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How to Recover From a Blown Sale … and More December Jeweler Questions

Also, learn how to deal with customers who, A.) won’t shut up, or B.) won’t start talking.

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lost sale Try to turn every blown sale into a learning opportunity, says sales guru Tim Connor.

Turn Lost Sales Into Future Wins

I blew what I thought was a sure sale. What can I do in the wake of a lost opportunity?

SALES GURU Tim Connor suggests developing a “lost sale strategy”. Learning from your mistakes may be simpler in sales as there are primarily two reasons you lose a customer for mainly two approaches. “What you do in the beginning before the relationship begins and what you do after you have completed the sales process and didn’t close a sale,” says Connor.

After the sales call, ask for an exit interview to assess the strengths and weaknesses of your sales performance. Send a thank-you note and possibly a gift. Or, send a little something that ties in the sales presentation that and the information gathered during it, such as a magazine article of interest of the customer’s favorite hobbies — sailing, perhaps.

SALES

Talking Styles

During the Christmas rush, it seems all we get is either motor-mouths or customers who you have to twist their arms to say a word. What are some tips on dealing with both types of customers?

Yep, that’s sales for you — either feast or famine. A salesperson is either subjected to a motor mouth or someone who has their lips in park — with the emergency brake on, to boot.

Selling Power magazine’s September 2005 has some sound advice for both types of customers. For chatty types the magazine suggests using more close-ended questions to help limit the response, such as “Can you tell me briefly …” or “In one or two sentences, how you would describe …?”

For those who are less forthcoming, Selling Power suggests a pause between questions and asking more open-ended questions like “What seems to be the reason, …?” and “I’d like to get your objective opinion on, …” or “What do you think led to this situation?”

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ETHICS

Feeling Used

There is a person in our company who persists in taking in used pieces, refinishing them, and reselling them as new. Sometimes they are obviously worn (thin shanks, prongs, etc) and I feel that this is highly unethical. As a fellow employee, what should I do?

This is a big no-no. As a general rule, a jewelry product can only be sold as new if it meets three conditions, says Jo-Ann Sperano, paralegal/mediator for Jewelers Vigilance Committee: 1.) the product must have been returned to the retail store where it was purchased; 2.) returned within the time specified in the store policy and; 3.) only require buffing or polishing after its return. “When a product needs repair or refurbishing of any kind, it must be sold as ‘pre-owned’ or ‘second hand,'” says Sperano. “And it must not be displayed in a showcase with new jewelry.”

This employee could be putting your company at legal risk. Your best bet is to report this activity to the store owner. Scull & Co. president Joe Romano offers an alternative — if harder-line solution to this employee’s bad habit: “I would buy the jewelry, prove the facts, and report it to the Attorney General or Division of Consumer Affairs.”

BENCH

Mark ‘Em High

What do other jewelers charge for an hourly shop rate for repair work or by-the-hour type work?

For the answer, we went to repair guru David Geller, author of Geller’s Blue Book to Jewelry Repair.

“My price book is based upon a minimum of $125 per hour, and I’ve met some jewelers doing custom design who figure $200 per hour,” says Geller. Many retailers think that if a jeweler is costing them $15 an hour, they should charge $65 an hour – and they couldn’t be more wrong, according to Geller. “A $15 per hour jeweler, with 25% added in for taxes and benefits, and another minimum 25% for down time, ends up costing $23.45 per hour,” he says.

“A four-time markup means charging $100 per hour. And sometimes, with less good jewelers, you’ll end up with only a three-time markup. So, the $125 an hour should be charged because many a good jeweler actually winds up costing you $20-25 per hour.”

OPERATIONS

Street Talk

How can I figure out what a fair price is for buying gold jewelry off the street?

Here’s a mathematical formula from Barry Nicholls of Paradise Jewelry that will ensure you won’t lose money when buying gold:

“Subtract one from the karat number (for 18K gold, you’ll use 17). Now divide that number by 24. That will tell you approximately what percentage of that piece is solid 24K gold. Why subtract one? Because it used to be legal to stamp a karat stamp on something that was as much as one karat lower and you need to plan for the worst-case scenario. Now, multiply that percentage by the daily gold price. So, at $470, 18K could be .708 gold (70.8%) and worth $332.92 per ounce. Divide that by 31 to get a gram price, or divide by 20 to get a pennyweight price. That is roughly how much the gold in that piece is worth. But you’ll only get about 90% of that when you send it off to the refiner. Now ask yourself how much you want to pay for that. Keep in mind you’ll have a cost for handling the gold, the holding period (the time value of money), plus shipping and risk (you’ll occasionally buy something fake). With time, you may want to adjust your buying price based on hindsight, and your competition.”

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MANAGEMENT

Hot Title

How can I spice up my job title?

