Alex Fetanat’s newest blog post:
In a recent article available on National Jeweler’s website it talks about how there has been a pretty startling increase in bankruptcies in the jewelry industry during the first quarter of 2013. According to the Jewelers Board of Trade statistics, the number of bankruptcies rose from 7 in the first quarter of 2012 to 11 during Q1 of this year. Among those that filed for bankruptcy, was Brodkey’s Jewlers the Omaha Nebraska based chain of nine stores. These statistics are for retailers- but there was also an increase in the number of wholesalers that filed for bankruptcy this quarter as well. In 2013 there were 4 wholesalers that filed for bankruptcies- up from 2 last year.
There were no manufacturers who filed for bankruptcy.
This might seem like a startling rise in bankruptcies, but in actuality this might not be such a horrible or foreboding statistic after all. JBT president Dione Kenyon was quick to point out that this year’s statistics might not be as telling because 2012 was an amazing year as far as bankruptcies are concerned. 2012 saw a record-low number of bankruptcies in the jewelry industry, and though there was an increase this year this might just be a reflection of things returning to normal. Kenyon said in reference to the statistics of 2012, “I haven’t seen anything like that in more than 10 years. You are coming off a comparison of a year when there weren’t that many,”
Along with the low number of bankruptcies in 2012, we’re starting to see an improving economic condition this year which in turns gives business owners the flexibility to take more risks. This, too, could be a root cause of some of these bankruptcies. “For those that it’s good for, it’s pretty good. For those that it’s not, it’s pretty bad. There’s not a lot of middle (ground),” Kenyon said.
All around, I don’t think that we should be too worried at the moment regarding these bankruptcies, but we definitely do want to keep an eye out for the rest of the year- if the jewelry industry is in for a turn for the worse we will see this pattern of bankruptcies continue in the rest of the quarters this year. But for now, let’s keep our eyes on the statistics and hope for the best!