You don’t have to be a business financing expert to envision the tremendous amount of working capital required to run a jewelry store. As if the materials used to make their products weren’t already expensive enough, their costs have risen over the past few years. Profit margins, however, have reportedly decreased, especially on diamonds.
Some stores attempt to offset these obstacles by doing more repairs and custom work, which come with their own costs. Others simply order more or less of certain items. While jewelry does maintain its worth longer than conventional retail products, anything loses value when tastes change. It is also extremely easy for jewelry stores to order too much inventory at the wrong time and ultimately reduce working capital.
Digital marketing has become increasingly important for jewelry stores as well. Customers must be able to browse products in detail on user-friendly websites and discover the products they’ve been looking for on social media. Long-term marketing campaigns would probably be a lot easier to finance were it not for the sporadic, seasonal nature of jewelry sales. Most stores perform the majority of their sales during peak seasons (holidays, weddings) and are prone to unexpectedly busy periods due to birthdays or anniversaries.
Fundture Capital has many years of experience providing Small Business Loans for Jewelry Stores. We can provide all types of business lending products. Contact us today for your FREE business funding consultation!