In the Loupe: May 2014

I N

T H E

LOUPE May 2014

The Ultimate Jeweler Resource

Issue 55

RJO Heads North to the Mini Apple

MINNEAPOLIS, HOME OF WHEATIES, masking tape, and Bisquick, serves as our host city for RJO’s Fall Buying Show, “There’s No Business Like Show Business.” We’ll be returning to the “Mini Apple,” noted for its farmer’s market that features fresh roasted corn-on-the-cob, the famous Spoon Cherry Bridge (below), and a mall the size of 78 football fields. Sitting on the banks of the Mississippi River, Minneapolis offers beautiful August weather, easy access by air, and a vibrant downtown.

JCK MAGAZINE RECOGNIZES RJO

Selected for keeping the jewelry business spinning SEE PAGE 4

GESSWEIN CELEBRATES 100 YEARS

Proud to be providing craftsmen with “The Right Tools” since 1914 SEE PAGE 5

This show will kick off with the popular RJO golf tournament, then move into a full slate of educational sessions and seminars, keynotes and roundtables, idea exchanges, entertainment and fun, not to mention the latest and greatest from RJO’s vendors. In addition to the terrific deals you’ll find on the Buying Show floor, as always your RJO membership entitles you to additional perks, including: up to three consecutive nights complimentary lodging for all qualifying stores; special airfare discount; attendance at our Sunday Evening Gala, which promises to be an evening sparkling with the glitz and glamour of old Hollywood; buying discounts; RJO Purchase Vouchers, allowing you to save up to an additional two percent on what you buy from vendors; and major league baseball, with the Minnesota Twins taking on the Kansas City Royals in a night game.

Your Buying Show Registration Packet will be mailed at the end of May, so keep an eye out for it, and be sure to watch for the various deadlines, to ensure the there’s no Buying Show like this Buying Show! August 16-18, in Minneapolis, MN.

MARKETING MATTERS: THE FUTURE

The roots of retail handson jewelry sales and the sudden onset of an electronic world make for a curious future SEE PAGE 8

FAMILY. DIVIDEND. SUPPORT. BUYING POWER.

In the Know with RJO by RJO CEO Mary Peterson Did ’ya know?

Minneapolis Show: Did ’ya know?

• We have created a great roster of seminars as well as a powerful keynote speaker, in Brigadier General Steve Ritchie. Get excited for some great learning!

• We will have the Event App again for the show to help you keep organized and informed.

• The Idea Center on the show floor will allow you to have one-on-one discussions with seminar speakers and social media trainers.

• NEW at this show, we will offer Idea Share Meetings on Friday evening. These meetings will be a great opportunity to learn from your RJO peers. In these professionally facilitated sessions, RJO jewelers have the opportunity to be paired with stores of a similar size to share ideas, best practices and discuss hot topics. These will be highly interactive sessions in which the participants choose the discussions topics.

• Meet all our great vendors and our newly selected vendors to see all they have to offer. No doubt they can meet all of your needs.

Education: Did ’ya know?

• The Next Generation Experience is happening May 17-19 in Chicago. We are very excited by the interest in this program and want to say a huge thanks to

Stuller and RDI for making this experience possible.

We even have a waiting list started for the 2015 program!

• We are working on a program for October for owners of stores planning their succession. It will be held in Chicago and be an interactive learning experience. We will keep you posted on registration and content.

Opportunities: Did ‘ya know?

• You will be getting the second half of your patronage dividend at the end of May. Think about using part of it to attend our great buying trips in October 2014. All trips offer great incentives and marketing materials.

- Antwerp: October 4th-9th and October 11th-16th - Idar Oberstein: October 9th-13th and October 16th-20th - Israel: October 24th - November 1st (Note date change)

• On-line bill pay and statement review is now available via the RJO website. Now it is even easier to pay your bills with our on-line program.

See you in Minneapolis!

RJO Board News The RJO Board of Directors and the Merchandise Review Committee are excited to announce the appointment of the following RJO members to the 2015 Merchandise Review Committee: Kate Marks Marks of Design Shelton, CT

Joanna Hudzik Haywoods Westlake, LLC Hardy, VA

They will begin their introduction to the Merchandise Review process at the JCK Las Vegas Show this June, with their full term starting January 1, 2015.

