The Silver Lining

I believe most Americans have a positive outlook. This morning’s Wall Street Journal is a good example of the search for the positive out of the lousy economic times we’ve endured for 15 months. A lead story titled “Markets Approach Milestone Levels” stated that “… the outlook brightened following a string of reports showing signs of a pickup in the labor market, service sector, and housing.”

Looking for signs of a pickup in the jewelry business depends on who is telling the story. Retailers looking for a positive slant will tell you business is all right but not great. Manufacturers will flat out tell you business is awful.

During the past 15 months there hasn’t been much merchandise enthusiasm or excitement for retail jewelers or their suppliers. It’s the result of the many negatives we’ve faced during this period. Our sense of stability has been shaken. Our concerns for the future have been challenged. We see enormous sums of money being spent with little tangible positive results. We seethe Congress enact new health care legislation and call on the congressional carpet the CEOs of firms who revise their earnings to reflect the added costs the new legislation imposes on their firms, as required by SEC regulations. The absence of the common sense, practical, operating knowledge of operating a business in Congress is amazing. But I digress.

The one silver lining in the industry experience is silver jewelry. Fueled by high gold and platinum prices, silver became a vehicle for manufacturers and retailers to meet “reasonable” price points and yet have a product that has some design, weight, and heft to it.

Abe Sherman, of Buyers International Group, has analyed retail jewelry price points and concluded that many if not most jewelers are way out of balance in their inventory positions by price point. They have too much of higher-price goods and not enough popular-price jewelry.

In these tough economic times, silver jewelry provided the product and price points that consumers want. The only excitement at last year’s JCK Show in Las Vegas from a merchandise perspective occurred at booths displaying a wide array of silver jewelry. Firms like Pandora and Belle Etoile enjoyed excellent business. The business has continued to show strength at retail.

In Charlestown, S.C., I visited a Pandora shop and spoke with the owner and one of the sales staff. Their enthusiasm for the company and the product was infectious. The store incorporated the official Pandora look and display methods. There was plenty of merchandise to talk about, and even better was the story line these two young women used with their customers, mostly women. They were having fun.

On another trip, to Palmyra N.J., I had the opportunity to speak with Anthony Fratto, the owner of Anthony’s Jewelers. He too reported excellent sales of silver jewelry, Pandora in particular. As a result, they’re in the process of installing a Pandora Shop within the store.

Generating traffic in a jewelry store requires good product at popular price points and enthusiastic, knowledgeable sales staff. There truly is a silver lining in these tough times, as these examples clearly show.

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