U.S. Bankruptcies Down 15% in First Quarter

The latest financial statistics from the Jewelers Board of Trade offer some encouragement in a tough market. For the first quarter of 2008, the total number of U.S. bankruptcies—combined totals among retailers, wholesalers, and manufacturers—declined by 15 percent compared with the first quarter of 2007.

The total number of new retail businesses in the first quarter of 2008 grew slightly, 1.7 percent, over the first quarter of 2007. For retailers, it appears the money is headed south, as all gains in new retail businesses happened in the Sunbelt. New jewelry businesses in the Southwest leaped 150 percent, the South Central region posted a 20 percent gain in new retail businesses, the Southeast a modest 7.1 percent gain. Meanwhile, snow is out—the Northeast, North Central, and Northwest regions all showed significantly higher declines in the number of new jewelry businesses opening this year vs. the same period last year. (Note: These figures indicate the number of new jewelry retail businesses opening in the quarter, not the total number of businesses in the region for the quarter.)

The number of new wholesale businesses grew 60 percent in the same period, but these increases were offset by a decline in the number of new manufacturing businesses, which posted a 75 percent decline from first-quarter 2007 figures. Overall, the number of new jewelry businesses in all three categories declined slightly, by 2.5 percent, in the first quarter 2008 over the same period of 2007.

JBT reports 9.4 percent fewer claims placed with its collections department in the first quarter of 2008 vs. the same period in 2007, however, the average amount per claim grew 24.6 percent, from $6,583 last year to $8,203 this year.
Source: jckonline

U.S. Jewelry Sales Creep Upward in January

Specialty jewelers in the U.S. market posted a very modest sales gain in January – +1.9 percent over the same month a year ago – according to the U.S. Department of Commerce. Total jewelry sales – sales of jewelry in all retail outlets which sell this merchandise category – were up 1.6 percent in January. Thus, while jewelry demand was weak during the month, specialty jewelers gained market share from non-traditional jewelry outlets such as discounters and others.

Further, as expected, the Department of Commerce revised December 2007 jewelry sales levels downward, though not by as much as we would have expected. Based on the newly revised data, December 2007 specialty jewelers’ sales in the U.S. market fell by 2.8 percent; preliminary data had indicated a decline of 2.6 percent.

Total U.S. jewelry sales data was modestly revised for 2007; it now appears that jewelry sales in America were up 4.2 percent in 2007, down slightly from the previously reported gain of 4.3 percent. The Commerce Department will continue to recalculate this number each month until about mid-year; we do not expect any significant change from current levels.

The Commerce Department also scaled back the previously reported preliminary retail sales gains (all categories) for the final quarter of the year (see Scoreboard below).

For the three months ended January 2008, the scoreboard for specialty jewelers’ sales, total jewelry industry sales, and total retail sales is summarized on the following table. The figures show that specialty jewelers gained market share in November and January from non-traditional jewelry retail outlets (discounters, mass market retailers, department stores, etc.), but lost market share in December. Further, jewelers lost market share to other retail categories which offered more enticing merchandise and more compelling values – particularly consumer electronics – at prices that are directly targeted to jewelers’ “sweet spot” pricing at the mass market level – $300-500.
Source: idexonline

U.S. chain store sales up slightly in February

U.S. chain store sales inched up in February, increasing 1.9 percent compared with the same period last year, according to the latest study by the International Council of Shopping Centers (ICSC).

The sales performance was ahead of expectations for the industry, largely due to a 2.6 percent sales gain at Wal-Mart.

But despite the slightly better performance, sales were weak for apparel-specialty and department stores, as well as for the luxury sector, according to ICSC Chief Economist and Director of Research Michael Niemira.

For the month of February, U.S. consumers shopped at value retailers, spent most on staples and were downscaling, Niemira said.

And although the sales gain in February was the strongest since November 2007 when sales increased 3.5 percent, there was a considerable weak demand in the retail environment.

