JB: You talk a lot about ‘tomorrow’s jeweller.’ What do you mean by that?
MS: The paradigms of the jewellery industry have been changing rapidly over the last few years and we feel that if people continue to live by the old business model, they will fail in time. ‘Tomorrow’s jeweller’ embraces technology and new business methodologies required in the jewellery industry to offset things like capital costs. This new kind of jeweller will not only be here tomorrow, but they will prosper. Hopefully, others will see their success and join the industry.
JB: You have converted your service centre in Toronto into a customer care facility. What prompted this change and how will it benefit your Canadian clients?
DC: Our new customer care centre is actually part of our ongoing strategy for Canada. We’ve moved the service centre into an office in Toronto, so people can still call in and talk to Stuller staff. We wanted to retain that face-to-face connection our associates have with our Canadian customers. We know both the associates and customers appreciate this interaction. But the biggest change in our Canadian strategy is single invoicing and accepting payment in Canadian currency, which we implemented this spring. What we’ve been trying to do since last year’s Canadian Bridge Conference is improve our service levels in Canada. We think billing in Canadian currency is a big breakthrough. We’re very happy with this and we think it will make ordering and receiving shipments from Stuller more like it is with our U.S. customers. We’ve also worked out very competitive ground shipping rates and established a new cutoff time. We think all of this is going to make a big difference in Canada. We’re very committed to the market place and I’m very excited about where we’re at. We’re in this for the long-term and that’s why we’ve invested so much in this new infrastructure.
JB: What are some of the changes you’re anticipating in the industry over the next few years?
MS: The jewellery industry is changing for many reasons. First, there’s a whole new consumer out there. They are much more demanding, much more educated, whether it’s academically or as a result of the Internet, and they pretty much know the style of jewellery they like before they even walk into a store. And that’s a very important thing to keep in mind—they still want to be able to touch the product and they want to be able to trust.
I think we’ll see wide swings in diamond prices similar to what we’ve seen in gold in the last five to seven years. We have no control over the diamond market, and so no matter what happens, we have to have a business model that allows us to weather the storm. Capital costs today are a concern. Banks are so much more demanding on debt-to-equity ratios and requiring a small business provide audited financials. So the transparency of your income is a critical part of a whole new way to be able to run a business. My fear is that as a jeweller’s product costs go up, there is much more demand on capital. Less availability of capital means less inventory, however, you’re still faced with more demanding customers who want more selection. There really is a collision course ahead—you want to have more customers come to your store, but you have to be able to satisfy their needs and requests with lower capital funding. That’s where things like technology, renders, and prototype products come into the equation, all the things we’ve been preaching over the last few years.
