How to start a jewelry business: a founder's guide

Starting a jewelry business is a rewarding venture that combines artistic creativity with business savvy. The global jewelry market is worth hundreds of billions of dollars, fueled by consistent demand for pieces for special occasions, fashion statements, and personal milestones.

This guide will take you through the practical steps of validating your business concept, building supplier relationships, acquiring inventory, and obtaining the necessary licenses to help you launch a successful jewelry business in the U.S.

Step 1: Plan and validate your business idea

First, define your niche. Use Google Trends to compare search interest for terms like "minimalist gold necklace" versus "bohemian beaded bracelet". Explore popular categories on Etsy and Pinterest to spot gaps in the market or underserved styles.

Analyze the competition

Identify five direct competitors, both online and local. For online brands, you can use a platform like Semrush to review their web presence. A frequent oversight is to ignore local players. Visit craft fairs and boutiques to understand regional pricing and styles.

Estimate your startup costs

Initial costs typically range from $1,000 to $5,000. Budget for raw materials ($500-$2,000), specialized tools like pliers and mandrels ($300-$1,000), and business license fees ($50-$400). Many new owners forget to factor in packaging and shipping supplies, so add those to your list.

Here are 3 immediate steps to take:

• Identify three potential jewelry niches using Google Trends and Etsy.
• List two online and one local competitor, noting their product prices.
• Draft a startup budget that includes materials, tools, and licensing fees.

Step 2: Establish your legal structure and get licensed

Most new jewelry business owners choose a Limited Liability Company (LLC). This structure protects your personal assets from business debts. It also offers pass-through taxation, meaning profits and losses are reported on your personal tax returns, which simplifies paperwork.

Secure the right permits and licenses

First, get a free Employer Identification Number (EIN) from the IRS website. You will need this to open a business bank account. Next, apply for a state seller’s permit, which allows you to collect sales tax. This permit can cost between $50 and $100.

Many sellers get into trouble by mislabeling materials. To avoid this, review the Federal Trade Commission's (FTC) "Guides for the Jewelry, Precious Metals, and Pewter Industries" before you write product descriptions. These rules govern how you must describe your pieces to customers.

Here are 3 immediate steps to take:

• Register your business as an LLC with your state's Secretary of State office.
• Apply for a free EIN directly from the IRS website.
• Research your state’s requirements for a seller's permit to collect sales tax.

Step 3: Secure your business insurance

You might want to start with General Liability insurance, which typically costs $300 to $700 annually for a $1 million policy. This protects you if a customer is injured at your booth. Also consider Product Liability insurance for claims related to allergic reactions from your materials.

Protect your inventory

With your valuable inventory in mind, look into Inland Marine insurance. This covers your pieces during transit or at craft fairs. A frequent mistake is to insure inventory for its material cost. You should insure it for its full retail value to protect your potential profit.

Speaking of providers, you can get quotes from companies that understand the jewelry trade. Look into Jewelers Mutual, Zensurance, or Hiscox. A general agent may not grasp the specific risks, like theft of high-value, small-sized goods, that are unique to your business.

Here are 3 immediate steps to take:

• Request a quote for a General Liability policy with at least $1 million in coverage.
• Calculate the total retail value of your inventory to determine your coverage needs.
• Contact a specialized provider like Jewelers Mutual to discuss a policy.

Step 4: Set up your workspace and source equipment

A dedicated home studio of 100-150 square feet is often enough to start. Check your local "home occupation" zoning rules before you begin. If you lease a retail space, try to negotiate for a tenant improvement allowance to cover costs for security systems or specialized lighting.

Find your core equipment

Your workbench is your command center. A quality jeweler's bench costs between $300 and $800. You will also need a flex shaft machine ($250-$500) and a soldering station ($150-$400). Some sellers regret buying cheap pliers and cutters that mar metal, so invest in good hand tools from the start.

Build your supplier list

Reputable suppliers like Rio Grande and Stuller are industry standards. To open a wholesale account, you will need your business registration and EIN. While some items have no minimum order, expect initial orders for precious metals to be around $100 or more.

Here are 3 immediate steps to take:

• Research your city’s zoning regulations for a home-based business.
• Price out a jeweler's bench and a flex shaft machine from two different suppliers.
• Gather your EIN and business license to apply for an account with Rio Grande or Stuller.

Step 5: Set up your payment processing

Choose your payment processor

You need a way to accept credit cards, both online and in person. Many new owners do not realize that payment processors often charge 2.5% to 3.5% per transaction. These costs can add up, so compare rates carefully before you commit.

If you plan to offer custom work, you might want to require a 50% non-refundable deposit. This protects your investment in materials and time if a client changes their mind. Make this policy clear in your client agreement before you start any work.

For jewelers who need to accept payments on-site, JIM offers a streamlined solution. With JIM, you can accept debit, credit, and digital wallets directly through your smartphone—just tap and done. It is particularly useful for sales at craft fairs or pop-up events.

At just 1.99% per transaction with no hidden costs or extra hardware needed, its rate is competitive against the higher average commissions other payment solutions offer.

• Get Started: Download the JIM app for iOS.
• Make a Sale: Type the sales amount, hit sell, and ask your customer to tap their card or device on your phone.
• Access Funds: Your money is available right on your JIM card as soon as the sale is done—no waiting for bank transfers.

Here are 3 immediate steps to take:

• Compare transaction fees from two different payment processors.
• Draft a deposit policy for your custom jewelry orders.
• Download the JIM app to see how it works for in-person sales.

Step 6: Fund your business and manage finances

Secure your startup capital

You might want to look into an SBA Microloan. These loans range from $500 to $50,000 and are great for buying initial inventory or equipment. Interest rates typically fall between 8% and 13%, and lenders often look for a solid business plan and a decent credit score.

