1

EXECUTIVE SUMMARY

The business opportunity identified is “Custom made

jeweler ”, in which the main product are rings ,bangles,

bracelets ,earrings, chains etc. which will be made to order in

the design approved by the customer and made of gold or

platinum containing diamonds or gems as per the customers

wish. Custom made jewelry business represents a huge

untapped market – both domestic and international.

This basic strategic business plan provides information

necessary for initial establishment and operation of the firm.

The bplan outlines the plans for business growth, methods,

procedures for operation and industry analysis. The firm is to be

formed in Thrissur, Kerala, as a partnership firm under the

Laws of Government of India.

The dynamic management team responsible for the

design, building, development of company policy, and hands-on-

management of the daily operations are Fazin Bin Ummer and

Sakeer Hussain. In addition, a team-oriented and customer-

focused staff will support the management team. The firm will

2

hire the services of a CPA firm to perform professional company

audits, prepare taxes and payroll, and serve as a business

consultant to assist in setting achievable long-range strategic

goals.

The Indian gems and jewellery industry is the fastest

growing jewellery market in the world. Recognized as the

diamond polishing capital of the world, the country is gaining

prominence as an international sourcing destination for high

quality designer jewellery with global retail majors such as Wal-

Mart and JC Penney procuring jewellery from India. The

presence of highly skilled, low-cost labour enables India to

design and make high volumes of exquisite jewellery at relatively

low cost. According to Credit Analysis and Research Limited

(CARE), the domestic jewellery market in India is pegged at US$

16 billion.

The Indian gems and jewellery industry is the fastest

growing jewellery market in the world. The product has a good

demand in the Indian market but has very less players in the

market with most of them catering only to the very higher end

strata of people. The major hurdle initially will be to bring in

awareness and build trust among customers. Since most of the

3

people in India have a habit of sticking on to one favourite

jeweler who they prefer, it is going to be a little difficult initially

to break peoples’ mindset to purchase from a custom jewellery

manufacturer.

The prices are set for the product based on the “Market

based pricing strategy” although a bit premium would be

charged owing to high level of customization wherein economies

of scale aren’t achieved due to each order being unique. During

the initial stages of the company, the promotional measure

would be aimed at increasing the brand awareness and would

go in for mass adverting campaign since it’s a new brand.

.

The cost of the project is estimated to be Rupees Twelve

Lakh and the start-up will break even in three years. The capital

structure for the project would be comprised of Personal

Investment and Term Loans in the ratio of 1:1.

4

1. BUSINESS

1.1 ABOUT THE OPPORTUNITY

The business opportunity identified is a “Custom made

Jeweler”, in which the service going to be offered to the

customer is designing and making of a ring, bracelet, bangle,

earring or chain according to the customer’s choice.

Custom jewelry is personalized jewelry, which a customer

gets it made on her interest and fancy. This happens

particularly in cases where readymade jewelry does not match

the taste of person. Custom jewelry gives total freedom to

customer about the specifics. The customer can ask for various

personal touches and get everything made as per the client’s

ideas. In fact, it gives ample space for personal choice and taste

to customer, which is not available in case of readymade

jewelry. The customer and craftsman together decide what

design is to be made. Often, the customer knows what he or she

desires and takes this idea to the jeweler, in the form of a sketch

or picture or sample. The popularity of custom jewelry is

increasing because of the fact that in it the customer gets

specially crafted jewelry suitable to his needs and taste. Custom

5

jewelry or personalized jewelry is particularly suitable for those

who have a fairly clear idea of what they want and are unable to

find it in jewelry stores. This form of designing jewelry gives a

person completes freedom over his or her jewelry particulars.

The demand is immense as the consumer consciousness

is increasing rapidly and the future of organized retail in India is

very bright with the Indian culture always having an unending

interest toward gold.

6

1.2 S-W-O-T ANALYSIS

The following table gives an overview of the SWOT analysis

about the service

Strengths

There is almost negligible amount of branded players

giving similar service.

Even if a family jeweler or a goldsmith does so he doesn’t

allow to this possible extent of customization.

Gold industry in India is booming at a very fast pace and

the industry is very promising and decline in demand was

not there even with increasing gold prices.

Weaknesses

Lack of awareness about the product among people.

