Achieving Sales Growth
The 2003 Cost of Doing Business Survey details sales growth for high-profit and chain jewelers
Why did jewelry chains and high-profit jewelry retailers achieve their better-than-the-whole 2002 numbers, as detailed by Jewelers of Americas 2003 Cost of Doing Business Survey?
Those with high profitability, as we charted last month (Staying Profitable, p. 66) garnered median net profits before taxes of 10.8% vs. 4.2% for surveyed jewelers generally. Jewelry chains were winners in sales growth, achieving median 6.1% growth, while jewelers in general reported flat sales.
A look at some survey details reveals some clues as to why they succeeded. In the chart at right, we compare sales growth in certain products for jewelry chains, high-profit companies and all companies in the survey.
Chain stores, for example, experienced much greater sales growth in watches, karat gold jewelry and cultured pearls than did jewelry retailers in general. Could better promotion, display or range of stock have contributed to these numbers?
Note also that high-profit companies achieved much better sales growth in estate jewelry, tabletops and fashion jewelry than did jewelers in general. High-profit retailers also reported a higher gross-margin-return-on-inventory in these three categories than jewelers in general. What are high-profit jewelers doing to achieve their greater growth and inventory profitability in these product categories?
While its impossible to know definitely, a detailed look at the charts in the survey could yield clues to help you achieve better results yourself. To compare your numbers to jewelers that mirror your store type and sales level, check out the entire survey, which details figures such as the ones in the accompanying chart for an array of jeweler groups, from high-end and midrange independents to designer/artist/custom retailers and chains.
To order the 2003 Cost of Doing Business Survey, sponsored by Jewelers of America and Professional Jeweler ($19.95 for JA members, $125 for non-members), call JA at (800) 223-0673 or visit www.jewelers.org. You also may order the survey at www.professionaljeweler.com.
by Peggy Jo Donahue