Big Lessons for 2021- What 2020 Taught Retailers ?

From ensuring business is financially sound, investing in jewellery that speaks to a younger audience to investing in tech and digital to being 100 per cent compliant with rules and regulations and understanding the strengths and weaknesses of the staff, these are the biggest learnings for these jewellers says Vijetha Rangabashyam

Post By : IJ News Service On 17 March 2021 11:59 AM

Adopt a 360° Approach
Akshay Verma, Verma Jewellers, Solan

We’ve all gone through a very tough time. People who have been aggressive when it comes to day-to-day business have only survived. The way our fathers and grandfathers ran the business won’t work anymore. Brand goodwill definitely matters but customers’ attention span is extremely short because of social media and other factors. They keep changing their minds. You have to take a 360 degree approach – from managing inventory to having the right kind of inventory, every single aspect of running a jewellery shop has now become more important than before. People believe overstocking is the right way but if one does not have the right items, then that backfires. We have to understand what sells, what our footfall is and we have to understand the science behind running a successful jewellery business. We need to understand our customer profile and their behaviour, which will help us in giving them a well-rounded experience; at the end of the day, customer experience matters the most. If we just focus on marketing and ignore other aspects of our business, then we will not succeed.

We as entrepreneurs, don’t correct ourselves. Being a leader, we believe everything we do is right and that is the biggest mistake. We are not ready to listen, we have ego clashes and we are not ready to evolve. We should not micromanage, if we have hired someone with a specific skill set, then we should allow them to function independently. The industry is changing rapidly, everything is getting digitalized. There will be a time that people will regularly purchase jewellery online and we should encash on that. We also need to focus on collective marketing and we should uplift the trade. During lockdown, no other asset appreciated like gold, but we didn’t make any noise about it. Gold is the only investment that can be converted into liquid.

This pandemic has taught us that overstocking is not good. All the expenses have to be analysed on a regular basis. I don’t mean that we need to cut our employees’ salaries, but if we don’t study our regular expenses, we don’t tend to look at unseen expenses. I have created a cap and for every expense, I ensure I don’t exceed the cap and that is how we monitor our outflow. This is the only way we can be debt-free.

 

Being a leader, we believe everything we do is right and that is the biggest mistake. We are not ready to listen, we have ego clashes and we are not ready to evolve. We should not micromanage, if we have hired someone with a specific skill set, then we should allow them to function independently

Adopt a Bottom-Top Approach
Abhishek Chanda, Kalasha Fine Jewels, Hyderabad

We thought E-commerce platform was a waste of time and jewellers were reluctant to share new designs over the internet and other digital platforms. We had thought investing in technology will not work. We also thought buying jewellery is only a physical phenomenon and it won’t get sold over the internet. But things have taken a 360 degree turn. We have learnt that having a good CRM in place is of utmost importance. We have learnt to assess customers better. Everything has got streamlined with the help of technology. We have improved on our inventory practices. We have improved on sales as well. Earlier, we had thought in case of exports they may shy away from buying online. With the help of high definition video calling, however this problem has been reduced, so export sales too have picked up.

When it comes to purchases as well, we used to purchase in trade shows etc. Virtual shows provide a good platform for placing orders with manufacturers. We were able to sit together as a team and decide what we want. We have adopted a ‘bottom-top’ approach – in terms of client preferences we are paying more attention to things at the ground level. Online sales worked for us and conducting business through video conferencing worked for us. Our sales personnel were given extra training to deal with online clients. We have now geared up to meet a variety of technological challenges. Financially, we never used to review our existing inventory. We used to keep adding to it. We now learnt to take stock of current inventory. We redesigned our existing stock, instead of buying something new altogether . We learnt to manage finances frugally.

Our staff is the pillar of our business, we optimally balanced – we had to cut down on incentives but we did not cut salaries. Our staff also accepted it and they were happy that we did not cut salaries. 2021 promises to be a positive year. Hyderabad has picked up well after Covid19 and the economy is coming back to normal. Disposable income with the masses is steadily on the rise and this promises to bring in good business for the G & J industry.

