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Surviving in a difficult economy


#1

I would appreciate anyone’s input, insights and thoughts about
surviving in this challenging business economy. Thank you in advance
for your recommendations.

marlene richey
www.marlenerichey.com


#2

Dear Marlene and everyone!

I’ll only give you some input from my side of the Canadian border.
Basically, create something very unorthodox in the realm of
jewellery. It doesn’t have to be rings or pendants, but just get out
of the proverbial “box”.

Spend some quiet time and use your fullest imagination and during
these very strange times we’re in people will beat a path to your
door. Case in point, I’ve totally retired from diamond setting to the
trade now but using my skills and I’m now into something related.

Remember that there are still a group of very affluent people out
there…cater to them!!! These folks have an income of over
$2+mill each year, don’t be shy that want something nice.

But they want 300+% quality, they will buy it. Let them know that
it’s “one-of-a-kind” and very original…with your new idea, you
definitely survive…

Gerry


#3

I have gone from an entirely private studio space, selling to
galleries and stores and at shows, to opening a very small space that
is mostly workshop space with a very small gallery space. I am doing
quite well with the workshops! The gallery is also selling steadily,
although at a low volume, which is what I expected. I’m open on
Mondays, 9 - 6, and schedule what I call “make and take” workshops
during that time, as well as offering beginning art classes for
children and adults. So far the classes have not taken off, although
I do have a few children in that one, but the workshops are doing
quite well.

This is providing a nice, if small, steady extra bit of income.

For the workshops I include all supplies and use of all needed tools
in the fee, and have safety glasses on hand for those who don’t
bring their own. In my area, this works the best - these folks are
not interested in purchasing tools and becoming either hobby jewelers
or professionals - they just want a chance to come, learn a bit about
making jewelry, have a great time, and take home something they made
themselves.

I’m also open by appointment, and have had folks Facebook me or call
to come over at times I’m not open to buy something. Nice!

Beth Wicker
Three Cats and a Dog Design Studio
http://www.bethwicker.com


#4

Hello Marlene,

I would appreciate anyone's input, insights and thoughts about
surviving in this challenging business economy. 

You can either cope and hope to survive or try to overcome the
challenges and prosper. To survive, watch your expenses, work hard,
give your customers excellent service and quality. I think most of us
can survive if we are disciplined and stick to the basics. What I
want to know is how to prosper in this economy. I suspect that this
involves taking more risks. All of the above plus sticking one’s neck
out. My instincts are that competition is going to be very different
than it has been. Already the high price of gold is not from a higher
demand for gold jewelry. So the goldsmith is stuck between costs that
have nothing to do with the demand for what we make and lower
consumer spending. Another problem is that conspicuous consumption
doesn’t feel as good if you are surrounded by others who are
struggling. I am sure that is holding back purchases by folks who can
still well afford luxuries.

The economy is only going to get better because people take care of
that little part of the economy where they can make a difference. It
will take harder work, thrift, investment and faith. Unlike some
previous hard times I don’t see the same kind of despair and
hopelessness that defeats or delays recovery. Things will get
better, not because of what the big-shots do, but because most people
want things to be better and will do what it takes to make things
better in their own lives.

Stephen Walker


#5

Well, there’s not enough room here to write an entire book so I’ll
stay with the main points, as I have learned them(the hard hard way).

  1. Plan. By this I mean anticipate the downturns. When you apply for
    a car loan, the bank doesn’t ask you how much are you going to make
    after you get that hoped for raise. They ask what are you making now
    and will all your debts be covered by it. Do the same thing when
    setting up your biz. Keep your obligations minimal, and flexible if
    you can manage that trick. You(your biz actually) are in essence
    borrowing from yourself, or at least from your future income or lack
    thereof. If you set yourself up to need $100,000(random number) a
    year to cover expenses then you have also set yourself up to REQUIRE
    substantially more than that in sales just to stay afloat. Quite
    doable in an up market, maybe not so doable when things go sour.
    Start with your lease since this impacts everything else you do. Is
    it better to have a hi-traffic, hi-dollar location (a fixed expense)
    that absolutely demands timely payments…or…is it better to have a
    lower traffic, lower cost location and try to make up the difference
    with promotion (a flexible expense)? No right answer, depends on a
    lot of other factors. Big nuts, little nuts. Since we’re all just
    hamsters in a wheel, which would you rather spend all day running
    off?

