Over the past few weeks, I’ve been to Toronto for the CJG buying show, the Western Canadian Jewellery Expo in Edmonton, and begun my rounds through Western Canada. So far, so good. Businesses are reporting acceptable to good sales, and with few exceptions retailers are repeating on fast-sellers and adding a few new designs to replace slower sellers.
While you’d like to hear that we’re in for an amazingly prosperous Fall season, I can’t in good conscience promote that idea. Since Summer 2008 retail has declined and then leveled-off. Yes Virginia, there was a recession. This is not news to most of you. Customgold however is doing more business than ever in 2011. Why? Because the boom years helped remind consumers who have always had money and who continue to have expendable cash that good jewellery is a pleasure to own.
When I began with Customgold in the Spring of 2001, we were trying to find ways to make $1,000 engagement rings because the market was so incredibly tight. When times are extremely tough, conspicuous consumption becomes unfashionable to those who have the means. Take a look at the number of newer Mercedes, BMWs, Lexus, Mustang GTs, Camaros and high-end motorcycles on the road. Those who “have” are feeling good about the freedom to enjoy their wealth.
Western Canadians who have money aren’t holding back on spreading around their wealth. This trend has held strong since 2007 – 2008. Many businesspersons have become wealthier because of the recession, as it gave them the excuse they needed to cut-out the fat from their operations and get costs under control. The oil and gas sector couldn’t continue to pay the prices they were paying for labor and contractors, but the wells still need to be dug, the upgraders still need to be built and the bitumen still needs to be processed. As I’ve quoted before from Gordon Pitts book Stampede, “oil companies are more interested in the price of oil 20 year from now.” A two or three year delay in these expenditures isn’t a big deal to the oil companies who have 10, 20 and 50 year plans.
Those in our society who have seen a real decline in their income and have lost real jobs are getting their jewellery in $50 hits now thanks to those famous bead-lines. Sterling silver is emerging to replace some of the lower price points abandoned by soaring gold prices.
Look forward to a Fall where your best customers have permission from society to treat themselves to the good-stuff. CG sales in the West are up 17% over 2010 so far, primarily on the strength of reordered fast-sellers. We’re not just eye-candy for your feature window; we’ve got designs that are proven to build you a healthy bottom line. I look forward to seeing many of you very soon.
Post your comments below. Do you agree that higher-end consumers are still spending???