Marketing and brand creation challenges.

Difficult to lure customers away from family jeweler who

have immense goodwill.

Opportunities

Has a huge untapped domestic and export market.

First mover advantage will be gained if properly marketed

7

Increase in disposable income of consumers and change

in lifestyle.

Threats

If venture successful then it might trigger competitive

reaction from existing branded jewelers also to provide

similar service.

8

1.3 PORTERS DIAMOND

1.3.1. The threat of substitute products or services

A close substitute product constraints the ability of firms in

an industry to raise prices. The firm has a medium to strong

threat of substitute in the form of ready to buy off the shelf

jewellery from any jeweler across India. The advantage the buyer

gets is that he has the good in hand immediately and does not

have to wait for the delivery as is in the case of custom made

jewelry. There is high risk of buyers propensity to substitute

with traditional off the counter jewelry due to lack of time as

well as due to preconceived notion that custom made jewelry is

way to premium priced. The only way in which this threat of

substitute can be confronted is by reinforcing the advantage of

product differentiation over traditional jewellery.

1.3.2. The threat of entry of new competitors

The threat from new competitors is very high as the entry

barriers are not strong and anyone with prior experience in gold

business who has contacts with vendors and a bit of capital can

venture into this business. Another problem is since the

industry is very lucrative and poised to improve steadily it will

9

definitely invite new players. Therefore the only way to block

this risk is to have a good brand name being the first mover and

also have access to vendors and distribution channels so

effective that even if a new entrant comes it should not harm the

business.

1.3.3. The bargaining power of customers (Buyers)

The bargaining power of the customer is medium to weak

due to the reason that the competitors providing the same

service is les or negligible, and also since the buyers are

fragmented no particular buyer has particular influence on

price. As in normal niche services the customers bargaining

power is generally low.

1.3.4. The bargaining power of suppliers

The suppliers with reference to this business refer to the

vendors who supply the finished the ordered jewelry i.e. the gold

smith. They do not normally have a strong bargaining power

owing to the fact that many competitive suppliers are there in

the market and there isn’t any significant high switching cost.

10

1.3.5. The intensity of competitor rivalry

For most industries, the intensity of competitive rivalry is

the major determinant of the competitiveness of the industry.

Since the intensity among jewelers are high the only way to

block this is to improve your product differentiation, innovate,

have a high presence as both an offline and online company

,spend a lot on advertising to increase awareness and build

brand equity and identify and improve on a competitive

advantage.

11

1.4 BUSINESS DESCRIPTION

The business is proposed to be established as a supplier

of Custom made Jewellery especially to high net worth

individuals, wedding brides etc. the firm will not be

manufacturing the jewellery itself. It will just help in designing

the jewellery with the input from the customer and then

outsource this work to their regular craftsmen. Once the work is

finished the firm will deliver it to the customer at his residence.

Since the supply of finished goods can be easily obtained

by the company with the existing gold business background

who have a good relation with goldsmiths, the main area of

concentration during the initial stages would be the creation of

awareness of such a service in the cities chosen for launch and

creating a database of High net worth Individuals who will be

the potential customers.

The presence of the firm would be generally on the

internet and initial phase there would be no retail outlet like a

traditional jeweler since the company executives will be meeting

the clients at their place for discussions. In the initial stage the

12

business would be catering to only 1 Class-A city and 1 Class-B

city. As and when the firm expands and grows steadily more

cities will be added and the long term objective will be to cover

all Class A-1 and Class A cities where immense potential is

there compared to Class B and C.

Classification City

A-1 Mumbai

A-1 Delhi

A-1 Kolkata

A-1 Chennai

A-1 Bangalore

A-1 Hyderabad

A Ahmedabad

A Pune

A Surat

A Kanpur

A Coimbatore

A Lucknow

A Nagpur

A Jaipur

A Visakhapatnam

A Vijayawada

B-1 Kochi

B-1 Patna

B-1 Indore

B-1 Bhopal

B-1 Guntur

B-1 Vadodara

B-1 Ludhiana

B-1 Agra

B-1 Nashik

B-1 Kakinada

B-1 Raipur

After the company is established and financially

stabilized, opening up of retail outlets in the main dominant

markets would be launched as a second phase. This would be

during the fourth or fifth year of operations by when there

13

would be a considerable amount of goodwill because of word of

mouth publicity form satisfied clients..

