Implementing a jewelry inventory management system may seem overwhelming, especially if you have been making jewelry for some time and have amassed a collection of jewelry supplies. While it may take a bit of time to get set up in the beginning, being able to track your components, costs and finished pieces can be a big step in gaining financial control of your jewelry business.
Benefits of a Jewelry Inventory System
Information is a key factor in jewelry business success. Knowing your costs per piece should be the basis of pricing your jewelry, and proper management requires that you know exactly where your money is going at any given time. Tracking your jewelry inventory also allows you to avoid last minute scrambling to order necessary components when you are trying to meet a deadline. When you are selling pieces at a craft show, an inventory checklist allows you to quickly mark what is selling and will alert you to missing pieces. Lastly, you will need to provide a total value of both your unused inventory and finished pieces to the IRS when you file a tax return.
What Should an Inventory System Track?
Loosely stated, you need a system that will track your components and your finished pieces. Each finished piece should have a list of the components used to create it, along with their individual costs and a total cost at the end. This information enables you to set the foundation for pricing a piece, and you can look to see which components are costing you the most in your finished jewelry.
At a minimum, you need to track the name, individual cost and quantity of each jewelry component. The following pieces of information are not necessary but can be very helpful in streamlining your inventory control practices:
Part Number: Writing down the number you use to order from your supplier can help you quickly reorder in the future. Supplier Name: Along with the part number, keeping this information handy allows for quick reordering of supplies. Size: If you keep multiple sizes of a certain bead, such as 4mm and 6mm Austrian crystals, having an extra field with size information will allow you to easily sort to the size you need to view. Price per Pack: For most supplies, you will order packs of multiple items. In those cases, budgeting for reorders requires knowing how much a pack will cost. Items per Pack: Use this figure, along with price per pack, to determine the unit price of a component. When you calculate reorders, it is helpful to know how many will be ordered at a time. Order History: Prices fluctuate on jewelry supplies, especially precious metals such as sterling silver. For more exacting pricing strategies, you can track how much you spend each time you order to determine a new price per item for every batch. You can then either average all purchases or use the exact price for that shipment as you use it. Photo of the Component: While not always necessary, it can be helpful to attach a photo to your component item listing to help differentiate it from another supply whose name and description sounds similar. You can also use this to help keep track of unique components. The bonus to keeping component photos is being able to reuse those photos should you decide to sell off excess supplies later.
Putting It All Together
You can purchase a software program specifically designed to track jewelry inventory, or use a program you might already have such as Excel or Open Office to create a customized spreadsheet for tracking. A popular software program is Jewelry Designer Manager, which allows you to track supplies and pieces and can automatically deduct inventory when components are used to create a piece. Let your budget, time constraints and familiarity with spreadsheet programs dictate where to go from here.
Jewelry inventory management is best begun before you start beading, but most of us do not realize a need until somewhere down the line. It will take some time to enter all of your information into a system, but maintenance after the initial set up is quick and easy. Being able to see at a glance how many opals you have left or how much you spent on that last pack of spacers can really help you track spending and maximize efficiency in your jewelry business.