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"The Best Way to Understand the U.S. Market Is to Stay Informed" PDF Print E-mail
2010-08-08 02:58:26
ImageRobert Headley, Chief Operating Officer of Jewelers of America, says suppliers in Turkey who can help U.S. retailers to meet market challenges and changes will have the greatest success. “I would strongly encourage foreign companies who want to enter the jewelry industry here to do their homework. The best way to understand the U.S. market is to stay informed,” he added.  Headley answered TURKOFAMERICA’s questions.
According to the Department of Commerce, the bulk of jewelry sales occur during the holiday season, November and December, and account for about 32% of annual sales. Other key periods are early winter for Valentine’s Day and the spring when sales are boosted by Mother’s Day and weddings.

Robert Headley, Chief Operating Officer of Jewelers of America, says suppliers in Turkey who can help U.S. retailers to meet market challenges and changes will have the greatest success. “I would strongly encourage foreign companies who want to enter the jewelry industry here to do their homework. The best way to understand the U.S. market is to stay informed,” he added.  Headley answered TURKOFAMERICA’s questions.

What does the American jewelry industry expect in 2010 in terms of production, sales, employment, and export-import?
In terms of sales expectations, business has been steadily improving so far this year. In fact, IDEX Online Research analyst Ken Gassman has reported that sales were up nearly 8% for the first fiscal quarter of 2010, and they are tracking right now to reach total sales of around $63 billion for the year (up from $59 billion in 2009). Based on government forecasts, that number has continued to improve.

What effect has the financial crisis had on the jewelry industry? Has the industry recovered yet?
Like all industries, the jewelry business is not immune to the impact of economic cycles. But the underlining factor is that jewelry remains timeless and a gift of choice in celebrating milestone events. Despite the downturn, the long-term outlook for jewelry demand in the U.S. (and elsewhere) is positive. For example, bridal demand—which has remained strong—is rising sharply and will continue to do so.

In the short-term, we’ve already seen an improvement from the holiday season of 2008. Specialty jewelers’ sales in the holiday season of 2009 were up 12.2% and the market has seen continuous improvement over the first half of 2010.

Turkey is one of the most important producers in the jewelry industry in the world. What would be your suggestion to companies which want to expand their business to the U.S. market? What are the most important factors necessary to be successful in the market as a foreign company?

A key factor to success in the U.S. market (which represents about half of the $140 billion worldwide jewelry and watch market) is researching and understanding the demographics and market influencers and how they are evolving.

In looking at the U.S. market, some important considerations are when and why people buy jewelry, as well as the type of jewelry retailer. According to the Department of Commerce, the bulk of jewelry sales are during the holiday season (November and December, which account for about 32% of annual sales). Other key periods are early winter for Valentine’s Day and the spring when sales are boosted by Mother’s Day and weddings. In terms of where people buy jewelry in the U.S., specialty jewelers—those retailers whose main business is jewelry sales—account for about 48% of the market. The rest of the market consists of discounters (like Wal-Mart), traditional department stores, mass merchants, online retailers and other outlets.

The key drivers of jewelry demand in the U.S. are bridal (which includes engagement rings and wedding jewelry), calendar events (like Christmas and Valentine’s Day) and life cycle events (such as birthdays, anniversaries and graduations).

There are also a number of key trends impacting the jewelry business. These include consolidation, the growth of online sales, generational spending (shifting from older to younger consumers) and other demographic shifts. For example, while the downturn has stalled the trend somewhat, the rise of female purchasing power is just one demographic trend that will have a long-term impact on the U.S. market. There’s also the impact of technology and the Internet.

Given these changes, jewelers in the U.S. are working harder than ever before to connect with customers in innovative ways—like social media—and are offering more choice and selection (from more affordable pieces to more customization). Younger consumers, in particular, want their jewelry to be unique and they’re more concerned about issues related to the sourcing of their products—they want pieces that are unique and beautiful and they want to feel good about their purchases.

Suppliers in Turkey who can help U.S. retailers to meet these market challenges and changes will have the greatest success. I would strongly encourage foreign companies who want to enter the jewelry industry here to do their homework. The best way to understand the U.S. market is to stay informed.

What are the biggest obstacles for the jewelry industry in near future?
Some of the factors influencing the industry include the rise of technology and the internet, the need for more flexibility in terms of product offering (both in terms of providing unique and beautiful pieces and offering a range of prices), and the need for more accountability and transparency. While there are challenges, jewelers who embrace change will succeed. In fact, the latest research indicates that the market has stabilized and those who have made it through the downturn are the strongest and will continue to thrive and survive.

How do you see the industry's future in the U.S. market?
According to research compiled by Ken Gassman, the U.S. jewelry industry is expected to grow 4 to 5% annually.

Could you give us some information about the association? Who can be a member, how many members does it have, the benefits of membership, etc.
Jewelers of America is the national trade association for businesses and organizations serving the American fine jewelry retail marketplace. The association’s primary purpose is to improve consumer confidence in the jewelry industry. JA represents business interests of jewelry retailers and suppliers in the U.S. and our members must uphold high social, environmental and ethical business practices within our Code of Professional Practices (http://www.jewelers.org/about/j_whatwestandfor/codeofpractices.php), which they sign when they become a member or renew their membership annually. In addition to our leadership role on issues and government affairs, JA provides access to education, scholarships and certification and we offer business-enhancing and money-saving perks. You can learn more by visiting our website, www.jewelers.org.

ROBERT HEADLEY
As COO, Robert Headley serves as Jewelers of America’s internal leader, reporting to President and CEO Matthew A. Runci. With Runci, he is responsible for developing Jewelers of America’s overall vision. Headley joined the association in February 2009, with the directive to integrate the association’s strategic plan with ongoing operations.

Headley currently serves as co-chair of the Responsible Jewelry Council’s Standards Committee. He also represents Jewelers of America on the Boards of the Jewelers Vigilance Committee and the Manufacturing Jewelers and Suppliers of America.

Headley worked for 20 years at Tiffany & Co., where he oversaw the brand’s revered, and stringent, quality control standards. There, he served as Vice President of Technical Services and directed quality assurance and manufacturing administration. Prior to joining Tiffany & Co., Headley spent eight years at Avon products, supervising efficient systems for ingredient manufacturing, packaging and corporate quality assurance. He is a former naval officer.
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Last Updated ( 2010-08-08 05:04:13 )
 
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