Since there is no barrier to entry for the service and the

only competitive advantage is the first mover advantage and a

niche market catering to specific needs it does not provide a

sustainable competitive advantage to the company and hence

the channel of distribution and human resource advantage

needs to be developed as a sustainable competitive advantage

for the firm.

Ways to minimize risk factors to the firm success include:

i. Obtain sufficient capital to build and cover expenses of initial

operation.

ii. Maintain low overhead cost, which increases the bottom line

profit. Skilled personnel will be made available for the

marketing and sales team and a continual training program for

the sales team will ensure they deliver consistent, superior

service, where customer satisfaction is paramount.

iii. Build a sufficient customer base by aggressive marketing

program.

14

1.5. START-UP SUMMARY

During the start-up phase of this project, the following major

events will occur, some of them simultaneously:

Obtain significant investment

Obtain all required permits with regard to Partnership and

Taxes department.

Register the website

Rent the back office site

Design the Site and test it

Order PC’s ,Laptops and Other devices needed for the

designers and sales team

Hire Key Personnel

Finalize operating procedures

Intensify marketing campaign

Enter Into strategic alliances with vendors, Goldsmiths, and

Logistics Companies

Open for business

15

1.6 OPERATIONS PLAN

16

Design team sends designs to sales.

Sales team shows customer the designs and gets concurrence.

Sales team communicates the design changes required to

design team.

Once confirmed with customer, sales team gets the

commitment from the follow up team and places a firm order to

both design team and follow up team (Supply Chain) after

getting advance from the customer.

The design team releases production drawings and quality

check list to the SCM team.

The follow up team places orders to the suppliers and gets the

job done.

In process audit is done for the jewels based on criticality and

the final jewels are taken to the HO.

QC is done in-house and certification requirements are taken

care of (Hallmarking Process etc ) .

The Jewels are send through secure packages based on value

through premium service providers like DHL.

17

2. INDUSTRY ANALYSIS

The Indian gems and jewellery industry is the fastest

growing jewellery market in the world. Recognized as the

diamond polishing capital of the world, the country is gaining

prominence as an international sourcing destination for high

quality designer jewellery with global retail majors such as Wal-

Mart and JC Penney procuring jewellery from India. The

presence of highly skilled, low-cost labour enables India to

design and make high volumes of exquisite jewellery at relatively

low cost. According to Credit Analysis and Research Limited

(CARE), the domestic jewellery market in India is pegged at US$

16 billion.

With consumer consciousness increasing, the future of

organized retail in India is very bright. The organised sector of

the gems and jewellery industry in India is estimated to grow at

40 per cent per annum to US$ 2.2 billion by 2010. The

increasingly savvy Indian consumer is becoming partial to

branded jewellery which is associated with better services,

18

premium quality products and attractive exchange policy. The

growing popularity of machine-made jewellery over traditional

handcrafted jewellery is also spurring the growth of the

organised retail segment.

A study released by the Bullion Association of India in

March 2009, stated that the share of branded jewellery in the

total market was growing at a pace of 20-30 per cent annually.

The number of gold retailers in the country has increased by 40

per cent since the year 2000, with 150 domestic and over 65

international established brands, the study said. According to

the CARE report on the Indian gems and jewellery industry,

India dominates the diamond processing trade with 11 out of 12

diamonds being cut and polished in India. India also dominates

the gold and silver consumption globally with consumption of

about 800 tonnes per annum. The industry provides

employment to 1.3 million people.

According to the World Gold Council's latest, "Gold Demand

Trends Report", gold tonnage off-take in the fourth quarter of

2009 totalled 180.7 tonnes worth US$ 6.39 billion, up 17 per

cent from 154.4 tonnes in the previous quarter and up 13 per

cent from 159.6 tonnes in the fourth quarter of 2008.

19

India is the largest consumer of gold jewellery in the world,

accounting for about 20 per cent of global gold consumption

Surat is India's diamond processing hub, contributing over

80 per cent of the country's diamond processing industry with

annual revenue of around US$ 13.03 billion. In recent years,

Dubai, being a port location, had developed into a diamond

distribution centre in West Asia. According to industry

estimates, 10-15 per cent of India's total polished diamond

exports go through Dubai.

