New York-based Nissko Jewelry Trading has launched a closeout division targeted to independent retailers and wholesalers. The new business, named United Manufacturer’s Jewelry Outlet, opened in December. Officials at Nissko say they have teamed up with six other manufacturers—who prefer to remain anonymous—to offer small-quantity closeout goods such as samples and small returns at the kind of rock-bottom prices usually reserved for major retailers.
“Small-quantity closeout merchandise has become an increasing problem for all manufacturers,” notes Avi Nissanian, president of Nissko. “Both independent retailers and some wholesalers would like to participate in this market but can’t purchase thousands or even hundreds of a single style. Meanwhile, there exists a gap in the marketplace between many of the larger manufacturers who cannot or do not sell to small wholesalers and independent retailers on a regular basis. [UMJO] provides an economical channel for these smaller buyers to buy closeout merchandise directly from large manufacturers without the higher cost associated with brokers of closeouts.”
Nissko specializes in colored stone jewelry for the majors. According to Nissim Kontente, chief executive officer of Nissko, the firm didn’t have enough diversity of merchandise on its own for the showroom, so it linked up with manufacturers that specialize in areas other than colored stones, such as diamonds, gold, and pearls. Although UMJO is a closeout business, Kontente stresses that the merchandise isn’t “closeout quality.” “Most large manufacturers have thousands of pieces of beautiful, first-line samples that for one reason or another didn’t fit into a retailer’s merchandising plans,” he says.
Nissko has instituted a “cash and credit cards only” policy for UMJO customers so it doesn’t have to deal with the kind of “extended payment terms” it often must endure when dealing with major retailers and wholesalers. “We don’t want to be bankers,” Kontente said. “We don’t want to worry about JBT ratings, slow pays, collections, or bankruptcies. We’ll sell to anyone with cash.”
Although the division is a joint effort between Nissko and its partners, it’s still a Nissko operation, with the firm providing staff, location, and opportunity. Eventually, UMJO will advertise, have a Web site, and exhibit at trade shows, Kontente says. It may also look to establish a membership of selected buyers that would receive special promotions and incentives to buy a certain amount of merchandise per year through UMJO, he adds.
Nissko executives say there are a number of manufacturers that have already expressed interest in joining UMJO, including firms from Hong Kong and India. Others are taking a “wait-and-see” stance before they decide to join the business.