Jewelry and watch wholesalers, like all business people in America, know that the economy remains sluggish and shoppers are discriminating. However, our survey of wholesalers reveals that jewelry sellers can still do well if they adapt their assortments and merchandise carefully. “A lot of retailers complained last year about sales being lower, and not doing well,” says Sterling Forest CEO Dinesh Kumar. “This year, if they market their products much better, add trendy products and explain them better, they can change the whole outlook of the store. There is a lot of business in the market.”
Following are the products and trends that industry experts say will get retailers a fair share of jewelry and watch business:
Metals and Materials
According to Sterling Forest’s Kumar, the key driver of customer satisfaction is high quality at value pricing. That means finding a way to offer bargains. “Gold and platinum are very expensive these days,” he says. “So silver is doing much better. A lot of retail stores that have been selling gold and diamonds have swung into silver jewelry because of price-consciousness.” Similarly, very small stone gems are selling now because there is a market for it. “We are doing a lot of cubic zirconium stones,” Kumar says. The smaller stones are powerful in the market. “A pendant might have 50 to 100 stones.”
Sun Fashion Designs manager, Diedre Parker, agrees. “Thin pendant chains are being used with medium sized and larger cubic zirconium stones,” she says, “This makes sense because the prices of semi-precious and precious stones has not increased as dramatically high as the price of the precious metals.”
So it makes sense that a non-precious metal, stainless steel, has grown in popularity, according to Kumar, a sterling silver jewelry wholesaler and importer. “Stainless steel is doing really well because the finish does not tarnish, it has luster, and is rough and tough compared with silver for men’s jewelry.” Kumar’s bottom line: “Sterling silver and stainless steel are going to be very hot products because the price points make them affordable. Look into the latest trends and keep up to date at all times to stay competitive.”
SalesOne International marketing director, Guy Pineta, agrees that gold is out. “Right now, because of the prices of gold and silver, stainless steel has been very popular,” he says. “All kinds of retailers are looking toward alternative metals like stainless steel. They need to sell something, and with the prices of gold and silver, it’s getting hard to sell those. Stainless steel has been coming heavy into play with jewelry customers.”
Alternative metals are becoming popular for traditional uses, says Pineta. “Cobalt chrome is new and hot, especially for wedding bands. People are even looking at stainless steel for their bands.” One steel variation has the appearance of gold. “It looks just like 14 karat gold,” says Pineta. “A lot of people really like it. It’s hypoallergenic.” Steel and silver styles often echo traditional styles, formerly found in gold. “We still are developing a lot of traditional jewelry designs,” notes Pineta, and “we’re expanding our stainless steel chain collection.”
Kumar of Sterling Forest agrees, adding that regarding anything that is doing well in gold or platinum, “those styles are doing very well in silver.”
But even less expensive materials will do well, says Kay Import president, Michael Chang. “Nowadays, wood sells well,” he says, adding that plastic and wood tends to sell better than metal. “Colored or natural wood is a good seller. I have a lot of shell necklaces and earrings coming in. I’m not ordering any metal. Plastic, wood, and shell will be good this winter.”
Cloth is another low cost material to consider. “Any kind of tie bracelet, similar to a sailor bracelet, anything made of cloth that ties or cinches onto your wrist, is very very popular right now,” says Phillips International director of sales, Marc St. Pierre. But one low cost material is on the down side of the trends. “Fun bandz” are not as much fun for retailers as they were earlier in the year. “What’s slowing down is the rubber band bracelet,” says St. Pierre, “now that schools are banning them.”
Colors and Styles
Maybe as an antidote for the dreary, grey economic outlook, one of the hottest trends is toward products offered in vibrant colors. VLC Distribution co-owner, John Hickey, who operates Watchwholesalers.com, has seen that in the watch business. “The hottest trend that has taken place in the watch industry over the last year and a half is bright bold color, which has just come on and taken over,” he says. “One-color watches, if you go to a department store, just jump out at you.” Confirming the trend to a wide color range, Kay Import’s Chang says that trying different colors is key to satisfying customers. He focuses on selling to African-American females, and for that demographic, “black and purple are the hottest colors.”
For the ultimate in color, how about products that change hue when worn? “We’re doing a lot of mood jewelry,” says Phillips International’s St. Pierre. “It just keeps going, with new designs and new finishes. That’s very strong for us.” And he has more color coming up. “We’re going to be bringing on an iridescent line,” says St. Pierre. “That’s going to be a variety of pendants with a pastel color iridescence. We’re also bringing on a ‘prism mood,’ a mood-with-crystal effect.”
“People like something fun, colorful, and fashionable, with many themes,” says Whimsical Watches owner, Robert Winenger, talking about recent watch trends. “We’re not pushing a timepiece so much as we are pushing something that’s fun, fashionable, colorful, and affordable. Everybody owns a cell phone today, so nobody needs a watch, really.”
In the mode of letting a watch be an expression of personality and fashion rather than just telling the time, Winenger offers watches that are decorated with emblems of one’s hobbies or profession, or favorite sports teams or pet. Compared with traditional watches, these are, “less expensive, more of a costume jewelry for adults,” he says. “Customers like different colors that go with various outfits they wear during the week, versus having one real high-end watch that you wear all the time.”
VLC’s Hickey agrees with that trend. “Everyone has cell phones” he says. “Everyone has a different way to keep time. So it’s definitely more of a fashion statement than it is a utilitarian piece of equipment.”
