Funding your jewellery business

It will come as no shock to hear that the jewellery market is exceedingly competitive, with countless retailers out there offering customers a wide range of styles, at a varying range of price points. However, jewellery is always in high demand; research shows that annual global sales of €148bn are expected to grow at a healthy clip of 5 to 6% each year, totaling €250bn by 2020. There are always birthdays, anniversaries, religious and non-religious celebrations, where giving the gift of jewellery simply won’t fail to win a big smile, and that’s without mentioning all the other, completely random, occasions on which we decide we deserve to treat ourselves. Jewellery will forever be wanted, and as such jewellery is undoubtedly a great market in which to have a business. However, funding a jewellery business, particularly if you stock high-end, luxury pieces, can be exceedingly expensive, but this shouldn’t put you off, as there are many ways in which you can secure the financial resources your business requires. Here are your options. Try traditional bank loans For some business owners, getting a loan with the bank may be a sensible funding option, but be sure to do your research; look carefully into what a certain bank is able to offer your business, whilst also considering interest rates and any other potential charges; if you have a good credit score, it may be possible for you to get a loan with low interest rates. It is worth noting, however, that many banks are no longer willing to lend sums of money out to smaller companies since the 2008 financial crisis, so getting a loan with a bank may prove to be difficult even if you think you should be eligible. Consider credit cards When it comes to increasing your funds quickly, credit cards are typically one of the easiest and most obvious options, even though they do sometimes come along with a bit of a stigma. The amount you are able to obtain is based on your credit limit, which will very likely be much less than what you could get from a traditional bank loan or an alternative type of loan. It is also important to note that credit cards often come with a larger cost, as interest rates tend to be high, but if used correctly and sensibly, this shouldn’t cause too much of an issue. Credit cards are an appropriate option for any business owner with small-scale revolving needs, and shouldn’t be dismissed when you are considering which funding option is most suited to you. Look into stock finance Often in the jewellery trade, funding can get stuck in stock, but stock finance allows you to release its value. Lenders purchase stock from your company on behalf of the buyer, and this tends to be used as a 30-90 day revolving facility, allowing your business to more readily access cash when you require it. Generally, funding can be in your bank account within as little as 24 hours. As such, this is undoubtedly a great funding option for any business owner struggling to sell stock directly on to customers, whether that’s down to seasonal fluctuations, an unpredicted drop in popularity, or any reason otherwise. Look for a business partner If funding is continually an issue for your business, then why not consider looking for a business partner who shares your passion for jewellery and running a successful company? Having a business partner allows costs to be shared, releasing you from some of the financial pressure. This can of course, be a daunting proposition for some business owners, but it could be a great move for your companies overall prosperity, and contracts can always be created with the help of a solicitor to help avoid any potential problems cropping up in the future. Funding any business, and a jewellery business in particular, is an expensive task, but with so many funding options out there, it shouldn’t be too much of a difficult one. Be sure to do your research well to decide which option is going to be best suited to both you and your company. Liz Rosling is a business finance specialist at Dojono, responsible for publishing relevant industry insight for SME Loans. Also an author at StartUp Mindset, Liz uses her years of experience in the financial services sector, to equip small business owners with the guidance and expertise they need to realise their full potential