Becky's Business Tips
8 Ways to Navigate the Highs & Lows of a Jewelry Business.
The topic of the day on most news platforms has been the chatter of a potential recession. I have been feeling the familiar tension rising like I did during the beginning weeks of the global covid-19 pandemic.
What is different from a global pandemic and a recession is that they are actually more common than people realize. According to the National Bureau of Economic Research, we have experienced 12 recessions since the 1940’s. That is a cycle of a recession every 6 or so years.
If you are interested in riding the next drama train, then sit still because the train has left the station! But if you would like to continue doing what you love, here are 8 ways to help navigate the highs and lows of a jewelry business.
1. Understand Your Company’s Finances
One of the surest ways to avoid the highs and lows of your jewelry business is to have a clean, complete, accurate and easily accessible set of books. It is hard to see and know if your margins are still good, your sales are declining or your expenses are increasing if you aren’t reviewing your company’s financials regularly. By keeping this information up-to-date, you can respond without drama and pivot.
Action Steps You Can Take:
Are you clear on your profit margins? Here is a way in which you could do this:
- Place a piece of your finished jewelry onto a piece of white paper.
- Photograph and print out the image.
- Identify how much each of the findings cost for you to purchase.
- Time yourselves assembling the finished jewelry to provide an estimate of labor.
- The money that you make after your cost and labor is your profit margin. The profit that you make from your jewelry is what allows for you to pay for everything else.
Credit: @meadowgrassdesigns
2. Create a Budget
As the buzz of a potential recession started to make its way into the news, Heather here at Nunn Design created multiple budgets within Excel to help us plan for various scenarios. It was helpful to see what our finances would look like if we saw a 20, 35, 50 and 65% reduction in sales.
If sales start to decline, this will affect our cash flow. We have a plan on ways to reduce expenses so that we can navigate changes within each scenario. Running out of cash is one of the top concerns for any business owner, especially during a recession when cash is more challenging and expensive to borrow.
Action Steps You Can Take:
- Go through all of your sales and break down your total sales month-by-month. Having this historical information will help you forecast your future sales. If you are tracking a decline, you can pivot with a clear head and not plummet into the “lows.” If you are having a killer month, you can bank some of the profits for the slower months.
- How much is it costing for you to run your business? What are all your expenses?
- Go through all your receipts and organize them month-by-month.
- Add up each month’s expenses.
- Start to track these expenses month-by-month and year-by-year. This will help you see a monthly average. If you are starting to see a trend in your expenses going up, you will want to review your margins or find other ways to increase your sales to cover those expenses.
Credit: @adorejulesdesigns
3. Save for that Rainy Day
We have all known the importance of having an emergency fund to cover our personal expenses. Having a rainy day cash cushion within the businesses is also very wise. During covid, I used my personal finances to support my family and leaned into the cash cushion that the business had to ride the highs and lows of running the business.
Action Steps You Can Take:
- Where could you secure money if you needed it?
- What pre-work would you need to do to secure those finances? It is so very helpful to secure finances before you actually need them!
Credit: @sistaswithbadhabits
4. Let Go of Your Ego
When the global pandemic hit, I was alone in the warehouse pulling orders. My ego felt bruised, but I experienced first hand how we could be a better company! Knowing that I could let go of my “I’m the boss” ego and pull up my big girl panties to do the work that needed to be done allowed Nunn Design to cut back on our operating expenses, streamline our processes and reduce our collection of jewelry findings to focus on essential sellers.
Action Steps You Can Take:
- Which tasks within your business could you take on if you needed to? There is no shame in doing what it takes to keep things going!
- For those of you who are already doing it all, what skills are you lacking? If you aren’t getting to that accounting, is there an accountant you could hire?
5. Lean into the Wisdom of Other Business Owners
It has been my experience that sage levelheaded business owners love to give back to others. More than likely, they had several mentors along the way who supported them.
Action Steps You Can Take:
- Create a list of all of the people in your life who are wise business owners that you admire.
- Who can help you ride the highs and lows of running your small business?
Credit: @hellodearhandmade
6. Pivot Your Marketing
Earlier we talked about tracking your sales. It is also important to track where your sales are coming from.
During covid, if you hadn’t built out some way to sell online, you were in trouble. But as people take to summer travel plans and are out and about more, do you have a brick and mortar store that people could discover your jewelry and purchase it? Or are you doing any shows this summer?
Action Steps You Can Take:
- If you are selling mostly online, are there retail brick and mortar stores that you could approach?
- Are you selling retail? Could you sell wholesale? Have you explored Faire.com?
- Have you built the foundation of your sales on a platform that you cannot control (yes, I’m talking Instagram and Facebook)? Invest your time, energy and money into your own newsletter. Explore Mailchimp as a company that you can build your email list with.
Credit: @flowerleafstudio
7. Mix up Your Jewelry Collections
Not everyone will be equally impacted by highs and lows of economic downturns. Identify ways in which you could change your jewelry collections to be more appealing to a wider audience. Maybe a jewelry collection that would appeal to a more conservative older customer and a collection that is bold and fun for younger audience. Nunn Design’s collection of jewelry findings is positioned to help you do just that!
If you have big and bold statement collections, could you offer something that is simple and priced at a much lower price point?
Action Steps You Can Take:
- Identify how you could diversify your jewelry collection to appeal to a wide customer base.
- Design your jewelry collections to offer a variety of price points.
Credit: @michelle_meyer_studio
8. Scrub Your Space
If there is going to be a recession, there will be nothing we can do to control it. What we can control is how we use our energy. Will you run about and scream and shout, or will you take advantage of this time to get your business in order.
Action Steps You Can Take:
- Make a list of all of the incomplete tasks that you have in your business.
- Put those items into order of priority, with the most essential items listed first.
- When you find yourself feeling stressed, pick-up that list and start to scrub your space!
Credit: @aprilhilerdesigns
As a creative person, it is easy (and I’m sure preferable for some!) to be focused on creating and not the running of your business. Focusing on being 1% better each and every day will consistency move you forward helping you navigate the highs and lows of a jewelry business.
We just navigated a global pandemic together. I know that we can navigate this too!
Shop Nunn Design Wholesale
Nunn Design has been supplying jewelry artists with findings for over 20 years. Shop wholesale jewelry findings for creative jewelry makers.
Shop Nunn Design!How to Purchase Wholesale?
If you are interested in becoming one of the many designers who trust their jewelry to Nunn Design Findings, please join us by registering to become one of our wholesale customers!
Please visit our Where to Buy Page for a listing of online stores that sell Nunn Design Findings retail.
If you enjoyed reading this post, please subscribe to our blog. Here are 10 Reasons Why to Subscribe and a place to do so!
