Back to Ganoksin | FAQ | Contact

Business plan for jewelry designers

How I wish my boss understood that! He gives away more labor and
materials during the day than I bring home all week! And I think,
“Oh, if you charged full price for that [insert repair job here], you
could pay me more.” And that’s each day.

Do not be ashamed of your labor. Charge what you need to charge. You
are running a business, not a charity.

best regards,
Kelley

He gives away more labor and materials during the day than I bring
home all week! 

I also give freebies, alot of them. Its actually a good way to make
new customers. Like this past week or so. Guy comes in, needs a
simple spring bar…twist twist tug tug, he looks in the cases, here
ya go, no charge. He’s says well you made a new customer. I tell him
that’s why I do it (doesn’t hurt to be a little blatant about it). He
came back Friday night, late late, after official closing (he called
first, always hand out your card), needs a couple of Valentines
gifts. Spent over two grand.

Was that worth a spring bar?

Although I will say it irked me a little when I worked for someone on
commission. Until one day the owner approached me with,“we’re going
to assign a value to these giveaways so you’re not working for free”
(greatly paraphrased). How’s that for a boss? I produced for him, he
produced for me. I produced harder. Because he and I were simpatico
about how the shop runs I tripled his shop volume within 2 years or
so. Maybe you wanna mention this to your boss?

Congratulations on your new venture, Annie! Also good job on writing
a business plan to guide you on your way.

I can't seem to find any showing numbers for similar
businesses. 

The very best source I have found for this info is “The Cost of
Doing Business” published by JA every year, based on surveys of it’s
members. Beg, borrow or steal the latest copy you can find (probably
2007 results). It has all of the ratios and statistics you will need
to write the financial portion of your plan. In fact, it seems as
though it is written for that very purpose. It is about the only
source that comprehensively gives you all you need when doing your
proforma projections.

I tried joining jewelers of America to get access to thier reports
but they said I have to have a physical retail location to be a
member. 

You don’t have to be a member of JA to buy the book, but it costs a
whole lot more if you’re not. Tell the person you talk to at JA that
you are a prospective member and that you will join JA as soon as you
qualify, and maybe they will sell you a copy at the "members only"
price. They did so for me. If that doesn’t work, see if you can talk
a JA member into ordering it for you. If you are serious about doing
a real business plan, you need that book. Anything else is guess work
and a financial professional will be able to tell immediately.

I was very fortunate when writing my business plan in that my uncle
is a retired Fortune 500 business consultant specializing in start-up
and acquisitions, and is also a SBA SCORE counselor. He gave me some
valuable insight as to how the SBA works, as well as how business
financing works. As others have pointed out and contrary to their
name, the Small Business Administration is geared more towards what
we would consider large businesses (25 to 1000 employees), but there
are services available for more modest sized operations as well. The
best thing SBA can offer you is probably in the business plan writing
phase. Their template is very comprehensive. Don’t count on any
financial help from the SBA though, no matter how well your plan is
written.

As you probably already know, a business plan is done in two parts,
the narrative part in which you describe the who, what, where and
how of what you intend to do and the proforma financial projections.
The main reason for doing a formal business plan is that it forces
you to articulate your plan in specifics and set realistic and
measurable financial goals, instead of just winging it with a general
"I think I could do real well with a jewelry shop, I sell everything
I make. All I need is a thousand dollars for some tools and metal"
kind of plan. You can use the spreadsheets you develop in the process
to help later with what-if scenarios, like “what if I give 20% off?
How many more will I have to sell to break even and how much will it
hurt if I don’t sell any more than I am now?” Real eye-opening stuff
and no MBA required. The other reason to do one is to secure
financing. But no matter how well it is written, unless you are
hitting up Neil’s Uncle Louis, financiers will be interested in only
four things – how much do you need, what are you going to spend it
on, how are you going to pay it back – and the deal breaker – what
do you have for security? Unless you have substantial equity on real
estate, a trust or something else of real monetary value, like
finished (and paid-for) inventory to use as collateral, your business
plan is worthless to you as a way of getting financing. As a start-up
your securities will generally bring about half of their actual cash
value in the way of financing, and you may (and probably will) lose
control of them as well in the form of liens. A really well
thought-out and written plan might get you another 10-20%, but that’s
about it.

All that being said, even if you don’t need it for financing, writing
a formal business plan is still a good idea. Maybe it’s just my
training as an Army Aviator where I was taught to “plan your flight
and fly your plan” that makes me need to know what I’m putting my
feet into as I step out, but I consider goal-setting in the form of a
business plan to be a very important thing to do when starting out on
something of such life changing substance. I mean, how will you know
when you’ve arrived if you don’t even know where you’re going?

Dave