Thriving in Troubled Times: With a Little Help From My Friends

“No man is an island,” wrote John Donne, the great English poet, and that’s also true for businesses.

Active involvement, say many jewelers, in a group of fellow jewelers or other businesspeople is important to their businesses and to them personally. A recent JCK poll of hundreds of independent jewelers finds two in five are in a business group of three or more jewelers (excluding national trade or buying groups) that meets periodically.

Those groups share some common threads: Member businesses are comparable in size and have similar challenges, and sometimes they swap slow-moving inventory. Groups are often circles of likeminded friends, which is just as important as business considerations.

Membership costs vary from nothing for informal groups to thousands of dollars annually for business-mentoring groups. Whatever the cost, many independents have high praise for business groups, especially in tough times. As a Maryland jeweler in a business mentoring group declared, “It’s worth every penny and more.”

Following is a look at some of these groups, and how they help their members.

Informal Groups

A group of 20 Philadelphia-area jewelers, none direct competitors, has been meeting for 20 years. “We talk about inventory, marketing, promotions, problems, what will or won’t work for a holiday season, and get each other’s feedback,” says member Cathy Calhoun, Calhoun Jewelers, Royersford, Pa. They meet every other month at a restaurant for a meal and a roundtable discussion.

Members interact in many ways, says Calhoun. “We advise each other. If a jewelry line works—or not—we share that. We report on turns we get on things. We regularly check with each other if we need something. For instance, a customer wanted an opal and ruby necklace. I didn’t have one and contacted my friends in the group. One did, sent it to me, and I made the sale. Another member planned an estate jewelry sale, and asked us for some. I sent some very nice pieces.”

Members attend jewelry shows together, including the gem shows in Tucson, Ariz. “If one finds a great deal, he or she calls the others’ cell phones,” Calhoun says. “We swoop in and buy as a group.”

Helping one another takes various forms. When Calhoun bought a free-standing building, the group showed up in work clothes (with sandwiches, soda, and beer) and helped her move in, all in a single day. When another member’s store burned, the group brought showcases, installed them, and cleaned and sanded his tools. He was back in business in a week.

“You’re not alone, especially when you have problems,” says Calhoun. “We’re always in contact. We give each other psychological and moral support, share ideas and inventory, and alert each other to manufacturers and products to carry or not. It’s a good security blanket, knowing these people are there for you.”

In Texas, about a dozen Houston-area jewelers meet for breakfast at a pancake house the second Friday each month. “We talk about business and what’s happening, hear new ideas and what’s working for each,” says Ronald Miller, president of Meyerland Jewelers, who helped start the group a few years ago.

Some jewelers won’t interact with others for competitive reasons, but Miller takes a different view. “Competition doesn’t mean you fight everyone on everything,” he says. “The idea is to help each other. We talk about what we can, like commonsense stuff on markup, who’s a good refiner, or new merchandise. Representatives of vendors, insurance and alarm companies, and law enforcement also come and talk.”

Members share problems and solutions. Miller recalls one member who was sued by a customer who claimed he had replaced the diamond in her ring with a CZ. The “diamond” was a CZ all along, but it wasn’t noted on the receipt. “So now, we all use take-in envelopes with disclaimers that an item for service or repair has been examined, and list its value, which the customer must sign. It’s helped considerably,” says Miller.

“The main thing is, this is a circle of friends,” he adds. “We all work very long, hard days in the jewelry business. So it’s good to kick back with friends with common interests and knowledge that you and they want to hear.”

National and Regional Networks

Charlotte Preston Catalysts Inc., White Bear Lake, Minn., administers a group of eight noncompetitive jewelers from the eastern United States. “We focus not only on money management, but all aspects of a small-business owner’s involvement in his or her community,” says Preston. “We also help each maximize their assets, which aren’t only economic, but include others, like their—and their staff’s—physical energy levels, important in difficult times.”

The group meets three days in spring and fall at a member’s store, and each member gets time to talk about issues such as employees, training, and strategic planning. Then the group problem-solves together, says Preston.

