As summer heated up, retailers took stock of 2019 so far, and of the year to come. Although the Las Vegas shows saw light traffic, and sales reports were mixed across the country, stores pursuing aggressive digital strategies were reaping the rewards. Retailers predicted that the year would see more store closures, but that the remaining businesses would be strong, lean and better prepared to serve their younger clientele.
The state of the market
In New York, sales were holding steady through the middle of the year.
“We’re here in [the neighborhood of] NoLita and hanging tough,” said Tara Silberberg, owner of The Clay Pot. In March, she shut down her second location in Brooklyn after 50 years to focus on her bridal business and online store. “We completely overhauled our website, and we’re changing the business,” she related. “So we’re moving right along and selling diamonds, and also having a really good spring with lab-grown diamonds.”
Further south, business was also brisk for Steve Samaras, president and owner of Zachary’s Jewelers, which has two stores in Maryland. “Our sales are up from last year, and the average ticket price is slightly higher, although traffic is slightly down,” he noted. “In our Annapolis store, we’re up 10%, and we’re up 20% in Severna Park.” Samaras attributed his success in part to more digital marketing. “Anyone that’s in business today in our industry, and in retail in general, who is not moving forward is closing their doors,” he said. “Buying habits of younger clients have changed so dramatically, so if you’re not involved in omni-channel, they’ll pass right by you.”
Yet out west, retail was less stable. “It has been uneven and soft so far this year through May,” reported Mike Butterfield, co-owner of Butterfield Jewelers in Albuquerque, New Mexico. One of the challenges he cited was competing with online sources. “The new generation of buyers are all ‘experts,’ since anyone can get information off the web, whether [it’s] accurate or not,” he said. “Most of our energy is spent getting over customers’ supposition that we charge way more than the internet.”
The Vegas shows
None of the retailers interviewed attended the Las Vegas shows personally.
“We generally go every four to five years,” said Butterfield. “We tend to overspend when we go to the show.”
Silberberg did not send anyone on behalf of her store. “The problem with those shows is that they have real competition with the New York shows,” she explained. “Vegas is great for snooping around and doing back-end stuff, but I like Tucson for buying. I didn’t feel like it would be a deficit at all not to go to Vegas.”
Even when Couture pays for her room, she went on, the Las Vegas events still cost her thousands of dollars, and the timing of the shows is inopportune. “You go all the way there and need to buy it right then, but a lot of the stuff I don’t need until the fall and the holidays. The New York shows are in a better position for smaller, independent stores looking for delivery in November.”
Samaras sent his chief operating officer and his buyer. “I’ve been [to the shows] the last two or three years,” he said. “And last year, we sent five people. We pretty much immerse ourselves in that show to do recon for new lines, and because it’s easier to see complete lines there.”
Looking ahead
Samaras expected the rest of his year to be positive, but he saw other retailers struggling. “My neighbor, a fifth-generation jeweler, just went out of business,” he reported.
Silberberg foresees a further culling of the industry as more stores close. “The strong will survive,” she stated. “All the little mom-and-pop stores? I don’t know how they’re staying in business as it is.”
Article from the Rapaport Magazine - July 2019. To subscribe click here.