Holiday Aftermath: Vendors Stay Lean, but More Shakeups Ahead

NEW YORK — Vendor caution will limit the damage from the poor holiday season, but it won’t stop more consolidation in 2003.Most firms...

James DeMattei, owner of the ViewPoint showroom, which represents La Nouvelle Bague, Robin Rotenier and other jewelry brands, said: "Everyone is looking to pass the burden and push the cost of holding inventory back to the vendor. Many firms have jumped into the jewelry industry in the last seven years and not all of them will make it.

"A lot of new vendors, both domestic and foreign, that lived through the exciting Nineties didn’t save for a rainy day and those designers will be challenged to maintain their business. Especially in the precious jewelry industry, where there are a lot of entrepreneurial companies and margins are as thin as they are, I think there are going to be a lot of changes. I expect the vendor structure will shrink and we will see more consolidation."

Helen Welsh, owner of the eponymous showroom, said: "Many stores aren’t able to invest in newer brands. Buyers are so tied to people guaranteeing margins that they don’t have flexibility to bring in newness. Most stores were very conservative in placing spring and are only now finalizing and updating their spring buys. Many stores still have plenty of inventory. There is still a lot of merchandise out there. But the days of stockpiling are over. People buy closer to need and are more conservative from the get-go."

Meanwhile at Wolford America, spring orders have exceeded expectations and are up in double digits against last year, said Maria Basquil, national sales manager.

"The business was tough for Christmas," said Basquil. "It was the overall economy, the short Christmas season, bad weather and talk of war. Stores are asking for markdown contribution and we will look at it case by case and see where we can help."

For spring, she said, some stores will be keeping lower inventory levels. But, she warned: "If you don’t have inventory you don’t have sales. You need to replenish to keep business alive."
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