In addition to loans, consider industry-specific grants. The Halstead Grant, for example, offers a $7,500 cash prize plus business mentoring. These are highly competitive, so your application and design portfolio need to be polished before you apply.

Plan your working capital

For your first six months, you should plan for $3,000 to $7,000 in working capital. This covers ongoing material costs, marketing expenses, and show fees. Many new owners focus only on startup costs and forget to budget for the cash needed to operate day-to-day.

Here are 3 immediate steps to take:

• Research two local SBA Microloan lenders and their specific requirements.
• Calculate your estimated working capital needs for the first six months.
• Review the eligibility criteria for the Halstead Grant or a similar industry award.

Step 7: Staff and run your operations

Hire your first team members

You will likely be the sole operator until you reach $50,000-$100,000 in annual revenue. Once order fulfillment consumes over 15 hours per week, consider hiring a part-time Studio Assistant. Their duties include packing orders, light assembly, and organizing supplies.

Expect to pay a Studio Assistant between $18 and $25 per hour. No specific certifications are required, but you should look for someone with strong attention to detail. A mistake many owners make is hiring too soon, which strains cash flow before sales can support the expense.

Manage your daily workflow

A spreadsheet for inventory works for a few dozen products, but you will outgrow it. You might want to use a dedicated inventory management system like Craftybase. It tracks raw materials and finished goods, which helps prevent stockouts of popular items.

Once you have your systems in place, you can think about your key metrics. As you grow, aim to keep your total labor costs, including your own salary, below 20% of revenue. This ratio helps ensure your business remains profitable as you scale your team.

Here are 3 immediate steps to take:

• Draft a job description for a part-time Studio Assistant.
• Sign up for a free trial of an inventory system like Craftybase.
• Set a monthly revenue goal that will trigger your first hire.

Step 8: Market your business and acquire customers

Build your online presence

Focus your efforts on visual platforms like Instagram and Pinterest. You should post more than just product photos. Create a content calendar that includes behind-the-scenes videos of your process and user-generated content to build a stronger connection with your audience.

Next, build an email list by offering a 10% discount for new subscribers. A healthy email list in the jewelry space can see open rates of 20-25%. A frequent misstep is to build a list and then neglect it, so plan to send at least one email per week.

Use paid ads and collaborations

You might want to experiment with paid ads on Instagram with a starting budget of $10-$20 per day. Aim for a Customer Acquisition Cost (CAC) below $50. For e-commerce, a conversion rate of 1-2% is a solid benchmark to work toward.

Consider collaborations with micro-influencers who have fewer than 50,000 followers. You can often trade gifted products for posts, which is a cost-effective way to get your brand in front of a targeted audience. Make sure their audience aligns with your ideal customer first.

Here are 3 immediate steps to take:

• Create a content calendar for one week of Instagram posts.
• Set up a welcome email for new subscribers that includes a 10% discount code.
• Identify three micro-influencers in your niche to contact for a collaboration.

Step 9: Price your products for profit

Calculate your base price

A standard formula is (Materials + Labor) x Markup = Wholesale Price. For example, if a necklace has $10 in materials and takes 30 minutes of your time at $25/hour ($12.50), your base cost is $22.50.

You might want to apply a markup of 2x to 4x. This puts your wholesale price between $45 and $90. Your retail price is typically double the wholesale price, so customers would pay $90 to $180.

Many new jewelers undercharge for their labor. Remember to pay yourself a realistic hourly wage. Your time and skill have value, and your pricing should reflect that.

Analyze the market

Once you have your base price, look at what competitors charge for similar items on platforms like Etsy or in local shops. This helps you see if your pricing aligns with customer expectations in your niche.

Avoid the temptation to simply undercut everyone. Low prices can make buyers question your quality. Instead, justify your price with high-quality photos, detailed descriptions, and strong branding.

Here are 3 immediate steps to take:

• Calculate the total cost, including materials and labor, for one of your signature pieces.
• Research the retail prices of five similar items on Etsy.
• Set a wholesale and retail price for your signature piece using a 2x markup.

Step 10: Implement quality control and scale your operations

Establish your quality standards

Create a quality control checklist for every piece. Inspect for secure clasps, even polishing, and properly set stones. A good goal is to keep your defect rate below 2%. This means fewer than two flawed items for every 100 you produce.

Many new jewelers run into trouble by not verifying their materials. You can use an acid test kit to confirm the karat of gold or the purity of sterling silver. This simple step builds customer trust and prevents costly returns from mislabeled products.

Know when to scale

Once your quality is consistent, you can plan for growth. A solid benchmark for hiring your first studio assistant is when you spend more than 20 hours per week on production and packing alone. This frees you up for design and marketing.

You might also want to expand your product line when your top three sellers consistently generate over 60% of your revenue. Introducing new collections helps you diversify and reduces risk if a popular style's trend fades.

As your team and order volume grow, a spreadsheet will not be enough. You can use project management software like Asana or Monday.com to track production stages, manage custom orders, and coordinate tasks with your new assistant.

Here are 3 immediate steps to take:

• Create a 5-point quality inspection checklist for your best-selling item.
• Research the cost of an acid test kit for silver and gold.
• Determine the weekly number of production hours that would signal the need for an assistant.

This guide gives you the steps, but your passion is the real key. In the jewelry world, your distinct style is what sets you apart. Let that guide you, from design to marketing. You are more prepared than you think to start this journey.

And when you make your first sale, a simple payment solution helps. JIM lets you take cards right on your smartphone, with no extra devices and a clear 1.99% rate. It keeps things easy so you can focus on your craft. Download JIM and be ready.