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Shoppers slowly coming back

Jewelers see room for growth as they emerge from Covid-19 and weather the complications of nationwide protests.
Jun 30, 2020 4:18 AM   By Lara Ewen
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Retailers are having a rough year, but then again, so is the nation. The combined impact of a pandemic, protests, and a presidential election year have made sales sink, but retailers are still trying to make the best of it. Some companies are using the downtime to revamp their digital storefronts, while others are taking stock of inventory needs. Other stores have already begun to reopen and recover. Everyone, though, is bracing for an uneven, uncertain future.

The challenges of reopening

“We shut down in late March,” reported Marc Feder, owner of Jay Feder Jewelers, which has one store in Denver, Colorado; one in Boca Raton, Florida; and a manufacturing, wholesale and retail operation in New York. Feder’s year started strong, so he was less than 20% down year on year by the time his Boca and Denver stores reopened in May.

“Still, we’ve been pretty slow,” he said. “And in New York City, we were trying to open, but then we had the protests, with windows smashed on Fifth Avenue, so building management told us to go home.”

Even stores with a strong digital presence found recovery difficult. “A challenge is bringing shoppers into our store in an environment where they feel safe and comfortable,” said Lauren B. Shmueli, owner of Lauren B Jewelry in New York. Some 65% of her clients already shop with her remotely, she said, but there is still room for growth. “Particularly in this environment, there is an even greater demand for a shift to an even stronger virtual interactive buying experience platform.”

Fortunately, customers appear as eager to return to normal as store owners. “We were ordered to close for eight or 10 weeks, and we’ve been officially open again since May 11,” said Lorraine Barker, co-owner of Barker Diamond Company in Nashville, Tennessee. “So business is way down. I don’t even like to look at the numbers. But since we’ve been open again, we have a lot more traffic than I had anticipated.”

Barker attributed this to increased discretionary income. “If you’re still employed, then your expenditures are way cut back, because you can’t go out and travel and buy tickets,” she explained. “Had Covid not happened, it would have been a trip to Europe, but instead it’s a diamond.”

Dealing with demonstrations

Feder, like many retailers, focused on redesigning his website during the quarantine downtime. Moving forward, he’ll be also be addressing Covid-19 concerns by providing masks and hand sanitizer in all his stores, he said. However, he’s decided not to make a public statement regarding the protests.

“Jay Feder has always been apolitical and open-minded,” he asserted. “We have all types of people working for us. I don’t understand or agree with the mob mentality, or with pushing people to make statements. I don’t like this ‘woke’ thing, and I don’t like any of these movements. I treat everyone with respect.”

In Nashville, major storms hit the city just before the coronavirus did, and then again just before the protests began. But Barker saw bright spots, too. “Our city, as a whole, has had a lot of hits to it,” she said. “And we’re having protests similar to other cities. But we also had a lot of peaceful protests, and they’re not affecting our area of town as far as safety or damage.”

Shmueli declined to comment on the protests in New York, but admitted she didn’t expect retail to go back to normal for a while. “It will take some time to see a slow return to normalcy, specifically in the retail environment, which has been affected by months-long closures.”

Cautious optimism

On a happier note, said Shmueli, “people are still getting engaged and married, which creates a need-based purchase.”

Feder also has a hopeful outlook. “Americans are very optimistic, and they want to get back out there and spend money,” he said. “If things could calm down, then people will come back. My optimism wants to believe that things will be okay.”

Yet there’s still a sense of caution. “You wonder what’s going to happen in terms of the virus,” said Barker. “Maybe we can live through the summer, but what about the fall?”

The uncertainty has given her pause. “I’m not eager to make any big investments. I’m feeling more positive today than I was six weeks ago. Whether that’s going to continue, I don’t know.”

By the numbers
  • US retail will see an estimated 20,000 to 25,000 store closures in 2020.
  • A quarter of US merchants saw a decline of over 50% in their April debit and credit card volume compared to February.
  • Forecasts show per-capita global consumer expenditure declining by approximately 5% this year and the world economy entering the worst recession since the Great Depression.
  • Rough-diamond sales are expected to drop by 30% to 40% this year due to Covid-19 shutdowns.
  • Swiss watch exports fell 81% to CHF 328.8 million ($339.1 million) in April.
Sources: Coresight Research, the Strawhecker Group, Euromonitor International, Moody’s Investors Service, Federation of the Swiss Watch Industry
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