Southern Jewelry News
  • Featured
    • All
    • Featured
    • Featured Retailers
    • Retailer Roundtable
    • Supplier Spotlight
    From Armenia to America, Motif Jewelers Turns 40
    Girl Power rocks at Jo & Co. Jewelers
    Jewelry Sales Training from a Living Legend
    Jewelers Look to Modern Tech for a Profitable Future
  • Latest News
    • All
    • COVID-19
    • Furry Friends
    • Industry Awards
    • Industry Events
    • NRF
    • On The Move
    • Other News
    • Sponsored Content
    • Tradeshow News
    • Video
    • What's New
    Luxury watch preferences among high-income women in the USATHE MV
    Columbia Gem House’s Jewelry for Wildlife fundraiser raises over $12,000
    GIA global research team convenes in Carlsbad
    Synchrony study reveals shoppers value in-store experiences, financing options for large purchases
    jewelers Security Alliance logo
    JSA reports surge in crimes against traveling salespersons and retailers not in retail stores
    CG Creations presents comprehensive Gold & Silver Almanac 2024
    Free and Festive Holiday Marketing from GN Diamond
    Free and Festive Holiday Marketing from GN Diamond
    Anna Martin to retire from GIA
  • Podcast
    The Jewelry Business Scorecard with JBT Experts
    Ep 53 – Jim Rocchio and Brenda Gamba, The Jewelry Business Scorecard with JBT Experts
    Ep 52 - Giving Thanks in Pearls, Our Thanksgiving Special Edition
    Ep 52 – Giving Thanks in Pearls, Our Thanksgiving Special Edition
    Ep 51 – Shelia Bayes, Making E-Commerce Accessible to Jewelers with Gem + Jewel 
    Ep 51 – Shelia Bayes, Making E-Commerce Accessible to Jewelers with Gem + Jewel 
    Stories, Trends, and Expert Insights from Snowden Jewelers
    Ep 50 – Chris Snowden, Stories, Trends, and Expert Insights from Snowden Jewelers 
    SoHo Success at the Atlanta Jewelry Show
    Ep 49 -Amy and Fran, SoHo Vibes, SoHo Success at the Atlanta Jewelry Show 
    The-Third-Generation-Fine-Jewelry-Expert_-Katelynne-Eslick-
    Ep 48 -Katelynne Eslick, The third-Generation Fine Jewelry Expert
    Long Jewelry Empire of Rembrandt Charms
    Ep 47 -Eric Lux, From Coop to Decades-Long Jewelry Empire of Rembrandt Charms 
    The Expert’s Guide to Jewelry Laser Technology of B&D Sales
    Ep 46 -Jacob Dupuis, The Expert’s Guide to Jewelry Laser Technology of B&D Sales
    Ep 45 -Andreas Argentinis, The Fine Personalized Jewelry Standard of Metal Pressions
    Ep 45 -Andreas Argentinis, The Fine Personalized Jewelry Standard of Metal Pressions
  • Columnists
    The Story Behind the Stone: Lost and Found in Africa
    A Visit to Mumbai – Diamond Central!
    Social media ads, boosted posts, Google paid ads: Making the right call for your jewelry store
    Image of Chuck Koehler
    The Retailer’s Perspective: Where Did the Good Times Go?
    The importance of having Patience & Compassion in your jewelry business
    The importance of having Patience & Compassion in your jewelry business
    Ruby sample before and after heating. Photo Natural Ruby company
    The Story Behind the Stone: Assume Heat
    International School of Gemology Education Series
    The Story Behind the Stone: Just Jewels
  • Classifieds
  • Subscriptions
    • Newsletter Signup
    • Print Subscription
  • Digital Magazine
    • Southern Jewelry News
    • Mid-America Jewelry News
    • Archive
No Result
View All Result
Southern Jewelry News
  • Featured
    • All
    • Featured
    • Featured Retailers
    • Retailer Roundtable
    • Supplier Spotlight
    From Armenia to America, Motif Jewelers Turns 40
    Girl Power rocks at Jo & Co. Jewelers
    Jewelry Sales Training from a Living Legend
    Jewelers Look to Modern Tech for a Profitable Future
  • Latest News
    • All
    • COVID-19
    • Furry Friends
    • Industry Awards
    • Industry Events
    • NRF
    • On The Move
    • Other News
    • Sponsored Content
    • Tradeshow News
    • Video
    • What's New
    Luxury watch preferences among high-income women in the USATHE MV
    Columbia Gem House’s Jewelry for Wildlife fundraiser raises over $12,000
    GIA global research team convenes in Carlsbad
    Synchrony study reveals shoppers value in-store experiences, financing options for large purchases
    jewelers Security Alliance logo
    JSA reports surge in crimes against traveling salespersons and retailers not in retail stores
    CG Creations presents comprehensive Gold & Silver Almanac 2024
    Free and Festive Holiday Marketing from GN Diamond
    Free and Festive Holiday Marketing from GN Diamond
    Anna Martin to retire from GIA
  • Podcast
    The Jewelry Business Scorecard with JBT Experts
    Ep 53 – Jim Rocchio and Brenda Gamba, The Jewelry Business Scorecard with JBT Experts
    Ep 52 - Giving Thanks in Pearls, Our Thanksgiving Special Edition
    Ep 52 – Giving Thanks in Pearls, Our Thanksgiving Special Edition
    Ep 51 – Shelia Bayes, Making E-Commerce Accessible to Jewelers with Gem + Jewel 
    Ep 51 – Shelia Bayes, Making E-Commerce Accessible to Jewelers with Gem + Jewel 
    Stories, Trends, and Expert Insights from Snowden Jewelers
    Ep 50 – Chris Snowden, Stories, Trends, and Expert Insights from Snowden Jewelers 
    SoHo Success at the Atlanta Jewelry Show
    Ep 49 -Amy and Fran, SoHo Vibes, SoHo Success at the Atlanta Jewelry Show 
    The-Third-Generation-Fine-Jewelry-Expert_-Katelynne-Eslick-
    Ep 48 -Katelynne Eslick, The third-Generation Fine Jewelry Expert
    Long Jewelry Empire of Rembrandt Charms
    Ep 47 -Eric Lux, From Coop to Decades-Long Jewelry Empire of Rembrandt Charms 
    The Expert’s Guide to Jewelry Laser Technology of B&D Sales
    Ep 46 -Jacob Dupuis, The Expert’s Guide to Jewelry Laser Technology of B&D Sales
    Ep 45 -Andreas Argentinis, The Fine Personalized Jewelry Standard of Metal Pressions
    Ep 45 -Andreas Argentinis, The Fine Personalized Jewelry Standard of Metal Pressions
  • Columnists
    The Story Behind the Stone: Lost and Found in Africa
    A Visit to Mumbai – Diamond Central!
    Social media ads, boosted posts, Google paid ads: Making the right call for your jewelry store
    Image of Chuck Koehler
    The Retailer’s Perspective: Where Did the Good Times Go?
    The importance of having Patience & Compassion in your jewelry business
    The importance of having Patience & Compassion in your jewelry business
    Ruby sample before and after heating. Photo Natural Ruby company
    The Story Behind the Stone: Assume Heat
    International School of Gemology Education Series
    The Story Behind the Stone: Just Jewels
  • Classifieds
  • Subscriptions
    • Newsletter Signup
    • Print Subscription
  • Digital Magazine
    • Southern Jewelry News
    • Mid-America Jewelry News
    • Archive
No Result
View All Result
Southern Jewelry News
No Result
View All Result
Home Columnists

