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Maximize Your Profits


   At the retail level, "quality" is a buzzword used so frequently that it has lost significant meaning. Customers have heard the old "quality, selection, price" triad so many times they are immune to it. So if saying it doesn't work anymore, what does? Showing it. When a person holds quality jewelry in their hand, the weight and integrity can be felt. Whether it is conscious or not, consumers respond to higher quality with more confident buying. That translates directly into greater return on investment and lower amounts of unsold or returned stock.

   Informal surveys with jewelry store managers revealed that nearly 50% of their low quality jewelry was returned or remained unsold, while only 5% of their higher quality jewelry was returned or remained unsold. This can be further illustrated as "quality verses quantity."

   Two wholesale buyers begin with equal amounts of money ($54.00), but because lower quality jewelry costs less, the retailer begins with six more pieces of low quality jewelry than high quality jewelry. The immediate assumption is that more money can be made if there is more merchandise to sell; however, only about 50% of the low quality jewelry will sell. Conversely, nearly 95% of the higher quality jewelry will sell, leaving only about 5% of the stock unsold.

   After fifteen weeks of re-stocking strictly with sales earnings, the $54.00 originally invested in high-quality jewelry netted $634.00 and only accumulated $72.00 worth of unsold stock. Meanwhile, the low- quality jewelry only netted $24.00 and actually accumulated $228.00 worth of unsold stock. The most detrimental effect of sacrificing quality for quantity is the accumulation of unsold and returned stock. In the cases surveyed, consumers readily paid a few extra dollars for quality.

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