New York—The news on credit in the American jewelry industry in the first quarter of 2008 was both good and bad, according to statistics from the Jewelers Board of Trade (JBT).
While the JBT reported a decline in the number of collection claims placed in the first quarter of 2008, compared with the first quarter of 2007, the average amount per claim jumped dramatically. The number of claims dropped by 9.4 percent in the first quarter—850 claims, as opposed to 938 for the same period in 2007—but the average claim increased 24.6 percent, from $6,583 to $8,203.
Bankruptcies, industry-wide, dropped by 15 percent in the first quarter of 2008, totaling 20 as opposed to last year's 17. As in the first quarter of 2007, the overwhelming majority of bankruptcies occurred at the retail level, with no regional trend discernible.
So far this year, decreases in credit ratings have outpaced increases by 1,703 to 1,559: a dramatic shift from the first quarter of 2007, when increases led decreases by 1,548 to 1,041. Downward adjustments increased by 63.4 percent in the first quarter of 2008, compared with the same period of 2007. For the month of March, the increase was 79.5 percent compared with March 2007.
In terms of new businesses so far this year, 60 new retailers have opened their doors, compared with 59 in the first quarter of 2007. New wholesalers are up 60 percent (16, compared with 10 in the first quarter of 2007), but only three new jewelry manufacturers have opened so far this year, compared with 12 in the first quarter of 2007: a 75 percent drop, perhaps reflecting the growing tendency toward global sourcing of various industry-related goods.