Managing: Your Credit Rating
What is the Jewelers Board of Trade and why should jewelers
The Jewelers Board of Trade was founded in 1884 to serve as
a credit reporting service for manufacturers and wholesalers
to learn which jewelry companies were financially secure. They
wanted to be sure the retailers with whom they did business could
be trusted with valuable goods and would honor their debt obligations.
Today, as a retailer, you may think JBT is still only for
manufacturers and wholesalers and really has nothing to do with
you or your business. But there are good reasons why a retailer
may want to consider membership, says Nathaniel C. Earle, president
of JBT (see box on next page). Even if you aren't a member, recent
changes and improvements make it all the more important you know
what JBT does.
First and foremost, JBT is a credit reporting service
offering members access to 38,000 current credit reports (on
retailers and manufacturers) in the U.S., Canada, Puerto Rico
and the U.S. Virgin Islands. The annual membership fee of $740
includes two Confidential Reference Books (referred to as the
Red Book, published in March and September) for quick name, address,
phone, business description and rating reference on each company
listed. The rating reference is derived from
information provided to JBT by companies that receive a questionnaire
annually. Based on the rating, the member can order a full credit
report, which provides a wealth of information about the company.
The annual fee includes weekly confidential service bulletins
that update the confidential ratings contained in the Red Book.
It also includes 25 credit reports annually. Additional credit
reports are only $7 each for U.S. and Canadian members, $11.50
for foreign members.
The Red Book is available now on CD ROM also. It allows
for more flexible searches by name, telephone number, address,
rating or type of business. The CD version is available for an
JBT also offers Continuous Service Automatic Updates for an
annual fee of $25. With this service, once you order a credit
report on a company, you receive all updated versions of the
credit report on that company for the next 12 months, eliminating
the need to order additional reports later in the year.
The collection department performs a major function of the
JBT and recently underwent some changes to become more efficient,
less expensive to use and more successful in collecting over due
accounts. Because JBT is a not for profit association,
its collection fees are very competitive. About one third of
JBT's 3,200 members use this service.
For an annual fee of $200, you also can receive JBT's Bankruptcy
Report and New Claims Report. The Bankruptcy Report lists key
developments in industry cases filed with the U.S. Bankruptcy
Court. The New Claims Report lists all claims placed with JBT's
collection department in the previous week. Both reports are
faxed to subscribing members every weekend so they can learn
even more quickly about companies that are slow to pay their
bills: a plus if you're trying to retrieve money owed you, but
a real minus if you are the slow payer and your debt is turned
over to JBT.
Providing Information to JBT
From a reporting viewpoint, JBT offers every retailer a chance
to present its business profile to the entire manufacturing and
supply side of the jewelry industry. While not every jeweler
feels comfortable sharing sensitive financial information, if
you do, you should report as fully and accurately as possible
to enhance your ability to to get credit and get it at the best
"The information a retailer provides to JBT is one of
the best ways for him to tell his story to the industry,"
says Earle. The more information provided, the better able JBT
will be to present the most accurate picture of your company
and its creditworthiness to the thousands of manufacturers and
wholesalers with whom you'd like to do business.
Should A Retailer Join JBT?
"There are good reasons why a retailer should consider
membership in the JBT," says President Nathaniel C. Earle.
As a jewelry retailer, you're not likely to extend credit
back up the chain of distribution. However, there are other reasons
you may need to know the financial stability of your suppliers.
For example, when planning inventory, advertising, catalogs,
in store displays, promotional events and direct mail campaigns,
you make certain purchasing decisions involving immediate and
future orders. You need to know the product you're marketing
will arrive when you need it and that you'll be able to replenish
stock as needed.
You can lose a lot of time and money if you develop brand name
recognition in a company that's on the verge of going out of
business or can't manage its own bills in a timely manner.
In an industry where you need to know as much as you can about
your supplier as well as your customer, membership in JBT can
be a valuable tool.
Copyright © 1999 by Bond Communications.