The complete guide to making a success of your jewellery venture.
As competitive as the jewellery industry might be, opportunities to make a profitable jewellery-making business certainly still exist.
In fact, the industry remains so profitable that a business intelligence group reported that the industry, unlike most, didn’t even falter during the recession. What’s more, it has also maintained consistent growth during the last five years and grew by 3.4% in 2014 alone.
Not only is the jewellery industry attractive for its profit potential, though. It’s also a business that enables artisans and designers to pursue their entrepreneurial interests whilst continuing to channel their creativity.
With such a broad range of options to choose from when creating a jewellery brand, like fine jewellery, custom products and handmade crafts, artisans are better able to develop a business model that best suits their personal interests.
Moreover, jewellery-making can also act as the perfect venture for those wishing to start part-time rather than quitting their current job and going all in. Businesses can be launched on a relatively low budget and come with considerably low startup costs, too, enabling entrepreneurs to enter the industry with relatively low risk.
Of course, it should be noted that starting a jewellery business, like all things worthwhile, isn’t easy. It takes time, commitment and a lot of planning and preparation
If you’re up for the challenge, though, then this article is for you. Here’s everything you need to know about setting up a profitable jewellery-making business online.
What Skills Are Required to Become a Jewellery Making Business Owner?
Of course, to set up a jewellery designing business, you’ll need to be experienced in designing jewellery. That entails having a creative flair, knowledge of design and passion for your work. But starting a jewellery enterprise requires more than just artisanal skill.
Having a Business Mindset
Where many creatives aspiring to become entrepreneurs go wrong is by failing to treat their work as a business. Enterprise isn’t just about making a good product. It’s about being an entrepreneur, too.
Designing and making your jewellery is the fun part. It’s the part that you’re passionate about and most enjoy doing. But when making jewellery, it’s important that you also consider the elements of your design that are important in the business side of things, like the cost-effectiveness of your products and profit potential.
Marketing and Advertising
Once your products have been crafted, you’re also going to have to be prepared to put in the time and effort required to generate an adequate amount of sales through marketing and advertising.
That involves designing an attractive website, advertising on social media and getting used to launching ad campaigns online.
Perhaps the most important skill you’ll need under your belt is to be organised. Very organised. It’s no good running out of supplies and shipping boxes when you have orders coming in thick and fast.
It’s those kinds of mistakes that, if not sharpened up, could crush your sales in the long-run, which is why it’s crucial that you remain organised and stay on top of everything.
Taking on Many Roles
Starting an entrepreneurial venture as a creative requires finding the right balance between being business-savvy and artistically skilled. You’re also going to have to get used to juggling many different roles under pressure until you can afford to employ other people to help you.
Of course, none of these things should deter you from following your passion for jewellery-making. You love what you do and you want to make a success of it. To do so, however, it’s important to first familiarise yourself with the responsibilities you’ll be taking on board as a jewellery-making entrepreneur. That’s what this section is all about.
Creating a Business Plan
Knowing what it takes to venture into the enterprise of jewellery-making is one thing, but where do you actually start? It all begins with planning. That’s what we’ll be covering next.
How to Create an Effective Plan for Your Business
Rather than throwing yourself into the deep end, it’s important that you take the time to construct a detailed business plan before making a start.
From the outset, you should sit down and try and decide on some fundamental factors, like the demographic you’re targeting, how you plan to reach them, location and any potential start-up costs.
You should also ask yourself some other key questions. Do you plan to sell products solely in your home country or offer shipment overseas? Are you opting more for fine jewellery pieces of fashion-specific products?
Creating a plan will ensure that nothing catches you by surprise. It’s those unexpected hurdles, like sudden influxes in sales, delivery fees and low initial sales that can cause you a lot of debilitating problems unless you plan ahead.
An effective business plan also takes into account the long-term strategy that your company will adopt. This will be affected by factors like projected growth, future staff hires and location changes.
When you begin making more sales, you’re going to need to start employing more people and perhaps even move your business to a larger space, like a warehouse. These are all things that you should think about before launching your company. That way, when the time comes, you’ll know exactly what to do.
Luxury or Budget?
There are many different types of jewellery on the market, all of which can be manufactured and sold. Knowing specifically which avenue to go down, however, can be tricky.
Fine jewellery is an incredibly lucrative market, with costs per item being far higher than that of costume/fashion alternatives. While fine jewellery accounts for a greater proportion of sales than all others, it also entails significant start-up costs. Precious gems and metals are expensive.
Moreover, the fine jewellery industry also comes laden with some controversy surrounding the exploitation of miners and workers, so it’s crucial that you do your research before making a decision.
Fashion jewellery, on the other hand, appears to be on the rise as consumers tend to favour low-cost pieces that can be purchased on the high street. It also appears that more entrepreneurs have begun launching cheaper alternatives to finer designs to cater to this market.
You have to be realistic with yourself when considering where your products will fit into an already highly competitive industry.
There isn’t much point in starting up a jewellery business unless you’re sure you’re able to provide genuine value. What’s your unique selling point? What makes you stand out? These are all important questions to ask yourself before making a start.
Forecast Your Cashflow
Getting your finances in order before you go ahead and launch your jewellery-making business is crucial to its longevity. Forecasting your cash flow means understanding what materials you’ll need from the get-go, where you’ll be based, your projected order numbers and how much staff you can afford to employ.
