YOU’VE PROBABLY HEARD of “good/better/best” pricing, but I’m going to talk to you about “good/better/best” jewelers.
A “Good” Jeweler …
Runs the store by the seat of their pants. They buy lots of inventory because they like pretty things without thinking too much about price points and how well they turn in a year. They hardly ever get rid of years-old inventory, thinking they’ll make a killing as gold rises — it’s their retirement plan.
Inexpensive items are left in the showcase at night covered with bedsheets. This invites criminals to break into the store windows, taking worthless jewelry but causing $25,000 to $50,000 in damage.
They expect that if they hire a salesperson, they should already know how to sell. Ha!
They are still using handwritten receipts.
A “Better” Jeweler …
Has a point-of-sale program and looks at a Daily Activity report, including how much money they took in and how much was sold by each sales staffer.
A Better Jeweler might be on a jewelers Facebook group, responding often to questions or even asking questions and deciding which answer coincides with their beliefs.
They might even have a commission plan, but it’s so weak, the staff yawns at it.
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A “Best” Jeweler …
Ah‚ the Best Jeweler. A delight. Runs a report each week of stock items sold last week that were in the store for less than six months and reorders this item until it doesn’t show up on the report anymore. This gives them a yearly turn of TWO! An awesome number, easy to achieve and it gives us more money.
In addition, a Best Jeweler knows inventory over 12 months old becomes stale, for customers and for cash flow. Over a year old increases accounts payable debt, credit card debt, loans from the owner and banks. It lowers our bank account balance as well, but a Best Jeweler uses many tactics to get rid of it.
- Returns it to vendor after 12 months
- Doubles commissions on aged inventory or gives spiffs.
- Puts it on sale.
- Sells it to other dealers.
- Takes it apart and makes new designs.
- If it reaches 18 months, scraps it.
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A Best Jeweler has incentives for the staff, has bi-monthly sales training and even joins jewelers mentoring groups to enhance their ability to run a top-notch store and train themselves to be a better manager to their staff.
They also use advertising media that matches how sales came into the store. Consistently, not blowing big bucks only at year’s end.
A Best Jeweler is not a workaholic, giving more time to their family and the families of their staff as well.
Here’s hoping you had a cash-positive 2023, and here’s to an even better 2024.