Truly Global

More than most businesspeople, jewelers are aware that they are part of an international market. Much of the product sold by jewelers comes from overseas. And jewelers are a traveling lot, both for business and for pleasure. It seems that someone you know is forever just back from some exotic location or just about to board a plane and fly there.

But for all this involvement in the world outside the U.S., there still are many in the industry yet to be concerned or convinced that a global jewelry market already affects business here directly – and will have a much greater impact as the years pass.

How events elsewhere in the jewelry world affect us here shows up in many ways. Some examples:

Growth of demanding and often sophisticated jewelry markets outside the U.S. means increasing competition for raw materials. This, in turn, usually means higher prices.

Growth of these new markets also means a lessening of U.S. influence and importance in the jewelry world. This is particularly apparent in southeast Asia. Only a decade ago, most jewelry manufacturing in that region was directed almost entirely to satisfying the U.S. market. That is no longer true. Many firms now are more interested in selling in Europe, Japan or in their own rapidly emerging domestic consumer markets. The outcome: U.S. buyers can no longer call all the shots or get first pick of available goods.

Major supporters of the industry here are spreading their interest – and their dollars – more widely to build or improve their presence in non-U.S. markets. Both De Beers and the World Gold Council are making major commitments in southeast Asia and, while both still actively support the U.S. industry, it’s clear that they’re very excited about long-term potential in the Far East.

Add up all these trends and a fairly clear picture emerges. It is of a world jewelry market in which the U.S. is but one of many players, albeit a very strong one. This sharing of prominence, of influence and of resources is a new experience. But it need not be damaging. Nor should it be if U.S. jewelers recognize that the jewelry world is changing and then adapt to deal with that change. Those who accept and like challenge will face few problems.

What’s it going to be like in this truly global jewelry market? The most obvious truth is that it’s going to be tougher to make a good living. Efficiency will have to pervade every aspect of the business and the best place to start is with the annual business plan, a fact that raises immediate concern. Too many jewelers do not put together such a plan. It’s easy to explain why: they lack time or expertise or, most commonly, motivation. In a market where already intense domestic competition is compounded by the added stress of global competition, these explanations will become irrelevant. You play in the big time or you don’t play at all.

This doesn’t mean that you have to run a mega-operation to succeed. Size is not the issue. Efficiency, expertise and focus are what matter. In fact, the independent jeweler who runs a smart business, who is a specialist in unusual merchandise, who understands enough about world trends to buy wisely and well, and who puts a premium on quality and service is far more likely to succeed than the major operator which tries to compete with bread-and-butter merchandise and an indifferent staff.

Buying wisely – in terms of both product and price – will be critical. The smart jeweler must have intimate knowledge of customers and their tastes. He or she may not wish or be able to travel to buy at the source, but must know enough about world markets to seek the best possible prices from regular suppliers. Close retailer-supplier relationships will be very important.

Inventory management will be just as critical, in buying and in knowing when and how to get rid of non-sellers. There’s got to be more flexibility in balancing markup and turn than there is now in many stores.

The good news is that the full impact of the global jewelry market hasn’t hit yet. So there’s still time to get ready. But not a lot of time. If you’re not in training for the new world now, better make it a top 1995 priority.