Zale CEO offers turnaround plan at Rap conference
September 09, 2008
New York—Hundreds of jewelry industry players gathered at New York City's classic
Waldorf-Astoria hotel on Monday for a modern view of the state of the diamond industry.
The well-attended Rapaport International Diamond Conference 2008 kicked off with speeches outlining the economic situation confronting the diamond industry, including the rising prices for larger diamond goods and the emerging importance of India and China.
The afternoon gave way to speeches designed to help retailers and wholesalers confront these challenging economic times, and included a speech from
Zale Corp. Chief Executive Officer Neal Goldberg, who outlined his plans for turning around the struggling jewelry chain.
Goldberg, who
came on board as CEO in December 2007, called out the company for having an inefficient organization, offering poor-quality jewelry product and competing on price, while stocking merchandise that floated in the value sector "sea of sameness."
In working to turn around the company, he said he visited stores all over the country and determined the chain needed to shake up its product mix, a fact illustrated by employees' lack of enthusiasm for the jewelry.
He said during one meeting, he asked merchants if they were wearing a piece of Zale jewelry, and less than 10 percent raised their hands.
"What a kiss of death," Goldberg said. "You have to have product that people love."
In addition to changing up the jewelry chain's merchandise, he said Zale also has reduced its vendor base by two-thirds, concentrating on its relationships with a few "true partners."
Other highlights of the all-day conference included:
—Morning speaker Gerald Celente from the Trend Research Institute predicted the U.S. economic situation would worsen into a depression worse than the Great Depression of the 1930s.
"We're going to see an economic 9/11," he said.
—Gemological Institute of America Chairman Ralph Destino gave a presentation on diamond branding, urging retailers to brand both their inventory and their stores.
—Adalah-NY continued its campaign against billionaire diamantaire
Lev Leviev, handing out flyers outside the hotel urging diamond industry players to "steer clear" of Leviev's businesses. Leviev's Madison Avenue retail store is located within blocks of the Waldorf-Astoria.
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