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Brilliance jewelers1/7/2023 The company’s experience navigating the pandemic has positioned it well for the Delta variant threat. The company reports this has resulted in a 40% improvement to inventory turn, along with a reduction in overall inventory levels. It’s been turning inventory faster, bringing in more productive lines and moving them around if an item might sell better in a different location. The backend work the company has been doing in inventory management also provides a cushion for any supply chain glitches. ![]() If things unexpectedly go sideways, she says they have the ability to pull forward Valentine’s Day orders to arrive in December. Reporting that about 50% of holiday orders are already in hand, she expects the rest to be delivered as expected. “We’ve seen incremental increases in our shipping costs, but we’ve been able to mitigate that somewhat because of the relationships with our vendors,” she relates. Before, they could only sell what they had in their case.” Secure supply chainīeing the nation’s largest jewelry retailer puts Signet in the driver’s seat when it comes to getting the supply it needs from its producers. Because of this our closure rates are up double digits versus where they were two years ago. So if you walk into Kay, our jewelry consultants can access merchandise from Jared to find what they are looking for. “Through their iPads they can access every bit of Signet inventory. “All of our store teams have gotten very comfortable using technology,” Drosos says. Thanks to improved bridal search and online browse functionality, Drosos expects many couples will land on its pages and show up at one of its stores. “While couples still predominantly buy bridal in-store, some 30% of couples in 2021 said they bought an engagement ring online, that’s double was it was in 2019,” she says. The company’s strong e-commerce presentation of bridal jewelry is further assurance that it is positioned to attract the attention of engaged couples. Weddings make you think about who you love,” she adds. “We know that people who are in or attend a wedding are more likely to get engaged. “A lot of people begin shopping for engagement rings in October with people getting engaged toward holiday and New Year’s,” she says.Īnd because more couples are celebrating weddings now after being delayed by the pandemic, she foresees added tailwinds for Signet’s bridal business. Signet is already seeing a bridal jewelry boom, with sales of bridal up 25% over two-years ago. “Bridal represents about half of our revenue,” she says, adding that the company’s research indicates some 2.3 million couples plan to get engaged this year, which is up high single-digits compared to the pre-pandemic year. ![]() The company’s reliance on engagement and wedding jewelry also provides a cushion for inflation headwinds with people spending more in the category. ![]() People spent more on those holiday gifts earlier this year with average transaction value up 18% over two years ago. This is backed up by results seen for Valentine’s Day and Mother’s Day, besides Christmas the biggest jewelry gifting holidays. Jewelry is a lasting and meaningful gift that holds it value,” she explains. ![]() “Higher-income consumers are feeling strong financially and will be shopping for jewelry at holiday. But the company’s consumer insights reveal 80% of customers feel they are the same or better off financially since Covid. On the consumer front, she expects some consumers to feel inflation’s pressure as government stimulus wanes and the cost of essentials, like food, gasoline and housing, goes up. “Our cash flows have been significant and our cash position is very healthy, which gives us a lot of agility to weather macroeconomic changes,” she explains. From an internal cost perspective, Drosos says the company is well positioned to absorb rising costs thanks to cost savings and its working capital management. Jewelry has been hard-hit by inflation, rising 10.1% in the past twelve months through July 2021. Given this quarter’s strong performance, Drosos also announced, “We are raising our guidance for the year, reflecting our business strength and confidence in our growth strategy.”ĭespite potentially troubling headwinds given the uncertainties through the end of the year, Signet is projecting it will end fiscal 2022 with sales in the $6.8 to $6.95 billion range, up from $6.5 to $6.65 billion previously projected.Īll retailers, but most especially ones like Signet that depend on discretionary spending, are challenged by rising prices, short supply of in-demand products and the threat of the Delta variant as the holiday season approaches.ĭrosos tells me all of these unknowns are baked into the company’s latest guidance. The two together combined with services and mid-market expansion are multipliers.” And she added, “If winning in our biggest businesses is our foundation, then leading in connected commerce is our accelerator.
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