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U.S. Retail
By Lara Ewen
Since the beginning of 2017, jewelry stores have been reporting that they’re either unexpectedly slow or unexpectedly busy. There was not much by way of middle ground. On one side, retailers in more conservative areas said they were riding a wave of good sales and high traffic, which many attributed to the current administration. In more liberal areas, though, numbers were down year-on-year, and those owners cited consumer concerns regarding the administration, while also noting the general retail depression, which has been affecting many businesses. Everyone agreed the country was moving through a period of change and jewelry stores were feeling the impact of those changes for better or for worse.
Jewelers in some of the more urban and liberal areas felt discouraged by the low sales figures of the past few months. “I really thought my February would be so much better than 2016, but I looked at the numbers, and we were the same,” said Ken Stein, owner of Bensons Jewelers in Washington, D.C. “January was slow and March was up. I have sold a few larger stones, but the key phrase is ‘customer loyalty,’ which doesn’t exist anymore. As for why, I would be a lot richer if I knew why.” Stein hoped things would pick up, but also expressed concerns about general problems in retail. “I hope it gets better, since we almost died in 2016 with a really bad holiday,” he said. “I have heard a lot of brick-and-mortars like me are slowly dying off, and even the big box stores are tanking. That’s because of internet sales. No question about it.” Other jewelers were concerned that the downturn was a result of consumer dissatisfaction with the current administration. “2017 has been very strange,” said Joseph R. Villarreal, president of Villarreal Fine Jewelers in Austin, Texas. “We’re really down compared to 2016. Typically, January and February are strong for us. The only idea I have is our change in politics and who the president is. People are scared and they don’t know what’s going on or what he’s going to do.” Villarreal also said he wasn’t planning to attend the summer shows. “Unless something exciting happens by the time JCK rolls around in Vegas, I won’t go,” he said. Some store owners saw the downturn as a natural phase and expected it to pick up. “The first quarter this year is probably worse than last year,” said Richard Hegeman, owner of Hegeman & Co. in Providence, Rhode Island. “I don’t have an answer for why. I just think that we always go through these cycles, and this is one of those little valleys we go through. But the valley won’t last the whole year.”
By contrast, the year has been very strong for store owners in conservative states. “Things are just wonderful across the board,” said Bill Jones, president of Sissy’s Log Cabin, with three stores in Arkansas and one store in Tennessee. “We’ve had the highest grossing sales that we’ve ever had.” Jones, who sits on the JCK advisory board, and who attended Baselworld and bought estate jewelry in London, says the current administration has made his customers feel like shopping again. “People feel a sense that there is some stability, and that we’re going back to the older ways of doing things, and we’re looking to cut taxes and increase jobs, and our stock market is doing great.” Sales have also been strong in the West, although connecting with younger customers has been challenging. “January and February were exceedingly strong, and I attribute that to the Trump bump,” said Richard Larkin, owner of Burri Jewelers in Cheyenne, Wyoming. “I have no understanding of the intricacies of the Affordable Care Act, but I know if we can get a tax reduction that will benefit people who have jobs and if they get us some money to spend, we’ll do well with it.” That said, Larkin struggles to connect with the younger generation. “We’re a traditional mom-and-pop business that’s been around for almost 100 years,” he says. “My strength is people who are a little older and have more wealth. The problem with that is they’re old, and dying. They are a declining asset.”
Despite pockets of enthusiasm, many store owners felt that the biggest challenge in 2017 would be dealing with consumer concerns regarding the Trump administration. “What will impact business the most?” asked Stein. “Trump. It’s been good in a few places, but he scares many of us.” The administration is causing not just slowing sales, but increased anxiety. “People need to get comfortable with their spending, and with who this president is,” said Villarreal. “Because I haven’t felt this much anxiety since the downturn in 2008.”Article from the Rapaport Magazine - May 2017. To subscribe click here.
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