Jewelers Saw Theft Loses Rise In 1996
While U.S. retailers as a whole saw their losses to employee and shopper theft drop by .1% in 1996, retail jewelers’ losses rose .17%, according to a recently released University of Florida survey of retailers.
The survey polled 227 retail companies in 24 different markets. These firms had an average of $1.6 billion in annual sales and 320 stores each, with 49 employees per store; median sales were $235 million per chain. It found these retailers as a group lost 1.77% of their annual sales to worker theft, shoplifting, accounting mishaps and vendor cheating. The loss rate in 1995 was 1.87%.
Ten jewelry chains, each with an average of 376 stores and 11 employees per store, responded to the survey. They reported a shrinkage rate of 2.27%, up from 2.10% in 1995.
According to the report, employee theft was the biggest source of loss, followed by shoplifting. The figures:
The survey asked participants to estimate the average dollar loss for three of the more prevalent types of retail crime. In most of the types of retail markets surveyed, the dollar loss per incident was by far the highest for armed robbery, followed by employee theft, with shoplifting third. The high price and small size of merchandise help
explain why shoplifting and armed robbery incidents were much more costly for jewelers than for other retailers.
The survey also asked about cash thefts. Here jewelers did better than other types of retailers. They suffered an average cash loss of $20,522 (per $100 million in sales), compared with $77,729 for the whole group.
Other crimes contributing to overall losses by jewelry retailers (stated as incidents per $100 million in sales):
Payment in the form of a bad check, 405
Credit card fraud, 82
Empty package discoveries, 56
Price tag switching, 25
Vendor fraud/theft, 25
Customer refund & return fraud, 24
Counterfeit currency, 11
The jewelry firms surveyed reported they locate 62% of their stores in enclosed malls and 25% in strip malls; the remaining 13% are stand-alone stores. In addition, 62% are in suburban locations, 20% urban and 18% rural. – Karen Scanlon
Gold jewelry sales rose 2.5% to $2.3 billion for the third quarter of 1997, reflecting gains in all distribution channels except catalog showrooms, reports the World Gold Council. Unit sales were up 6.7% to 25.9 million units in the quarter. For the year to date, sales rose .4% in dollars and 2.7% in units compared with 1996.
Department stores showed the greatest growth, with gold jewelry dollar sales up 7.6% and unit sales up 7.4% from the year-earlier period. Independents were close behind, with sales up 7.5% in dollars and 6.4% in units. Chain jewelers also did well, with increases of 5.1% in dollars and 6.1% in units. Difficulties in the catalog showroom sector forced dollar sales for the discount/catalog showroom sector down 12%, despite a 5.9% increase in unit sales.
“The ability of the other channels to make up the losses experienced in the catalog showroom sector indicates the vitality of the gold jewelry category, especially going into the fourth quarter, traditionally the most important sales period,” says Michael Barlerin, regional chief executive, Americas, for the council.
Earrings did especially well, with unit sales up 22.5% and dollar sales up 14.6% from a year earlier. Bracelets and charms also showed steady growth, with bracelet sales up 7.5% in units and 8.2% in dollars, while charms gained 6.1% in units and 5.8% in dollars. – Karen Scanlon
U.S. workers were in high demand in 1997. That’s expected to continue through the early part of this year, according to the Employment Outlook Survey conducted by Manpower Inc., Milwaukee, Wis.
In the quarterly survey of 16,000 businesses, 24% foresee an increased need for workers (compared with 21% a year earlier), while 62% expect no change in demand (compared with 64% in ’97). Only 10% plan to cut payroll (vs 11%) last year, while 4% are uncertain (down from 5%).
Mitchell Fromstein, CEO of Manpower, says there’s never been a stronger first-quarter outlook in the 21-year history of the survey. He notes that patterns of hiring intentions remain uniformly strong in all regions of the country.
The outlook for retail workers is promising. The survey says post-holiday staff trimming will be less severe than usual. Thus, 22% of those surveyed say they’ll continue to hire into the first quarter of this year; only 17% plan to cut staff. – Alisa Bland
Platinum Demand topped Supply in 1997
As a result of the suspension of Russian exports of platinum during changes in control of the Russian precious metals industry in the first half of 1997, world supplies of the metal were expected to drop by more than 200,000 ounces by the end of 1997, according to Johnson Matthey.
Although shipments from South Africa were on the rise, they did not fully compensate for the loss of the Russian supply. South African producers were reviewing their operations and supplies in anticipation of a continued shortfall in supply, but they already were operating at levels close to capacity.
This production shortfall, combined with increased demand, was expected to produce a 320,000-oz. deficit, the first for platinum since 1988.
The biggest increases came in fabrication of platinum jewelry in the United States and China. Sales of investment platinum also increased as the United States Mint released the American Eagle platinum coin in 1997. – Alisa Bland
|Source of shrinkage||Retail jewelers||All retailers|
|Source of loss||Retail jewelers||All retailers|