FAMILY. DIVIDEND. SUPPORT. BUYING POWER.

From the RJO Chat Channel

SERVICES

Centralized Billing Patronage Dividend RJO Website (rjomembers.com) Buying Shows (Fall/Spring) RJO Chat Channel In the Loupe – RJO’s newsletter Free Print and Radio Ad Library (on the RJO website) Educational Seminars (at the Buying Shows)

Member-to-Member Incentive Program (Recruitment Program)

Organized Buying Trips to Antwerp and IdarOberstein, and Israel RJO Directory Travel Vouchers at Shows (offered at varying times)

Free Hotel Room Incentive (at the Buying Shows)

RJO Informational E-mail Blasts Purchase Vouchers (at the Buying Shows)

RJO Membership Certificate Education on the Go Podcasts and Webinars Private Label Credit Card Service JewelConnect

THE CHAT CHANNEL ON THE RJO WEBSITE (www.rjomembers.com) hosts a variety of interesting discussions each month. Here’s an edited post from this past March—and responses to it—that can be found in the RJO—Open to RJO Jewelers Only area, under the heading “Jeweler Salary ... ?”

Post: We have three jewelers, but I am REALLY REALLY curious if anyone would share how they pay in-house jewelers, specifically salary, hourly, hourly plus bonus, what rate, etc? Everyone wants more; how do you figure out what’s “worth it?”

Response One: If your jewelers are coming to you asking for more, I’d listen to them and pay enough to satisfy them. If your hesitation is because your repair department is not a profit center, then that needs to change. Heck, we cannot find a good bench jeweler in Amarillo. Michael does all of our bench work, and it slows us down to a two-to-three-week turnaround on basic repairs. Seriously, the place to find out what a craftsman expects to be paid would be on the MJSA forum, or you can email David Geller at jewelerprofit.com to discuss.

Response Two: My son, who is 24, was working part-time for us for about two years. In September he took a position with a midwestern jewelry chain that has about 55 stores. They gave him two months of training and moved him to Bismarck, where he is their only bench jeweler. They are paying him about $14 per hour—plus a small commission on sales and repairs—which comes to about $31k annually. I hope that helps some.

Response Three: Our jeweler has been with us for about 16 years as an independent contractor, so he gets no salary, no benefits, etc. We pay him by the piece, so it’s easy to quote a price to our clients and obtain an excellent mark. He’s fast and efficient. Most years he grosses $45-$60K per year. If our shop is slow, he makes less; if we’re busy … he makes more. It works for us.

Response Four: David Geller’s book gives information on how to pay the jeweler on a commission basis. I think he bases it on a full-time jeweler making $40-60K. He could tell you more about how that works. Steven is our jeweler (and owner) so you can’t really base a salary on that. Hope that helps. Using Geller really allows you to make enough to pay well, and their pay is tied to work product.

Board of Directors Election

The RJO Board of Directors is comprised of nine RJO members, elected by the general membership, to aid management in decision-making, policy review, development and implementation, strategic planning and maintaining the overall viability of the organization. At this time, two seats are up for re-election on the RJO Board of Directors. We are seeking applications from interested members. The elected members will begin their board responsibilities on January 1, 2015.

The Board of Directors requires a great deal of involvement and dedication. If interested, please carefully review the Roles & Responsibilities of the Board.

Applications will not be accepted after Friday, May 23rd at noon. Click here for application.

FAMILY. DIVIDEND. SUPPORT. BUYING POWER.

JCK Magazine Names RJO One of its Trailblazing Trade Groups THE APRIL ISSUE of JCK Magazine features an article entitled, “Circles of Power: JCK’s 2014 List of 15 Trailblazing Trade Groups.” RJO is selected as one of 15 organizations and industry associations that “keep the jewelry business spinning.”

RJO was the only buying group recognized on this list, among some pretty big names. You may read the article here.

