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How To Navigate the Changing Tides of Business
Cindy Edelstein

Those designers who have been in business for a decade or less have never experienced a negative economy, and those in business longer were young and growing during the previous recession of the early '90s.

Many designers didn't know how to respond to the quick change in retailer's attitudes about fine jewelry. It seemed like buyers turned conservative overnight. The enthusiastic, experimental buyer dried up. They only wanted the sure things. Most designers were unprepared for hard times and lacked the resources to ride it out well. Plus, the market became more competitive than ever before. There are more designer-owned businesses today than in the early 90s, and marketing has become much more important in recent years.

Yes, business savvy is important

The second biggest business challenge jewelry artistís face -- today as in the past -- is a lack of business knowledge and focus. Artisans go into business because they love making art. They go to school for art and spend all their hours perfecting it. In many cases, not one business book enters their studio before opening day. But enthusiasim for the business side is just as important for success as passion and profiency in creating jewelry.

Entrepreneurial artisans of all kinds need to apply their wellspring of creativity and passion to their business as well as their product. Public relations and marketing are definitely creative pursuits and could be a fun challenge in between tasks at the bench. It is harder to find the enthusiasm for bookkeeping or collections but they are more necessary than anything else.

The third biggest challenge is in keeping their work fresh and relevent. Studio jewelers are very connected to their processes, creating at the bench and using techniques they have worked hard to perfect. That often gains them their first measure of success. The real challenge comes in the second phase of their career. After working very hard to gain recognition and respect, they cannot rest on their laurels but, to quote that famous chef, they have to kick it up a notch. Once you are well known for something you have to work even harder to keep that artistic thumbprint but apply it to new work.


Are trends important. too?


Jewelry trends have become more important to the consumer in the past five-plus years as women become more savvy about what jewelry celebrities are wearing and what brands are emerging. So a designer who adores making a signature design needs to give his or her line a reality check every once in a while to make sure he or she isn't making only long, elaborate earrings in an era of studs or vice versa.

It is a challenge to always remember that your art is a business that must produce financial as well as artistic rewards.

How can economic factors affect an artist's ability to market and sell work?

Economic factors always affect an artist's ability to market his work. When times are good it's easy for even the least talented to find some clientele. There are always more buyers at trade shows, more people at craft fairs, more potential. When times are good there is enough turnover to mask even the sloppiest bookkeeping mistakes, mispricing and bad management. Buyers attend more trade shows and customers are more generous and adventurous in their purchases.

When the economy falters those factors seem to change overnight. It seems like the rungs on the ladder to success are much farther apart and only the truly talented have the reach. The challenge is for the artisan to do things differently with the hope of a different outcome. It's very hard for human beings to change and especially to objectively look at your efforts and admit that what you're doing isn't working.

Change

It is also difficult to react to the change in your customers, as well. Many designers face a large level of frustration caused by retailers who lead with their emotions, most often fear, and miss the chance to help their businesses rebound. It is a self-fulfiling prophecy to an extent -- not everyone is comfortable with a gamble so they hold tight for too long. There are a lot of retailers out there understocked because they are afraid to commit. This tests that basic axiom of if you have nothing to sell you are sure to sell nothing. And lots of retailers are afraid to spend on badly needed refurbishing or increased advertising and promotion. These things can often delay recovery rather than protect against further slippage.

Artisans have the challenge of not only managing their own fears but of holding their customerís hands as well. They need to lead by example with confidence.

They may decide to downsize their client list to concentrate on the most profitable ones. There is an old axiom that 80% of your sales come from 20% of your customers, so concentrating on that percentage may be easier to do in hard times.

Designers may decide to do more trade shows, or less trade shows. I have seen both approaches in the past year as they try new markets, jumping between the fine jewelry trade shows, craft shows and fashion accessory events. I have also seen designers commit all their energies to their biggest show - ACC in Baltimore or JCK Show in Las Vegas - and cut back on their smaller, ancillary shows.

Another change worth mentioning: designers who until now have done only wholesale shows have added some retail fairs to their agenda. Others have opened up their own galleries. In fact, designer-owned jewelry galleries have opened at a steady pace across the country in the past two years. This is another way to grow a business without a middleman, so to speak. For the most part this has been the one universal success story of this economic downturn.

What if your work is really unique?

What is the best way for artists who create one-of-a-kind or limited production jewelry to find their market, and sell their work to customers who are interested in and appreciate it?

