Happy New Year! Time for retailers to rest, right? Actually, don’t kick back in that easy chair just yet. With the holiday shopping season over, this is the time to review the past year and make plans that will help ensure a successful year ahead. The holiday rush has given us all an opportunity to learn about our customers’ buying habits. Wise jewelers will now use that knowledge to plan for a profitable year ahead.A good place to start is in a review of your sales figures from the past quarter. What were your best-selling categories? What was your average price point? Were your customers requesting product that you didn’t have available? Talk to your vendors and find out what their best sellers were. Once you’ve determined what sells the best, you should review your current inventory and see if the mix is right.
Do you have an adequate supply of your best-selling categories? Does your average price point reflect what sold last year? Check your gross margins by category. Compare them to industry averages. Are you in-line with the rest of the industry? Make sure you have a good mix of items that will generate a higher margin, in addition to specials, which turn quickly but may not generate as high a margin.
Here’s something everyone eventually has to address: what are you going to do with that slow moving inventory still sitting in the display cases after another Christmas season? Analyze your aging inventory, and identify pieces that have not moved for a while. These pieces may create an opportunity for you to advertise clearance specials in time for the Valentine’s Day buying season. Mark them down to a price where they will move, and utilize the cash generated from the sale of those goods to invest in better selling categories. Now you’ve turned stale product into a sales opportunity.
Are your competitors offering something that you aren’t? Have your customers asked for additional services than what you currently offer? Review your return policies, repair policies and other services that help to retain your customers, and be sure you’re competitive.
Don’t be afraid to branch out. Are you currently set up to buy gold from your customers? This has been a huge profit center for many jewelers the past couple of years, and with the current value of gold, the trend should continue. Make sure you are set up to take advantage of this opportunity. If you can buy gold for $15 a gram and sell it for $25 with minimal effort and investment, why not make additional cash to help pay the overhead? (And remember, you’re also giving your customers cash they can spend on something new in your store.)
Speaking of gold, have you reviewed your pricing to make changes for the increased valuation? As gold has seen tremendous increases over the past year, you may want to review your price structure to reflect the current values.
As you continue the evaluation, ask yourself what was the most effective form of marketing and promotion you employed this past year. How do customers learn of your special offers? Is your mailing list up to date? Have you started to use social media resources? Many times a jeweler will cut his marketing and advertising budget when sales begin to decline. However, this strategy could kill a business. You should investigate cost effective ways to market your product and inform the public of all the reasons why your store is a leading competitor.
Don’t forget to take a pulse from your own team. Sit down with your store managers and other sales people and listen well. They are dealing with your customers every day and they hear things that you need to know. Make them comfortable in discussing their ideas with you, and you will learn from it, and your sales will likely benefit.
So before you settle into a winter snooze, take the time to make changes that will help improve your sales performance in the New Year. Don’t wake up from that hibernation and make the same mistakes from the past. In today’s competitive marketplace, a proactive owner takes home the prize. Learn from your mistakes, and constantly evaluate how to make enhancements in your sales strategy. If you do, chances are good that you’ll be ringing in the New Year in style, all year long.
Bob Epstein is CEO of Silverman Consultants, LLC. Offering a legacy in sales strategies for jewelers since 1945, Silverman Consultants provides guidance to store owners seeking to turn around a business, sell off unwanted inventory, or liquidate an entire store. With offices located in Charleston, South Carolina; New York, New York; and Saskatoon, Canada; the company helps jewelry store owners and chains formulate strategies designed to maximize revenue in times of transition, whether due to retirement, store closing, or simply when needing a boost in sales. For more information, visit www.silvermanconsultants.com or call Bob direct at 800-347-1500.