How did Blue Niles business model hold up when consumer demand began falling?
We have a very-low-inventory model. While traditional bricks-and-mortar retailers were concerned with excess inventory and were scaling back their selection, we could expand our offerings without taking financial risks. We have exclusive relationships with diamond and jewelry suppliers; what you see on our Website can be found only on Blue Nile. We have more than 50,000 diamonds available at any time, but it’s [mostly] a virtual inventory, so we don’t have the carrying cost of what would be $500 million to $600 million of inventory.