What’s discount really costing you?

David Brown by David Brown
February 2, 2012
Share on FacebookShare on Twitter
Reading Time: 6 minutes

All business owners need to maximize their time by concentrating on those things that give the greatest Return on Investment (ROI) for the time involved. This would seem logical, however frequently we will see a store owner focusing on minor issues, such as staff taking too long for lunch while ignoring the hundreds of dollars of discounts that are being given away each day.

Employee tardiness shouldn’t be ignored, but if you are to address the most important issues in a business, then looking at the amount of discount given away will be a far better use of time. Yet many store owners don’t know where to look when it comes to measuring this – after all, it is seldom reported separately in financial profit and loss accounts.

Producing a daily sales report from your system should show you the amount of discount you are giving away each day, and you can check these reports monthly and annually to see the cumulative effect. Once you realize you’re giving away the equivalent of an extra employee’s income you soon realize what these discount decisions are costing you!

One of the problems with discounting is that once you start with a customer it can be hard to stop. My colleague, Michael Dyer, recently came up with an analogy that summed it up brilliantly (as a new grandfather he could relate to it first hand!). He describes offering a discount as being very similar to picking up a crying new born baby. At first it is a short term solution to the problem – but the trouble is the baby, realizing it can get this response, will resort to crying each time to get what it wants – and having trained it to respond in this manner you have then effectively created a rod for your own back.

Discounting is the same – once a customer realizes you are open to negotiating (and how low you are prepared to go) they will expect it every time, and won’t understand (and can become angry) if you then aren’t consistent. However, the reality is that you can’t offer the same level of discount on every item.

