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Keep it fresh for the upturn

Chief executive of the BJA, SIMON RAINER, on why the economic upturn means retailers should re-examine their business model.


was particularly pleased with the optimism that was in evidence at this year’s IJL show. In general the majority

of exhibitors and retailers I spoke to were experiencing a good show and felt confi dent of a good lead up to Christmas and beyond. So where does this optimism

originate from and how can suppliers model their businesses to take full advantage of the new opportunities available to them? As a keen observer of

macroeconomics, it seems to me the country is about to turn the corner. Whilst there are a few key statistical indicators pointing to a recovering economy, it is the mood of the consumer that is really key. If we are generally feeling better about things then solutions are easily found. Relating this to the jewellery

industry, I believe that the fall in the gold price has had a major impact

as The Bullion Room and Albermale and Bond are testament to this. To put it simply, you cannot survive in a business where your major income is derived from a commodity price that you cannot control and where volume of trade is absolutely imperative to supporting such low margins, which are in many cases in the region of 0.5 to 1 per cent. As gold prices have fallen,

increasing numbers of retailers have cashed in their gold stocks and released capital, which in turn has meant investment in fresh jewellery stock and brands. The eff ect of this is that designers,

manufacturers and distributors are enjoying increased order books, and thus the economic wheels slowly begin to turn again Even more importantly, the lost

years of relying upon scrap gold sales are being slowly recovered by retailers off ering new products to their


on the change of mood and perhaps more importantly a change in business models. For too long, retailers have relied

on the purchase and sale of scrap gold to supplement their falling jewellery sales. For too long, surviving in this comfort zone negated paying attention to long term business solutions. The fall in gold price has had a

major impact on our industry and recent issues surrounding traders such

November 2013 |


customers. Such a simple concept to keep a business fresh. Here, please allow me to digress for

a while. I recently had the pleasure of meeting a major international retailer who is about to enter the UK market. With more than 300 stores in the UK, the fi rm’s merchandising is such that stock is changed between stores every week to ensure that customers are always presented with a fresh product off ering. The lesson here is that new

products or even, as a minimum, switching product display position in-store is vital to maintain customer interest. Would you want to visit a store where you see the same thing in the same place every time you visit? So investment by the retailer in new

products and brands is slowly helping our industry to feel a bit better about itself and at last realising that there is a reasonably good future ahead. However, there are even more

trends emerging as both suppliers and retailers seek to fi nd that point of diff erence and add value to their trading proposition. We are starting to see that

designers and suppliers are far more conscious of consumer and retailer needs in developing brand stories to their collections. Retailers now have a huge choice of market-savvy suppliers to trade with who realise that product in isolation is not suffi cient to help generate sell-through. Whilst designers and suppliers

have stepped up their game, retailers are becoming far more aware of the opportunities available to them and with the help of the supply sector are realising the importance of becoming far more socially responsible in the products that they sell, too. There is a huge wave of new

interest in Fairtrade gold, and corporate socially responsible business practices that can only be of long term benefi t to our industry. The retailer’s renewed interest in

product and exposure to greater sources of industry initiatives and information will, I hope, provide even more momentum to the industry’s growth, optimism and prosperity.

Jewellery Focus | 17

SIMON RAINER is the chief executive of the British Jewellers’ Association (BJA). He has 20 years of experience of both the UK and international jewellery markets, and is a key industry contributor in improving business practices and supply chain transparency.

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