When the economy is weak, your stock of basics should be strong. And when the economy is trong, your stock of basics should be … strong. That’s the advice of both business experts and successful jewelers.
“These ‘basics’ are your best sellers with the highest turn in tough times and good,” says retail consultant Janice Mack of Performance Concepts Inc. They’re “what people ask for every day,” adds Lori Askew of the Vantage Group. “It’s critical that your business keep them in stock in a variety of price points at all times.”
A store’s basics reflect its market, of course, but usually include diamond studs, pendants, and solitaire earrings; three-stone pendants and rings; pearl earrings and necklaces; best-selling watches; gold bangle bracelets; birthstones; and bridal jewelry, not only for the bride and groom but also for the bride’s mother, maids of honor, groomsmen, and ushers.
Good brand-name products are important, too, says Canadian jeweler Jeff Buzbuzian of Knar Jewellery, Waterloo, Ontario. “They give customers assurance that they’re buying quality. In tough times, especially, people want guarantees when they make big purchases.”
Informed selling. In general, 80% of sales come from 20% of the people on a store’s customer lists. That’s why Buzbuzian advocates “informed selling, which is knowing your customers and what they like.”
For Buzbuzian, who lectures on inventory management, “[customer] data is king.” That includes not only a record of purchases (product, frequency, spending level, even the salesperson) but also personal data.
“We collect as much information as possible about customers and their relatives—birthdays, anniversaries, ages, hobbies, sports they play, country clubs, even hair color,” he says. Those details help him understand what customers want for themselves and for others. When customers visit, “we review our lists to recommend specific items,” says Buzbuzian. Last Christmas, for example, six top clients were in the store at the same time. “Our lists enabled us to do $80,000 of business in 30 minutes,” he notes. “It takes time and effort to compile data, and you must be organized, but it’s worth it.”
Precision buying. Buzbuzian also recommends “precision buying.” “When I go to trade shows, I have detailed customer lists in hand [that say] what a client likes, his ‘hot list’ items, what his wife likes, and what we’ve recommended,” he says.
Review, too, what clients purchased last year. “A guy who bought a Rolex or an anniversary ring last year probably won’t this year,” says Buzbuzian. “So, have something ready that matches what he bought—such as carat diamond earrings or a magnificent opal bracelet—when he comes for another anniversary gift.”
Jeweler Tom Light in Hattiesburg, Miss., agrees. “In a small town like this, people go to the same events and see each frequently,” he notes. “If you buy an expensive piece from us and later see somebody with the same thing, it takes the fun away. So, if somebody wants an expensive piece [like someone else’s], we order something similar.”
Buzbuzian also suggests reviewing last year’s sales—monthly, quarterly, six-month, and annual—by department or category. “If solitaires sold well last year, do you have enough to match that this year?” he asks. “What do you need for quick sales? What do you need for special orders—usually bigger diamonds—and what mountings? Put together a small program for those, with catalogs and pricing sets, and you’ll close those sales faster.”
Specialize. “There are a thousand-and-one outlets for jewelry,” notes Light. “So, be different and create a niche that sets you apart, with things you carry exclusively or something you do best, such as custom design.” Light, for example, is the exclusive retailer in his region—and in some cases, for the entire South—for a number of lines. “We avoid trendy stuff and go with one-of-a-kind things, exclusive lines, and a lot 18k and platinum,” he says.
“Once you have a niche, cultivate it in good times and bad,” adds Terry Ianuale. “Don’t deviate from it if the economy weakens, or you’ll confuse customers. Stay focused on who you want to be.”
We asked the JCK Retail Panel the following questions about their inventories: What are your top 10 basic items? (In descending order)
|* Equals more than 100% due to multiple answers
Source: JCK Retail Panel, February 2002
|1. Gold chains (all lengths, rope, cable, snake, etc.)||71.4|
|2. Diamond studs||66.7|
|a) .50 ct.|
|b) .25 ct.|
|c) 1 ct.|
|d) .33 ct.|
|e) .75 ct.|
|3. Wedding bands (plain, white/yellow gold)||39.5|
|4. Diamond pendants and/or necklaces (incl. 21 solitaires)||28.6|
|5. .25 to 1-ct. loose diamonds (incl. 17 rounds)||27.2|
|6. Diamond anniversary rings (gold and platinum)||20.4|
|7. Diamond solitaire rings||20.4|
|a) .50 ct.|
|b) 1 ct.|
|c) .25 ct.|
|8. Colored-stone rings||20.4|
|9. Pearl stud earrings (5.5 mm to 7 mm)||18.4|
|Has this list changed over the past five years?|