Final sales as legendary retailer and mall staple set to close 150 stores as CEO cites 'economic and inflation' concerns

A LEGENDARY retailer has announced it will close 150 stores by year's end after a paltry first quarter hit jewelry sales.

Signet, a conglomerate of multiple well-known jewelry brands, said it would shut down stores - the CEO said economic concerns curbed customers' discretionary spending.

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The retail giant - owners of recognizable brands Zales, Jared, and Kay Jewelers - said it would close "underperforming" stores.

Joan Hilson, Signet’s chief financial, strategy, and services officer, said in an investor call that the company will focus more on e-commerce business.

"We now expect to close, up to 150 stores over the next 12 months, largely at expiration," Wilson said on the call.

"We perform a continuous review of mall, off-mall, and digital channel activity in the given trade area to ensure we are most effectively supporting our connected commerce experience."

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Hilson said the new online-focused brand, Blue Nile, is "doing quite nicely for us."

The company has not detailed which stores it expects to close by year's end.

In an earnings call, the company reported $1.7billion in sales during the first quarter of 2023.

The 2023 sales are a 9.3 percent drop from the year before.

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The company also said operating costs expanded by $200,000.

Signet referred The U.S. Sun to the earnings call's transcript when asked for comment.

INSIDE THE CLOSING DECISION

Company executives said that the retailer is dealing with multiple economic headwinds.

"Lower tax refunds, economic concerns triggered by regional bank failures, and continued inflation led to a weakening trend in spending across the jewelry industry," Virginia Drosos, the chief executive at Signet, said to investors.

The company said it didn't notice a massive drop in sales - but noted a decline in average dollar per sale (ADS).

Signet executives believe the change represents an economic decision, as customers pull back during perceptively shaky economic times.

Instead, customers opted for other money-savers.

The company noted a strong trend in buying warranties on high-priced products.

Warranty sales grew five percent last year.

Executives believe there is a social impact on their business too.

COVID'S IMPACT

Drosos said that a massive social change, brought on by the pandemic, impacted the company.

With fewer people dating during pandemic lockdowns, the company noted a downturn in engaged couples.

"As we predicted, there were fewer engagements in the quarter resulting from Covid’s disruption of dating three years ago," Drosos said.

The executive said she believes the trend will reverse within the next year as dating picked back up after the initial lockdowns.

The company found another solid source of income - traveling couples.

"We have identified and tracked a proprietary list of 45 milestones that trace a couple’s journey through four major relationship stages—meeting, exclusivity, committed, and engagement," she said.

"Couples traveling together is one of the top milestones later in the couple’s journey to engagement.

"Searches for ‘couple’s vacations’ on TikTok are currently twice what they were [in the previous quarter]."

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