For years, Mark Loren resisted entreaties from jewelry distributors who urged him to expand his gallery and take on more inventory.
“I didn't want it to become a numbers game for me,” says Loren, a well-established Fort Myers jeweler who does business as Mark Loren Designs. “That's not why I got into the business.”
Instead, Loren preferred to make custom jewelry, and repair older pieces that people hold dear. He tells the tale of making a piece from a coat button that an Auschwitz survivor says was the only memento from her mother before she went to the gas chambers.
But as it turns out, Loren's decision to fend off eager distributors ended up being prescient because he wasn't burdened with inventory he couldn't sell when the recession started. Because 80% of his company's revenues come from making custom jewelry and repairs, he's been able to keep his staff intact and the business profitable while competitors closed.
Of course, Loren, 50, hasn't been immune to the downturn. Annual revenues for his jewelry business have been flat at more than $2 million in 2008 compared to 2007, and down from $3 million in 2005 and 2006.
While sales of jewelry in his gallery have fallen 20% during the recession, custom work and repair sales rose 40%. Nearly two out of three customers who seek custom jewelry bring their own gold, which Loren melts to fashion a new piece. Customers get store credit for any gold that's left over.
Usually, customers bring gold jewelry they've accumulated over the years and don't wear any more. One woman once walked in with $5,800 worth of the precious metal.
Loren spends more marketing dollars on sponsoring charities and giving away jewelry at community events than advertising his wares in glossy magazines. Giving pieces to charities they can auction helps Loren gain name recognition.
“The charity validates you being there,” says Loren, who asks charities to establish a minimum bid for his pieces at auction.
“We always bring the armored car,” he says, pointing to an imposing armored car that sits outside his shop on heavily traveled McGregor Boulevard -- his name plastered on it.
Over the next few months, for example, Loren plans to give away small mystery pouches containing jewelry ranging in value from $100 to $4,000 around Lee County for people to find and keep. The pouches will be “dropped” at various businesses around the county for people to find in honor of Loren's 25th anniversary in business.
While Loren's 10 employees are happy to sell jewelry, they're paid hourly or salary, not commission. “We all work together as a team,” Loren says. “I don't want master sales people.”
He says that sets his store in Fort Myers apart from many competitors, who pay their employees sales commissions to move inventory that was foisted onto them by eager distributors.
To his best customers, Loren hands out tickets to special events or he may send them a gift. “It costs so much more to get a new customer,” he reasons.
Still, Loren has been making less expensive jewelry in the last two years. He has been breaking down pieces that cost $10,000 or more into jewelry that costs about $3,000 and he refashions any piece that sits in the display case for longer than eight months. Most of the jewelry he sells now costs between $1,000 and $3,000.
To find new customers, he often visits retirement homes to help elderly people clean and evaluate their jewelry at no cost. “A lot of businesses forget that community,” he says. “Sometimes you need to go to them,” Loren says.