Many jewelers tend to ignore discounts as they see it as an area over which they have little control – they feel uncomfortable and pressured by the customer and tend to lose control of the situation; however a few simple steps can be taken to regain control and see the leakage reduced substantially from where it was:

  1. If a customer asks for a discount – celebrate! It means they want to buy it. You have now moved beyond selling and into the area of negotiating. They are a step closer to buying and the game has moved in your favor.
  2. Don’t offer one! 50% of customers will accept it if you explain that this particular item can’t be reduced. This will half your discount immediately. Those who won’t accept it won’t walk straight out the door. You have an opportunity to deal with them as outlined below.
  3. Offer an alternative. Vouchers (which will cost you less and bring them back in-store) or discount on an alternative item with more margin, or one that you really want rid of.
  4. You’ll be left with the 10-20% of hard core bargain hunters by now. You don’t have to give in straight away! Many enjoy the challenge and will, in fact, be suspicious if you give in too easily. Offer a level less than they are asking and many will accept.
  5. You’re nearly there! If they are still insistent, give them what they want (within reason). It is better than losing the sale. But following this strategy and training your staff in this manner will cut your amount of discounts given away by hundreds of dollars EACH DAY!
  6. Discuss the daily discount with the staff. One store who let their staff know the amount being given away each day, and named the amount given away by the heaviest discounting staff member (but not their name – they knew who they were by seeing their own sales reports) saw an immediate drop in the willingness of staff to discount and a sizeable reduction in the amounts given away.

It is a law of nature that you will get that which you concentrate on the most – whether it is good or bad. Concentrate your thoughts on why the economy is bad and the economy will be bad. Concentrate your thoughts on finding a partner and you will find a partner.

Concentrate on reducing your discounts and see the results.

David Brown is President of the Edge Retail Academy, an organization devoted to the ongoing measurement and growth of jewelry store performance and profitability. For further information about the Academy’s management mentoring and industry benchmarking reports contact Carol Druan at carol@edgeretailacademy.com or phone toll free 877-569-8657.

David Brown

David Brown

David Brown is the President of Edge Retail Academy, the leading jewelry business consulting and data aggregation firm, who provide expert business improvement plans, to help with all facets of your business including improved financials, healthier inventory, sales growth, increased staff performance, recruiting, and retirement/succession planning - all custom-tailored to your store’s needs. They offer Edge Pulse, to better understand critical sales and inventory data, to improve business profitability, benchmark your store against 1200+ other Edge Users, and ensure you stay on top of market trends with our $3 Billion+ of industry sales data. Contact David at 877-569-8657, ext. 001, Inquiries@EdgeRetailAcademy.com or www.EdgeRetailAcademy.com

Related Posts

The Story Behind the Stone: Lost and Found in Africa

November 27, 2023

A Visit to Mumbai – Diamond Central!

November 20, 2023

Social media ads, boosted posts, Google paid ads: Making the right call for your jewelry store

November 15, 2023
Image of Chuck Koehler

The Retailer’s Perspective: Where Did the Good Times Go?

November 13, 2023

Latest News

Podcast Episodes

Ep 53 – Jim Rocchio and Brenda Gamba, The Jewelry Business Scorecard with JBT Experts

November 28, 2023
On The Move

Luxury watch preferences among high-income women in the USATHE MV

November 27, 2023
Other News

Columbia Gem House’s Jewelry for Wildlife fundraiser raises over $12,000

November 27, 2023

Other News

GIA global research team convenes in Carlsbad

Synchrony study reveals shoppers value in-store experiences, financing options for large purchases

The Story Behind the Stone: Lost and Found in Africa

A Visit to Mumbai – Diamond Central!

JSA reports surge in crimes against traveling salespersons and retailers not in retail stores

CG Creations presents comprehensive Gold & Silver Almanac 2024

Southern Jewelry News

© 2023 Southern Jewelry News.

Additional Information

  • About
  • 2023 Jewelry Trade Shows & Events
  • Media Kit
  • Contact
  • Sitemap
  • Newsletter Signup

Get Social with Us

No Result
View All Result
  • Featured Articles
    • Featured
    • Featured Retailers
    • Retailer Roundtable
    • Supplier Spotlight
    • Sponsored Content
  • Latest News
    • What’s New
    • Industry Events
    • Tradeshow News
    • On The Move
    • Other News
    • Furry Friends
  • Podcast
  • Columnists
  • Classifieds
  • Subscriptions
    • Newsletter Signup
    • Print Subscription
  • DIGITAL MAGAZINE
    • Southern Jewelry News
    • Mid-America Jewelry News
    • Archives

© 2023 Southern Jewelry News.