New Startups are booming.
Why, when many businesses are still struggling to recover from the latest recession and with the uncertainty over Brexit unresolved, does it appear that the U.K. jewellery industry continues to be such fertile ground for a new enterprise?
Entire books have been dedicated to making a success of a new business, but here we will look at a few of the signposts which underline why jewellery sellers and stores seem to be on the increase.
Lessons from the past
Not so many years ago, most of the smaller independent or family-run jewellers on our high streets appeared to be in danger of being engulfed by the sweeping expansion of seemingly interchangeable chain stores and mass market jewellery retailers. Fast forward to today, and many of those seemingly vulnerable names have endured or indeed thrived. Often they have fared far better than those very same corporate cousins who once threatened to displace them and the trend is now being reversed with small independents popping up with increasing rapidity whilst many of the larger groups have been forced to streamline or tread water.
Whilst this is not so unusual in terms of “survival of the fittest” where quality and service win out over market saturation, historically the jewellery trade as a whole has been more robust than many others, certainly in terms of supporting multiple retailers within what is essentially a specialised field.
This inherent strength is further borne out by certain business consultants who submit that the jewellery trade did not falter to the same extent as most other industries during the recession; furthermore, they point to the fact that where there was any loss of revenue, the evidence suggests that those affected bounced back at an accelerated rate.
A further historical factor which has helped support the burgeoning British jewellery market has been its ability to survive repeated increases in precious metal prices and to ride out periods of currency turmoil.
The here and now
Anyone looking to move into the jewellery trade now has huge advantages at their disposal compared to someone trying to do so years ago.
One of the most attractive aspects is the comparatively low startup costs involved. Before the advent of e-business and the popularity of working from home, setting up a “traditional” bricks and mortar store would have required the equivalent of £20k investing at the outset for each shop without taking any other costs into account.
Now it is possible to begin trading from home with as little as £100 to cover initial costs and materials. Selling handmade jewellery remains a popular and cheap way to gain a foothold, and with the average markup on such goods being around 3 times cost price, it is easy to see why.
Online marketplaces such as eBay, Etsy and Facebook allow for the quick and easy sale of goods to a potentially huge customer base with what amount to only minimal marketing costs, whereas previously getting the product in front of a customer was far from instantaneous and often required huge marketing campaigns.
A number of retailers have taken advantage of drop shipping, which essentially allows them to trade without actually ever having to hold any stock as the seller buys from a 3rd party who fulfils the order on their behalf. This helps reduce costs by eradicating the need for an initial outlay for stock or the ongoing costs involved with storage. For an example of how much growth is possible for a business which starts out predominantly using dropshipping, take a look at Amazon.
Craft fairs and trade markets have become a popular way to both introduce wares to a wider audience and offer the budding entrepreneur networking opportunities with potential suppliers and trade partners, as well as being great places for providing inspiration.
A brief look at the future
Analysts such as McKinsey and Global data expect growth within the jewellery market to continue. The former predicts that sales will reach £220bn per annum by 2020 and the latter forecast that improved levels of growth of 13% are sustainable going into the next decade.
It certainly appears that the juxtaposition of a traditional trade like jewellery making and contemporary retailing opportunities will continue to go hand in hand.
5 key to success
The above may all sound great, but there are certain key elements that will go a long way to helping any aspiring jewellery retailer when starting out.
- Passion. Whether you design and make your own pieces or simply plan to sell other people’s creations, a passion for what you do will often be more valuable than the depth of your knowledge. Knowledge can be easily gleaned from books or the internet whereas passion cannot be taught but will shine through in everything you do. Jewellery is very personal, often aspirational and customers will appreciate someone who shares those values.
- Be dynamic/responsive. Just as clothing fashions change, so do jewellery trends. Jewellery comes in all sorts of ranges and variations so you should never be short of inspiration and whilst it may be difficult to stay ahead of the market, it pays to keep an eye on where there is the greatest demand or need.
- Costs. Jewellery can be expensive, of course. However inexpensive jewellery is no less popular and is a good starting point for many new businesses. Because most jewellery is relatively small storage can be kept to a minimum and shipping costs are far less prohibitive than with much bulkier goods.
- One size fits all. There are many items of jewellery to which this applies, so unlike a clothing retailer who will need to consider what sizes to stock, the jeweller has the advantage that their earrings, necklace or bangle will have a universal appeal.
- From little acorns… It is fairly easy to start small, particularly for a low budget concern. However, jewellery lends itself well to a business that wishes to eventually expand and perhaps tailor itself to a particular niche within the market. There are “added value” services which could also be considered such as cleaning, repair, valuation and servicing which can all help to build your brand and your revenues.
Whether you’re an established business or an up and coming e-commerce brand, Lila & Angelys can provide advice and great wholesale products to help you get to the next level. Don’t hesitate to browse our ranges on this website, or get in touch for a chat.