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David Brown: The Verdict From the Till: A Good December

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David Brown: The Verdict From the Till: A Good December

David Brown: The Verdict From the Till: A Good December

BY DAVID BROWN

The crucial month of December can make or break the year for most jewelers, and coming at the end of the financial year, leaves no room to turn around annual figures if numbers are low.

The news for most jewelers in 2011, however, was positive with improvements in sales and profitability from 2009 and 2010.

David Brown: The Verdict From the Till: A Good December

The trend for the last three years now shows a steady increase in December sales from $213,963 in 2009 to $259,343 for December 2011 – an increase of 21 per cent over the 3-year period. That is growth most jewelers won’t say no to.

The changes have been across the board and include repairs, dispelling the oft-cited notion that repairs become stronger when sales are low or the economy struggles, as consumers seek to preserve old items rather than buy new ones.

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Of particular note this time was the increase in the average sale – after a dip in 2010 related to the strength of the bead market. Average retail sale value per item sold has increased to $198 – up 17 per cent on 2010’s average. This has been reflected in better diamond sales and a return to higher-end product by many purchasers.

Margins have maintained their status quo with a level of 52 per cent, or $52 gross profit for every $100 sold. This is an area that largely held its own during the financial crisis, helped by the better profitability on lower priced items.

Of interest in the December figures was the better profitability of the smaller stores in our sample (those with annual sales below $1 million). These stores showed a better margin than larger stores selling more than $1 million per annum but had a much lower average retail value sold, reflecting again, the better margin that cheaper items have to offer.

Gross profit is showing a healthy improvement over our sample stores with an increase from 2009 figures of $108,837 to this year’s average of $135,698 – a 24 per cent increase in just two years. The data also show the percentage of total annual sales contributed by December trading has grown slightly from 21 per cent to 22 per cent of total revenue.

The financial crisis seems to be over, as far as most jewelers are concerned. December’s data are a continuation of the trend we have seen in the rolling annual figures over the last 12 months with average jewelry sales per annum now at $1.2 million across our sample group. Most jewelers have now enjoyed 12 months of growing sales despite constant talk of economic gloom.
Long may the trend continue.

 

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About the Author: David Brown is President of the Edge Retail Academy, an organization devoted to the ongoing measurement and growth of jewelry store performance and profitability. For further information about the Academy’s management mentoring and industry benchmarking reports contact Carol Druan at [email protected] or Phone toll free (877) 5698657 Edge Retail Academy, 1983 Oliver Springs Street Henderson NV 89052-8502, USA


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Wilkerson Testimonials

If It’s Time to Consolidate, It’s Time to Call Wilkerson

When Tom Moses decided to close one of the two Moses Jewelers stores in western Pennsylvania, it was time to call in the experts. After reviewing two candidates, Moses, a co-owner of the 72 year-old business, decided to go with Wilkerson. The sale went better than expected. Concerned about running it during the pandemic, Moses says it might have helped the sale. “People wanted to get out, so there was pent-up demand,” he says. “Folks were not traveling so there was disposable income, and we don’t recall a single client commenting to us, feeling uncomfortable. It was busy in here!” And perhaps most importantly, Wilkerson was easy to deal with, he says, and Susan, their personal Wilkerson consultant, was knowledgeable, organized and “really good.” Now, the company can focus on their remaining location — without the hassle of carrying over merchandise that either wouldn’t fit or hadn’t sold. “The decision to hire Wilkerson was a good one,” says Moses.

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David Brown

David Brown: The Verdict From the Till: A Good December

Published

on

David Brown: The Verdict From the Till: A Good December

David Brown: The Verdict From the Till: A Good December

BY DAVID BROWN

The crucial month of December can make or break the year for most jewelers, and coming at the end of the financial year, leaves no room to turn around annual figures if numbers are low.

The news for most jewelers in 2011, however, was positive with improvements in sales and profitability from 2009 and 2010.

David Brown: The Verdict From the Till: A Good December

The trend for the last three years now shows a steady increase in December sales from $213,963 in 2009 to $259,343 for December 2011 – an increase of 21 per cent over the 3-year period. That is growth most jewelers won’t say no to.

Advertisement

The changes have been across the board and include repairs, dispelling the oft-cited notion that repairs become stronger when sales are low or the economy struggles, as consumers seek to preserve old items rather than buy new ones.

Of particular note this time was the increase in the average sale – after a dip in 2010 related to the strength of the bead market. Average retail sale value per item sold has increased to $198 – up 17 per cent on 2010’s average. This has been reflected in better diamond sales and a return to higher-end product by many purchasers.

Margins have maintained their status quo with a level of 52 per cent, or $52 gross profit for every $100 sold. This is an area that largely held its own during the financial crisis, helped by the better profitability on lower priced items.

Of interest in the December figures was the better profitability of the smaller stores in our sample (those with annual sales below $1 million). These stores showed a better margin than larger stores selling more than $1 million per annum but had a much lower average retail value sold, reflecting again, the better margin that cheaper items have to offer.

Gross profit is showing a healthy improvement over our sample stores with an increase from 2009 figures of $108,837 to this year’s average of $135,698 – a 24 per cent increase in just two years. The data also show the percentage of total annual sales contributed by December trading has grown slightly from 21 per cent to 22 per cent of total revenue.

The financial crisis seems to be over, as far as most jewelers are concerned. December’s data are a continuation of the trend we have seen in the rolling annual figures over the last 12 months with average jewelry sales per annum now at $1.2 million across our sample group. Most jewelers have now enjoyed 12 months of growing sales despite constant talk of economic gloom.
Long may the trend continue.

Advertisement

 

About the Author: David Brown is President of the Edge Retail Academy, an organization devoted to the ongoing measurement and growth of jewelry store performance and profitability. For further information about the Academy’s management mentoring and industry benchmarking reports contact Carol Druan at [email protected] or Phone toll free (877) 5698657 Edge Retail Academy, 1983 Oliver Springs Street Henderson NV 89052-8502, USA


{JFBCLike}

{JFBCComments}

Advertisement

SPONSORED VIDEO

Wilkerson Testimonials

If It’s Time to Consolidate, It’s Time to Call Wilkerson

When Tom Moses decided to close one of the two Moses Jewelers stores in western Pennsylvania, it was time to call in the experts. After reviewing two candidates, Moses, a co-owner of the 72 year-old business, decided to go with Wilkerson. The sale went better than expected. Concerned about running it during the pandemic, Moses says it might have helped the sale. “People wanted to get out, so there was pent-up demand,” he says. “Folks were not traveling so there was disposable income, and we don’t recall a single client commenting to us, feeling uncomfortable. It was busy in here!” And perhaps most importantly, Wilkerson was easy to deal with, he says, and Susan, their personal Wilkerson consultant, was knowledgeable, organized and “really good.” Now, the company can focus on their remaining location — without the hassle of carrying over merchandise that either wouldn’t fit or hadn’t sold. “The decision to hire Wilkerson was a good one,” says Moses.

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