Our sales personnel were given extra training to deal with online clients. We have now geared up to meet a variety of technological challenges. Financially, we never used to review our existing inventory. We used to keep adding to it. We have now learnt to take stock of current inventory. We redesigned our existing stock, instead of buying something new altogether

Focus on your Strengths and Not What Others are Doing 
Abhishek Kajaria, Avama Jewellers, Kolkata

I have learnt how to organize things in a better way – also how to manage staff related matters while everyone is away at home. I have learnt how to coordinate with staff and karigars despite the lockdown. By organizing – I mean – I have learnt to see what we have and what we are lacking. We had all the time and therefore could pay attention to details. One should not engage in over trading and that is extremely important. One should not keep excess stock.

Social media is key now. One needs to focus on social media. The challenge is how to strike a balance between not disclosing some precious designs and yet putting up some good designs and inventory for the masses, so that they feel attracted to come and buy from us. We are selling inventory online as well. Our clients keep looking up designs on social media.

We have implemented personnel management, how to keep track of stock, how to market how to keep track of payments, etc. Once you get busy, we tend to forget some things. We have planned many things and therefore the future looks bright. Jewellers should focus on their own strengths and market those. It is important to focus on what is your strong quality and use it to get more number of clients.

We have planned many things and therefore the future looks bright. Jewellers should focus on their own strengths and market those. It is important to focus on what is your strong quality and use it to get more number of clients

 

Maintain Daily Balance Sheet
Rishi Verma, Fatehchand Bansi Lal Jewellers, Ambala Cant

In terms of personal journey – I was able to do a lot of things which I could not do before. I started my own YouTube channel. It is the first channel which talks about jewellery as a whole, it is quite informative. On the professional front, I was able to evaluate marketing strategies – we could reach out to about 20,000 customers personally—identify their requirements and products they preferred, etc. Keep only those products which you can sell fast. We keep products which will have great demand. A good study of clients’ needs is important. Financial challenges will be there but we have paid full salaries even during lockdown. I personally believe that one should be able to maintain daily balance sheets. Talking to the staff helps understand their problems and provide solutions.

Keep only those products which you can sell fast. We keep products which will have great demand. A good study of clients’ needs is important. Financial challenges will be there but we have paid full salaries even during lockdown

 

Minimum Stock & Maximum Sales should be the Mantra
Pratik Dugar, Indian Gem & Jewellery Creation, Kolkata

The biggest learning has been the drastic change in conducting business – especially using technology to buy jewellery. Even now, people are coming forward to buy only the stuff they really need –casual buying is quite low. Families which have weddings planned are coming forward to buy jewellery. Need-based buying alone is on the rise. It is important to show the best stock to clients, we are giving heavy discounts on making charges. So that customers come forward to buy jewellery. Normally, we would have had to break down aged stock, and convert it into new products. This involves cost of production and some loss of precious metal as well. So instead, we have tried to pass on the benefit to clients instead of converting aged stock into new stock.

We haven’t cut down on staff salaries or haven’t laid off staff as well. We have cut down partly on advertisement. We believe that situation will improve. Our profit margins have come down slightly but we are managing. We are targeting at how to bring back clients into our stores. We are showing jewellery and conducting webinars for interested clients and they are getting interested in coming into the stores to come and look at the stock. Getting clients to buy only based on their online viewing is quite difficult. Inventory management is important. This is the biggest investment in our business, so the loss of interest is quite high. So we have to learn to make the most in limited stock. Minimum stock and maximum sales is the mantra.

Inventory management is important. This is the biggest investment in our business, so the loss of interest is quite high. So we have to learn to make the most in limited stock. Minimum stock and maximum sales is the mantra

 

Financial Freedom is very Important
Salil Jain, Jain Jewellers, Ludhiana

The biggest learning has been not to overstock. We need not take unnecessary loans or advances from banks to maintain high stocks. In 2019, we had cleared all our loans – so we had no financial stress. Financial freedom is important – it is one of the biggest learnings of this pandemic. Looking at the market trend, selling stock is easy but raising funds to re-create the same stock takes time.

