Temperatures on the East Coast were reaching the triple digits in July, but at Watchmakers Diamonds & Jewelry, store president J. Dennis Petimezas was thinking Christmas, www.nationaljewelernetwork.com writes.
With air conditioners going full throttle, the store hosted a "Christmas in July" sale, an annual tradition that has already given the retailer a 9 percent lead this year over its 2009 sales. But the head start doesn't mean Petimezas is resting easy. With that other Christmas approaching, the retailer is keeping a studious eye on everything from he store's marketing to the inventory in is showcases, namely making sure that Watchmakers' offerings are of a breadth wide enough to reach marriage-minded millenials, bead-crazed shoppers and veteran customers seeking everything from entry-level silver to high-end diamonds.
With just two months before the holiday season kicks into high gear, retailers across the nation are similarly focusing on inventory. It's not an easy task, especially when it means tying up cash to gamble on inventory.
"I want to spend dollars on merchandise, but in order to turn that merchandise, it's much easier to buy a sold item," says Steve Ginsberg, owner of Ginsberg Jewelers in Cedar Rapids, Iowa.
As Ginsberg and other retailers have found, it makes the most sense to reorder product that has already proven its merit at the counter, and high-tech management systems, such as The Edge, are making it easier than ever for retailers to zero in on best-sellers.
Years of experience have shown Doug Meadows, co-owner of David Douglas Diamonds in Marietta, Ga., that holidays make for "a big season for diamond earrings, diamond bracelets and diamond pendants," the retailer says.
Petimezas, likewise, is making sure to stock a deep inventory of diamond jewelry pieces, including De Beers' Everlon designs, which Watchmakers introduced last year. Petimezas, who says the store's sweet-spot ticket price lies between $500 and $900, believes that Everlon sales will be even stronger this year as more consumers become familiar with the knot-themed jewelry.
Bring on the bridal
Yet if there's one demographic that retailers appear to be betting on for the 2010 holiday season, it is those who are planning to get engaged.
"We're stocking up heavily on bridal," says Camille Hannoush, a vice president of the Hannoush Jewelers chain, who was among the retailers attending the JA New York Summer Show. "That has been our main focal point all year."
Bridal has also been a focal point for Petimezas, who was shopping JA for tungsten carbide, titanium and stainless steel bridal designs to complement pieces already in stock.
"It seems that the bridal is driving everything," he says. "If you get the bridal, everything else will follow."
Ginsberg, who is expecting the holiday sweet spot for bridal pieces to fall between $1,500 and $4,000, says being prepared with bridal offerings is something of a no-brainer.
"Not only do a lot of people like to get their rings for the holidays, but they want to get them by the holidays so they can show them to their families," the Iowa jeweler says.
Yet being able to capture the attention of bridal shoppers can be tricky, because it requires having a wide selection of options to show, something that comes at a cost. One solution Ginsberg, among others, has turned to is showing prototype jewelry, look-alike designs composed of alloys and cubic zirconia.
"For a $10,000 investment, I have a $300,000 look in inventory and it's allowing me to expand my selection to my customers without breaking the bank," says Meadows, whose store has used prototype jewelry for years and is now showing both bridal and fashion prototypes from Stuller's new "Merchandising Solution" program. "We're on the outskirts of Atlanta, so some of my competitors are the big-box stores. I've never felt that they've been competition in terms of price, but they have been in terms of selection."
After launching the program with bridal prototypes in January, Stuller increased its offerings to include gemstone and diamond fashion pieces, paving the way for the 1,160-plus prototype pieces now available.
Customers love being able to try on the prototypes unattended, Meadows says, adding that clients do not yet seem to mind leaving the store without a finished piece in hand, since pieces are ready for delivery the next day or within a few days.
Ginsberg, who also uses the Stuller program, says that in addition to helping to sell the fine pieces that they stand in for, the prototypes also help move other finished designs.
"There's a great give and take, because there's more to try on, more to look at, more to compare," he says.
Petimezas, who currently uses a prototype system at Watchmakers, was on the lookout for more "brass-and-glass representations" at JA. He says that his store has had limited success with the system currently in place, but adds that as with a first car or a first anything, that is to be expected.
What Petimezas has learned thus far is that carrying prototypes with larger center stones increases the likelihood that a customer will splurge on a similarly large stone. He's also found that it's important to do some retooling to fit the store's needs.
"We've refined [the program to] what we think would be more successful for us," he says.
With Stuller's program, the company provides retailers with recommended assortments, which can be changed up to 25 percent. In addition, retailers can design their own collections and choose 100 percent of their own pieces, and an exchange privilege allows them to switch up to 25 pieces per year.
Traffic-drivers
Prototypes aside, there are just some live and ready-to-go pieces that retailers are making sure to keep in stock this holiday season.
During JA, James Durbin of James Durbin Jewelry Design in Kirkwood, Mo., was on a merchandising mission for fashion rings featuring larger stones that would help catch shoppers' eyes and help "add to the overall picture of the store," which does a big custom business, he says.
Fashion pieces have also been on the shopping list for Long Island, N.Y., retailer Marc Solomon, who is betting on colored pearls, colored diamonds and Italian jewelry, including brands such as Marco Bicego, Nanis and Rebecca, for his two Solomon Jewelers stores.
Then there's silver jewelry, a category that cannot be ignored, what with consumer demand for entry-level pieces running high and supply from the manufacturer side brimming.
Among the designs catching Hannoush's eye during the JA Show was a diamond-cut silver chain line from Italy. The designs, Hannoush says, would make a good substitute for more pricey gold chains.
"This is the type of product under the $400 price range that we're trying to fill in," he says.
At David Douglas, the recent focus has been on silver jewelry from Pandora, the bead jewelry powerhouse that also produces sterling silver interchangeable earring designs, stackable rings, and sculptural bangles and pendants. While Meadows has seen bead customers beginning to show interest in Pandora's silver, he says that the offerings also make sense for non-bead shoppers who are simply seeking affordable gifts.
The retailer references a line from Stuller's Bob Cox, executive vice president of sales, who has previously spoke on the "three Bs" of the jewelry business: Bridal, Beads and Buying of gold. From what Meadows can see, it looks like these Bs will hold strong for the holiday season.
"I hope there's more to it, but it's definitely something I can count on," he says.
