Question

In: Finance

What are the financial implications of a gemstone business plan?

What are the financial implications of a gemstone business plan?

Solutions

Expert Solution

Financial implications of gemstone business plan are as follows-

A. It helps in diversification of portfolio of investors because this is a completely different business and it is not impacted by the the economic cycles much because these are precious stones and they have and uniform demand.

B. Majority of experts believe that buying gemstone is similar to the act of investing in art so it is best to buy precious gems because you like them and find them beautiful rather than aim to use them solely as a form of investment.

C. These gemstones are low in supply so they are expensive in nature and the value of gemstone is based upon the supply.

D. One need to to choose the types of gemstones and find quality cutters along with determining the audience if one wants to start the the gemstone business.

E. The cost of running a business related to gemstone can be very high, depending upon the gemstone you are buying.

F. The profit margin on gemstones are higher.


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