And looking toward traditional jewelry, one popular style is the eternity circle, a sort of hoop on a necklace chain. Sun Fashion Designs’ Parker says that it remains popular, with more variations. “The medium sized and large eternity circle was the first version of the style to be popular,” she says, “but now we see all shapes and sizes: small, medium, and large; circles, squares, ovals, rectangles and squares, and even geometric shapes; and with and without stones.” Parker also suggests larger hoop earrings and large, open link chains, in combinations of bracelet, double bracelet, and double length necklace, are also popular. Another style trend to watch: “The motorcycle/biker edgy look is still popular,” according to SalesOne International’s Pineta.
Displays and In-store Merchandising
One key to good margins is how the customer perceives the product. “The better your display, the more you get in value for your merchandise,” says Sterling Forest’s Kumar. “In a brand store, in a pretty looking store, retailers can get 500 percent, 700 percent markup, compared with 100 to 200 percent markup in a mom and pop store. The display part of it makes a lot of difference.”
According to Dinesh Kumar, one way to get a good return on metals less precious than gold is to make them seem upscale in the store display. “Trends are to put silver and stainless more on the whiter backgrounds,” he says. “No more black backgrounds. It gives you more elegance.”
For other venues, such as the souvenir and gift stores that buy from Phillips International, presentation is no less important. “Display in jewelry is everything,” says St. Pierre of Phillips. “The most successful way to display is to put it on a floor spinner. That’s more successful than showcases on countertops or walls or any other method. People like to see a big representation and assortment of jewelry, and when you do a floor display, you have four sides, so you are able to tell four strong stories, make four strong statements. You can do a side of mood jewelry, a side of sailor bracelets. It draws the kids and the tweens over to the rack, and they can group around it, and spin it and shop it.”
St. Pierre does not think that the point-of-sale should be the prime driver in selling jewelry. “A lot of times, the customer may try us on a counter, and it’s not successful,” he says. “Typically people are waiting on line at a counter to pay for the merchandise. They aren’t going to get up to the counter and start shopping for jewelry. The counter is for impulse items. Jewelry needs to be on a floor display.”
Echoing that emphasis on grouping similar products, Kay Import’s Chang suggests putting all the same color jewelry together. “That way, when shoppers buy a purse or shoes, they can match the colors,” he says. “A lot of black ladies do that. They try to match the earrings with shoes, earrings with necklaces. They like matching colors.” He also suggests putting the silver on one side, the gold on the other, and the colored stuff in between. Each section then tells the, “strong story,” that St. Pierre describes.
Low Prices, Not Low Quality
Keeping prices down is a repeated theme one hears from these wholesale experts. “I’m hearing a lot of customers are finding it tough out there,” says Phillips International’s St. Pierre, “but luckily for us we are selling retail jewelry at price points of $9.99 and under, and that has been key. Our customers are flat-to-up with our line. They may be suffering in other areas. The people who are out there looking for souvenirs on a family vacation are cutting back, but they’re not cutting back on the $9.99 souvenir. They’re maybe not buying that $29 sweatshirt, but they’ll go to Alaska and pick up $9.99 necklaces with a moose on them all day long.”
Whimsical Watches’ Winenger also thinks his company has managed to thrive by offering value-priced merchandise. “The biggest thing that I’ve heard from others that market watches is that the trend right now is not towards real high-end, luxurious, expensive watches. It’s just not the economic time to be able to sell stuff like that. That’s good for our business. Not only is our stuff unique because it is whimsical; it fits someone’s budget even in the worst economic times of our life.” VLC’s Hickey agrees with that, saying that people want the quality of name brand watches, but not the higher priced versions. “We sell most brands in the mass market and mid-tier price points,” he says, citing Timex and Casio, among others.
Kay Import’s Chung has words of warning for retailers who take the low price mantra too far. “Customers are always looking for low price, but its really dangerous if you sell that. Low prices always means low quality,” he says. “People look for cheaper and cheaper stuff. But in six months, the color has been turned. The quality is not good.” He suggests that selling the lowest price and quality merchandise only works if you manage customer expectations. “I put them on sale for 25 cents apiece. They are not meant to last long. They’re meant to be worn a couple times and then be thrown away.”
On the whole, these savvy wholesalers think there are decent profits to be made in the business, even in the current economic climate. “We’ve tripled our business in the last three years,” says Whimsical Watches’ Winenger. SalesOne International’s Pineta suggests that successful business such as his own are positive examples, saying, “Our business has done pretty well. Customers are looking to us.” And Sterling Forest’s Kumar is also optimistic. “It should be an up season this year, compared with last year.” With any luck, that can be true for their customers as well.
For more information:
5975 Shiloh Rd., Ste. 107
Alpharetta, GA 30005
Toll Free: 877-324-0845
5510 Brystone Dr.
Houston, TX 77041
Kay Import Inc.
3427 Oakcliff Rd. #102
Doraville, GA 30340
Toll Free: 888-457-5522
New York, NY 10001
Phillips International Inc.
717 NW 2nd St.
Hallandale, FL 33009
Toll Free: 800-432-3636
151 Woodward Ave
Norwalk, CT 06854
Tel: 203-356-9077 or 866-507-2537
Sun Fashion Designs
3220 Tower Road
Prescott, AZ 86305
Toll Free: 800-398-7802