Economic pressures are boosting the appeal of pre-owned jewelry among retailers and consumers alike.
Estate provides brisk business for jewelry stores looking for healthy margins and unusual inventory. Sourcing challenges, including increased competition from online consumer-to-consumer sites such as 1stdibs.com, have made it harder to find some pieces, but experienced retailers say good pieces will always find a home.
This may be especially true for the upcoming holiday season, store owners suggest, because a looming recession may encourage clients to choose well-priced estate items over higher-priced new merchandise.
A significant part of business
Estate is a big part of business for Robert F. Moeller II, president and director of sales at R.F. Moeller Jeweler, which has two stores in Minnesota.
“In each store, we have 8 linear feet dedicated to estate and antique,” he says. “We’re also buying vintage diamonds and recutting them or repurposing them. We’ll build custom off of that, and when we can we keep the pieces intact, they end up in our estate section. In addition, we buy things that we sell to other stores.”
In Los Angeles, Gail Friedman, owner of Sarah Leonard Jewelers, says estate has been part of her store’s merchandise mix since it opened 75 years ago.
“Even before it became a popular thing to do, we’ve always bought estate pieces off the street,” she says. “But it probably wasn’t always as huge a part of our business as it has become. That’s how we stay in business, because that’s where we have our margins.”
Yet Friedman no longer shops estate at shows, because of pricing. “A lot of consumers end up at trade shows, so the prices have gone up to retail price instead of wholesale price,” she elaborates.
Tamara Toms has found that estate has become her niche market. “We’ve been buying from the public for over 40 years,” shares the general manager of Carreras Jewelers in Richmond, Virginia. A certified gemologist appraiser, she adds that estate does especially well when gold prices are high. “It’s a balance for us. If the sales go down on the new product, they go up on the estate.”
Demand for estate is good now, she reports, although the bridal segment is sluggish.
“That’s one area of estate that has really not done very well for us in the past year or so,” she notes, adding that most bridal customers today want a bigger diamond in a solitaire mounting. However, “they sometimes like the idea of using an old European stone because it’s recycled.”
Estate used to appeal primarily to an older demographic, but that’s changing, says Moeller.
“What the internet has done is made these things so available,” explains the Minnesota jeweler, who owns the domain names antiquejewelry.com and estatejewelry.com. “You’ve got influencers, you’ve got that authenticity movement, and the anti-disposal movement to recycle everything.”
Estate is still a small subset of bridal and engagement for him, but even that is growing.
“It’s not the majority,” he says. “But it’s definitely more than it used to be.”
Friedman’s demographics run the gamut.
“We have young people who really are into it, and older people who like unique items, and people that don’t want the same thing as everybody else,” she says. “We have very wealthy customers, and people who can’t afford it and do layaway.”
Toms, who has mostly older purchasers, says she’s always looking for signed pieces and estate diamonds.
“It’s harder and harder to find a pristine period piece or a piece that hasn’t been altered in some way, or married with something else, because along the line, people have made adjustments or done things to their jewelry to make them more wearable for them,” she comments.
Since 2020, Moeller has seen an increase in his estate business.
“Our problem — and everybody’s problem — is how to get enough [supply],” he says. “We run events four times a year, and we advertise consistently, and our websites don’t hurt, either. That gives us some validity.”
He also says lab-grown stones present a challenge. “We’re more diligent, and have been for a number of years, looking out for lab-growns. It’s certainly an issue, and it’s going to be more of an issue.”
The estate business will always be around, Toms asserts, because there are “always going to be people who don’t want something that’s been handed down, people who are ready to buy, and people who unfortunately need money. But I don’t know that there’s going to be a major increase, either. And there’s not that many stores in our area that are buying off the street. Chain stores don’t do it.”
By the numbers
- Retail shrink — the difference between a store’s recorded stock and the results of a physical inventory count — accounted for $94.5 billion in industry losses in 2021, compared to $90.8 billion the year before.
- Americans are expected to buy an average of nine presents this holiday season, down from 16 in 2021. Outlay per consumer on gifts, experiences, and non-gift purchases is set to remain flat at $1,455.
- Jewelry and watch revenue at LVMH (which owns Tiffany & Co.) rose 25% year on year to $2.58 billion in the third quarter.
- US e-commerce sales are expected to climb 2.5% year on year to $209.7 billion over the holiday period, versus a 9% increase to $204.5 billion in 2021.
- US jewelry revenue grew 7% year on year for September, although there was a 5% decline in sales of luxury products that weren’t jewelry.
Sources: National Retail Federation (NRF), Deloitte, LVMH, Adobe Analytics, Mastercard SpendingPulse