Most of us work day to day or week to week, engrossed in what is in front of us and only thinking about the bigger picture when absolutely necessary. This can make it difficult to see the forest from the trees, especially when you live and breathe your business, and have been doing so for many months or even years. It's not easy to spot problems when those problems have crept up on you, and it's not easy to fix problems that you are not sure are real to begin with.
The clearest indicator that your jewellery business is in trouble is low or nonexistent profits. But there are other, less obvious indicators that you should be looking out for:
Repeat customers are the life blood of a jewellery business. If your stock is unique and fashionable, customers will return again and again. You will become their first port of call when they need a new piece of jewellery to match that new dress. If you're not attracting repeat customers, you have a problem.
When was the last time a customer came up to you and said: My friend was wearing a wonderful necklace she bought off you last.... If you can't remember, or if this has never happened, then you have a problem. It means your stock is not standing out. It's not unique enough to be noticed or for customers to seek you out over.
I just love your stuff. It's so different. You should be hearing this every day. If you're not, there is a very real problem with your stock, and you need to fix it. Otherwise your business will languish in mediocrity, just another small time jewellery business barely getting by.
The best party organisers don't go looking for business, it comes to them. If you are handing out business cards at your parties and not getting any calls, you have a problem. It could be a problem with your stock, your prices, or the whole package. You need to find out why.
If you're buying for £2 and selling for £3.50, you have a problem. The mark-up on fashion jewellery in particular can be very high. An item you buy wholesale for £5 plus tax could easily retail for £20. If your margins are tight, either you're under pricing, or your supplier is over pricing. You need to work out which is causing the problem, and fix it.
Most major problems that drag a jewellery business down are related to stock or pricing. If you don't have the right stock, you will never be truly successful. You may get by, coasting along and breaking even like so many of your fellow jewellery retailers, but you will never stand out from the crowd. And even if you do manage to get your stock right, a bad pricing structure could put you out of business very quickly. Too cheap, and your profits are low, making the businesses unsustainable. Too expensive, and your jewellery will not sell, often leading you to the incorrect conclusion that nobody wants your jewellery.
But there are a host of smaller issues that plague the jewellery retailer, some of which I have touched on earlier. Over time, you may fix these problems yourself, but that can take many years of low sales, and struggling to break even. So what are those issues, and what can be done to address them?