If you’re an entrepreneur, you could definitely do with a cool job title, says Scott Ginsburg, author of The Power of Approachability.

“This is a perfect way to show customers that you are That Guy,” he says. “For example, I always write ‘Author/Speaker/That Guy With The Nametag’ on my materials. Because that’s what I do! And people love it.” For a jewelry-store owner, some that might work would be “Head Romantic”, “Love Facilitator” or even, taking a cue from Ginsburg, “Owner/Sales Manager/That Guy With the Diamonds”. Whatever you do, Ginsburg says: “Get creative. Find a way to make your designator stand out.”

OPERATIONS

Name Dropper

I’m thinking of changing my store’s name. What would be the effects? What sort of costs would be involved?

Give this one some serious thought. It could be positive if you’re trying to change a perception about your store.

However, Ellen Fruchtman of Fruchtman Marketing advises you to consider your investment in your current name. “Has the name been around for 25 years and known by the entire community? That’s an investment you don’t want to overlook,” she says.

Once you’ve decided to change the name, you’ll have to pay for a new logo, stationery, job envelopes, invoices, signage, packaging, and boxes. You’ll also need to consider costs of advertising-related expenses like new audio for radio, new tags for TV ads, new billboard and print, etc.

David Geller warns that you might have to close out a checking account and open a new one — check with your bank first to make sure. There could also be attorney’s fees and business licenses to obtain. “You can avoid massive legal expense if you simply change your name as a DBA,” says Fruchtman. Obtaining a DBA is generally a low-hassle, low cost proposition (in Travis County, TX, a DBA can be had for $13 plus 50? per name on the form).

WATCHES

Arms Wide Open

I’ve always wondered: why, in watch advertisements, are the hands generally set at 10:10?

This question has been debated for decades, says Jeff Hess, jewelry retailer and co-author of The Best of Time: The Unauthorized History of Rolex. Hess says there are three theories. First, readability — it’s easier to market watches when the brand of the watch is showing clearly.

Second, that placing the hands at the 10 and the 2 makes the watch appear to be “smiling,” thus associating a positive feeling with the watch. Finally, some believe that the religious connotations of the cross symbol led marketers to plant that message into the subconscious of buyers. “As much as I would like to think the marketers had religion on their minds, the answer is ‘just so you can see the name on the dial,'” says Hess. “It would be difficult to market a watch without seeing the name!”

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ADVERTISING

Saved by Radio

When is the best time to negotiate an annual radio advertising buy?

True marketing experts recommend the dead of winter, preferably January.

Why? Because listenership picks up during the summer months when TV is in reruns and people are out enjoying the weather. This also means national advertisers are spending more during this time, so avails (short for available advertisement time slots) are scarcer. Flush with success and high audience numbers, radio reps are less likely to curb their rates during warm-weather months (May-September).

Radio reps are generally short term thinkers, so catching them in January when they’re furthest removed from those heady months can do wonders for your rates. Just make sure they agree ahead of time to run your spots at the negotiated rates when rates inevitably rise during the summer.

ETHICS

Bad Rap

How is it that the public gets their hands on Rap reports?

According to Barry Nicholls of Paradise Jewelry (Naples, FL), the culprit may be a jeweler who is telling them what he can do for them price-wise (“Here, shop and compare prices, but this is New York wholesale. I can sell you for these prices and no one can beat that”).

Or, it might be someone who dabbles in the business. “They may have a beauty shop license, etc., and they then get into shows like the Helen Brett show,” says Nicholls. People like this buy jewelry at wholesale and sell to their friends. “Anytime wholesalers fail to carefully check credentials, they give amateurs the opportunity to get into the business and muck up the waters.”

MARKETING

Little, Yellow, Useless

How important is it for me to be in the Yellow Pages?

Not very, unless custom design, repair, or estate jewelry are big parts of your business.

While your phone directory rep will pitch you until he turns yellow himself, most customers will have their minds made up about which jewelers to visit long before they go to make a purchase. Intrusive media such as radio and television, along with passive media (print, billboards, and magazines) that they encounter regularly, will influence their decision. Hardly anyone in the market for jewelry will be totally uninfluenced, which is the only reason they would need to check the Yellow Pages (or the Internet).

Now, if you offer a specialized service like custom design, repair, or estate buying, those customers are more likely to wait until they have such a need before seeking out a provider. That being the case, you should always include any services in your Yellow Pages ad.

Otherwise, you’re just as well served with a simple black-and-white line listing with your address and phone number. Spend your money on media that will influence the customer before they’re in the market for your product!

This story is from the December 2005 edition of INSTORE

Over the years, INSTORE has won 80 international journalism awards for its publication and website. Contact INSTORE's editors at [email protected].

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