The article notes many of RJO’s strengths, including our: • quality vendors, • discounting power, • popular buying shows, • online billing system, and • our annual international buying trips.

industry spinning. To paraphrase the article, ‘it would be hard to imagine our industry without RJO.‘ “

“I couldn’t agree more with JCK,” says RJO CEO Mary Peterson, “and I applaud all of our members for helping RJO keep the jewelry

JewelConnect Opens Up Bargain Marketplace Available to All RJO Members JEWELCONNECT, THE RJO-EXCLUSIVE digital marketing system, launched “Retailer Marketplace” this past January at the Savannah Buying Show. The Marketplace is coming out of beta-testing and into mainstream JewelConnect apps this summer, at which time it will be available to all of RJO’s JewelConnect members.

“We saw lots of great interest in Savannah,” says Andrew Boundy, JewelConnect’s developer.

“Marketplace allows retailers to advertise their own stock to other RJO retail stores. Some stores want to offer their slower-moving items to other stores at incentivized prices, and this is a simple and free way to do that.”

Look for items on the system now by clicking here.

Sign-up to be one of the first free activated accounts.

Remember to check out all the JewelConnect tools, including marketing, mobile sites, e-commerce, diamond e-retailing, marketplace, blogging and much more at www.JewelConnect.com

The JewelConnect system has always allowed free viewing of items, but the full release offers the ability to list pieces for free as well. Thomas Roethling, JewelConnect’s data manager, adds, “We wanted to say thanks to RJO by making the Marketplace available to all 600 of our subscribed RJO users, and we think that this feature will have great value.”

“It’s sort of like the online marketplace eBay, but it’s just for RJO retail stores,” says Boundy. “The items are added and displayed, and if you see something you like, you contact the store that added it directly, to make a deal. It’s great for moving stock, and you can use the sale to fund the purchase of new stock that will move faster.”

FAMILY. DIVIDEND. SUPPORT. BUYING POWER.

Vendor Profile

Gesswein Marks 100 Years of Serving the World’s Finest Craftsmen

THE YEAR 1914 WILL LONG BE REMEMBERED for Babe Ruth’s first professional at-bat and the first appearance of jungle-dweller Tarzan. It was also the year that jewelry industry vendor Gesswein opened its doors. As the company celebrates its 100th anniversary this year, it’s easy to see how proud they are of their longevity. In fact it’s in the company’s tagline: “The Right Tools Since 1914.”

Gesswein is truly an American success story. Founder Paul H. Gesswein came to America with his parents when he was in his early teens, taking a job working in a hardware store.

He soon found that he had many requests from nearby craftsmen for high-quality small-size precision tools. Recognizing a unique opportunity, he decided to start his own business, beginning by importing European tools and initially concentrating on local customers. The original focus of Paul Gesswein’s enterprise was to supply tools and equipment to the thriving jewelry and silversmith industries in New York and Boston. After more people heard about his precision tools, requests from other parts of the country came in.

Paul decided to produce a catalog of tools and supplies that he could mail to those who couldn’t visit the store. By the 1930s, the Paul H. Gesswein Company, Inc. occupied one room in a building in lower Manhattan. Paul made sales calls, while one employee manned the phones. The company grew, expanding as quickly as space became available in their building. By 1950, the Paul H. Gesswein Company carried more than 1,000 items.

During the 1950s, plastic injection molding came about and grew very quickly. It became apparent that different types of finishing stones were needed, and over the course of the next decade, Gesswein was able to provide solutions that increased finisher productivity and overall mold finish quality.

In 1963, the company finally outgrew its available space. It moved uptown a couple of miles to lower Park Avenue, beginning with 5,000 square feet of

space. As the decade progressed, so did the company. Within three years, another generation of Gesswein family members had entered the business, renting another floor and part of a third, to store equipment. Even with the extra space, at least two employees were sharing the same desk and alternating their workdays in the office. Another move was clearly on the horizon, and the decision was made to move operations to Bridgeport, Connecticut.

Additionally Gesswein has branch offices in Toronto, Canada; Bangkok, Thailand; and Mumbai, India.

