I run a retail jewellery business. We sell mainly platinum engagement rings. We purchase castings which are then finished/sized/set by 3rd party workshops. We spend circa £6,000 per month on these 3rd party services.
I am wondering whether at that level of expenditure we should look to set-up a small workshop at our premises to take on some of this work.
I am thinking of 1 jobbing jeweller and some equipment like a laser etc.
I believe I could save workshop costs as well as retain some of the precious metal filings. Plus we would also be able to offer a better service to clients.
Are there any jewellers on this forum who have considered this problem?
Hi! I don't have experience in your field, but I just wanted to say congrats for the idea, and for your business in general: it sounds like you're doing good!
It sounds like you have two problems to overcome: money and the actual shop.
Money-wise, if you think 6k/month would cover salary, rent, utilities and other expenses, then you're already winning: like you said, you'd provide a better service to your customers, and that is very valuable on its own. Not to mention opening another line of business, which helps long-term.
Of course, you should factor in the initial investment in static assets; but I expect asset turnover to be quite good for you: you'll be able to maintain a steady flow of orders, so you're safe in assuming that your initial investment in lasers, etc will pay off.
So, all that remains is to find a good jeweller, right?
Sorry for my rant :) and best of luck!
When I owned my jewelry business, I made everything in house until the number of orders exceeded what I could produce, in excellent quality. I contracted two local jewelry instructors to work in house for the overflow. I found that there were too many issues with quality and design when I outsourced. Having someone in house allows you monitor, speed, quality and offer your customers the best service.
If you already have a space that you can reorganize to add the laser and setter then you only have to absorb the cost of the additional employee and the cost of equipment. Of course looking for gently used equipment is always an option.
You said that you use several 3rd party services, I am wondering if one of them is a small shop that my consider joining your venture, that way you are working with someone you know, like and trust already.