Your recent article titled “The Coming Decade: Golden Times Ahead?” (JCK, January 2000, p. 84) included a quote from Ken Gassman Jr., who is a retail stock analyst. Gassman states, “The chains have the clout to buy better than the independents and therefore keep prices in line.” While on the surface, many would feel this statement is true, if we really look at the reality of purchasing inventory, I believe you’ll see that the exact opposite is true.
While it’s true that buying $1 million of a certain product will most likely lead to a lower price than if one were to purchase $20,000 worth, how many large chains will write a check for that $1 million purchase? Few, if any. Their purchase is typically financed with interest rates in the 8% range. I, on the other hand, may pay 4% more on the front end because I’m purchasing a smaller quantity; however, I can avoid the 8% interest finance charge incurred by the big boys by being able to pay quickly for my purchase. I’m already 4% ahead on the front end! Add to that the fact that I can afford to work closer on my margins for various reasons, such as lower advertising costs and lower rents. One can now understand that the independents are actually buying better than the chains. This is, quite simply, why we don’t feel the need to run misleading 50% to 70% off “sales,” yet our bottom line continues to look good.
The coming decade does look good, but only for those retailers who can grasp that customers don’t want to be deceived anymore. They want great product, great service, knowledgeable salespeople, and a great atmosphere to shop in. The independents are positioned to give all this, and more.
Gary Youngberg, President, Ames Silversmithing, Ames, Iowa
A Bittersweet Farewell
After almost half a century in the jewelry business, I have sold my store and retired. I do so with mixed emotions, as it has been interesting, challenging, exhausting, and exhilarating.
Mardon Jewelers has been sold to my manager of 15 years, Jim Sweaney. He will continue to run the store in the American Gem Society tradition.
Through the years, so many sales reps have visited with me. They have introduced me to many wonderful products and have been extremely helpful. I can’t thank them enough, as they have gone the extra mile many times.
Jewelers’ Circular Keystone has been more than a magazine. It has been a valuable source of information. It has inspired me in so many ways and introduced me to countless new styles and better ways to succeed. I looked forward every month to reading it.
I thank you and your staff, past and present.
Don Harris, Mardon Jewelers Inc., Riverside, Calif.
Suppliers as Competitors
It happened again today. A young man walked into our store asking if we would sell him a mounting and set a diamond he had recently purchased elsewhere. We had shown him diamonds in the past and had educated him about the “four Cs,” but when it came time to buy, he went to an importer. Has this ever happened to you? If you own a retail store, I’m sure it has.
I don’t appreciate the fact that often my suppliers are my competitors. Everyone in our industry is so anxious to make a sale that suppliers are cutting the throats of retailers and inevitably their own throats. Retailers can’t afford to stay in business and offer a vast range of services if they aren’t allowed to sell product (today’s young man paid 20% off the Rap sheet for his diamond). In this case, the young man had spent more than $6,000 on the diamond and was looking to spend $500 on the mounting.
Let me offer another scenario: A diamond importer receives a call from a consumer. The importer asks if the customer has a relationship with a retail store. If the answer is yes, the importer gets the name of the store and tells the customer that he or she will call that store and arrange to ship the appropriate diamonds to the retailer. If the customer has no such relationship, the importer could ask what community the consumer lives in, then look up a retail source in the Jewelers Board of Trade book, suggest a store, and make the call.
Imagine the goodwill that would be generated by such a call. Everyone would win. The customer would receive the attention from a local resource that all diamond customers want as well as the opportunity to develop a relationship with a local retailer. The supplier would make a sale and win the alliance of a retail store. As we look at the homogenized world around us, Mom and Pop stores of every description are disappearing. Let’s guard our industry against the trends of other industries. Save the retailer!
James L. Alperin, James Alperin Jewelers, Chagrin Falls, Ohio
A photo caption on p. 70 of JCK’s January 2000 issue included incorrect distributor information for Jörg Hysek’s new line of watches. The watches are distributed by Chronotime, 600 S. Livingston Ave., Livingston, NJ 07039; (800) 364-5441.
The promotional supplement “Turkey in the New Millennium,” published in the January 2000 issue of JCK, included incorrect information about Anagold Corp.’s manufacturer members. Atasay and Temizocak Altin are gold jewelry manufacturers. Bedri & Yolaç, Med-Art, and Sümer are diamond jewelry manufacturers.
JCK welcomes letters. Please include your name, address, and telephone number. Letters may be edited for clarity and length. Jewelers’ Circular Keystone, 201 King of Prussia Rd., Radnor, PA 19089; fax (610) 964-4481, e-mail: firstname.lastname@example.org