The best way to find wholesale customers is to exhibit at a trade show. You get the chance in 3 to 5 days to meet dozens and dozens of retail store owners and fellow entrepreneurial artists. You get to do market research by strolling the aisles, get informal credit reports by gabbing with exhibitors, conduct public relations by meeting with editors and industry intelligence and invite saturation by talking to everyone and looking at everything. You get so much out of one business trip if you design your experience correctly.

To find the right markets for your work you will have to research different shows, talk to a lot of peers and your existing customer base and just roll the dice. Repetition is the key to all advertising and promotional venues and it often takes a few shows before the buyers are willing to work with you. Still, sometimes a show works for you and sometimes it doesn't, even when you do the exact same thing in both.

At vertical market shows (jewelry trade shows) it is a given that you will find people who want your product but there is also more competition because everyone is selling jewelry. At horizontal market shows (craft shows that sell many different categories) you get buyers who are interested in your type of work - artistic - but not necessarily your category (jewelry). A mix of the two types of shows often works well for jewelry artisans.

A growing number of craft galleries are turning to fine jewelry as a new or growth sector of their stores. Many are upgrading what they carry, moving from sterling and brass to gold and platinum. This presents a good growth market for fine jewelry makers but there is an additional challenge as well.

More gallery owners of all types seem to be turning to jewlery sales as they realize that they can make a tidy profit. However, any gallery owner moving into this category has to realize that specialized knowledge regarding jewelry is going to have to be learned. You can't fudge when it comes to gemstone weights, diamond qualities or metal karatage Some lower-priced jewelry can be sold as fashion but the selling of higher-end jewelry needs education. What I hear is that sales could be so much more if the new retailers knew more about jewelry. Designers will need to offer more support and education to these retailers.

Or, you can try do-it-yourself

Lastly, designers can find more clientele by opening their own galleries. While theyíll have to learn a new set of business skills -- retail is not for the faint of heart -- they have the opportunity to increase profit margins, test new designs and build a loyal local following that can help them through any future market instability.

How have current and even past trends affected artists who work in metal? Or put another way: How do trends in the mass market affect art jewelers and their ability to be competitive?

The answer is that trends have a direct impact on jewelry manufacturers and their competitiveness. Just look at the resurgence of platinum and pearls as design elements in just the last five years and you'll see how that has influenced jewelry sales. Anyone who ignores trends is taking a risk that their work may fade out of favor. Having said that, however, I would also balance that comment with the observation that fine, high-quality, well-designed jewelry made with the traditional mainstays of gold, diamonds and silver will always have a market, and a means for an artist to make a living. It becomes a matter of how big you want your share of the pie to be.

Celebrity trends have become more important in recent years, too. Magazines and TV shows nowadays mention the designer of both the dress and the jewelry when celebrities walk down the red carpet at awards shows and premieres. Thanks to InStyle magazine, in particular, a single feature can translate into phones ringing off the hook at a designerís studio, although that is not always a sure thing. Consumers really notice and care if Julia Roberts is wearing Me+Ro hoop earrings.

Fashion trends are way more important now than ever before - hoop earrings, Y necks, 'Sex in the City' horseshoe or nameplate necklaces, Tin Cup pearl necklaces....all have made significant impact on sales. And artisans who spurn any such trends as against their version of art need to realize that it will negatively impact their business. Consumers want to wear what is popular and if they are spending more money on that, then there is less to go around for the less trendy pieces. This is not to say that you won't make a living if you don't make hoop earrings but you must at least be aware of the hoop trend and conscientiously factor it in your plans. You may decide to go with the trend or against it, but if you choose to go counter to the trend, do it in a strategic way that offers the client a rationale for bucking the trend and spending money with you.

Up against the big guys

One of the bigger problems facing true designer artisans is competition from big manufacturers that are pretending to be designers. The problem lies in the fact that these big companies also have big, even huge, advertising budgets that smaller designers couldnít possibly match. That puts them at a disadvantage, even when their product is measurably better -- or their design came first.

There is a related difficulty with stores that are dropping designers who don't come with large marketing support programs in favor of those that advertise in Town & Country or InStyle. While this seems like a problem for the more commericial designers it has filtered down to every level.

Branding is still the biggest buzz word in the fine jewelry industry. This is good news on the surface for designers who come with a ready made brand in themselves. But it is a double-edged sword as more manufacturers create a brand or a designer image along with the goods.

Some retailers have taken the branding bait too well and are buying into well-known names that come with large minimum orders that tie up their capitol and prevent them from spreading their purchases around to more designers.

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