RAPAPORT... This is the time of year that everyone has been anticipating. Most retailers will recall that last year’s sales began sharply falling just after September 2008, so anyone who has seen brisk business this fall is already feeling cautiously optimistic. A creeping sense of guarded relief is almost palpable, and store owners who managed to stay the course through the rough waters of early 2009 say that, while numbers may not climb back to 2006 levels just yet, they are better than 2008. That, in and of itself, is a reason to cheer.
Positive Thinking“Holiday is the most crucial time of year for us,” said Sean Dunn, vice president of J.R. Dunn Jewelers, with two stores in South Florida. “It accounts for probably 30 percent of our business. But we’ll be up from last year, because some people have lightened up the lock they had on their wallets. The continuous momentum of the stock market has made people feel better. It’s probably all on paper, and it’s psychological, but jewelry is all about feeling good. I think a lot of women out there are feeling like it’s time for a romantic treat.”
In Meridian, Idaho, Jay Simmons, owner of Simmons Fine Jewelry, is hoping for the best but still ready for tough times. “I anticipate 2009 will be better than 2008, but I’m prepared for the way it was last year,” he said. “We were off 30 percent then. Last year, October was when we started feeling it. But this year, we beat our last October, so we’re very optimistic that 2009 will be great. December is the kind of month where we set the tone for the rest of the year. You buy big for it and you hope to sell.”
Any improvement over last year’s debacle will be welcome. “Last year was weak at the end of the year, but this year will be better, because there was a high level of fear last year,” said Perry Sporn, owner of Perrywinkle’s, with one store in Vermont and three stores in upstate New York. “There’s more confidence this year that the wheels won’t fall off capitalism. We’re ready to have a better season.”
For some retailers, this will be the first season with a new store to show off. That energy is fueling a lot of optimism at Steve Quick Jeweler, which opened a second Chicago area store in September 2009. “The response from our new store has been fantastic, and the existing store is having one of its best years ever,” said Steve Quick, owner. “We’re doing the things we need to do to make people interested, and we have no reason to expect anything but a very good Christmas.”
O.C. Tanner also opened its second store this past September, and has focused a large amount of attention on that $24.9-million investment. “The new store has infused us all with renewed vim, vigor and vitality,” said Curtis Bennett, vice president of retail operations at O.C. Tanner, now with two stores in Utah. “And it’s done the same for our clients. I think everybody has to approach this year’s holiday season as enthusiastically and yet as guardedly and as carefully as they can. I genuinely think we’ll exceed 2008, but call me on January 1st and ask me again. So far, we’ve already beaten September and October of 2008. But I don’t think we’ll see 2006 numbers until late 2010 or early 2011, and it wouldn’t surprise me at all if it took longer than that.”
AdviceWhile it may take more than one good holiday season to come completely out of the recession, long-term thinking is what’s keeping retailers cheery this Christmas. “The reality is that the pessimism lags farther into the recession than it should,” said Sporn. “But you can’t plan your business based on your current emotions. You have to hunker down and know where you’re going.”
Recent economic troubles have given a lot of independent jewelers a renewed sense of purpose and drive. “If there’s something I’m not doing, tell me, because I want to do that too,” said Quick. “Right now, we’re extremely aggressive with everything, including advertising, which we’re increasing. If there’s a spare second, we’re thinking about what we can do to promote ourselves.”
Bennett agrees than slow times call for more work, not less. “If we’re in a recession, we’re actually busier trying to drum up business,” he said. “We’re really working. I had a conversation with a friend and mentor just after it all really hit. He’s been in the business for 60 years, and I asked for advice. He said, ‘Don’t participate in the worrying, and stay the course, and you’ll do fine.’ And it’s working out for us. That was the best advice.”
The Marketplace- Round is by far the top-selling shape.
- 1-carat stones are selling best right now, though some buyers trend toward slightly larger or slightly smaller stones.
- SI1 is the most popular clarity.
- G-H is the most requested color range.
- 18-karat white gold currently outsells platinum, except at the very top of the luxury market.
- The average price for an engagement ring, including stone and setting, is $5,500.
Article from the Rapaport Magazine - December 2009. To subscribe click here.