According to a new report by RNCOS on the Indian jewellery

market, the cost per carat for cutting and polishing diamond is

US$ 10 in India as compared to US$ 17 in China and US$ 150

in Belgium.

India is the largest resource hub in diamond cutting and

processing. Low cost of labour involved in the production of

finished diamonds has lured global attention, thereby resulting

in the growth of the industry. India is the largest diamond

cutting and polishing centre in the world

It accounts for 60 per cent value share, 82 per cent by carats

and 95 per cent share of the world market by number of pieces.

20

It is the third largest consumer of polished diamonds after the

US and Japan.

Exports

According to The Gem and Jewellery Export Promotion

Council, exports of gems and jewellery from India, rose 45 per

cent over December 2008 to touch US$ 1.89 billion in December

2009.

Exports during the April-December 2009 period, increased to

US$ 19.6 billion from US$ 19.1 billion a year earlier. Exports of

cut and polished diamonds in the April-December 2009 period

stood at US$ 12.06 billion as compared to US$ 11.5 billion in

the corresponding period in the previous year.

The UAE, led by Dubai, is the largest destination for India's

gems and jewellery, accounting for 31 per cent of the country's

total exports, followed by Hong Kong (25 per cent) and the US

(20 per cent).

Moreover, The Gem And Jewellery Export Promotion Council

is looking at tapping newer markets for diamonds and diamond

jewellery, such as China, the Middle East and Russia.

21

The Road Ahead

The Indian gems and jewellery sector is excepted to cross

US$ 26 billion by 2012, driven by availability of a huge base of

skilled labour and improving lifestyle, according to a new report

called "Indian Gems and Jewellery Market - Future Prospects to

2011", by RNCOS, published in September 2009.

According to the same report, the Indian gems and jewellery

sector is expected to grow at a compound annual growth rate

(CAGR) of around 14 per cent from 2009 to 2012.

According to industry experts the consumption of diamond

jewellery in India is expected to touch US$ 6.41 billion in 2012.

Presence of Traditional Pockets of Jewellery Manufacture

Jewellery crafting by traditional goldsmiths is confined to a

few regions in India. These pockets are widely separated and

involve craftsmen whose skills have been handed down over

generations.

Surat is an important diamond processing centre, which

exports around 80% of the production and has more than 3,500

diamond processing units.

22

Jaipur is a key centre for polishing precious and semi-

precious gemstones.

Delhi and its neighbouring states are famous for

manufacturing silver jewellery and articles.

Calcutta is popular for its lightweight plain gold jewelry. This

category of jewellery finds a large market in Tamil Nadu.

Hyderabad is the centre for precious and semi-precious

studded jewellery.

Nellore is a source for hand made jewellery that has been

supplying the Chennai market for quite a few decades. Belgaum

in Karnataka and Nellore together specialise in studded

jewellery using synthetic or imitation stones.

Coimbatore in Tamil Nadu specialises in casting jewellery.

Trichur in Kerala is another source for lightweight gold

jewellery and diamond cutting.

Mumbai is the centre for machine made jewellery. The city is

also India’s largest wholesale market in terms of volume.

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The unorganized sector

The sector is largely unorganised at present with a small but

growing organised sector. The Indian gems and jewellery sector

is largely unorganised at present. There are more than 15,000

players across the country in the gold processing industry, of

which only about 80 players have a turnover of over $4.15

million.

There are about 450,000 goldsmiths spread throughout the

country. India was one of the first countries to start making fine

jewellery from minerals and metals and even today, most of the

jewellery made in India is hand-made.

The industry is dominated by family jewellers, who constitute

nearly 96% of the market. Organised players such as Tata with

its Tanishq brand, have, however, been growing steadily carving

a 4% market share. As India’s jewellery market matures, it is

expected to get more organised and the share of family jewellers

is expected to decline.

There are more than 6,000 players in domestic diamond

processing industry. The average gestation period for setting up

a diamond cutting and polishing unit is 15 months. The low

24

gestation period, coupled with low capital cost allows easy entry

into the sector.

This has led to the industry being largely characterised by a

large number of small scale players. However, just as in the

case of jewellery, the share of the organised sector has increased

significantly in recent years due to an increase in demand for

better and finer quality finished goods.

