How A Powerful Buying Strategy Determines Your Economic Success
By Don Greig, Owner, Focus Business Management Institute
"Failing to plan is planning to fail". - Unknown
Having an effective buying program is among the keystones to retail jewelry store profits. Remember that each and every month ends a previous 12 month trading cycle and begins a brand new one. How nicely you program your purchasing for the next 12 months will control your success.
SUPPLIERS We're all acquainted with the Pareto principle: 80% of the effects come from 20% of the causes. The identical holds true for your companies. Your top 8-10 providers really should be producing 80% of your sales. For that reason, if you want to increase your annual sales by 30%, you are going to need to have to enhance the sales of your top suppliers by the very same amount. What supplier wouldn't want a 30% annual boost in sales? Let them realize just what your strategies are and what you may need from them so as to make it happen (e.g. quicker distribution time, superior terms, a lot more aggressive balancing).
Moreover, you need to be switching those providers that aren't offering you what you need - even if they've been a tried and true provider for a lot of years. We have discovered that as organization cycles alter, so do the business models and customer service levels of the wholesale suppliers. You need to make the modifications to your home business which will assist you to succeed now. Go out and discover suppliers who have gorgeous merchandise in a price point (over $1000 average retail sale) which will assist you to move to a higher level. You also need to obtain a couple of far more diamond vendors who've the top quality, cut, and price you want to pay. You may obtain these suppliers at the Luxury Show, the JCK show, the Continental Purchasing Group, Centurion, as well as the IJO show.
SPENDING "You've got to spend money to make money." This is true, however it is how you invest your funds which is the critical element to success. Retail jewelers take a look at their monthly spending and tend to think, "Wow. I don't want to invest that a lot this month on stock since I've this and that to pay" and then they don't stock their store effectively. Bear in mind, a retail jewelry store doing $1 million in annual sales will spend at least $500,000 on merchandise over the next 12 months. If you don't spend income on the stock, you won't have it inside the store, and you couldn't sell it.
This $500,000 is your open to buy for the year, an average of $40,000 per month. This is easily extrapolated; a $2 million store will invest $1 million ($80,000 per month); a $3 million store will invest $1.5 million, ($125,000 per month), etc. This is really a lot of money and how wisely you spend it will fully control your prosperity.
PURCHASING Spending just isn't buying. Spending is having money leave your bank account. Buying is the process of realizing what you will need and then spending the income needed to obtain it. Whenever you go to the tradeshows these figures must be foremost within your mind. You're not going to the shows to look around; you're checking out the shows to purchase very wonderful diamond semi-mounts, diamond pendants, bracelets and earrings 1 piece at a time. It's best to also know what price points of what item you need to sufficiently stock your store and have the wholesale price already calculated so that it is possible to ensure a targeted of 130% everyday markup.
Diamonds and color really should yield 80% of your sales, with the diamond divisions accounting for 62% of product sales plus the color departments comprising the remaining 18%. The rest of your store will account for the remaining 20% of your company, but your focus needs to be on how you obtain the items in this 80% group. It is best to be looking to acquire gorgeous pieces that fall into the $3,750, $6,500, $15,000, and $25,000 retail price ranges.
When attending the trade shows, make sure to stop by the Chinese and also the Indian pavilions to see the new exciting trends which are coming into the United States. Visiting these sections also gives you a broader worldwide perspective of what is going on in the jewelry business today.
What is your planned open to buy? The diagram underneath shows just how much it is best to be looking to properly spend at the industry events, along with the quantity of old supply that you simply really should actively stock balance (or exchange) together with your distributors.
A solid getting plan is critical to the success of your retail jewelry store. Keep in mind: What you do buy at these shows is dictating what you'll sell, and how well you are going to profit, within the next 12 months.
Focus BMI are going to be attending the following trade shows in 2011, and attends most of the key trade shows in the USA on a yearly basis.
Luxury Las Vegas (Booth LUX998) :: JCK Las Vegas (Booth LUX998 ) :: CBG Las Vegas (Booth 519) :: IJO Nashville (Booth TBD) :: Centurion (Booth TBD)
We welcome you to pay a visit to our booth for a custom acquiring analysis program.
"Failing to plan is planning to fail". - Unknown
Having an effective buying program is among the keystones to retail jewelry store profits. Remember that each and every month ends a previous 12 month trading cycle and begins a brand new one. How nicely you program your purchasing for the next 12 months will control your success.
