Question

What are the competition or barrier faced by Jewelry industry in Canada

1- List them

2-Choose your top 3

3-Describe them

4-Analyze them

Where do you fit in the Competitive landscape in Canadian market

Answer 1

Understanding Barriers to Entry
Competing as a business in any industry is a competitive prospect, and only the strongest companies can survive competitive pressures over the long term. In addition, entrepreneurs and businesses have to pay a price and overcome distinct hurdles to enter any industry as a new player. These obstacles are collectively referred to as barriers to entry -- the things that stand in the way of entering a market. Common barriers to entry include startup costs, specialized licenses and certification, distribution challenges and the brand equity of existing players in the market. Every industry presents a different set of barriers to entry, and the jewelry industry is no exception.

Inventory Costs and Sourcing
The cost of inventory is a significant barrier to entry faced by new retailers in the jewelry industry. Depending on the planned size of a store, simply stocking the shelves for opening day can cost millions of dollars. In addition, retailers in the U.S. must often look to foreign sources of inventory when dealing with diamonds and other precious gems, and it can be difficult to secure business with suppliers operating under high-volume contracts with existing retailers. A jewelry retailer could circumvent this barrier by sourcing inventory from domestic third-party distributors, but at the expense of decreased profitability because of higher inventory costs.

Overcoming Entrenched Brands
Jewelry shopping can be an emotional experience, and existing brands in the industry have learned to build deep and lasting connections with loyal customers by leveraging these emotional experiences to create strong bonds. This unique aspect of customer loyalty in the industry can make it especially difficult for new retailers to compete. Jewelry retailers compete almost exclusively on quality, creating a framework for consumer psychology that can be difficult to break into. Existing retailers work hard to define their brand as the best or only option for buying jewelry gifts, again using emotional appeals, which can give new market entrants an image of lower quality by default because of their lower brand awareness.

Facilities Investment and Risk of Loss
Jewelry retailers face the same infrastructure requirements as other retailers, including shelving, display cases, back-room warehouse storage and point-of-sale systems. However, jewelry retailers require advanced security systems to protect their high-value inventory. The amount of security required of a retail jewelry store can incur the largest infrastructure expense, after the cost of cameras, safes and electronic monitoring for doors and windows are taken into account. Even with advanced security, the risk of loss from theft can be a significant deterrent to entering the industry. Jewelry retailers should always carry adequate insurance policies to cover significant loss, but the cost of such policies can be another barrier to entry.