RETAILING Sterling Advice

Why is Gerald Ratner so successful? In just six years the Englishman has parlayed a two-karat family business into the world's largest jewelry retailer, with 1,000 stores in the U.S. (under the names Kay and Sterling) and an equal number in Britain. In a speech last week at London's Albert Hall before the annual convention of the prestigious Institute of Directors, Ratner, 41, offered a four-point program for becoming a multimillionaire.

Rule No. 1: Understand your market. His stores, he says, sell "cheap and tacky products." Rule No. 2: Form clear quality goals. "We also do cut-glass sherry decanters complete with six glasses on a silver-plated tray -- that your butler can serve you drinks on -- all for 4.95 pounds (($8.73)). People say, 'How can you sell this for such a low price?' I say because it is total crap." Rule No. 3: Evaluate how your product stacks up against all the competition. "We even sell a pair of earrings for under 1 pound (($1.76)), which is cheaper than a prawn sandwich from Marks and Spencer. But I have to say the earrings probably won't last as long." Oh, yes, and Rule No. 4: Don't write your own speeches.