25

3. COMPANY STRUCTURE

3.1 LEGAL STRUCTURE

The company is to be established as a partnership firm

including the following promoters, who would form the

management team of the company

Fazin Bin Ummer, Managing Partner

Sakeer Hussain Partner

3.2 MANAGEMENT TEAM

The following are the qualifications and the experiences of

the promoters along with the areas of concentration in the

company

Fazin Bin Ummer, MBA(Marketing) would be involved in

Marketing and sales

Sakeer Hussain has 10 years of experience in the the

Gold Industry having worked closely with goldsmiths as

well as in a Jewellery hence would be involved with

operations and would co-ordinate with the

vendors/goldsmiths.

26

3.3. NON-MANAGEMENT TEAM

The other employees needed to run the company are the

following:-

Designers-they will be having experience in designing

jewellery and will be skilled in software like Matrix 3d, ,

3design, Jcad, Jewelcad, DelCAM, ArtCAm etc

Marketing/sales team-they will be having experience in

working in the gold industry and there would be specialist

dealing in various areas like Gold, platinum, Diamonds,

Gems, Rings etc.

Follow up team - This team has to co-ordinate with the

sales team once an order has been placed. They get in

touch with the vendors for price estimation , deliver

period etc and revert with this information to the sales

team. They make sure that the product is finished on time

by the vendor and couriered to the salesmen and he

delivers it personally to the customer.

27

4. MARKETING PLAN

4.1.PRODUCT DESCRIPTION

Necklaces

Necklaces are bands or chains looped continuously to adorn

and accentuate the neck. Our range of necklaces is diverse and

we don’t just give the client a choice of designs but custom

make it to suit and enhance your personality. Everything from

the design of the loops and links to the design itself is

customizable, even right down to the choice of materials used.

The metals used in the necklaces are usually gold & silver and

precious stones are used to break up the monotony.

Pendants

Everything from color, design and detail goes through intense

scrutiny to ensure that the pendants you wear are exclusive and

individual. Pendants are extremely popular and though designs

can be traditional and ethnic, the ornaments themselves are

light and can be worn to match any occasion. These custom

designed, handmade pendants bring sophistication and verve to

28

the wearer’s personality. Ornately designed pendants that will

display the intricacies of its designer’s vision and the skill of its

craftsman or simply stunning subtle sparkles, whatever is your

fancy we have the perfect pendant to swing around your neck.

Earrings

Off late traditional styles of jewelry design are making way for

newer schools of thought and more contemporary design. We

design understanding the global trends and accordingly design

exquisite jewelry keeping in view both the traditional as well as

contemporary influences.

We offer an astounding range of elegant earrings that speak

eloquently of the workmanship that goes into each and every

unique pair of them. Whether you like to wear the jewels on long

strings or prefer them fitting squarely in place, we design with

you in mind. Our range of uniquely designed earrings are

crafted in different metals with rare stones embedded in them

as embellishments in various permutations.

Rings

The designs used for making rings are simple and subtle to

enamor people of all age groups. Each ring is made strong and

29

the wearer’s comfort is formost in our minds. Which is why we

create exclusive designs that are unique to the individual. The

rings are made in the noble metal; gold but are also available in

silver and platinum should the customer otherwise. Originally a

traditional ornament especially in the west, where a ring is a

symbol of matrimony, today it is widely used as a fashion

accessory that can be worn in various designs and details on

any or all finger(s).

Bracelets

Bracelets have been in use since ancient times as bands or

chains encircling the wrist or arm. Fashion today dictates

bracelets created in enticing forms to accentuate feminine

elegance. Traditional craftsmen, who have learnt the art from a

long line of descendants are employed to create designs that

make each bracelet unique, contemporary and yet possessing a

sense of timelessness.

Bangles are just bracelets without clasps. Worn in multiples

usually, they are also used singularly or in doubles. In India the

bride is almost paranoid about her bangles which are

considered by many communities to be a symbol of well-being of

her spouse. Today it is worn with style unlike the dictates of

30

ritual and tradition. The design philosophy we follow enables us

to experiment with influences both traditional and

contemporary, enabling you to wear your personality on your

arm.