Members are in phone and e-mail contact, and Preston contacts each before sending a monthly newsletter. Preston says, “The group’s real power, though, is members’ honest and confidential interaction, finding in each other’s experiences and knowledge the resources and feedback to address each one’s business needs.”

Groups also provide moral support. Newport News, Va., jeweler David Nygaard is in a group of a dozen local small-business owners, part of the national C12 network of groups of businesspeople who integrate faith and business. When 2008’s credit crisis struck his business, members’ support provided a lifeline.

In April 2008, Wachovia Bank—then in uncertain financial straits—called in the full amount of Nygaard’s long-term loans, despite his good credit history, forcing him to begin liquidating inventory. In late June it seized his assets (including money for employees’ last paychecks), froze his accounts, and sold the remaining inventory. Nygaard had to close his seven stores immediately, costing 35 people their jobs.

Nygaard’s fellow C12 members responded quickly, he says, providing money to reopen a smaller store. One hired him as a marketing consultant, and others frequently take him to lunch and offer encouragement. It helps, he says, “to have the encouragement of these Christian men of business, who also face these fears, some who’ve had bankruptcies, too, and who provide good, relevant advice from personal experience.”

The Gemological Institute of America’s local alumni chapters enable GIA grads to socialize and take field trips, but they also help their businesses. John Anthony Jr., of John Anthony Jewelers, Bala Cynwyd, Pa., serves as president of the Delaware Valley chapter, which encompasses southeastern Pennsylvania, southern New Jersey, and northern Maryland. “You make acquaintances here, especially important in times like these if you need a product or information about something and must call someone,” Anthony says. “Not next-door competitors, of course, but if a store 20 or 30 miles away needs a gemstone, for instance, and you have it, it’s stupid not to move that for your benefit and theirs.”

Anthony adds, “We help people get in touch with each other, hold roundtable discussions, trade products—if it isn’t selling in a particular area—and bring in experts who tell us how to build up and protect our businesses.”

Business Mentoring

For some jewelers, participating in groups overseen by business tutoring firms improves—and sometimes rescues—their businesses.

Karin Volz, owner of Kloiber Jewelers, Milwaukee, is a client of Focus Business Management Institute, Henderson, Nev., which has taught good business practices to hundreds of jewelers. A couple of years ago, before signing on with FBMI, Volz thought she would have to sell her store or liquidate. “Now I’m out of debt, in the black, and operating my business in a disciplined way, instead of flying by the seat of my pants,” she says.

FBMI clients also benefit by interacting with other jewelers, starting in FBMI’s seminars. “They form informal groups right from ‘go,’ working with the same people,” says Don Grieg, FBMI founder and president.

“At those intense seminars and meetings, with their wonderful marketing ideas and business tools, we meet people we respect from around the country, with whom we exchange business cards, interact with by e-mail, calls, and at meetings, bouncing ideas off each other,” says Volz. “Sharing helps us all in difficult times.” Group members also get together at trade shows and on a chat channel on FBMI’s Web site.

Nelson Coleman Jewelers, Towson, Md., is a client of Business Resource Services, in Seattle, which works with businesses to improve financial operations, cash flow, and profits. A key element is performance groups of similar-size businesses in the same industry, which become a board of advisors for each other.

As Zachary Coleman, Nelson Coleman’s comptroller, notes, these are “people dealing with the same things as you. You see what they do, share success stories, really get to know each other, and develop a partnership of friends.”

Coleman’s group has eight jewelers across the country. “We have monthly Friday morning conference calls to exchange ideas and talk about burning issues,” says Coleman. Topics include cutting expenses, inventory problems, marketing ideas, suppliers, and legal issues.

The group meets twice a year for three days at a member’s store, where they review each other’s financial data and also assess the guest store. They go department by department, talking to employees and observing operations. “Then we make recommendations, giving as much helpful input as we can,” Coleman explains.

“That helps us all, too,” he adds. “In our own store we’ve instituted operational, inventory, and office procedures we saw in other stores that cut expenses and increased profitability.”