A Way With the Crutches!

Geography is one of the most persistent elements factored into any economic forecast. It’s a favorite cause-and-effect; because such-and-such a region’s having tough times, businesses there must suffer.

Let’s look at a couple of recent examples in our own industry.

Midwest manufacturing collapsed as the auto and steel industries were undermined by foreign competition. As factories closed or cut back, the Rust Belt was born – and jewelers’ sales had to suffer.

Then New England caught it in the neck. The Massachusetts boom, fueled by a mix of government contracts and hi-tech industries, went bust – and jewelers’ sales had to suffer.

Next it was California’s turn. Thousands of jobs were wiped out as funding for military and space projects was throttled – and jewelers’ sales had to suffer.

Many jewelers in these three broad markets did suffer as a direct result of the regional economic downturns. But, guess what? Some jewelers in each of these markets did very well, even in the worst of times.

In late August, I talked with two jewelers attending the Los Angeles Jewelry Show. Both do business in the same Southern California market. In addition to problems caused by big layoffs in their area, both are in financially-troubled Orange County, another source of economic unease.

Jeweler No. 1 conceded that times are tough but said you have to go out and work harder to make sales. This jeweler’s 1995-to-date sales are up 30% from 1994 in one store and 80% in another.

Jeweler No. 2 said there’s no hope of doing well in such an economy. This jeweler is talking about closing down.

This story and many similar ones make me believe that it’s high time we stopped paying so much attention to geography in our business forecasts. Of course it’s a factor. But it should be considered a factor to deal with, not an excuse. Too often blaming outside forces for inside problems means using them as a crutch. Shrewd businesspeople know that crutches are for the sick, not the healthy.

Jewelers who’ve seen some of their best customers laid off or living in fear of layoffs no doubt will say: “You’ve no idea how bad it is! You haven’t lived through what we’re living through.” I can’t answer from personal experience because I don’t own a store. But I can point to jewelers, such as the very successful one in Southern California, who are living through the worst of times and coping very well.

At the heart of most success is someone who acts rather than reacts. We need more acting and less reacting, less stalling, less reliance on crutches.

The starting point is to accept what is and determine how to deal with this reality. The next logical step is to have a plan, a roadmap of where you want to go. A good plan is essential, no matter how small the business.

One of the great strengths of the jewelry business is that it meets the needs of customers who want to celebrate gift-

giving occasions – marriages, anniversaries, birthdays, graduations among them. These occasions are unaffected by any economic circumstance. They occur as regularly and inevitably as the sun rises. The jeweler who really knows his or her market and understands the stresses and strains it is undergoing can adapt inventory and selling strategies to meet customers’ gift needs. To say that you can’t reach such customers because the local economy is in trouble is defeatist and, very likely, a self-fulfilling prophecy.

This month and last, we have a series of articles, based on talks given at the JCK Las Vegas show, on steps jewelers can take to improve business. Most center on hiring, training and motivating a top sales staff – a clear priority. But there’s much more involved in building a business. The people who run GIA’s Advanced Retail Management System course (GIARMS) neatly pinpoint some other priorities with their focus on what they call the 4 S’s – stock, suppliers, staff and self.

If a jeweler drawing up a 1996 business plan does no more than address these four issues – and thinks through how to deal with each in the coming year – then that jeweler has a good chance of being a winner with both sales and profits. Chances are the real winners will be those who deal honestly with the issue of “self.” When the owner has a positive and can-do attitude, it’s amazing how much the rest of the staff will be stirred up to make good things happen.