Bangles and bracelets are created using the best grade metals

engraved with designs ranging from traditional motifs like

celestial bodies to vivid flora and fauna patterns.

Embellishments such as precious stones and other metals can

be embedded for a stunning effect. Motifs and emblems can be

carved out or embossed in to the metal be it gold, silver or

platinum. There are many different types of crafting gold and

gold studded jewelry.

4.2 PRICE

The prices are set for the product based on the “Market

based pricing strategy”, but at most of the times a bit premium

is charged owing to high levels of customization but that’s

common and acceptable for most niche market products and

services.

31

4.3 PLACE / DISTRIBUTION CHANNEL

The presence would be there both as an online presence

initially and after the business getting stability will have retail

presence also in cities with high demand. The base for the

operation would be in Thrissur where the team of designers will

be due to the registered office being there. Thrissur is chosen

owing to logistical advantages because of availability of very

highly skilled goldsmiths in the region.

4.4 PROMOTION

During the initial stages of the company, the promotional

measure would be aimed at the objective of awareness

generation and to gather as much publicity as possible and

thereby increase brand equity. For this purpose the following

media will be used

Cable ads

Radio spots

Internet website

Direct mail

Print ads

mobile advertising

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5. FINANCIAL PLANS

Table 1-Operational Expenses

2010 - 11 2011 - 12 2012 - 13 2013 - 14 2014 - 15

Office Expense

Salaries

12,60,000

22,62,000

28,64,400

34,37,280

41,24,736

Selling Expenses

12,60,000

31,92,000

55,10,400

80,82,480

99,08,976

Office Rent

96,000

1,05,600

1,16,160

1,27,776

1,40,554

Office Electricity

12,000

12,200

12,400

12,600

12,800

Phone

36,000

36,600

37,200

37,800

38,400

Internet

24,000

24,400

24,800

25,200

25,600

IT

30,000

30,500

31,000

31,500

32,000

Stationeries

24,000

24,000

24,000

24,000

24,000

Misc

24,000

24,000

24,000

24,000

24,000

Branding & Marketing

Website

50,000

-

-

-

-

Catalogue

20,000

10,000

10,000

10,000

10,000

Website Maintenance

8,000

8,000

8,000

8,000

8,000

ERP Maintenance

30,000

30,000

30,000

30,000

30,000

Total Expenses

28,74,000

57,59,300

86,92,360

1,18,50,636

1,43,79,066

33

Table 2 - Sales Projection

Particulars 2010 - 11 2011 - 12 2012 - 13 2013 - 14 2014 - 15

Sales Reps In Metro 6 12 15 15 15

Sales Reps in Tier 1 6 12 15 15 15

Sales Value Gold 1,49,33,333 3,28,53,333 5,25,65,333 8,41,04,533 13,45,67,253

Sales Value 1,400 3,080 4,928 7,885 12,616

Per Sales

Rep 117 128 164 263 421

Gem sales Value 8,16,667 11,22,917 14,37,333 22,99,733 36,79,573

Total Sales Value 1,57,50,000 3,39,76,250 5,40,02,667 8,64,04,267 13,82,46,827

34

Table 3- Projected Income Statement

PARTICULARS 2010 - 11 2011 - 12 2012 - 13 2013 - 14 2014 – 15

INFLOWS

SALES 1,57,50,000 3,39,76,250 5,40,02,667 8,64,04,267 13,82,46,827

TOTAL REVENUE 1,57,50,000 3,39,76,250 5,40,02,667 8,64,04,267 13,82,46,827

OUTFLOW

Raw material & purchases 1,32,30,000 2,85,40,050 4,53,62,240 7,25,79,584 11,61,27,334