The Paul H. Gesswein Company, Inc. has come a long way from that one-room walk-in store on Maiden Lane. Today, it offers more than 16,000 items to a large community of jewelry manufacturers and mold and die polishers around the globe. It is run by about 60 employees. Even with this growth, however, the company is still loyal to the vision Paul had a century ago, constantly adding new and innovative products to help the metal and wood-working industries.

“Our guiding policy is simple,” says Scott A. Petrillo, Vice President Sales,” and it has been the same since our inception in 1914: Provide quality tools and supplies to manufacturers and retailers worldwide.

Our customers are the ones responsible for our success, and thus we are here to serve them completely through product and know-how.”

As they mark their 100th year, the celebration seems to be focused on many of the same notions that have let them thrive for so long.

“We had a celebration already at our Bangkok, Thailand office, and more are expected throughout the year,” says Petrillo. “Our focus this year is the integration of our new computer software to better serve our customers.”

Gesswein is located at 201 Hancock Avenue, Bridgeport, CT 06605. Phone: 203-366-5400. Website: www.gesswein.com

FAMILY. DIVIDEND. SUPPORT. BUYING POWER.

2014 Fall Buying Show • RJO heads to Minneapolis this August, where the Fall Buying Show will be held the first week of that month. The larger half of the Twins Cities (along with neighboring St. Paul), Minneapolis is the largest city in Minnesota, and is the 47th largest in the United States. Yet this town of nearly 400,000 is home to 15 Fortune 500 companies— more than any other city in the United States—including 3M, Best Buy, General Mills, and Target.

Minneapolis has a vibrant downtown, featuring a walking plaza, fountains, and public green spaces, all served by a transportation network that features a light rail system.

The town’s major league baseball team—the Minnesota Twins—plays their games downtown in the recently opened Target Field Stadium.

Minneapolis is the hometown for a number of famous faces, including: Vince Vaughn, Richard Dean Anderson (“MacGyver”), the Andrews Sisters, and Prince (whom, for a decade during the 90s, changed his “name” to this icon. He then became known as “The artist formerly known as Prince”).

We’ve put together some preliminary information about the Buying Show and its host city. We hope it helps you start your planning for August.

Get to know The City of Lakes

Minneapolis is the birthplace of the Juicy Lucy, a cheeseburger that has the cheese inside the meat patty in addition to on top. A piece of cheese is surrounded by raw meat and cooked until it melts, resulting in a molten core of cheese within the patty.

Minneapolis has more golfers per capita than any other city in the US.

A person may not cross state lines with a duck atop his head.

Minneapolis holds the Guinness World Record for Largest Gathering of Zombies (8,027), thanks to a pub crawl that was hosted in October 2013.

All men driving motorcycles must wear shirts.

”The Song of Hiawatha,” a poem by famed poet Henry Wadsworth Longfellow, was written about Minnehaha Falls in Minneapolis, a place that Longfellow never visited.

A statue of Mary Tyler Moore—downtown on the Nicollet Mall—pays homage to the legendary 1970s CBS television sit-com, The Mary Tyler Moore Show. The statue marks the site where producers filmed the series’ iconic opening sequence, in which character Mary Richards throws her hat up high in the air.

FAMILY. DIVIDEND. SUPPORT. BUYING POWER.

Minneapolis, MN • August 16-18 The average high temperature in Minneapolis in the first part of August is 79 and the low is 63.

Our Host Hotel: Hyatt Regency Minneapolis The Hyatt Regency is in the heart of beautiful downtown Minneapolis, and it recently completed a $25 million transformation that is being met with great reviews.

Travel site TripAdvisor lists the Hyatt Regency as one of Minneapolis’ best hotels, and recent travelers’ reviews are positively glowing. For example:

If you want a perfect hotel experience from beginning to end of your stay, this is the place. The rooms are large, spotless, have high-class decor, and have roomy bathrooms with great lighting. To top it off, the bed is extremely comfy, and the crisp duvet cover sealed the deal for me. Of all the Hyatt Regencies I've stayed at, this is probably the best.

Book your rooms early by clicking here.

The Hyatt Regency Minneapolis is located at 1300 Nicollet Mall downtown.

