IT’S AMAZING HOW many jewelry store owners and salespeople don’t believe in their prices.
We negotiate on price when we should be focusing on the reason the client came in and the unique characteristics of the item itself. When you negotiate and fall back on price, that’s just a cheap cop-out to close early because you don’t have the patience or knowledge to prove the value that’s on the price tag.
When you discount by even 10 percent, that adds up over the course of time. I was working with a $4 million store the other day, and they ran a report for me showing that they’d lost $400,000 that year because of negotiating prices.
Another problem when you negotiate is that the client is going to want more off when they come in next. Stores that sell at the price on the tag have a higher closing ratio than stores that negotiate or play with their prices. When you negotiate, the client always thinks they could have done better when they leave.
And when you apologize or feel you have to justify the price, the client knows that you think it’s marked up too high. Instead, use value-added salesmanship. Value added is when you give facts about the item that prove the price is real. It could be the complication of design; the metal; color, clarity and quality of the diamond and gemstones; craftsmanship; brand name. There are all sorts of tools you can use to justify the price.
There are two perceptions of the price: the one the client has when they come in, and the one they have when they leave. If the presentation is always about them, the item and the reason they came in, you’re not focusing on the money.
Bridal and anniversary season is coming. You need to learn how to romance the reason they come in. Focus on the client, and the more they talk, the higher the closing ratio. So ask a lot of selling questions. Stick to your price on the tag, and teach your sales team NOT to sell out of their own pocketbook. Build the relationship first. Clients want to feel important. Talking to a computer is a lot different than talking to a real person, and that’s why online sellers can never build the loyalty you can.
When showing diamonds and bridal, start high. It’s easy to come down, and the client will realize you’re not pre-judging them. When you get to their price, they’ll believe that the value they’re receiving is actually very affordable. That’s how you improve your closing ratio.
When selling branded jewelry, use terms like “vendor restrictions” so clients know there is no negotiating the price. If you can sell those brands at the price they suggest, you should be able to sell every product in your store for what it says on the tag and do it with confidence, integrity and ethics.
Always prove the integrity of the item, of its manufacturing, of the lab report, and of the color, cut and clarity of the diamond. This eliminates negotiation.