|
|
U.S. Retail
By Lara Ewen
There is no question that the unpredictable winter storms that hit much of the country in the beginning of 2014 kept shoppers home and made business difficult for many independent retailers. Still, sales for the first few weeks of 2014 were at or above 2013 levels, year on year, which bodes well for the springtime thaw, when consumers historically tend to come out of hibernation and return to the stores. While store owners remain unconvinced that the economy has fully recovered, savvy retailers have found that stocking the right merchandise mix can be almost as good for sales as an actual economic recovery.
Early 2014 was sluggish, but not actually bad, despite the erratic and sometimes devastating weather patterns. “2014 actually started very well for us, and business has been good,” said Brandon Katzeff, chief executive officer (CEO) of Joyce’s Fine Jewelry in Uniontown, Pennsylvania, and Joyce’s Jewelry Boutique in Morgantown, West Virginia. “We’ve had terrible weather, though, and there have been days when we weren’t able to open. But January was up despite the weather. 2013 was our best year ever, and we expect to do better in 2014.” “This has been a tough winter, weather-wise, and that does have an impact,” said Perry Sporn, owner of Perrywinkle’s, with one store in Vermont and three stores in upstate New York. “January was slow, but I think we’ll be slightly up. For us, it’s about mixing up price points. And stores have to become destinations that entertain and that keep people from going online to click and make their purchase.”
Charla Hall, manager of Baker & Baker Jewelers in Marietta, Ohio, agreed that creating an environment that attracts customers is important. “I think people are trying to find more independent places to shop,” she said. “They do research online, but they want to touch a diamond before they buy it, and they like independent, local retailers,” she said, adding that “They don’t like big box stores” for jewelry purchases. Hall also said her numbers for early 2014 were up year on year. “But it’s been slower,” she said. “Through the end of 2013, we did a lot more transactions, but not a lot of bigger-ticket items.” In Boulder, Colorado, sales were also good, but for the opposite reason. “We have more higher-ticket items selling,” said Keith Hurdle, owner of Hurdle’s Jewelry. “We’re selling fewer pieces, but for more money per piece. And January was up for us over predictions. I’m expecting numbers to continue to improve through 2014.” High-ticket sales were also a big part of the success for Curtis Bennett, vice president of retail operations at O.C. Tanner, now with two stores in Utah. “We had a very successful January,” he said. “We anticipated a 5.2 percent increase, year on year, and our numbers were beyond that. And we had a couple of nice single sales, including one $130,000 Rolex sale on the last day of January, which put us over the top. I wish I knew why higher-ticket items are now in demand, because then I could forecast what we should be buying and why. But right now, our watch business is about 55 percent of our sales, and 70 percent of that business is men.”
Even though retailers survived recent storms, both weather-wise and economically, they have difficulty feeling optimistic about the coming year. “The whole economy is just too volatile, and I don’t think it’s ever going to stabilize,” said Hurdle. “I think there’s always going to be fear, and it’s something people face more than they used to.” Sporn also admitted to doubts that a recovery would ever return sales to prerecession figures. “I think 2014 will be similar to 2013, or slightly better,” he said. “But we need the middle class, and there’s no doubt that since 2008, the middle class has gotten squeezed and discretionary spending is down. I don’t think we will go back to a pre-2008 economy.” Not everyone agreed, however. Tanner was optimistic, though not without caveats. “We’ve surpassed our best numbers, and we’ve recovered from 2009,” he said. “But to say the recession is over would be wrong. People are still tenuous and careful. But we do see a loosening up of our clientele, particularly when they see a value like with a Rolex.” Hall also sensed that a change was in the air. “The economy is getting better,” she said, “but more people are paying cash and not using credit,” an indication that spending habits have changed. Still, Hall thinks, “people are not as scared to spend as they used to be.”Article from the Rapaport Magazine - March 2014. To subscribe click here.
|
|
|
|