Loring Park Neighborhood

Adjacent to the Hyatt Regency is The Loring Park neighborhood, a pedestrian paradise with easy access to bicycle trails, a short walk to the downtown and uptown areas, and excellent public transportation.

The neighborhood is dotted with a wide range of ethnic restaurants, entertainment, retail shops, businesses, six of the city’s largest and most historic churches, the Walker Art Center and Sculpture Garden, and within a short walking distance, the Minneapolis Art Institute, the theater district, and Orchestra Hall.

Airlines Serving Minneapolis

RJO will again receive a group discount for attendees purchasing their tickets from American Airlines at www.aa.com. Enter Promo Code A4684AZ to receive a 5% discount on your airfare.

FAMILY. DIVIDEND. SUPPORT. BUYING POWER.

Marketing Matters

Pondering the Future of the Jewelry World

A RECENT SERIES OF ARTICLES on jckonline speaks to the future for jewelers and potential changes on the horizon for jewelry stores and the industry. While some change is necessary, I would tread carefully into the future when selling jewelry.

Technology has made all of our lives much easier, and the internet is an endless source of entertainment and information.

Software that can profile customers, manage inventory, and teach you more about your industry and running your business should be at the top of your list of things to investigate.

That being said, I would caution you to avoid a dependence on the internet to sell your products.

Please note the word “dependence.” One of the JCK articles speaks to an optical company that has customers come in to try on and purchase new glasses. The hook is that those glasses are then shipped to them a week later.

Comparing eyeglasses with jewelry, in my opinion, is as unconnected as comparing Valentine’s Day to President’s Day. While there is a fashion aspect to a new pair of glasses, they are, for the most part, a functional tool that we use to help us through our daily lives. While jewelry also has the fashion aspect, what it really has is an emotion and place in time.

Whether the occasion is a birthday, an anniversary, an engagement or the all-important

“baby bauble,” jewelry has the rare ability to freeze a moment in time forever. Many times jewelry is a constant reminder of a very emotional event or moment in our lives.

Going to a storefront to pick out a gift for my wife and then to have it shipped a week later takes a lot of the emotion of the purchase away, and it makes it more of a transaction. Jewelry is one of the most pure emotional purchases, and I would endeavor to make it more so, rather than less. If the purchase becomes transactional, every person with access to the internet could compete with you everyday.

The future of the jewelry business, from a customer standpoint, should look like the past. Strong customer service, beautiful merchandise, a great-looking store, and a competent, well-trained sales team. I’d focus on being the “go-to” source for jewelry questions and big-moment gifts.

Be highly visible in the community and be known as “the place” to go when “the purchase matters.”

From my many interactions with RJO members at Buying Shows throughout the years, I know that to be successful in the jewelry business it takes great people skills, long hours, and a

commitment to excellence. But it is SO worth it. You are a true asset to your communities, and you make a difference in many, many lives.

Look forward into the future of your industry, but never forget how you got to where you are.

Those skills and that passion will keep you strong for many years.

Michael C. Woody is President and Chief Idea Officer of Capital Ideas. He has nearly 30 years of experience in television advertising and loyalty marketing.

Phone: 515-556-5373.

E-mail: MichaelC@ideas2burn.com Website: www.ideas2burn.com

FAMILY. DIVIDEND. SUPPORT. BUYING POWER.

RJO Sponsored Trips 2014

In October: Let Us Show You Europe or Israel FOR MORE THAN 25 YEARS, RJO and participating retailers have experienced on-going success buying diamonds directly from the source, beginning in Antwerp. In 2006 RJO extended these trips to include IdarOberstein, Germany, the colored gemstone capital of the world.

Last year RJO initiated a completely new trip to Israel.

While more complete and updated information on all of these trips can be found on trip-dedicated web pages on the RJO website, here’s a rundown of the trips for this fall.

