Business is improving, but the recovery remains slow
October 31, 2013
New York--Jewelers of America’s 2013 Cost of Doing Business Report shows that jewelers’ sales continue to increase a little bit each year, and that brick-and-mortar retailers may be regaining ground when it comes to diamond sales.
The report, released by JA Tuesday, compiles 2012 financial data from a cross section of jewelers. It is intended for use as a benchmarking tool so jewelers can compare their performance to that of their peers.
Overall, retailers surveyed reported that sales were up 5 percent in 2012 as compared with 2011.
The last time JA did the Cost of Doing Business Survey, in 2011 using fiscal year 2010 data, survey-takers’ sales were up 7 percent year-over-year, a sharp increase following three straight years of falling revenues during the recession.
The 2013 report also sheds light on how different types of jewelry, i.e., diamonds, colored stones, and karat gold, are selling these days.
Though it may surprise some, the report shows brick-and-mortar retailers are experiencing resurgence in diamond sales.
Retailers surveyed reported that in 2012, 51 percent of their sales came from diamond jewelry (36 percent) and loose diamonds (15 percent). That is up from 36 percent (27 percent diamond jewelry, 9 percent loose diamonds) in fiscal year 2010 and 44 percent in 2009 (31 percent diamond jewelry, 13 percent loose diamonds).
In addition, those surveyed reported that diamond jewelry sales were up 9 percent in 2012 as compared with 2011 while sales of loose diamonds climbed 8 percent.
Other key merchandise categories for survey-takers include repairs (13 percent of sales), colored stone jewelry (8 percent of sales), karat gold jewelry (7 percent of sales), fashion jewelry (6 percent of sales) and timepieces and watch bands (5 percent of sales).
A total of 116 retailers took JA’s 2013 Cost of Doing Business Survey.
They were asked to classify themselves as primarily high-end, mid-range or designer/artist/custom firms.
Using data from all participants, JA then broke out the performance of the top 29 stores with the highest profit before tax to compare their performance with that of the other retailers.
The comparison indicated that high-profit retailers didn’t necessarily sell more jewelry but manage to have a fatter bottom line because of their ability to cut operating expenses, specifically in payroll, occupancy and advertising.
“The report reveals that there are no barriers to high-profit success in the jewelry industry; the only requirement is to identify the areas where high-profit firms perform better and target for that level of performance,” JA stated in an analysis.
Jewelers can order the entire 2013 Cost of Doing Business Report online at Jewelers.org or by contacting JA at 800-223-0673 or firstname.lastname@example.org. The report is $49.95 for JA members and $199.95 for non-members.
Profit Planning Group compiled the survey and administered the report using jeweler responses from across the United States. Retailers who participated in the survey received the final report for free, as well as a customized performance analysis.