Congratulations! You’re still in the jewelry business. Despite everything that we’ve faced in the last five years, you (or your employer) have figured out how, in the most difficult environment ever, to make it work.
This means you’ve managed to lock down your expenses, control your personnel costs, develop your ideal product mix, all while maintaining margins, and in an ever changing economy. Sharp retailers are relentless in staying after these goals, and keep a watchful eye on every aspect of the business they can control.
But here’s what is unique and so challenging about our industry. The major component of the biggest expense we all face, the “cost of goods sold” is the price of gold. And, we have absolutely no control over its price! Do all the cost cutting you want, but the price of gold is set by a bunch of traders in London at something called “The Fix”. That should tell you everything you need to know.
One of the cardinal rules of any business is that you should never sell an item for less than its replacement cost. This, of course, means that on gold’s most volatile days, retailers are forced to change the price tickets on all their gold merchandise. Otherwise, they run the risk of selling for less than what it might cost to re-stock the item! And, as far as I know, no one has come up with a way around this task yet.
The 24 Karat Club, despite our name, doesn’t control the price of gold, nor can we predict it. We do offer, however, incentives and scholarships so you can learn how to monitor and manage those aspects of your business that you can control. To learn how you may qualify for any of our scholarship opportunities, ask your favorite 24 Karat Club member for details.
Now its time to announce the first annual 24 Karat Club “Nail the Close” contest. Just predict the closing price of gold for December 31, 2013. E-mail your entry (one entry per person, please) to me (Howard@FingerMate.com) with your name and where you work. Please put “24 Karat Club/Nail the Close” in the subject line. Whoever comes closes to predicting the closing gold price will win lunch for two at the spring SJTA Atlanta Jewelry Show with one (or more) board members of The 24 Karat Club. Entries must be received by June 30, 2013. In case of ties, everybody wins.
If you win, you agree to have your picture published in an up-coming issue of Southern Jewelry News, and more importantly, tell us how you did it! Good Luck!
Howard Kelrick is President of Finger Mate and a board member of The 24 Karat Club, SEUS. Finger Mate manufactures and installs expandable ring shanks and sells to retail jewelers throughout North America. Contact Howard at 954-458-2700 or e-mail Howard@FingerMate.com.