"Looking forward to March, we expect spending to improve slightly, as we are projecting an increase of about 2 percent," Niemira said.
Source: nationaljewelernetwork

Palladium Jewelry to be Marketed in U.S.

Palladium jewelry will be marketed to the United States and China, the Palladium Alliance International said Thursday.

The decision was made to develop a marketing program for the white precious metal following a study involving PAI, independent consultants, and the International Platinum Group Metals Association.

Norilsk Nickel, the largest producer of palladium, will lead the effort, supported by the major palladium producers in South Africa (Anglo Platinum, Impala Platinum, and Lonmin) and the United States of America (Stillwater Mining Company), PAI said in a statement.

The objective is to establish a clear and specific brand position for palladium in jewelry which, in partnership with the jewelry designers, manufacturers, and retailers in the hopes of achieving a sustainable palladium jewelry market with growth opportunities.

This follows a platinum jewelry development program supported by the South African platinum producers since 1975. The platinum program is led by Anglo Platinum and it will continue. Norilsk Nickel and Stillwater Mining Company will be supporting the platinum program.

Both platinum and palladium jewelry market development, will be funded by the same group, but will be managed by separate organizations. A new individual brand identity will be developed for palladium jewelry.

The key Platinum Group Metal producers said in the statement that they believe this to be "an important strategic development for the industry, both cementing the market position for platinum jewelry and significantly enhancing the value of palladium as a jewelry metal in its own right."
Source: jckonline

De Beers cuts U.S. marketing budget

De Beers is cutting its U.S. marketing budget, forcing the layoff of 11 employees working on the Diamond Trading Co. (DTC) account at advertising firm JWT.

Sally Morrison of the Diamond Information Center confirmed to National Jeweler that the cutbacks are related to the perception that the United States is headed into a recession, and that 2008 is expected to be a tough year for everyone.

As a result, De Beers is refocusing its efforts to concentrate on the male consumer; the company's "beacon" products, such as Journey diamond jewelry and three-stone rings, won't include anymore female-targeted advertising.

Morrison confirmed that the loss of advertising would be counteracted by more public relations.

She also confirmed that those employees impacted were not senior level.

The news is the latest in a string of bad news for the jewelry industry as a whole, as De Beers always has been known for its robust advertising campaigns.

U.S. holiday sales for the majority of jewelry retailers, including the usually bulletproof Tiffany and Co., were down in 2007, and two chain retailers recently entered into bankruptcy.

Boston-based Alpha Omega Jewelers is seeking Chapter 11 protection, and creditors for Addison, Texas-based Friedman's Inc. have filed a petition to force the struggling company into Chapter 7.
Source: nationaljewelernetwork

JSA: U.S. Jewelry Crime Down 20% in 2007

Crime in the U.S. retail jewelry industry for the first nine months of 2007 dropped about 20 percent in both dollars and the number of incidents, compared to the same period in 2006, John Kennedy, president of the Jewelers Security Alliance, has told JCK. The JSA tracks crime in the jewelry industry on an ongoing basis.

Robberies declined from 204 in 2006 to 121 this year, with the dollars lost “declining an astonishing 71 percent,” Kennedy said.

No jeweler has been killed during a crime against a jewelry business since March 2006. Ten or fifteen years ago, he noted, 20 or more jewelers were killed annually in the U.S. That dreadful statistic “has been on a steady decrease since,” he said.
Source: jckonline

Labeling Jewelry Made in USA

If you live in the United States and make and sell jewelry, you may have wondered if you should label it "Made in America" or "Made in USA" to help distinguish it from cheaply-made imports. American-made products are gaining popularity with U.S. consumers in light of recent quality problems with imported goods. But under federal law, making your jewelry in the United States is not necessarily enough to qualify you to describe it that way.