  2. Give em what they want. Of course this really depends on your
    market and your place within it, and where you want to go.

  3. Be diversified. If you try to cater to a narrow band within the
    customer spectrum you run the risk of missing the target. Miss and
    you have nothing else to carry you. End of saga, you don’t even get a
    sunset to ride off into. Spread your income sources around that
    spectrum and you stand a much better chance of maintaining cash flow.
    In hard times cash flow is the single most critical factor. Even if
    you’re not earning a big profit, good cash flow can keep your bills
    paid(its perfectly fine to reschedule debt payments, your creditors
    will appreciate the call) until such time that you return again to a
    higher profit operating condition. A one trick pony is famous only
    for the Warholian fifteen minutes. Your career will last longer than
    that, we hope.

  4. Be humble. Recognize that the world will go on without you.
    Customers have choices and you should try to earn their favor at
    every opportunity.

Ok but suppose one didn’t do any of that and finds oneself in a
sticky situation now. At that point I would suggest taking stock of
all your resources and liabilities and determine a course of action.
You’ve got to decide if the situation is tenable and if not, what its
gonna take to become tenable. Believe me this is much harder to do
when your resources are dwindling and liabilities mounting. Your task
at this point is to reverse trends. It can’t be done by sheer force
of will alone. You might have to make some tough decisions. You might
decide that a sabbatical is in order. You might decide that you can
tough it out. Whichever way your immediate plan goes, when you get
running again, don’t go and do the same thing again because maybe it
didn’t work so well for you the first time. Please don’t take that
as some kind of pejorative. Think gestalt therapy.

I should point out that ‘you’ is not anyone in particular except
maybe…me.


#6

Hi Gerry (and All),

please Gerry, give us a clue about what you are doing right now or
where are you trying to step into. After 12 years devoted to stone
setting, I think I’m also about to have a change.

Fernando


#7

Hi Marlene:

I’d like to offer some help, having survived all kinds of things, in
an out of our trade. Maybe it would help if we knew what kind of
business you’re running (think I’ve met you at the Philly show,
weren’t your representing your late husbands work? I liked his stuff
a lot.) Anyway, maybe the first thing to do is to drop the term
"surviving". I don’t want to seem too New Age, but it’s possible that
approaching things with that attitude might not put you in the most
creative frame of mind. That said, it’s certainly understandable if
you do. But really, it’s better if you focus on your long term
objectives. If you succumb to the short term approach entirely,
you’ll have a sort of internal state of panic to deal with. Not to
say your shouldn’t be mindful of impending financial demands, just
that you need to be able to put them aside when you need to work and
make decisions.

In my situation, we’ve really focused strongly on the service aspect,
working with every customer as if they are our most important
customer and our personal friends. It’s easier if you generally like
people, which, fortunately, we do, and having come from humble
circumstances and meager advantage, we aren’t prone to being
judgemental. This builds that trust issue, which can help solidify
word of mouth referrals. Build the network with your vendors, and I
must say, it’s time we all went back to the sort of loyalty we used
to have in this industry. We never used to shop around to get the
absolute lowest price, we trusted the people we did business with on
a regular basis to provide us a “fair” price: fair to them and us.
This will garner the best service and when you need a little
"extension" for something, they’ll probably help out as they know
you’re good for it. And that also implies you’ll be paying them
promptly as a habit.

Find the price point that your local market is responding to,
assuming you’re doing retail in a specific location. Work to keep
the product as affordable as possible. If people sense you’re not
thinking about it, just pulling out a price, they really feel
helpless and they won’t come back. Volume is what you want anyway,
because if and when the economy turns around, it’s that larger
customer base that counts, not the few that bit on the high tag
items. That is pure survival strategy. A lot of retailers think
they’ll get that elite big ticket item crowd, and maybe they do, but
those customers aren’t that loyal, generally. They tend to shop
around and spread it around. But don’t spend too much time fishing
for the low end purchases. I have a few $15-$75 items, but I don’t
do custom work in that price range, and it all stays in one case off
to the side. It’s fine to have something for the casual purchase, but
make sure it’s not too prominent or the quick browsing customer will
not bother to take time and see the better stuff. Keep an eye on
which cases the customers are spending the most time over. Make
mental notes of the most common price points. Shape your inventory
profile like a diamond, not a pyramid. You should have the largest
part of your inventory in the middle range where the most active
price point is, then less at the top and bottom.