We have our own set of customers. NRIs not coming to India is a setback to the whole G & J industry. Businesses are striving to survive. Survival and sustenance is important. Market looks bullish and 2021 looks positive. Going ahead, plan wisely, strategise well, once travel restrictions are lifted business will improve.

The biggest learning has been not to overstock. We need not take unnecessary loans or advances from banks to maintain high stocks. In 2019, we had cleared all our loans – so we had no financial stress
 

Learn to Keep your Promise to Customers
Vastupal Ranka, Ranka Jewellers, Pune

The biggest lesson we have learnt is to – get back to our basics – know your customers well and serve your customers well. It is a tough time for everyone around, even our customers are going through a rough patch. Stick to your promise, when times are tough, people may come to exchange or sell jewellery in case of an emergency. We need to honour our commitments and that is how we maintain our goodwill. If we have to retain our clients, we need to invest in good technology and E-commerce platforms. This is the only way we could reach out to customers during special occasions like Gudipadwa and Akshaya Tritya. A good E-commerce structure will go hand in hand with Whatsapp and video calls.

Revisit your entire stock and cut down on unwanted stock that might add to your financial burden. There has been a lot of restructuring on the supplier side as well. Jewellery was given on approval and turnaround of stock was much better but that is not the case anymore. Whatever sells, keep that, get rid of stock that does not have good demand.

Revisit your balance sheet and know your risk taking capacity. As an entrepreneur, we need to understand our income, outflow and our revenue and whether our cashflow is maintained well. 2020 was a good learning time – we have learnt to restructure ourselves and become lean. We learnt to innovate. The educated client is well informed and we should be able to answer their queries well. They ask so many questions about gold and diamonds, so we need to keep ourselves updated on latest trends.

It is also the time to collaborate. We did a few events with Narayani Silks, where we invited their premium clients over to our store. This collaboration boosted sales for both. We had to cut down on our wasteful expenditure. Staff was given tighter targets. Everyone is now on their toes, we are evaluating people based on their performance. We have always been giving training in marketing, work-life balance, sales and we have tied up with universities to give training in English speaking etc.

We have to constantly be visible to our customers, so we can’t cut on our advertising and social media spends. It is a very competitive world outside, with passionate players who have bigger muscle. They have bigger budgets and they are constantly in touch with their clients. We need to shed that money as part of marketing expense.

Revisit your balance sheet and know your risk taking capacity. As an entrepreneur, we need to understand our income, outflow and our revenue and whether our cashflow is maintained well. 2020 was a good learning time – we have learnt to restructure ourselves and become lean

Look for Lucrative Collaborations
Snehal Choksey, Shobha Shringar, Mumbai

Opportunities in forms of innovation and cost cutting have led to improved profitability of the company – these are the biggest lessons from the pandemic. Willingness to change, being attentive and adaptable to change is important. Talking about inventory management – we have all cut our over leveraged position – we have cut down on unwanted inventory and kept only what is essential. We are keeping 10-15 per cent less inventory – business is almost 10 per cent lesser than last year.

Financially those who are free, without loans and advances are doing well. We work on huge volumes and small margins. In this scenario, we cannot afford to have finance from outside on a large scale. Those who have control on overheads can do well. We are trying to make our presence felt nationally – through collaborations with Miss India pageant, even billboards are available at half the price because of the pandemic – we need to be looking out for such discounted collaborations and advertising and we need to build our brand. Stick to your strengths and do not get swayed away. Never be over leveraged, cut costs wherever you can.

Opportunities in forms of innovation and cost cutting have led to improved profitability of the company – these are the biggest lessons from the pandemic. Willingness to change, being attentive and adaptable to change is important

Have Plan B & Learn to Adapt Quickly
Saurabh Gadgil, PNG Jewellers, Pune

We moved a lot of our business online, we started using technology to the best of our abilities. Select online, buy offline and several other modes by creating dedicated online channels for customers were created. All the inventory was put up online. When lockdown began, gold was at Rs 38,000 and when lockdown opened it was at around Rs 50,000 for the same amount of gold. So a lot of money for most retailers was tied up in inventory. This made everything quite uncertain.

