(PRESS RELEASE) WARWICK, RI — JBT’s mission for over 135 years has been to provide accurate financial reporting information to the jewelry industry. By providing credit ratings of jewelry firms to our members, we help the economic supply chain of the jewelry industry function efficiently. By providing aggregated business data, we help our members understand broader economic trends specific to the jewelry industry.
JBT is also a member-supported organization. Some of the questions we are hearing from our members are:
- What is happening to the economic supply chain of the jewelry industry?
- When will this economic crisis bottom out?
- What will the recovery look like?
The biggest question we are hearing from firms which currently have a JBT Rating is:
- What impact will this crisis have on my JBT Rating?
We have spent the past two weeks consulting with our membership, our management, and our listed firms on how to manage credit information during this crisis. To be honest, some of the discussions have been pretty heated, reflecting both the concern and the passion for industry survival from all of the participants. As you would expect, the opinions ranged from “Don’t change a thing” to “Freeze everything until this is over” and everything in between.
Throughout these discussions, it was apparent that no one has the answer as to when the economic crisis will bottom out and what the recovery will look like. Anybody who says they know is resorting to punditry. Because we don’t know the answers to these questions, changing our methodology to meet today’s conditions would be asking for trouble, particularly because it would be nearly impossible to determine when to return back to the original methodology. What constitutes “recovery”?
By continuing our current methodology, JBT can provide the most accurate information regarding store closings, changes in financial position, and overall changes in operations. That will make it easier to determine both the economic bottom and the upward slope of the recovery when it happens. With a solid pre-COVID-19baseline to work from, maintaining our current methodology will help everyone comprehend the scale and speed of the eventual upswing. As part of that strategy, we are asking our members to continue to submit their data as they have before the crisis without modification. We will also be asking our members to highlight if any special terms or extensions were granted so that our aggregated data isn’t unintentionally skewed by unanticipated member credit modifications.
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However, we recognize that every jewelry firm has been adversely impacted by this crisis, and to give large numbers of firms a low rating because the economic supply chain is broken isn’t particularly helpful for either the rated company or the JBT member extending credit. What is needed is additional context. In that regard, in addition to the rating using our normal methodology, we will be including in every JBT Credit Report the rating of the listing as it stood prior to the COVID-19 crisis. If a firm was highly rated prior to the crisis, that will be visible to the JBT member. By the same token, if the firm had a low rating prior to the crisis, that will also be visible. We believe this approach balances both fairness and accuracy, while providing the greatest amount of data transparency. For firms that are worried about updating their own information once the recovery is under way, JBT is in the process of building a web-based solution for any jewelry business owner to claim their own listing, provide updated information, and their latest trade references.
These are obviously challenging times for everyone. At JBT, our goal is to provide the best and most transparent business data possible, which we hope will help everyone in the jewelry industry, navigate successfully out of this ditch. In the meantime, it is our sincerest wish that everyone remain healthy and safe. Together, we will get through this.
We would love to hear from you your thoughts.
