Thursday, July 31, 2008

Tucson Jewelry

Tucson Jewelry

By virtue of the fact that I give free internet marketing advice on another one of my blogs, I became acquainted with a new friend that had some questions regarding selling online (retail) in a local market. As you may have gathered from the title of this post, her husband and her are one of several retailers in the tucson jewelry market.

I remember marvelling (out loud) while driving around Arizona back in 2004 when things were still booming, "how do all these retail storefronts stay in business?" Now that things are slowing down a bit, how do higher end retailers do?

Jewelry Store in Tucson

It turns out that the founder of Rainbow Jewelers got his start in the jewelery markets of New York. During his time there, he developed a certain craftsmanship and expertise in custom jewelry and repairs. The custom stuff and repairs are keeping their business thriving while people get more price sensitive to the price of gold, diamonds and other precious gems.

Tucson Diamonds

Apparently, after talking to her, she told me that there are quite a few people who will buy a diamond loose and then "go local" and have their jewelry store in tucson to have it placed in a custom designed ring, etc.

That makes sense I guess. If you're trying to save a few bones but are in the situation where you want (or need -- more on this later) to spend some of your hard earned pesos on some diamond jewelry, there are quite a few online retailers that can provide competitive prices.

Online Jewelry Stores

I bought a present for Golden Lotus a couple of times from BlueNile. I know next to nothing about diamonds and other precious gems, (and frankly my tin foil leanings make me believe it's an artificial market being run by a cartel which limits the supply on the open market) but gosh darnit...try explaining that to most women out there -- including Golden Lotus.

So, rather than wait for man-made diamonds to further mature to deliver colorless stones at reasonable prices, I bought online.

Diamond Engagement Rings

As it so turns out, I happen to be in the market for one of these -- shhhhhhh -- don't tell Golden Lotus :)

Of course like many things in Uruguay, the prices relative to the size, and quality of, cut, clarity, color, etc left a little to be desired. At the jewelry store in punta carretas, they wanted over 20,000 for most anything decent -- not huge stones -- just a carat or so.

Now, I know the dollar is down and gold, platinum, diamonds, and (probably everything) is up, but good grief. These seemed to be overpriced by about 2x over what they "should" run.

At the same time, I'm a little freaked out about the process of getting a ring sent by one of the online retailers to UY, because I'm guessing if they could guess there was diamond jewelry in that package, I'd owe a duty on it.

An Idea!

So, now the wheels start turning in my head....

I can put myself into indentured servitude for Golden Lotus' engagement ring! brilliant, huh?

It would be like a 21st century version of the sharecropper settling up with the company store at the end of the month...

"well, at .50/hour, you worked 320 hours this month, and that totals out to 160 dollars, congratulations!"

"now, let's see....that's less $15 for the bottle of vodka, $22 for the large bag of rice, $18 dollars for the box of top ramen, $56 for the new keyboard, and $12,000 for the diamond engagement ring....that puts you at only 11,924 dollars in the hole.....see you next month!"

it could be the hole new model for displaced IT workers worldwide....gets companies out of those pesky social security and medicare contributions!

Uruguay Guy

p.s. all joking aside, i think for small retailers a skill that differentiates and can't easily be commoditized (like his jewelry repair skills and custom jewelry business) will do better than those who are forced to compete on price in commoditized businesses like the Diamond or Gold Business. I heard a similar thing from a friend of mine who used to deal in silver and gold coins and decided to go into the investment advisory business instead....even though prices are booming, margins aren't.

No comments: