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David Geller

David Geller: Tighten Up

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Offering guarantees of satisfaction on repair work means more profits, says David Geller.

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[h3]Tighten Up[/h3]

[dropcap cap=M]any jewelers guarantee their work only if the customer didn’t “bang it up or was the cause of the problem.” If you size a ring smaller and three weeks later a 5-point diamond falls out, do you take responsibility? Or do you start with “Well, lady, looks like you hit that prong and bent it. That’s why the diamond came out.”[/dropcap]

What do you say to her comeback: “Looky here young man. I’ve had this ring for 12 years and never had a problem! I bring it here, you size it, and, bingo, a stone falls out.”

The sad part is she’s right. If you charge her for the lost stone or she walks away, either way you’ve a lost a customer.

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Everything we buy or get fixed at most places is guaranteed a year. Why don’t you charge extra and guarantee it? In our price book we have “check and tightening stones” as an extra charge. Read this presentation to a customer coming in with a ring that has two rows of seven channel-set diamonds.

[inset side=right]Everything we buy or get fixed at most places is guaranteed a year.[/inset]“Mrs. Jones, it’s $28 to make your ring smaller. There is an additional charge of $20, and for that our jeweler will check and tighten each stone and make sure they are tight before they leave the store. We will guarantee for a year if they get loose, we’ll tighten them, and if any fall out in a year, we’ll replace them at no additional charge.”

That’s a $48 charge, and when presented that way 70 percent of the customers will pay the extra $20. Isn’t it a good value? The 30 percent who don’t want to pay, we’d size the ring for $28 and write on the envelope “No guarantee on stone loss — customer didn’t want to have the stones checked and tightened.” (We really want to write “Too darn cheap!” but can’t do that.)

Still apprehensive? How about if I threw hundred dollars bills at you? Here are the stats:

Let’s say you take in 10 repairs a day, six days a week. That’s 3,120 jobs a year. What percent of those have five or more stones in the piece? Think hard now. It’s typically between 40 to 80 percent. So let’s average and say half of the jobs have five or more stones. That’s 1,560 opportunities to say “Mrs. Jones, there is an additional charge of $20 to ….”

I have found 70 percent will take the check-and-tighten fee. That means 1,092 people will pay the minimum of $20 for check, tighten and guaranteeing.  

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That gives you a whopping $21,840! Now you can guarantee your work. The lady can take a sledgehammer to it. The typical store tells me it gives away $3,000 a year in lost stones that they replaced. I just gave you $21,840. Can’t you be nice to the woman for crying out loud?

We do repair work and include in the price check and tightening the first four stones. If it has five or more stones, here are the charges: Five to 20 stones: $20; 21 to 35 stones: $35; 36 to 50 stones: $45.

Do what a good insurance company does. Charge extra and fix the problem no matter who’s at fault.

You’ll make your customers happy, your staff won’t be so stressed waiting on them, and you’ll send $21,840 to the bottom line. Hey, at 6 percent net profit, you’d have to do an extra $340,000 in sales to have that much left over.

David Geller is an author and consultant to jewelry-store owners on store management and profitability. E-mail him at [email protected].

[span class=note]This story is from the April 2007 edition of INSTORE[/span]

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