Power 12,000 12,200 12,400 12,600 12,800

Wages and salaries 12,60,000 22,62,000 28,64,400 34,37,280 41,24,736

Rent & others 3,42,000 2,45,100 2,57,160 2,70,276 2,84,554

Depreciation plant & office eq - 1,53,000 1,98,400 2,70,720 3,00,576

Interest 66,000 66,000 60,500 46,750 30,250

Selling expenses 12,60,000 31,92,000 55,10,400 80,82,480 99,08,976

TOTAL EXPENDITURE 1,61,70,000 3,44,70,350 5,42,65,500 8,46,99,690 13,07,89,226

Difference -4,20,000 -4,94,100 -2,62,833 17,04,577 74,57,601

Tax - - - 5,96,602 26,10,160

Pat -4,20,000 -4,94,100 -2,62,833 11,07,975 48,47,440

Add depreciation - 1,53,000 1,98,400 2,70,720 3,00,576

NET PROFIT -4,20,000 -3,41,100 -64,433 13,78,695 51,48,016

LOAN REPAYMENT - 50,000 1,25,000 1,50,000 2,82,000

RETURNS AFTER LOAN REPAYMENT -4,20,000 -3,91,100 -1,89,433 12,28,695 48,66,016

35

Table 4 - Projected Balance sheets

Particulars Initial 2010 - 11 2011 - 12 2012 - 13 2013 - 14 2014 - 15

LIABILITIES

Capital 7,35,000 7,35,000 7,35,000 7,35,000 7,35,000 7,35,000

Borrowings 6,00,000 6,00,000 5,50,000 4,25,000 2,75,000 -

Transferred from P & l - -4,20,000 -3,91,100 -1,89,433 12,28,695 48,66,016

Creditors - 11,81,250 14,17,500 14,17,500 15,35,625 14,17,500

Total 13,35,000 20,96,250 23,11,400 23,88,067 37,74,320 70,18,516

ASSETS

Office assets 7,65,000 9,92,000 13,53,600 15,02,880 12,02,304 9,61,843

Building advance 40,000 40,000 40,000 40,000 40,000 40,000

Debtors - 6,56,250 7,87,500 7,87,500 8,53,125 7,87,500

Cash with bank 5,30,000 4,08,000 1,30,300 57,687 16,78,891 52,29,173

Inventory - - - - -

Total 13,35,000 20,96,250 23,11,400 23,88,067 37,74,320 70,18,516

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6. CRITICAL RISK FACTORS

7.1 LABOR RISK

The main risk associated with the project is the labor risk,

which arises due to the shortage of skilled designers. Despite

the fact that the area of business establishment has a good

worker population, the scarcity of workers for related business

might cause labor shortage issues even during the initial stages

of the company.

7.2 MARKETING RISK

The company would have to identify alternate channels

and customers at the earliest. Though this partnership can

provide a good foundation in the initial stages, it might not

profit the company in the long run if consistent orders are not

received.

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7. CONCLUSION

The Indian Gem and Jewel industry is the fastest growing

jewel market in the world. The country is gaining prominence as

an international sourcing destination for high quality designer

jewellery. The presence of highly skilled, low-cost labour enables

India to design and make high volumes of exquisite jewellery at

relatively low cost.

The consumer consciousness increasing, the future of

organized retail in India is very bright. The organised sector of

the gems and jewellery industry in India is estimated to grow at

40 per cent. The number of gold retailers in the country has

increased by 40 per cent since the year 2000. Therefore we can

say that the industry looks very promising and is steadily

improving. There is a constant increase in disposable income,

people are spending more and are aspiring for a better lifestyle.

This is the right time for a Custom Made Jeweler to enter

the market. The company should put in place an integrated

marketing approach. It should focus on building brand equity

38

and making the people realize the advantages of a custom made

jeweler.

Once if that is done successfully then even with a

premium charged the company can make inroads in today’s

gem and Jewel industry.

39

Bibliography

Websites

– http://www.gjepc.org/

– http://goldprice.in/2005/04/india-gold-jewellery.html

– www.gold.org/

– http://en.wikipedia.org/wiki/Jewelry#Jewellery_market

– http://www.paynesjewelry.com/

– http://handcraftedjewelry.imagesjewelers.com/

– http://www.culturalindia.net/jewellery/types/custom-jewelry.html

– http://www.india-crafts.com/jewelry/custom-jewelry.html

– http://www.artofjewellery.com/guestarticle.aspx?id=28

– http://www.ibef.org/artdispview.aspx?in=25&art_id=25314&cat_id=439&p

age=1

– http://www.resourceinvestor.com/News/2007/8/Pages/India-s-Gems-and-

Jewellery-Market-is-Glittering.aspx

– http://www.angeljewel.com/index.php/custom-jewellery/gents-bracelets