RAPAPORT... The 4Cs are not the only things that make a piece of diamond jewelry a sales winner. In an ongoing series, RDR explores the “3Ws” — what’s selling, what’s not and why — by going straight to the people who really know — jewelry retailers. Each month, we ask a sampling of retailers to comment on the important issues that are facing the industry today. Here is what they had to say when asked: Which types of diamond jewelry do you think will be the hot sellers for 2008? What will you be stocking for the new year?
DENIS BOULLE, OWNER
DEBOULLE DIAMOND AND JEWELRY
DALLAS, TEXAS
“I actually think that color is going to do more. I very strongly feel that sapphires, emeralds and rubies, in that order, are going to be stronger. We’re already seeing a bigger increase on those because diamonds are priced so high that they’re not even in the realm any more.
“We’ve found large — 10- to 20-carat — sapphire rings have done well, and also necklaces, then earrings, matching earrings and necklaces. People are going more to the sapphires and emeralds in solitaire rings. We’ve sold more of them this past year and I think that will continue.
“I’m worried that diamonds have such a high price; we have a very high-end store, but even at this level, we’re seeing less demand just because of prices. Obviously, we love diamonds and try to sell them. But I think that if someone wants to buy a 10-carat diamond and they have to spend, you name the figure, say three quarters of a million dollars, where you’re making very little margin, or you can sell them a sapphire for half that where you’re going to make more money…the margins are definitely with the colored stones. In the end, jewelers are going to end up going where the money is.
“We’re going to start looking more to colored gemstones. Now, we used to sell a lot of big stones, but I’m seeing a resistance so I’m scared how much I’m going to have to put into inventory — five million, eight million, for very little return. The margins aren’t there anymore, so it does not make sense to inventory as much.”
LEO HAMEL, OWNER
LEO HAMEL FINE JEWELERS
SAN DIEGO, CALIFORNIA“I would probably say big diamonds — 3 to 10 carats. We just sold a 13 carat last night, almost out of the blue, and some big ones at Christmas. I think that’s where we’re going. I’m seeing big diamonds in rings. Some years, you see a lot of earrings go out the door; other years, it’s necklaces. I think now it’s rings.”
MARC SOLOMON, FIRST VICE PRESIDENT
SOLOMON’S JEWELERS
PLAINVIEW AND ALBERTSON, LONG ISLAND“New and different; branded product, branded diamonds, branded merchandise that’s advertised that has an intrinsic ‘want’ to it. We do better with that. I think that the Journey has taken its journey, at least here in New York. On the coasts of the United States, I think it’s fashion first. You want elegant, you want classic, you want, in my words, the latest, greatest.
“As far as large diamonds, we had a better year selling bigger. We cater to the luxury group. And I think that again, it’s where we’re located. The truth is that diamonds are forever, will sell forever. There will always be a demand for diamonds, diamonds, diamonds. People who are struggling to fill their car with gas are not buying jewelry, let alone diamonds.”
CATHY CALHOUN, OWNER
CALHOUN JEWELERS
ROYERSFORD, PENNSYLVANIA
“I was just talking about this to other jewelers. Gearing the diamond jewelry more toward the luxury market, that’s what really brought me through and brought me ahead. All this year, I was running behind on my figures until right at Christmas week and I made some huge sales — each one maybe $100,000 apiece — so the luxury consumer hasn’t been affected. So what we better all do is target them. That’s my feeling.
“I sold several of the long opera-length diamond necklaces. My last sale on Christmas Eve was $97,500 for a long diamond necklace. And I do a lot with estate jewelry; the higher-end estate jewelry sold.
“I’m stocking larger-stone anniversary bands and larger, bigger diamond weight — instead of selling 1 carat total weight, going to 2 or 3 carats. Colored diamonds are very big — yellow and pink. I have a lot of them in the store.”
RICHARD WHITE, OWNER
ED WHITE JEWELERS
CULLMAN, ALABAMA
“It’s going to be tough on retailers buying back inventory for the spring with the higher gold prices. And you don’t know what the public is going to be willing to pay. That’s the only thing that concerns me right now. I still think the economy is good but what we’re going to have to pay to replace the inventory we’ve sold is going to hurt.
“The Journey pendants did real well for us — only the one style, the single line ‘s.’ For Valentine’s Day, I’ve already restocked on it; I’m stocking the quarter carat and half carat total weights. The three-stone rings are still good for us. Anything that De Beers is promoting seems to do well for us.”
MICHAEL HAINES, OWNER
THE DIAMOND SHOP
LEWISTON, IDAHO“We had a great 2007. We’re a downtown, freestanding store, been in business since 1926, so we have a lot of momentum going, which is kind of fun. And we still give great service and we believe in truth in prices. This year, I’m really going to be taking a look at some of my own inventory in terms of utilization of loose goods. It’s that sleeping money that so many jewelers have in the vault, be it melee or gold scrap or fancy stones that are sitting there, loose color gems — ruby, sapphires, emeralds — fancy colored diamonds, larger diamonds that you think the guy’s going to come in and ask for so you want to have one in the vault.
“Certainly, saleswise, we’re optimistic just because we’re on a growth spurt. I think a lot of jewelers’ growth is determined by their attitude and their level of inventory. If you’re going to get conservative and get careful and not buy and build new fancy jewelry because you’ve just sold your Christmas inventory, then guess what? When that client comes in, you’re going to lose some of your ‘wow’ factor and you’re going to lose some of your ability to create those sales. I think you control your own destiny in that regard. It’s kind of a catch-22.
“We’re building a lot of three-stone and Journey pendants that were good for us. We do mount a lot of our own tennis bracelets. We do all our own diamond earrings, diamond solitaire pendants. All of our wedding sets are mounted here. So that’s exciting.”
Article from the Rapaport Magazine - February 2008. To subscribe click here.