Retailers, consumers and prices
Check Out Line: What Signet Jewelers says about how shoppers feel
Check Out how higher end jewelry is helping Signet Jewelers and how its shoppers are getting better about paying their bills.
Signet Jewelers, the parent of Kay Jewelers, reported stellar earnings results on Thursday, which is sort of counterintuitive. Isn’t jewelry a completely discretionary expense you can skip?
Apparently not, especially for the well-to-do. Signet’s results got a boost during its second fiscal quarter from a 14 percent surge in same-store sales at its higher-end Jared chain, reinforcing the increasingly heard notion that the economy is bifurcated, with affluent consumers getting more affluent, and the less-well-to-do falling further behind. (The average item at Jared cost $768 vs $349 at Kay– pricier, though still far from prices at Tiffany , which in May reported a surge in sales of items $50,000 and up.)
There were also signs shoppers’ finances are improving and that they are better able to pay down their credit cards. Signet, which gets 80 percent of its sales in the U.S.A. and the rest in Britain, said the percentage of bad debt to total sales has fallen to 5.2 percent from 6.5 percent a year ago.
Still, Signet CEO Terry Burman said on a call that the economic outlook is uncertain, so the company is planning to keep growing by picking off sales from rivals like Zales.
Tomorrow, Tiffany reports its own results, and we’ll get a better sense of whether the gap between haves-a-little and haves-a-lot has grown deeper since May, when the jewelers last reported earnings.