to deal with inventory that isn't selling. There are currently BILLIONS of dollars tied up in non-performing merchandise in jeweler's showcases. I thought my earlier point adequately covered the bridal lines which, in reality, ARE sample lines, only with a much higher price tag. Unfortunately, when a retailer chooses to bring in a new line, and in particular a new brand, the honeymoon is all about marketing, sales training, product training, in-store events, area exclusivity and of course inventory level requirements. All of these are meant to contribute to sales for both parties, and as long as sales continue, area exclusivity agreements are maintained, delivery and quality are as agreed and the jeweler pays his bills!!, all is good in the world. Over the past 12-18 months however, many jewelers are not able to pay their bills, due to the unsustainable inventory levels that had been built over the years. Too much inventory had not been a real problem as sales continued to grow and as you know, volume hides a great deal of sins. The result is manufacturers are not shipping special orders to these jewelers and NEW inventory sales are very hard to come by indeed. In other words, we are at an impasse. This is resulting in manufacturers looking for new 'retail-partners', who are difficult to come by these days, but the relationship with their current retail-partner is damaged or over. As we see these scenarios play out across the country (and work to help as many people come out of this as unscathed as possible), we have to face the fact that all of these non-performing SAMPLES are killing cash flow. As there is NO EXIT STRATEGY in place to deal with this issue, the jeweler is left with little choice. Heavily discount the merchandise should they be lucky enough to find a customer who not only fits the center diamond requirement, but the finger size as well... or break up the item for scrap. I am not advocating B&G sample lines to the exclusion of live goods (in most cases), but as an adjunct to the jewelers assortment. Although I'm happy to make the argument that there WILL be bridal stores whose assortments will largely be comprised of sample merchandise. If you've not been to a Spence Diamonds store in Canada, it may be worth the trip... Let's continue the dialog.... this is a big and important subject with many working parts.

Abe, You fail to address the main point of my discussion, which is how the independent jeweler will survive if the industry moves to unsaleable (undeliverable) samples in the showcase. They will not be able to compete on that playing field because they will not be able to sell it cheaply enough. You mistakenly identify another point as selling something for more than it is worth. I am not advocating that. In fact, I argue exactly against that in my discussion of titanium and tungsten rings, which aren't worth NEARLY what they are being sold for and sold as. Many in the industry have far too eagerly accepted price as the sole motivating factor for someone to make a buying decision. My experience as a consumer and an industry professional has been quite different. I am telling you that it is all about VALUE and not just about PRICE. When you compete on that level and philosophy there is always going to be someone willing to sell it cheaper. Please don't mistake my commentary for advocating jewelry be sold for more than it is worth. I do know that fewer and fewer are capable of making a compelling argument to the consumer as to why they should buy real precious metals over something used for hip replacements and golf clubs. They have been hoodwinked into believing they are doing their customer a favor by selling them the cheapest thing in the store and all the while eroding profit dollars, if not margin. It's all about VALUE, Abe, not just getting them to spend more money for the sake of making a bigger sale. And if you have read my blogs in the past you would also know my thoughts on jewelry "brands" and how they have helped get jewelers in the over-inventoried positions they are in today. In this blog I am raising questions and thoughts about what Brass and Glass will mean to the independent jeweler business. I agree with you that many "Costco-types" will have difficulty implementing an order-as-you-go system. I think most ALL will have difficulty with managing customer expectations and ensuring results. If you have been following my writings the past several weeks you would have also noted the tenor of my conversation on manufacturers and reps. We all know there is a need for change and that many will have to move onto other jobs and undustries as jewelry continues to evolve. And I have made my point time and again on how vendors need to be a more active participant in managing their customers' inventory from them. I just don't think switching it all to brass and glass is the answer the industry is looking for---especially the consumer. As you said, we'll see.

Jeffrey wrote: "Profit dollars are already eroding and a jeweler makes a conscious decision to make less by selling lower cost goods rather than getting better at convincing customers why they should spend a bit more to get something of real value. I don't get it. After all, what is really the difference between a wedding ring and a washer for a bolt? Is it where it is sold, how it is sold, or what it is made of which makes the difference?" I'll get to your overall discussion in a bit, but to this particular part of your post, this "convincing customers to spend a little more" is one of the strategies that have gotten us into such a cash flow problem to begin with. Branded lines supposedly have 'added value' to the cost of materials and those same branded lines then dictated how much inventory the jewelers needed in order to maintain the Brand's Integrity by proper representation. It's that SAME inventory that is now sitting in jewelers showcases, unsold and unappreciated by the consumer... And so, we are stuck. I think it will be a while before the country as a whole will want to be 'convinced that they should pay a little more'.... for anything, not just jewelery. Now to your post about the Brass & Glass concept becoming the catalyst for the undoing of our bridal business, I think the proof will be in the job itself, not the samples. If anyone has worked in a retail store, they know how challenging it is to train staff in the myriad issues concerning getting a bridal ring made right the first time... I can't imagine people in Costco getting this right the THIRD time... it's not their subject and never will be. I'm afraid that sales reps are already an endangered species; fewer and fewer stores, larger territories and increasing travel expenses are eating these guys up. Add to that the pressure on the manufacturers and I don't see many of them being on the road in 5 years. The very idea that the reps job has to change and change dramatically actually makes the argument for a B&G program to be implemented. Their job would be to train, train and then train some more. The Canadian version of what you are describing is very successful and now that they are 'coming to America' we'll see how they do in the states. One last thing about 'samples'. The reality is most of the branded bridal lines are already sample lines, just very expensive sample lines that the suppliers won't swap for new head sizes so the jewelers get to hold on to their $80,000 worth of sample from each supplier. Does this make sense? When margin was better, the jeweler was able to afford to keep this inventory, but as the margins have eroded in center stones, the cost of carrying this inventory has become difficult - which is what started this conversation in the first place. Sample lines have a place in retail stores and if done properly, should be very successful. Since bridal is often special ordered anyway, this is just one more version of the sample. Done properly, it won't be an issue.

Jeffrey, Your commentary on the industry so often goes against conventional wisdom. It is refreshing to hear a well thought out, honest and upfront opinion that does not seem to be tainted by bias. Thank You!