Why the Long Face?

by Abe Sherman – CEO, BIG – Buyers Intelligence Group

June 25, 2024

A horse walks into a bar. The bartender asks, “Why the long face?”

There was, if not an expectation, certainly a feeling of resignation of what was to be a disappointing round of shows in Vegas. It’s an election year after all. There are two hot wars raging, domestic discord, 24/7 news cycles that feed into our anxieties, inflation, high interest rates, housing prices, food prices and record gold prices. Did I mention it’s an election year?

I can’t count the number of conversations we had over the week-long visit to Vegas. We had nine BIG team members attending four different venues, so I suspect there were hundreds of interactions with retailers and vendors alike. Not once during the week had any of us heard about this being an election year insofar is it impacting how business was going. Personally, I didn’t hear one thing about politics, inflation or wars. There were two discussions that were consistent throughout the week that both the Balance to Buy and BIG Network teams were having.

The first conversation was about falling diamond prices. I had lots of questions about where we’re seeing prices of natural. At this moment, I don’t have enough information to report on pricing, but those who were there to buy found favorable prices on what they were looking for.

The four team members who work with our vendors and sales reps were received with open arms throughout the shows. Accolades about how using Balance to Buy to prepare for their appointments has “changed their lives”. Retailers continue sending us new suppliers to sign up for the BIG network (which number more than 100) and suppliers continue to encourage more retailers to share data – and it’s working for both parties.

The traffic may have been light but there was a lot of good energy and apparently business was brisk. The challenge most people are facing is there is too much inventory in the stores that has been building since 2020. As sales soared, so did inventory and cash flow was wonderful. But that time has passed and as business normalizes, cash has been diminished and inventories are once again too high. This is especially noticeable for the retailers whom we connect with for the first time; many are seriously over-inventoried. But that’s the work that we do – analyze what’s needed and create the plans for moving forward. Sell down, remerchandise, buy into the opportunities and work much closer with suppliers.

Business is good for the jewelry industry. Period. We see it in the numbers every day. Most stores are doing as well as they ever have and yet… and yet, we’re hearing some retailer’s comment that the economy is not doing well! I’ve always felt that jewelry is a leading economic indicator and if our industry is doing well, so is the overall economy. I remember the beginning of a slowdown that started in late 2007 and the dramatic mood swing in the summer of 2008 and wondered what was wrong. This was months before Lehman Brothers collapsed and we went into a tailspin.

Today, I’m not seeing the declines. Stock market is at record highs, unemployment is at record lows, inflation is cooling, housing prices are way up, and the wealth effect is robust. These things are good for our industry. Not necessarily good for a 30 year old looking to buy a new home, but we’re not selling real estate and as the saying goes, “the solution to high prices, is high prices”. The market will adjust.

Listen, I’m optimistic about how business is going to be for the rest of this year. If you think the economy is bad, stop watching the news, we’re simply not seeing it in the numbers. And remember… There’s six more shopping months until Christmas.