How long has that $15,000 engagement ring been sitting in your showcase?
You know the one: the beautiful piece you know will be perfect for the right customer. But in the meantime, thousands of dollars of capital are tied up in a piece that won’t sell.
Every industry deals with aging inventory, but in the jewelry business, the stakes are higher. Individual pieces are massive investments, and worse, there’s a risk of becoming emotionally attached to those pieces in a way that leads to less-than-wise business decisions.
Understanding when and how to mark down expensive pieces can free up cash flow for the inventory your customers want. You just need the right strategy.
This blog covers inventory aging reports and how to use them to make better decisions when it comes to discounting key inventory.
An inventory aging report helps you track exactly how long each piece in your store has been sitting in inventory. You can use this report to identify the pieces that perform well and the ones that drain your resources.
These reports typically organize your inventory into aging buckets (0–90 days, 91–180 days, 181–365 days, and the dreaded 365+ days category), giving you a clear snapshot of what's moving and what's not.
Related Read: How To Manage a Jewelry Store [+ 7 Mistakes To Avoid]
Jewelry retailers face a few unique challenges that make inventory aging reports even more essential:
The real cost of aged inventory is lost buying power. Every dollar trapped in a piece that doesn’t sell is a dollar you can't invest in the fresh, trending inventory your customers actually want.
Not all jewelry ages at the same rate, and understanding category-specific benchmarks is essential for making informed decisions about when to take action. Here’s what “normal” aging looks like across major jewelry categories:
Related Read: Mastering Retail Strategy: A Comprehensive Guide for Jewelry Stores
Understanding these benchmarks helps you spot problems early and discount strategically before pieces become dead stock.
Jewelry store owners can sometimes get passionate about a specific piece. That passion is a crucial part of your role in some areas, but in this one, it can be your biggest obstacle to smart inventory management.
Related Read: 7 Proven Sales Techniques for Selling Jewelry
The trick is to recognize the emotional traps and set yourself up to break free of them. The most common emotional barriers look like this:
Every single day a piece sits unsold, you lose money in carrying costs, insurance, opportunity costs, and dead capital. The loss you're trying to avoid by holding out for full price is happening right now, every day — whether you acknowledge it or not.
Your inventory aging report is only helpful if you know how to read it. When reviewing your reports, check for early warning signs of larger problems. Then, take steps to address them before they snowball.
Related Read: Remote Store Management: Essential Dashboards for Jewelry Store Owners
Start by understanding what your aging categories actually mean. Pieces in the 0–90-day range are your fresh inventory and should be your largest category. The 91–180-day bucket is your "watch closely" zone. This is inventory that's been around long enough to establish a pattern.
Once pieces hit 181–365 days, you're in action-required territory. And finally, anything beyond 365 days needs immediate intervention, unless it falls into one of the exception categories we discussed earlier.
You also want to look for patterns in your reports. If you have multiple similar pieces that are aging together, you might have a systematic buying error, resulting in the consistent overbuying of pieces and styles that the market doesn’t want.
Next, you need to understand your carrying costs so you can appropriately assess the risk of hanging onto a piece at full price for another month. Calculate your true carrying costs by factoring in insurance premiums, security expenses, the physical space the piece occupies, and most importantly, the opportunity cost of capital.
Once you identify the pieces you need to take action on, you need to know what action to take. Let’s discuss the best approach to jewelry store sales. The key is to use data and create a tiered approach that moves your aging inventory without killing your profit margins. Consider the following:
You also want to time your markdowns as strategically as possible. Spend time in October and November running discounts to free up capital for your holiday inventory. Customers expect sales during these periods, so your promotions will fit right in. You can use quarterly goals as motivation to clear aging inventory, too. Set targets and make a plan to move old pieces at the end of each quarter.
If you don’t want to go with a traditional markdown, you can take an alternative approach. Here are some options to consider:
Whatever approach you choose, be sure to track the results of different markdown strategies. This way, you learn what works best for your market and can improve your approach over time.
Aging inventory is inevitable across retail categories, but using these strategies and tips, you can make better markdown decisions and clear your older inventory. The key to implementing these tips and managing your inventory more effectively is having access to the right data.
Jewel360's inventory aging reports give you the information you need to make the best decisions about your aging inventory.
Our automated tracking system flags slow-moving inventory before it becomes a crisis, so you're always ahead of problems rather than reacting to them. You'll see true cost analysis that factors in carrying, insurance, and opportunity costs, sales velocity insights, and markdown ROI. Using our advanced reporting, you can make the best markdown decisions and take control of your inventory.
Schedule a demo to see how Jewel360's automated inventory aging reports help you move old inventory and protect your margins.