COMPENSATION
I am considering hiring a salesperson from a chain who wants a fairly high level of compensation. Will he be worth it?
Despite the frequency with which the service at majors is disparaged, their sales people do outsell their peers at independents (according to the 2013 Big Survey the average independent sales person sells about $215,000 a year, compared to about $234,000 for an employee of Sterling). Of course, a salesperson working at one of the majors has a huge corporate support system behind him that closely monitors market demand, utilizes a data-rich approach to merchandising and inventory and oversees training programs. When it comes to an employee’s responsibilities, the main difference between a chain store and independent jeweler is the amount of freedom and initiative required of the staff member. Does this person give you the impression he is flexible and can think out of the box? Does he “get” your store’s personality and ethos? Does he understand there isn’t always backup if he wakes up feeling less than 100 percent? Vigorously follow up on any references he provides, invest time in the screening process, and then go with your gut.
FINANCES
I’m thinking of going open book with my finances as a way to get my staff to better understand what’s involved in running a business. What do you think?
A few years ago we profiled Kessler’s Diamonds Center in Wisconsin, which uses such a system with apparently great success. But such a level of transparency isn’t for everyone. You may just want to reveal your sales figures or profit margin, which is a much better indicator of performance. Let your staff know that with anything less than a 5 percent net profit margin your business is barely surviving. Otherwise, discretion may be the better course of action. “Know what numbers you can share and defend, or just keep your books closed,” says Greg Crabtree, a CPA and author of Straight Talk, Big Profits.
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LOOSE STONES
What are jewelers doing with the thousands of carats of loose color they may have pulled from items bought off the street in recent years?
We turned this one over to the industry’s largest and coolest survey group, the Brain Squad. In all, it seems you have about eight choices, starting with saving them as back stock, which it sounds you’ve already tried without great success. So, you could:
Sell them. Commercial Mineral in Scottsdale, AZ, was recommended as a buyer by several jewelers. Or you could package them as a collection and list them on eBay.
Reset them. Remount your better stones in sterling silver, in stack rings (especially good for marquise cuts) or other bold pieces. The margins are reportedly OK.
Use them as marketing props. This could include holding a “Guess how many gems are in the jar” contest. If they are birthstones, send them attached to a card to customers celebrating a birthday. Another jeweler suggested creating your own 2,000-gem “Fantasy Bra.”
Display them in-store. Mark Neumann of Ross Designs in Highland Park, IL, puts them in a candy dish. “It’s a good conversation starter and inspires custom pieces … out of nowhere!”
Give them to a charity. A cool idea from Scott Kelly, of Jems Jewels & Gold, in North Wales, PA: Hide them in a sand pile for a “treasure hunt remount sale.” Donate the $5 entry fee to a local charity
Just give them away. To a local lapidary club, as grab bags at events, or to children who come in with parents.
Dump them in your fish tank. Five separate jewelers assured us loose colored scrap makes great fish tank gravel.
STOCK BALANCING
How common is it really for vendors to do one-for-one stock swaps?
We asked this question of more than 700 jewelers in our 2010 Big Survey, and the results should put you at ease: 85 percent of vendors will offer some form of stock balancing and 53 percent will do one for one. So, be a good client and vendors will go out of their way to help you.
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What’s the Brain Squad?
If you’re the owner or top manager of a U.S. jewelry store, you’re invited to join the INSTORE Brain Squad. By taking one five-minute quiz a month, you can get a free t-shirt, be featured prominently in this magazine, and make your voice heard on key issues affecting the jewelry industry. Good deal, right? Sign up here.
