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U.S. Retail
By Lara Ewen
In the first few months of 2017, reports of sales and traffic at jewelry retailers were mixed. While some stores saw robust, even record-breaking sales year on year, other stores were seeing slow traffic and lackluster numbers. Even the types of sales differed from region to region, with some stores serving customers at a broad range of price points and other stores struggling to find customers in any price range. Hopes were high, though, across the board, and ever-optimistic retailers agreed that even a somewhat sluggish but predictable market was better than the unstable roller coaster ride that was 2016.
In the wake of a tumultuous 2016, some retailers found themselves steeling for difficult times and pleasantly surprised when it wasn’t dramatically awful. “2017 so far is not nearly as bad as I expected,” said Stew Brandt, owner of H. Brandt Jewelers in Natick, Massachusetts. “People are unsure what the future holds.” Brandt said that repair work was keeping his store busy, but that apart from a few significant Christmas returns in January, he was even, year-on-year. “The middle market is quiet,” he said. “The highs are doing okay, and the lows are trickling in. But right now there’s also a lot of service work, like restyling and remodeling. That seems to be pretty active.” In the Midwest, there was a sense that the overall jewelry market was slow. “Business is soft,” said Mike Lordo, president of Lordo’s Diamonds in Ladue, Missouri, a suburb of St. Louis. “Last year was a roller coaster, with good months and bad months, and we were 12 percent down, year on year. Then January was a little off from 2016, and February is a hair off.” Lordo said that some of it is just politics. “St. Louis is a very conservative town,” he said. “Those conservatives are waiting to see what this man they voted in is going to do. And it’s not like we’re in dire straits. I just feel like it’s soft. And vendors and diamond dealers are saying certain pockets are doing well, but overall the whole market is soft.”
Of course, there were also stores with positive numbers. In the Northwest, for example, sales were strong, according to Kathy Cary, stone and diamond buyer and graduate gemologist at Skeie’s Jewelers in Eugene, Oregon. “Business has been good, but we’ve earned it,” she said. “We have done everything we needed to do to grow our business, and we haven’t rested on our laurels. And we are very conscious of the fact that everything we do has to cater to the next generation.” Cary also said that she was seeing strong numbers from the mid-end. “Our middle market is way up,” she said. “We have a fantastic salesperson who’s magical with the middle market, and our highs are also great, but we struggle with our low end. It’s hard to find lower-end merchandise that we want to carry.” Cary also said that watches, and Rolex in particular, were helping her bottom line immensely. “Rolexes are selling really well,” she said. “There are some months that I think Rolex probably carries us.”
Even for stores that are seeing good sales, there’s been a drop-off from years past. “The middle market has picked up slightly, but they are spending about 20 percent to 30 percent less than what we were seeing only a few years ago,” said Rich Goldberg, president of Safian & Rudolph Jewelers in Philadelphia, Pennsylvania, who also said his year was going “relatively well.” He explained, “High end and low end remain strong. Those who have the money to buy the finer, more expensive jewelry are still out buying. Low-end purchases have increased as more people are seeking price-point jewelry, though these sales often result in competing more directly with the internet.” The middle market was also quiet according to Bob Moeller II, president and director of sales at R.F. Moeller Jeweler, with three stores in Minnesota. But that hasn’t seemed to hurt his bottom line at all. “We actually had a very good start to 2017,” he said. “Interestingly enough, we’ve sold quite a few watches. Benchmarked to previous years, we were up 20 percent over the previous January, due to a couple of big watch sales.” Moeller is still being cautious, though. “We’ve had one of the best Januarys in the history of the company,” he said. “I hope it’s just because we’re awesome, since we’re not immune to external factors.”Article from the Rapaport Magazine - March 2017. To subscribe click here.
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