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Laurie Owen: Inventory Turns

Stats to know for your store.

Published

20 years ago

January 1, 2006

David Squires Instore January 2006 Issue

1.4

What is it? It’s the number of inventory turns you should be shooting for per year. (Of course, if your turn is higher, all we have to say is … well played, sir, well played.) Typical is 1.1 to 1.4 turns per year, according to a 2001 Jewelers of America “Cost of Doing Business” survey. Your store’s profit margin is an important consideration here. Says David Geller: “A gross margin of 50 percent goes well with a turn of ‘one’. Less than that and you may have problems making profits”. Geller reasons that since most jewelers have profit margins in the 41 to 48 percent range, they need at least a 1.25 turn to stay healthy. And for optimum health, you should shoot for a 1.4 turn.

Strategy: How can you move your entire inventory an average of one and a half times per year? Two keys: 1.) Re-order fast sellers frequently – as often as weekly, and 2.) Have your hand on the switch, ready to euthanize any dogs the very instant they turn one year old. Be ruthless! Keep turning!

This story is from the January 2006 edition of INSTORE.

Closing With Confidence: How Bailey's Fine Jewelry Achieved Outstanding Results With Wilkerson

When Trey Bailey, President and CEO of Bailey's Fine Jewelry, decided to close the Crabtree location in Raleigh, North Carolina after 15 years, he knew the decision needed to be handled with intention and professionalism. The goal was clear: exit the location while maintaining financial strength and honoring the store's legacy. Having worked with Wilkerson successfully in the past, Bailey understood the value of their comprehensive approach. "They understood both the emotional and financial sides of the store closing sale," Trey explains. "Their reputation for professionalism, results and care made it a very easy decision." The results exceeded expectations. Wilkerson helped Bailey's sell through significant inventory while maintaining the dignity of the closing process. "They don't just run a sale, they help close a chapter in the best way possible," Bailey says, strongly recommending Wilkerson to any jeweler facing a similar transition.