SUPPLIERS We're all acquainted with the Pareto principle: 80% of the effects come from 20% of the causes. The identical holds true for your companies. Your top 8-10 providers really should be producing 80% of your sales. For that reason, if you want to increase your annual sales by 30%, you are going to need to have to enhance the sales of your top suppliers by the very same amount. What supplier wouldn't want a 30% annual boost in sales? Let them realize just what your strategies are and what you may need from them so as to make it happen (e.g. quicker distribution time, superior terms, a lot more aggressive balancing).
Moreover, you need to be switching those providers that aren't offering you what you need - even if they've been a tried and true provider for a lot of years. We have discovered that as organization cycles alter, so do the business models and customer service levels of the wholesale suppliers. You need to make the modifications to your home business which will assist you to succeed now. Go out and discover suppliers who have gorgeous merchandise in a price point (over $1000 average retail sale) which will assist you to move to a higher level. You also need to obtain a couple of far more diamond vendors who've the top quality, cut, and price you want to pay. You may obtain these suppliers at the Luxury Show, the JCK show, the Continental Purchasing Group, Centurion, as well as the IJO show.
SPENDING "You've got to spend money to make money." This is true, however it is how you invest your funds which is the critical element to success. Retail jewelers take a look at their monthly spending and tend to think, "Wow. I don't want to invest that a lot this month on stock since I've this and that to pay" and then they don't stock their store effectively. Bear in mind, a retail jewelry store doing $1 million in annual sales will spend at least $500,000 on merchandise over the next 12 months. If you don't spend income on the stock, you won't have it inside the store, and you couldn't sell it.
This $500,000 is your open to buy for the year, an average of $40,000 per month. This is easily extrapolated; a $2 million store will invest $1 million ($80,000 per month); a $3 million store will invest $1.5 million, ($125,000 per month), etc. This is really a lot of money and how wisely you spend it will fully control your prosperity.
PURCHASING Spending just isn't buying. Spending is having money leave your bank account. Buying is the process of realizing what you will need and then spending the income needed to obtain it. Whenever you go to the tradeshows these figures must be foremost within your mind. You're not going to the shows to look around; you're checking out the shows to purchase very wonderful diamond semi-mounts, diamond pendants, bracelets and earrings 1 piece at a time. It's best to also know what price points of what item you need to sufficiently stock your store and have the wholesale price already calculated so that it is possible to ensure a targeted of 130% everyday markup.
Diamonds and color really should yield 80% of your sales, with the diamond divisions accounting for 62% of product sales plus the color departments comprising the remaining 18%. The rest of your store will account for the remaining 20% of your company, but your focus needs to be on how you obtain the items in this 80% group. It is best to be looking to acquire gorgeous pieces that fall into the $3,750, $6,500, $15,000, and $25,000 retail price ranges.
When attending the trade shows, make sure to stop by the Chinese and also the Indian pavilions to see the new exciting trends which are coming into the United States. Visiting these sections also gives you a broader worldwide perspective of what is going on in the jewelry business today.
What is your planned open to buy? The diagram underneath shows just how much it is best to be looking to properly spend at the industry events, along with the quantity of old supply that you simply really should actively stock balance (or exchange) together with your distributors.
A solid getting plan is critical to the success of your retail jewelry store. Keep in mind: What you do buy at these shows is dictating what you'll sell, and how well you are going to profit, within the next 12 months.
Focus BMI are going to be attending the following trade shows in 2011, and attends most of the key trade shows in the USA on a yearly basis.
Luxury Las Vegas (Booth LUX998) :: JCK Las Vegas (Booth LUX998 ) :: CBG Las Vegas (Booth 519) :: IJO Nashville (Booth TBD) :: Centurion (Booth TBD)
We welcome you to pay a visit to our booth for a custom acquiring analysis program.
About the Author:
Don Greig is founder and President of Focus Business Management Institute, the industry leader in retail jewelry consulting. By way of a specialized analytics software system which has been perfected over the past 30 years, the personnel at Focus BMI can give anyone with a pinpoint assessment of the inventory items you will need within your store and at what price points, so that you can increase your results.
How A Powerful Buying Strategy Determines Your Economic Success
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