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Laurie Owen: Gross Margin Target

Stats to know for your store.

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51.5

What is it? Gross margin is the portion left of each sales dollar after you pay for merchandise sold, direct labor for craftsmen and repair people, as well as freight in and freight out. When stated in dollars, it’s known as gross profit. For the “high profit” group in our 2004 Jewelers Financial Benchmarking Study, the average gross margin was 51.5%. The rest of the companies only took home 47.2% of each sales dollar. For a $2.5 million dollar company, every 1% more in gross margin means $25,000 straight to the bottom line – assuming, of course, that they keep all other costs in line.

Strategy: The trick? Buy better, price better, lose less merchandise to five-finger discounts, and sell more of before it goes out of style. Simple? Yep. Easy? No. Know your target gross margin, and track it overall and by depart-ment all year long.

This story is from the March 2006 edition of INSTORE.

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Moving Up — Not Out — with Wilkerson

Trish Parks has always wanted to be in the jewelry business and that passion has fueled her success. The original Corinth Jewelers opened in the Mississippi town of the same name in 2007. This year, Parks moved her business from its original strip mall location to a 10,000-square foot standalone store. To make room for fresh, new merchandise, she asked Wilkerson to organize a moving sale. “What I remember most about the sale is the outpouring excitement and appreciation from our customers,” says Parks. Would she recommend Wilkerson to other jewelers? “I would recommend Wilkerson because they came in, did what they were supposed to and made us all comfortable. And we met our goals.”

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