WE ASKED OUR Brain Squad members late last month to gaze into their crystal balls and predict the most likely scenario for economic recovery in the age of COVID-19. The majority of the 230 respondents predicted bumpy roads and roller-coaster rides ahead, with only 15 percent expecting a V-shaped or quick recovery and another 23 percent predicting a J-shaped recovery, meaning stronger growth ahead.
The remaining 62 percent were divided between less promising options, including U-shaped (tumbling along the bottom for several quarters), L-shaped (no significant recovery for quite a long time) and W-shaped (another slump ahead).
“I fear an economy where all things start to devalue, because people don’t have jobs or money to spend,” said J. Craig Grant, M&M Jewelers, Owensboro, KY, who expressed a common concern among the less optimistic responders.
The more optimistic responders focused on pent-up demand for jewelry, the agility of small businesses, the resiliency of the bridal market, and the fact that people will be ready to celebrate special occasions.
Here are some jewelers’ thoughts beyond the statistics:
V-Shaped (Quick Recovery) 15 Percent
- “We are just about to match our pre-COVID forecasted May goal. Bridal came back strong, just like it did for us in 2008.” — Jonathan McCoy, McCoy Jewelers, Dubuque, IA
- “Business has been very good since we reopened. Traffic maybe slightly down, but those coming in have clear objectives.” — Donnie Blanton, Brittany’s Fine Jewelry, Gainesville, FL
J-Shaped (Stronger Growth Ahead) 23 Percent
- As clients think they are safe(r), they will return to near pre-COVID buying patterns. Full recovery will be seen next year. — Vince Isaacson, Lake Street Diamond Co., Kirkland, WA
- Several guest speakers on the multitude of seminars I consumed while home mentioned critical planning for the second wave. There is definitely pent-up demand and we are still the professionals people know and trust! Once the population at large starts easing out back into the New Normal of mainstream life – a lot of anniversaries, birthdays, graduations and milestone celebrations will still need to be recognized- We’re ready! — Denise Oros, Linnea Jewelers, La Grange, IL
- I believe people will be making more emotional purchases. Happy and more appreciative of their loved ones. However, not necessarily expensive purchases as not all have the resources as in the past. — Kas Jacquot, Kas A Designs, Jefferson City, MO
- “I was able to work on a number of growth plans that I had been putting off for lack of time. I anticipate a strong (although not instant) recovery, and growth before the end of the year!” — Janne Etz, Contemporary Concepts, Cocoa, FL
- My business is small enough to be agile. Without interruptions at the door, productivity has increased. An increase in telephone activity has allowed business to continue with limited contact. I have used headsets for 15 years to allow me to multitask. It works. — J Mason Cutchin, JMason Custom Jeweler, Chapel Hill, NC
U-Shaped (Tumbling Along the Bottom for Several Quarters) 26 Percent
- I hope and pray for a V shape but plan our budgets (operational, inventory, marketing) for the remainder of 2020 based upon a U-shaped recovery. — Tom Duma, Thom Duma Fine Jewelers, Warren, OH
L-Shaped (No Significant Recovery for Quite a Long Time) 23 Percent
- Demand will be back for some stores in the right spot such as high traffic centers. Many customers are scared, and many don’t have a job. With the extra unemployment many are still making good money, however if they are not working before that runs out there will be a huge reduction in demand for everything. I am hoping that we may see more gold buying in the future. Right now, diamond prices are all over the place with many vendors dumping goods on Blue Nile at low prices to move them. Larger diamonds of 1carat or more are very difficult right now. I am selling diamond wedding bands, but my engagement ring business is down by 90 percent for this time of year. — Mark Goodman, Goodman Jewelers of Abingdon, Abingdon, VA
- We’ve been in business for over 20 years and to be shut down for seven weeks was really hard – mentally, physically and financially. Once we were allowed (with stipulations) to reopen; our choices were to pack it in or forge ahead. We decided to go with the latter and decided this was going to require new and fresh ideas to rejuvenate customer interest and volume of sales. Customers are coming back, so we’ll track how quick our recovery is. — Teri Vogan, Vogan Gold & Silver Works, Colorado Springs
- I’m torn because I feel like we will recover but not in just three months. People are still spending the PPP and stimulus money. The effect on business closures and the future unemployment has not kicked in yet in the minds of most people. They should be worried but they’re not. — Rick Sanders, Sanders Jewelers, Gainesville, FL
W-Shaped (Another Slump Ahead) 13 Percent
- We are the first to feel a downturn and the last to benefit from getting out. Although the stock market (Wall Street) is showing a V-shaped recovery we know by now Wall Street and Main Street have no correlation. I think Main Street is going to have a tough time moving forward, however it is my belief that our products are luxury goods and the wealthy are going to get out of this situation in a better financial situation than before. So I think if you focus your attention on your richer clients you can and will make sales. People in the top income brackets will be reducing expenses in travel, education, nannies, restaurants, clothes, etc. There is money out there, there is demand. Find the people with money; they will need to buy anniversary gifts and birthday gifts; young people if they have their jobs will still buy engagement rings; people are getting married, albeit locally and with minimal frills, but then again maybe they will take the saved money and buy nicer rings? — Jeremy Auslander, Roxbury Jewelry, Los Angeles, CA
- I wanted to pick two because I think it will be a quick recovery, but with a another quick dip later in the year and coming back after the election season. — Josh Rider, Dylan Rings, Montgomery, AL
- If COVID-19 comes back big during the next flu season, we’re screwed. If businesses are forced to close during the Christmas season, it will probably have an effect on the economy for years. Also, if they don’t open up the economy to all businesses soon, the same may happen. — Charles Hood, C.B. Hood Diamond Co. Santa Maria, CA
- I think there will be a major resurgence of cases as people start to think it is OK to go back to old bad habits. It happened with Spanish flu; it happened with Poliomiolitis; it happened with AIDS. Is there any doubt it will happen again? — James Doggett, Doggett Jewelry, Kingston, NH