Finally, you’ve got to have good staff and treat them well. That
part of your business is by far the most valuable investment you can
make. The big mall chains, the big box store, etc., are completely
lacking that, besides the fact that they just sell crap anyway. Best
of luck.

David L. Huffman, surviving, yes, but also growing, building
something, imagining things I can do better, etc.


#8

Fernando, and anyone else.

About 25 years ago I had an office in a jewellery tradebuilding.
Across the hall was an artist and this was way before Cad-Cam, this
fellow drew from my mind two coloured renderings. Well after
throwing out some very old invoices and memorabilia I came across
them only yesterday afternoon. One ring and one lovely movable
interlocking necklace. After this holiday period is over I’m going to
instruct my Cad-Cam lady-maven to create these for initial
duplication, why?

As I said, that in this economy there still some extremely affluent
groups of consumers. I will cater to them through my designs, the
ring and necklace will have center stones both weighing at least
6.00+ carats each. The larger the better and at least V V S,D-E.
no messing around like the large box store prices.This will also
contain ? cts.of shoulder stones

The only thing I will tell you& everyone is charge well for your
time and your creative thinking. Don’t think cheap or you’ll be
always competing with others, rise up and charge well! I found an
auction online site who cater to these folks…One diamond dealer
sold…read this. A naturally pink 50.67ct D/IF diamond appraised at
$250,000/ct for only $12,667,500.00.

As the old saying goes…"if you build it, so they will buy/come"
after all you only need one client to make this so worthwhile. About
three years ago a designer made a backgammon playing game…made in 15
pounds of gold with 64,000 diamonds with 2,070 cts. He sold three of
them at $1.5 mill EACH, worldwide… go to
charleshollandercollection.com.

So Fernando, being “almost semi-retired” is giving me more time
explore other avenues aside from diamond setting for other
clients…so now you know what I’m up to now…:slight_smile:

regards to all in 2010…Gerry!


#9

Beth- The description of your business is interesting as it is
similar to what we are doing with a combination classes and a gallery
although we also do quite a bit a regular repair work as well. I’m
curious what the difference is between your classes and your
workshops. We do classes through the local community college since
they do a good job of reaching a wide group of potential students
through their catalog and website but this also limits are
flexibility on classes and times. How do you advertize your
classes/workshops?

Thanks Charlie Yost, Heart of Gold Jewelers


#10

Know who you want your audience to be and cater to them. Make
beautiful things.

Be really nice to your customers.

Stay flexible.

The rest is just math and common sense. Have fun and make lots of
jewelry.

Jo Haemer
www.timothywgreen.com


#11

Charlie - I consider classes to be something that is scheduled for
multiple sessions, although the number may vary. Workshops are a one
time thing, for me so far one day or part of a day. It is the
workshops, which I set up as “make and take” that are doing quite
well. Price includes everything, so folks know coming in what they
will be paying.

I advertise through my e-mail list, on both my personal Facebook
page and my Facebook Fan Page, and by sending press releases to the
local media both for stories, and for inclusion in the local
calendars. I also list everything on my web site, and try to refer
back to that from other places.

Since I’m not a non-profit the press releases are decidedly hit or
miss… mostly they don’t run them, but sometimes they do.

I have very little budget for paid advertising, and don’t feel it
would be of much benefit to me at the level I can afford right now.

I also printed one sheet flyers, and took them around to all the
local private schools and pre-schools and churches to hand out. I
think this has been the most effective in reaching new folks. Overall
the most effective has been the direct e-mails to my existing list.

I also ask in each e-mail that recipients please forward it on to
anyone they know who might be interested, and have added some folks
to my list that way.

I tried scheduling through my local arts commission at their
facility, but for whatever reason this proved to be quite difficult
on their end. I really don’t understand what is hard about scheduling
a class, but… this is part of the reason I opened my own
facility, so that I could control the scheduling and promotion.

An advantage to having the classes in the same space as my gallery
is that at most workshops and some of the classes I make sales -
anything from under $25 to over $300… so that is a real bonus!

Good luck!

Beth Wicker
http://www.bethwicker.com