Analyze 2000 Before Buying
Time to take a close look at brand sales for 2000 and prepare to enter this year's buying season
Its February. Youre finished with what I hope was another great holiday season. Yet before you know it, youll be faced with important buying decisions for the coming year. Here are some thoughts on some of the questions that may crop up in the coming months.
How did the watches in your store perform? Look at sales not just in the fourth quarter, but throughout the year. Did the strong remain strong? Were there noticeable increases or decreases in sales among the brands?
Lets say you carry a brand that has underperformed in 2000 compared with 1999. This means it ended 2000 with fewer unit sales, lower return on investment or lower overall sales dollars. If you have a brand that fits this definition, did the slowdown occur recently or did sales drop continually during the year? Look for clues to discover reasons for the drop. Has the brand suffered because of poor marketing, poor position in your store, loss of interested salespeople or in-store competition from other brands?
Work With the Rep
You must understand the reason for a downward sales trend for one brand when perhaps all others showed gains. Once youve identified the problem, first try to work with your sales representative to locate the root cause. Before you split with the brand for good, it pays to remember a few key points:
- In the current climate of competition among stores and the brands within these stores, its tempting to give up on a poor performer. Some jewelers give a short opportunity for brands to make it before pulling the plug.
- Its possible some brands, trying to make it in the watch-eat-watch world, are so eager for any presence theyll make it easy for you to sign on and sign off with little risk. But quick sign-offs may not be the best long-term answer. Risks are not just financial. Stores that roll brands in and out in rapid succession may alienate customers. Even if a brand performs poorly in its first year, how do you explain its disappearance to a loyal customer who bought one based on your recommendation? Perhaps the strongest marketing for the brand has yet to reach consumers. Your store may be ahead of the brands sales curve. Sure you can say its a business decision, but a quick trigger on a brand can cost you credibility.
It is not unreasonable to expect a new product in your store to take longer than one year to develop. If sales remain slow after a couple of years and youve reached an impasse in new strategies for the brand, then it may be time to make a move.
Next Month: Looking at New Brands
Each month Paul White fills this column with sales tips for retailers who want to sell more watches. If you have suggestions for topics, questions for Paul or specific examples from your store, send them to Professional Jeweler, 1500 Walnut St., Suite 1200, Philadelphia, PA, 19102; email@example.com.