The pandemic taught us the importance of being able to adapt to changes quickly. Covid has taught the world the value of human life, compassion and being able to overcome challenges posed by uncertain times. The exchange policies, buyback terms etc had to be learnt again. Crisis times taught us the importance of facing challenges as a team. We had a good bonding with all employees at every level. Stronger ties have been nurtured. We have started understanding our clients better. We understand their problems as well. Areas which were neglected were given more attention.

After the storm settles, it is time to take stock of your business. Things are going to get better from here, aim for the sky, create a better industry. One has to learn the importance of having a Plan B. We have to learn the importance of being able to bounce back in no time.

Covid has taught the world the value of human life, compassion and being able to overcome challenges posed by uncertain times. Crisis has taught us the importance of facing challenges as a team.

Be Compassionate and Take Care of your Staff
Manish Gupta, Alankar Jewellers, Patna

The first thing we learnt is to be fair to our employees. We learnt that you have to support our team. You have to have the depth in you to be able to support your people in times of crisis. Being able to support the team in the right way goes a long way and it reflects on our value system. So their respect towards the organization also has increased. The whole idea is being able to be more humane.

We were able to showcase products in the right way, we learnt to optimize by looking at products which are not moving – finding the reasons why certain products are not moving. As gold prices shot up, some pieces were not in line with the expectation of the customers, price wise, so we learnt to redo the whole set – make it lighter. We were able to identify the fast moving segments and getting more of that inventory in.

Everyone is selling jewellery but what we can offer is an experience of buying jewellery. Customers value the little things. Sometimes, a customer wants to buy only the earrings from a necklace set. Earlier we were stubborn but now we have learnt to be flexible and service customer’s every little need. We made certain changes in our sales policies, made ourselves more flexible. Each one has a different viewpoint – you cannot steam roll your way in this field. The industry should work as a team. You need to approach such situations through team work. Customers’ feedback is of utmost importance and getting them to realise that there is no other product which gives you value for your money like gold is also crucial. You cannot do this with your Bulgari jacket or your Mercedes Benz. Jewellery is the only luxury product which you can wear many times as you want, redo it at one-tenth the cost and get a brand new piece, or exchange or sell it at a higher price. The whole industry must come together to explain this to clients. Awareness about the effort and labour that goes into making a piece of jewellery should also be created.

Jewellery is the only luxury product which you can wear many times as you want, redo it at onetenth the cost and get a brand new piece, or exchange or sell it at a higher price. The whole industry must come together to explain this to clients

Tread Cautiously and Don’t Be in a Hurry
Anantha Padmanabhan, NAC Jewellers, Chennai

2020 has been quite bad for all of us. From April to September we could not work. For six months we had to bear all the overheads – interests, rents, salaries etc, prices also rose. Many people lost money in gold loans – liquidity dried up in no time. Most of us survived. We expect good business from February.

We should not have too much risk and loan exposure. Everyone should have a provision to overcome these dangers. If we are doing a 100 Cr business we should have a backup worth 2-3 per cent. People who have 5 or 10 showrooms have to plan properly and not be in a hurry. We have to be very cautious. We were able to manage salaries but we had to cut about 15 per cent of our workforce, otherwise the establishment would have been in danger– if there is an opening, we will give them first preference. For Diwali we gave a 50 per cent bonus. We have now restored salaries as well. We cannot expect any increment this year. After six months we may be in a better position to do it.

We need to look into the fast moving items and concentrate on those. We also need to get into deals for fancy items with manufacturers, which they can take back and redesign and send back to us if the need arises. We have removed a lot of our old stock and converted them into fast moving pieces. We need to plan our stock properly in the coming months . We may have to buy only 5-6 bridal sets as against 15-20 sets and we need to wait for the season to pick up. We have to go for light weight diamond jewellery. Platinum is doing well because prices are low. We are cutting on advertising revenues as well. We are concentrating on social media and radio, newspapers and magazines have become cheaper since Covid.

We need to look into the fast moving items and concentrate on those. We also need to get into deals for fancy items with manufacturers, which they can take back and redesign and send back to us if the need arises. We have removed a lot of our old stock and converted them into fast moving pieces. We need to plan our stock properly in the coming months

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