Every time a new fine jewelry brand hits the scene, the inevitable question that comes to mind—at least for us—is: how?
How, in a business where basic requirements include having access to gold and diamonds? How, when the technical skills to fulfill expectations of quality are so specialized? How, when sourcing materials is incredibly tricky and time-consuming? The answers seem to be: a lot of passion, trial and error and—perhaps the biggest and most important—money.
“Fine jewelry is definitely an expensive business to enter,” says Nicole Mann Novick, founder of eight-year-old label Garland Collection. “Gold has, at times, tripled from when I originally started and every piece that I make requires a minimum of one sample. Diamonds and precious stones are expensive, of course, as is the labor for the talented and select group of master jewelers that we employ to do our work.”
“I unfortunately did not assess the cost of entry, which is not advisable,” she added.
Still, there’s clearly a hungry market for Novicks’ designs—since launching in 2007, Garland Collection’s pieces have been worn by celebrities like Taylor Swift and appeared in publications like The New York Times and Vogue. Giant coups for a new designer trying to sell investment pieces whose prices stretch to $17,000, though most hover within the $500-$1,900 range.
It’s no secret that expensive jewelry have always held intrinsic cultural value, mostly signifying status—like whether someone’s married or one’s social or economic background—but also as a way to make a press-getting statement.
President Lincoln commissioned a full set of seed pearl pieces from Tiffany and Co. for his wife Mary Todd, and who could forget the emerald and diamond necklace Richard Burton tasked Bulgari to create for his marriage to Elizabeth Taylor? And let’s not get started on modern celebrity engagement rings.
However, while most fine jewelry is traditionally expensive because of labor costs, newer models are cropping up that are making quality pieces more affordable.
Bouchra Ezzahraoui, a Princeton grad and Goldman Sachs trader, went to Morocco for research when she launched her modern fine jewelry line, AUrate, with her partner Sophie Kahn, also a Princeton grad who’s the Global Director of Strategy for Marc Jacobs.
They launched in 2014 under the model of “fine jewelry at a fair price,” sticking strongly to an e-commerce model cutting out the costly middle man, creating each piece in New York.
“We were two women on a mission when we started. It took a lot of business planning, research, process learning,” she says. “We had to put all our savings and earnings—and also life—into this, but we felt compelled to do so because we believe in our story.”
Regardless of what type of fine jewelry business you’re launching, the barriers seem obvious. However, trusted consultancy group, McKinsey and Co., released a report earlier this year that should have anyone interested in starting their own line jumping for joy. Apparently, there’s never been a better time to get into the biz.
Why? Well, for one thing, annual global fine jewelry sales are expected to grow at 5 to 6 percent each year, totaling around $280 billion by 2020. Two, because consumer demand appears more voracious than ever. And three—and probably the most relevant—is that the jewelry market is following the apparel market, with high-street fashion consumers seeking more trend-driven styles and quickly.
Innovative jewelry players will emulate fast-fashion apparel companies by reacting to trends quickly and reducing their product-development cycle times.
Basically, “trendy” fine jewelry is taking over where heritage brands have historically ruled.
That said, on-trend pieces won’t sell themselves, especially given that retailers often buy jewelry on consignment, “which makes it very difficult for startups,” said Bronwyn Cosgrave, author and former features editor of Vogue UK, who now consults for luxury jewelry brands,
In a traditional sales model, the retailer buys the products outright and takes on the burden of selling the inventory. But in a consignment situation, a manufacturer essentially loans the products to the retailer–so a store will stock a product, only pay for what they sell and then return the rest.
A fact that, according to Cosgrave, makes it imperative for a designer to be present on the shop floor, always promoting their work with personal experiences and trunk shows.
Launching your own fine jewelry line requires money, an understanding of the business, and knowledge of what consumers want, but there are also several other factors that contribute to cracking this expensive, labor-intensive market, too. Here are more collective bits of wisdom from Cosgrave, Ezzahraoui, and Novick.
What’s really required to properly launch?
“A five-year business plan mapping out growth is essential, a committed backer or definite long-term revenue stream, a cohesive collection and an ability to update it with new collections, advises Cosgrave.
“PR takes care of itself if the work is out there being worn by the designer and or a brand ambassador.”
What’s the biggest barrier to entry when starting a fine jewelry line?
“The jewelry business is also a traditional business,” explains Ezzahraoui. “And you need to spend a considerable amount of time building relationships and trust with your partners throughout the manufacturing process.”
“For me, it was finding people who could execute my vision and help me create timeless pieces with qualities and details that I’d always be proud to have out in the world,” says Novick. “Finding talent who also have the same respect for details may not always be easy.”
If someone’s getting into the fine jewelry business, how can they manage overhead?
“Like any other business, you can choose the other overhead costs that are necessary for you, whether it be office space, assistants, PR, IT, web design, photographers,” says Novick.
“And those may change as you grow. It isn’t necessary to have everything, and you’ll always need to wear many hats, so in the beginning I recommend starting slowly and if you’re on a strict budget. Only hire what you absolutely cannot do yourself.”
Bouchra adds:”Don’t over-invest in inventory and be nimble in your manufacturing so that you can see what works and doesn’t. Customer response to your product will guide you so that you can adapt your production.”
Any secret weapons?
“A patron who promotes your work is almost essential,” Cosgrave points out. “Before founding Cartier, Louis-Francois Cartier worked in obscurity in a small Paris workshop until he was launched into the top drawer of French society by Princess Mathilde Bonaparte.”
Translation: Try to get your pieces on important people, or those in the public eye.
Is there a formula for success?
“A trio of common elements are distinguishing aspects of the great jewelers,” says Cosgrave, “They all have a unique vision. Their work is distinctive and the quality of their workmanship is second to none.”
“But never forget your own passion, hard work and determination is where it all begins and ends, added Novick.”