First Europe Trip Hosted by Liz Schlauch and Jeff Horlacher Antwerp: October 4-9 Idar-Oberstein: October 9-13

Second Europe Trip Hosted by Connie & Steve Matsen Antwerp: October 11-16 Idar-Oberstein: October 16-20

When you take advantage of this outstanding opportunity, you’ll qualify for these incentives:

• First-time travelers receive $500 toward travel expense • Free 19-inch TV/DVD player, with Antwerp Advantage DVD • Personalized DVD filming at Fall Buying Show • Overseas hosted dinners • “How To” marketing guide • Entry into a drawing for 1ct tw. diamond studs

Israel Trip Hosted by Randy Pedersen and Jennifer Zacharias October 24th November 1st

RJO takes you along some of the most exotic backdrops of Israel, while touring eight RJO vendors in one of the largest and most important diamond centers worldwide—an excursion that will give you a heady mix of business and pleasure.

In addition to providing a marketing DVD and posters, RJO and sponsoring vendors will provide stores with these perks:

• $250 travel voucher with any purchase in Israel (checks mailed following the trip)

• a 2% discount on all purchases made in Israel

The RJO Next Generation Experience Launches in Chicago With Nearly 40 Stores Attending

RJO, ALONG WITH sponsoring vendors Stuller and RDI, launched the first-ever Next Generation Experience, from May 17-19, 2014, at the Hyatt Lodge in Chicago, IL. Entitled, “The Next Generation Experience: Creating Ultimate Jewelers of the Future,” the Experience is hosting 37 stores represented by one next-generation owner or manager of an RJO store.

“Our vision for the Experience,” says RJO CEO Mary Peterson, “is to create and engage. We created a curriculum of hands-on learning and interactive dialogue to aid the next generation of retail jewelers in preparing for the future of our industry and their business. We will engage participants to ensure continued learning occurs after the initial gathering.”

development and design for the future, and the future of the industry. To ensure maximum participation, all lodging and meal expenses were covered by RJO, RDI, and Stuller. Participants only needed to pay their way to the Experience.

Look for a first-hand account of the gathering in the next issue of In The Loupe.

Topics to be covered during the two-day event include personal development skills, business

FAMILY. DIVIDEND. SUPPORT. BUYING POWER.

MILESTONES

JULIE M. BARRY, of Sturhahn Jewelers in Quincy, IL, died March 3. She was 30.

MARILYN EDITH ILLINGWORTH, of Illingworth Jewelers in Albia, IA, died January 9. Marilyn was 86.

BARBARA JEAN SCHNOOR, of The Gold Boutique in Chariton, IA, passed away April 22, at the age of 65.

Our thoughts go out to each and every family.

JUNE 2014

10 All payments must be received in RJO office

13 Vendor Show Registration deadline

14 Flag Day

JULY 2014

4 Independence Day - RJO office closed

10 All payments must be received in RJO office

18 Retail Member Show registration deadline

15 Father’s Day

23 All invoices must be received in RJO office

23 All invoices must be received in RJO office

NEW MEMBERS

Dave Askew Jewelers Dave Askew St. Cloud, FL

referred by Rob Hays, Victor Settle Jewelry, Bloomington, IN

David Wilson DesignerGoldsmith Inc. Dave Wilson Salem, OR

Draeb Jewelers, Inc. George Draeb, Bill Draeb Sturgeon Bay, WI

Franzetti Jewelers Monte and Cathy Franzetti, Bobby Franzetti Austin, TX

referred by: Greg Greffin, 24 Karat Rose, Wayzata, MN

Gemstone Creations, LLC Nancy Yan-Sheldon and Craig Sheldon Fredericksburg, VA

referred by: Ed Waters, Kelly Waters, Boston, MA

Georgetown Jewelers Scott Chamberland, Tracy Matousek Wood Dale, IL

Grono & Christie Jewelers Meryl Manin Milton, MA

MPC Jewelry Design, Inc Michael and Maryanna Capozzoli Trinity, FL Nummi Jewelers Dale Nummi, Karen Nelson, Katie Nummi Superior, WI Philip’s Diamond Shop Phillip High Jr., Molly Lurth Marion, IA

Staats Jewelers Brent Staats, Ronda Staats Liberal, KS

Thank you to the jewelers referring new members to our group. These jewelers will receive a $1,000 finder’s fee for their referral, payable after a new member has been in good standing for at least six months.

FAMILY. DIVIDEND. SUPPORT. BUYING POWER.