IDEX Online Research: US 2014 Jewelry Sales Edge Barely HigherFebruary 05, 15
(IDEX Online News) – Reflecting a disappointing Holiday selling season, which accounts for more than a quarter of the typical US jeweler’s revenues, annual sales of fine jewelry and fine watches in 2014 edged up by a very modest 1.5 percent from 2013 levels – in the US market, according to new figures from the US Department of Commerce.
While sales of fine jewelry and fine watches hit a record level of $78.1 billion in 2014, the slowing rate of growth, especially in the face of a robust economy and solid consumer demand for other big-ticket merchandise, is worrisome.
Further, this modest sales gain was below expectations. Forecasts originally called for an annual jewelry sales gain of just over four percent, though revised predictions later in the year were more cautious. This weak sales performance in the jewelry industry contrasts with strong sales gains in some other big-ticket merchandise categories such as automobiles and home furnishings.
The graph below summarizes the change in sales year-over-year for fine jewelry and watches in the US market for the past decade. Except for weak sales during the “Great Recession” of 2008 and 2009, jewelry sales for every year in the past decade have shown solid growth, until 2014.
Preliminary data from the US Department of Commerce show that total annual sales of fine jewelry and fine watches in the US market were about $78.1 billion in 2014, up modestly from the prior year’s $76.9 billion. These figures, both for 2014 and prior years, will be revised over the next several months, but the depressed growth rate will not likely show any major change.
The graph below summarizes sales levels for the past decade for fine jewelry and fine watches in the US market.
Government data also showed the following for the full year 2014:
· Sales of fine jewelry were an estimated $68.8 billion, up 1.5 percent, when compared to 2013.
· Sales of fine watches were an estimated $9.3 billion, up 1.6 percent from 2013 levels. However, despite this slightly above average sales gain for the full year, it is important to note that sales of fine watches fell by a significant 2.4 percent in the 2014 November-December Holiday selling season. If this trend continues into 2015, watch sales performance will trail sales of fine jewelry.
· The industry’s sales mix of fine jewelry in 2014 remained at just over 88 percent of total sales, with fine watch sales just under 12 percent of sales. This sales mix is basically unchanged from prior yearly trends.
The government significantly revised downward its previously reported October and November sales data, with both of those months now showing a sales decline from the prior year. That negative revision was followed by very weak December sales – down 1.6 percent, based on preliminary data – for fine jewelry and watches.
With almost no growth is the world’s largest jewelry and diamond consuming market, the impact on diamond prices will likely be depressing for much of 2015.
A full analysis of 2014 jewelry sales will be published in March, after a second round of revisions to the annual and fourth quarter numbers.