Depending on who is doing the counting, it looks like about 2,000 independent retail jewelry stores closed up shop in 2016. That’s about 10% of the total nationwide, and that is just astonishing. Many of these stores were third generation businesses and long established pillars of their communities.
The unfortunate thing for the owners is that they had to close their stores, rather than being able to sell them or transfer them to the next generation or the current staff. This means that instead of getting a multiple of the store’s earnings and full value for the inventory, the owner’s had to settle for some fraction of the value of the store’s remaining stock.
While many store closings are inevitable and unavoidable, you wonder if perhaps some advance planning, that should have been in place years in advance, may have forestalled the closing of the store and facilitated the sale or transfer of the business. Which, of course, leads me to the story of the Jewish holiday of Passover, which begins April 10.
Now, the Jewish people know this date well in advance. In fact, as the holiday winds down, we always check the calendar to see when next year’s holiday will fall. So, its not like the holiday ever sneaks up on us. Yet, it is a time honored tradition of Jews not to make travel plans, do the shopping, or make any of the preparations for Passover until the very last minute. And, that is in keeping with the origins of the holiday.
You are, of course, familiar with the story. The Jews were slaves in Egypt. Moses pleaded for their freedom. Pharaoh hesitated and delayed, and didn’t relent until after the plagues ravished his people and their land. Once he gave in, the Jews left in such haste, they couldn’t even wait for their bread to finish baking. So today, to commemorate this, we eat this dry, flat, nearly inedible thing called Matzoh for a week!
The Jews were hoping and praying for this day and had to know it would come soon after the plagues had wreaked their havoc. So, why weren’t they prepared? Why wasn’t the bread already baked and ready to go? Why, to this day, do we still not know just a few days before Passover, who’s house, who is coming, and who is bringing what?
And, so it is with jewelers who are forced to close their store, rather than sell it. Did they not look five years down the road and ask, “What is my exit strategy? Who is going to own and manage this valuable asset once I am ready to retire?”
Successful retail jewelers have either great bench skills or great sales and marketing skills. Either one is usually enough to assure some level of financial success. What is often lacking is the business management skills that might include planning for the future. There are always obstacles that confront every business owner, and having some business management courses under your belt to compliment your bench or marketing skills could be invaluable.
The 24 Karat Club offers a variety of scholarships to members of the jewelry trade. While most recipients use the money for technical training, we’d be happy to sponsor business management courses as well. If you, or someone you know would benefit from a 24 Karat Club scholarship, ask your favorite 24 Karat Club member (a list of members can be found at www.The24KaratClub.org) to consider nominating you for the appropriate scholarship. The right business courses could help prepare you to properly manage what might be your most valuable asset and help you maximize its value when it is time to retire.
The Jews of ancient Egypt weren’t prepared when it was time to leave, so today, their descendants must eat Matzoh instead of bread for eight days. If you are not preparing for the transition of your business when you are ready to retire, you might suffer a fate worse than eating Matzoh for a week, hard as that is to imagine. Be prepared to face any problems. Get the business training you need. Let the 24 Karat Club help pay for it.
And finally, no matter who you voted for in November, you have to figure the Trump Presidency will be good for the price of gold. If his plan to lower taxes and reduce regulations succeeds in juicing the economy, the resulting prosperity and hint of inflation is always bullish for gold. However, if his policies back-fire, and the economy tanks, investors will sell their financial assets, and move their money into the precious yellow metal. And, heaven forbid, he gets us into a shooting war, people throughout the world will reach for gold as the only safe haven, again causing prices to rise. Feel free to pass this observation along the next time a customer asks if the gold chain she is considering is a good investment.
From all of us at The 24 Karat Club, we wish you and your families a Happy Passover and a Happy Easter!