The FTC's Made in USA Policy

The Federal Trade Commission (FTC) regulates the use of "Made in USA" labels on products and advertising. Under the FTC Act, it is illegal to make a Made in USA claim about a product unless it is "all or virtually all" made in America. This means that not only must the final product be made in the United States, but "all or virtually all" of its components must be, too. According to the FTC, that "means that all significant parts and processing that go into the product must be of U.S. origin. That is, the product should contain no — or negligible — foreign content."

That's a little troubling for most of us who make jewelry using pre-made findings and beads, which tend to be imported. Even if you fabricate jewelry completely from sheet metal or wire, some or all of it may have been mined or processed in another country. However, even if your jewelry contains foreign components, you might still be able to market it as made in America - as long as you carefully comply with the FTC's rules.

The first question the FTC asks when determining whether a product is truly American made is whether its "final assembly or processing" occurred in the United States. If you personally make jewelry in a state or territory of the Unites States, then it probably passes this first test.

Next, the FTC requires that no "significant part of the final product" be of foreign origin. Your bead store or supplier should be able to tell you where their components are from. Obviously, if all of your components are originally from the United States, then you have no problem. On the other hand, if all of your components are imported, then it's probably not legal for you to make an "unqualified" Made in USA claim. (We'll talk about "qualified versus unqualified" in a moment.)

What if your jewelry is made from both American and foreign-made components? This is when you need to decide whether the FTC would consider the foreign components to be "significant" or "insignificant" parts of your design. The FTC provides a couple of examples of significant and insignificant parts on its website (link below), but unfortunately neither involves jewelry. Based on those examples, however, I surmise (but this is not a legal opinion) that if you made a beaded necklace from all American-made components except its two crimp beads, you probably could call the design American made. But if the necklace featured an imported pendant, then you probably shouldn't call it American made - even if the beads and other components were all manufactured in the United States.

Qualified Made in USA Claims

If you're in doubt about whether your jewelry contains "significant" foreign made parts, but you'd still like to call it American made, your safest option may be to make a qualified claim rather than an unqualified claim. An unqualified claim is one that only says "Made in USA," "Made in America," "American made," or something similar. A qualified claim contains additional information telling consumers that some components are foreign. According to the FTC, one example of a qualified claim is "Made in USA of U.S. and imported parts." As long as you're being truthful, you probably have less chance of violating the FTC rules if your claim is qualified.

Assembled in America Claims

Another option is to label your jewelry "Assembled" in American rather than "made" there. The FTC allows this kind of claim where a product's "principal assembly takes place in the U.S. and the assembly is substantial." I think this would probably apply to most handmade American jewelry, but be careful about making this claim if you use any components that themselves were handcrafted or "assembled" in another country. Also, consider how you feel about referring to your work as "assembly" from a marketing perspective. Most independent American jewelry makers consider themselves to be crafters, artisans, or artists - not merely assemblers.

How Best to Protect Yourself

The FTC is concerned about consumers being mislead or deceived, so your best bet is to be as truthful and up-front about your jewelry as possible. It is important for potential customers to know that your jewelry is handmade and not cheaply imported, but most people will not be put off by your use of some foreign components. In fact, many people actually prefer imported stones and beads because they seem more "exotic." On the other hand, customers may be afraid that imported findings and other mass-produced parts are of poor quality. You can avoid that problem by using only high-quality components (whether they're imported or not), and describing their quality accurately to your customers.

Please be aware that this article is for informational purposes only and is not a legal opinion. Always use your best reasonable judgment about how to label and describe your jewelry. The FTC, unfortunately, does not "pre-qualify" products for Made in USA status, but you can read through their entire publication on complying with the rules for further guidance:

Complying with the Made In the USA Standard (FTC)

If you have questions or comments about this topic, feel free to post them in the Jewelry Making forum.

You may also be interested in these publications, available through Amazon.com:

The Law (In Plain English) for Crafts

Your Crafts Business: A Legal Guide
Source: bellaonline