Of course, factors like staff employment aren’t going to become relevant until your business is generating a significant amount of revenue. Regardless, it’s important to estimate ahead of time when you expect to take on new people and so that you can plan accordingly.
Valuing Your Products
As well as projecting your finances, it’s important that you take the time to value your products. The price of your items will need to account not just for the cost of the materials it took to produce them, but also the time, effort and delivery fees involved.
When pricing their work, jewellery manufacturers tend to opt for one of two approaches: attaching a price tag either before or after the product has been made.
By valuing your products before they’re made, you can go ahead and produce them based upon their cost. Others prefer to design products first and value them afterwards.
Whichever route you choose to take, pricing is never easy. It’s tricky to decide exactly how much a piece should be worth, but it can help to consider all of the factors involved in the manufacture of each product.
How to Get Your Jewellery-Making Business Online
As we all know, the modern world of consumerism is rapidly moving towards trading online. If you’re a brick-and-mortar store or plan to make physical sales only, we strongly recommend that you get your jewellery enterprise online.
Doing so is actually pretty simple – and inexpensive. Low-cost web-designing tools such as Shopify, WordPress and Squarespace make it easy for you to launch a beautiful, fully-functional website without expending your entire budget.
Once your site is up, you should start by adding your products to a ‘Shop’ page, ensuring to use high-quality photographs and well-written sales copy.
As well as having an online shop in place, it’s also wise for you to begin marketing your products across a range of different social media platforms. The big three, Facebook, Twitter and Instagram, serve as incredibly effective mediums through which to reach your customer base and let them know what you’re up to.
Another way to get digitise your jewellery enterprise is to make use of selling platforms like Not On The High Street and Etsy, both of which specialise in handmade products made by independent artisans.
The beauty of running your business online means that you don’t have to spend so much time with in-person advertising at events like trade fairs. Instead, you can meet your customer base where they are, on the internet, and direct them straight to your website.
How Much Does It Cost to Run a Jewellery Business?
We’ve already touched upon some of the expenses you’re likely to incur when running a jewellery business, but how much does it actually cost to launch and maintain a startup in the jewellery sector?
It’s a difficult question to answer, really. It all depends upon the nature and specifics of your business.
First and foremost, the materials and tools required to produce your jewellery will impact your overhead costs dramatically. Starting things off at the lower end of the price spectrum will slash your upfront fees. That’s because fashion and costume jewellery is significantly cheaper to manufacture compared to more expensive fine products.
Other factors such as location will determine your costs. For instance, if you plan to mass produce by manufacturing overseas then you can expect to have to spend more money on labour and shipping fees.
If you’re looking for a specific figure, jewellery designer Sacha Jacobsen might have an answer for you. “I probably initially spent about £400-500 in total,” she said in an interview with Startup. “That’s including all the tools, the materials and the equipment to take the photos,”
Rules and Regulations to Keep In Mind
As is the case with many product-manufacturing industries, the jewellery market comes with a number of specific rules and regulations that you’ll need to keep in mind before trading.
Firstly, if you’re planning on launching a physical shop or stall as well as an online business, UK law requires that you first purchase a license to sell from your local council.
Licenses typically incur small fees and have varying requirements based upon your location, so it’s important to familiarise yourself with these before proceeding to sell any products.
Self-Assessments and Tax Returns
There are a number of tax-filing regulations and laws that you should be aware of. HMRC requires that all trading businesses submit a self-assessment and tax return by the end of each tax year. You’ll also be required to pay national insurance.
The Trade Descriptions Act and the Sale of Goods Act
- TDA: The TDA is a law forbidding sellers from selling counterfeit goods and making any false claims about their products.
- SGA: The SGA ensures that products being sold are fit for their advertised purpose and have been manufactured to an acceptable quality. If these requirements aren’t met, customers have the right to exchange or return their goods.
Hallmarking Precious Metals
UK legislation requires that all precious metals are hallmarked before being sold, as is written in the Hallmarking Act of 1973. Transactions involving precious metals that haven’t been properly hallmarked is strictly illegal and could land you in a lot of legal trouble.
Hallmarking involves testing metals and branding them with a specific seal which denotes their purity, making this clear to potential buyers. Hallmarking must be carried out formally by an Assay Office.
If hallmarking sounds like too much hassle for you, you can always choose to purchase metals that have been hallmarked already. That way you can rest assured knowing that the materials you’re using are okay to trade legally.
Last on the list of regulations to familiarise yourself with is the Registration, Evaluation, Authorisation and restriction of Chemicals – or REACH for short.
REACH is an EU regulation which was put into place in order to protect the health of jewellery purchasers, restricting the use of harmful chemicals in the manufacturing of jewellery. Metals such as lead, cadmium and nickel should be used with caution in order to adhere to the guidelines set out by REACH..
Starting a new venture in the jewellery industry can be an exciting and incredibly lucrative endeavour to embark upon. Knowing the ins-and-outs of the business before launching a startup is crucial to maximising your chances of success.
Having an awareness of existing regulations when manufacturing and selling your products will keep you out of any sticky legal trouble, whilst constructing a detailed business plan will ensure that nothing crops up and takes you by surprise.
By taking all of these things into consideration, you’ll stand better equipped to get your jewellery-making enterprise off the ground without running into too many obstacles along the way.