Jeweller - April 2020

STRATEGY FEATURE | Coronavirus Survival Guide
INVENTORY REVIEW
7 STOCK MANAGEMENT TIPS
When developing a strategy to sustain a retail jewellery
business throughout the coronavirus pandemic, stock
management is a critical component.
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As a first step in these uncertain times, it is essential
that customers are immediately contacted once
repairs and custom makes are completed; these
items can then be collected from the store or
delivered to the customer’s home.
Store owners can then contact suppliers to discuss
flexible terms, deals or discounts that may be offered
to assist them.
Buying groups are also an essential source of
information and practical support, including stock
assessments and assistance in transitioning to an
e-commerce business.
A complete stocktake should be conducted with items
prepared for listing online.
Employees may be directed to take clear, high-quality
photographs and write engaging descriptions with
accurate keywords to help boost SEO.
In addition, old stock including gold jewellery and
excess findings may be sent for smelting to a
trusted refiner.
As part of the stocktake, retailers should identify
bestsellers and analyse margins to create a list
of items that should be kept in stock.
Meanwhile, the Australian Retailers Association (ARA)
advises that operators of multi-store, omnichannel
businesses can “fulfil online orders from stores that
are struggling to shift their stock, meeting increased
demand online at the same time”.
The ARA also advises stores to accept backorders
online for out of stock items, offering customers a date
for fulfilment.
While retailers may be tempted to hold a sale, “Now is
not the time to go deep into heavy discounting, unless it
was old inventory that has had a long shelf life,” cautions
Jackie LeBental, founder Barri Luxury Consulting.
Customers may be focused on other priorities, such
as stocking up for emergencies, making a sale less
effective and eroding brand value in the long-term.
“[Retailers] have a brand image they should be trying
to preserve,” LeBental explains.
There are many advantages to carrying stock as an
e-commerce retailer. One is customer service – retailers
can process orders as soon as they are placed, and give
extremely accurate information on shipping times as well
as negotiate shipping rates. Additionally, product returns
and repairs are more efficient.
Marketing is also simpler, as carrying stock allows
retailers to run sales and promotional activity – for
example, holding competitions – at any time. However,
it is important not to overstock and some retailers may
prefer a partial drop-shipping model to keep costs low.
EXPERT ADVICE
Retail Priorities
Jackie LeBental
Barri Luxury Consulting
Founder
“Now is not the time
to go deep into heavy
discounting, unless it was
old inventory that has had
a long shelf life.
Retailers, just like
jewellery designers,
have a brand image
they should be trying
preserve.”
Nathan Bush
12High
Founder
“Rather than stress
our teams or push them
harder to meet slipping
sales targets, we need
to prioritise looking
after them. They are
our number-one
priority.”
John Kennedy
Jewelers Security Alliance
President
“A lot of people don’t
put all their things away
every night, they feel
it’s too much work, or
sometimes they will leave
low-priced items out. But
you can’t leave things
out in a showcase for a
month. Lock them in a
safe or vault. If you don’t
put everything away,
you become a magnet
for crime.”
Russell Zimmerman, executive director Australian
Retailers Association (ARA), said, “The ARA welcomes
the Victorian initiative, and I’d like to thank the Premier
on behalf of retailers.
“The COVID-19 outbreak will impose unprecedented
and perhaps existential challenges on small and medium
retail businesses; the measures the Premier has
announced this morning bring major and welcome
relief to our sector.”
In putting together a financial strategy, retailers must also
take into account that their business insurance policy is
unlikely to assist them.
That is because most insurers and re-insurers exclude
business disruption arising from diseases notifiable under
the Quarantine Act 1908 or the Biosecurity Act 2015 – of
which COVID-19 is one – from policies.
Additionally, if a retailer decides to temporarily close their
store, they are required by the Duty of Disclosure section
of the Insurance Contracts Act (1984) to notify the insurer.
Unoccupied property can be at higher risk of vandalism,
break-ins, or water damage, meaning insurance claims
could be invalidated if the insurer is not kept informed of
an unoccupancy period. Most insurers extend full coverage
for several months of unoccupancy.
For jewellery stores, the risk of break-in and theft during
periods of closure is more elevated.
It’s strongly suggested that jewellers look
into installing remote surveillance systems
where they can monitor live store security
camera footage from home.
If the business is closing for an extended period of time,
store owners are also advised to secure product in a safe
or vault, rather than a showcase.
John Kennedy, president of the Jewelers Security
Alliance in the US, says, “A lot of people don’t put all their
things away every night, they feel it’s too much work, or
sometimes they will leave low-priced items out. But you
can’t leave things out in a showcase for a month. Lock
them in a safe or vault. If you don’t put everything away,
you become a magnet for crime.”
One advantage of strict social distancing restrictions is
that crime tends to be reduced, as police can more easily
patrol areas and identify suspicious activity.
Experts caution against bringing jewellery items home
for safekeeping, as this can make jewellers a target for
residential burglaries.
If operating an e-commerce business from home, retailers
are advised to perform an audit of all computers and
improve their cybersecurity as necessary. A recent report
published by cybersecurity firm Proofpoint also found a
significant increase in phishing, malware, and spam email
campaigns using coronavirus as a theme, for example
emails with the subject line, ‘COVID-19 Infected Our Staff’.
22 | April 2020