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U.S. Retail
By Lara Ewen
The good news is that most retailers are reporting steady sales for the first few months of 2013. Even though some store owners are concerned that the economy isn’t as stable as it could be, the general consensus is that 2013 is moving in a positive direction, with traffic and sales trending upward.
Economic concerns, including the sequester, have kept retailers from becoming overly optimistic. “Business was up in January and February, but our March has been a tiny bit soft,” said Kathy Cary, diamond buyer at Skeie’s Jewelers in Eugene, Oregon. “But it’s always a little soft in the first half of the month. We’re cautious because the economic climate is not splendid. It’s not terrible, but it’s not splendid.” Sales also have been somewhat shaky for Harold Krasner, owner of Harold Steven’s Jewelers in San Diego, California. “January was pretty flat, and February was pretty good, but March has been pretty soft,” he said. “In February, we had a significant amount of loose diamond sales that got mounted into engagement rings, and not just because of Valentine’s Day.” For others, sales have been positively booming. “So far, 2013 has gone well,” said Bob Moeller, president and director of sales at R.F. Moeller, with three stores in Minnesota. “We’re up from 2011 and we’re even with 2012.” In New England, an abundance of snow kept some shoppers home and depressed traffic and sales totals on the worst-weather days, but overall, business was good. “We had a strong January and we’re having a strong March, but we had a challenging February,” said Kathy Corey, vice president of merchandising and co-owner at Day’s Jewelers, with five stores in Maine and one in New Hampshire. “Weather probably impacted us more than anything else. February and March typically aren’t big jewelry months for us, but we’re hopeful that this momentum will continue through Mother’s Day, and we’re hopeful that there’s a bit of pent-up demand. That’s my gut feeling. I’m seeing our average price point go up, and our traffic has been good.” Unfortunately, some stores are still struggling. “2013 has been softer than I anticipated,” said Chuck Wallace, owner of Wallace Jewelers in Bethlehem, West Virginia. “I thought once the election was over, that would take the apprehension out of the air. However, with the gloom and doom that you hear on the news, people just don’t want to spend money. We’re below 2012 numbers. I thought I would be even with the first quarter of 2012, but we’re below now, by close to 30 percent. Some of this is our population. People are leaving the area. We’re about 25 percent below our prior census.”
Of course, no one has a crystal ball, and no one can tell what the rest of 2013 will bring. But most store owners are prepared to work as hard as they have to in order to keep their businesses moving forward. “I’m not going to let the softness of the first quarter of 2013 beat me down,” said Wallace. “I’m going to say, ‘What are we doing wrong, and then what can we do to right the ship?’” Happily, many retailers share that optimism and determination. “I thought the first quarter would be strained, and it has been a little restrained,” said Krasner. “But I think that’s going to change. Housing is doing better, the stock market is doing better and my gut sense is that things are a lot less uncertain.” Additionally, bridal has proven to be a dependable source of income. Although young couples may not be buying large stones the way they used to, at the very least, they are still buying engagement rings and still getting married. So while there is room for improvement, as always, this spring is looking particularly upbeat.
Even in tough times, most independent jewelers feel that bridal is a bright light, because it’s both dependable and a good way to cultivate long-term customers. “Bridal is very important,” said Cary. “It’s a large portion of our business, and when you get the bridal, you have a good chance of getting that customer for life. If they trusted you with their bridal, they’ll trust you with anniversaries, first-child gifts, etcetera.” Moeller agreed. “Bridal is the number one thing we focus on,” he said. “Diamond jewelry is about 65 percent of our business, and bridal is about 40 percent of that. In the past, it’s been larger, though. It’s smaller now than what it has been.” Corey has also seen changes in the bridal business over the years. “Bridal is critical to our business,” she said. “Without it, we wouldn’t be here. And reliance on our bridal business has become more important to us now than it was 10 or 15 years ago.”Article from the Rapaport Magazine - April 2013. To subscribe click here.
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