Craftier Shares a 101 Guide on How to Start a Lab-Grown Diamond Business

Starting a small business isn’t a cakewalk; it requires a deep understanding of what works best and sharp business acumen. Especially when it's a Diamond brand, one can only imagine the amount of effort that goes into it; however, it's about to change. If you're someone who aspires to start a Lab-Grown Diamond Business, then this article is your holy grail! From licenses and certifications to advantages and challenges, in this 101 guide, Local Samosa is in conversation with Achal Gupta, the founder of Craftier, a lab-grown diamond brand. Let's begin, shall we?

A Strong Foundation

• Have clarity on brand ethos, knowledge about the market (ethical sourcing), and acquisition of quality certification
  
  
• Awareness of target demographics
  
  
• A well-researched pricing strategy. One should also decide whether one is going to manufacture diamonds or will source them from reputed labs.
  
  
• Partner with manufacturers who offer diamonds certified by the IGI (International Gemological Institute). 

Achal Gupta states, “The runaway success of Craftier lies in maintaining strict quality control and working only with certified suppliers. So, a new player in the market should look for labs or suppliers with proven ethical sourcing practices. They must be committed to sustainability and should be capable of maintaining a consistent supply chain.”

Pros and Cons of Manufacturing Your Own Diamonds

Pros

• Lower upfront investment, easier scalability, and greater flexibility in managing inventory and designs
  
  
• Complete control over quality and production, offers better margins in the long term, and provides opportunities for innovations and customisations

Cons

• It also comes with limitations such as reduced control over customisation and a reliance on suppliers for consistent quality and availability. 

“One accrues these benefits at a high upfront cost and massive investment in machines and infrastructure, apart from the need for specialised talent to run operations. Moreover, establishing a manufacturing setup is a time-consuming process”, says the founder of the brand. He continues to add, “In light of all these aspects, Craftier has adopted a sourcing-focused model that prioritises certified diamonds while emphasising strong design, a curated retail experience, and luxury at affordable pricing.” 

What Should One Look for When Choosing a Supplier for Lab-Grown Diamonds?

• Certifications: Ensure all diamonds are IGI or GIA certified.
  
  
• Ethical practices: Transparency in sourcing and labour.
   
• Quality control: Consistency in grading and clarity.
  
  
• Reliability: On-time delivery, inventory variety, and responsive communication.
  
  
• Pricing: Competitiveness and margin flexibility for resale.

Licenses or Permits are Required to Legally Start and Operate a Lab-Grown Diamond Brand in India

Starting a lab-grown diamond brand in India typically involves obtaining several key licenses and permits, including:

• GST registration
   
• BIS certification for gold jewellery
  
  
• Trade license
  
  
• Factory license if you foray into manufacturing
  
  
• State-specific retail license
  
  
• Trademark registration for brand protection
  
  
• Import-Export Code 
  
  
• For the producers of LGDs, environmental compliance is also necessary.

Local Samosa also asks Achal Gupta, “Are there any specific industry certifications that build trust with customers, such as IGI or GIA? How important are these certifications?” he replies, saying, “Yes, IGI certification is crucial in India. So, we ensure every lab-grown diamond by Craftier is IGI-certified to offer customers both trust and confidence in every purchase. Certifications are synonymous with authenticity, a non-negotiable factor in the diamond industry, especially for first-time buyers and in the growing segment of eco-conscious consumers.”

How to Ensure Transparency & Ethical Practices in a Lab-Grown Diamond Business

• Source diamonds from certified labs with verified sustainability standards
  
  
• Understand the importance of certifications
  
  
• Eco-friendly packaging
  
  
• Honest pricing model

To ensure a better experience, Craftier has also introduced a Piggy Bank Scheme that further builds trust. In parallel to these practices, the founder suggests educating the target audience through informative content on various media verticals. 

Essential Tools or Equipment

For the retailers in this industry, the essential tools are grading equipment:

•  Loupe
  
  
• Microscope
  
  
• Diamond tester

It also requires jewellery design software like:

• CAD
  
  
• Inventory management systems
  
  
• POS systems for retail boutiques
  
  
• E-commerce platform for online sales
  
  
•  HPHT or CVD reactors
  
  
• Polishing machines
  
  
•  Advanced spectrometers

One might ask, is it necessary to have high-end tech or machinery? Achal Gupta believes that it depends on the mission and vision of a business and the resources available to the entrepreneur. However, one can start by sourcing certified diamonds, working with skilled artisans, and leveraging boutique or e-commerce retail. In our case, we started with a flagship boutique in Hisar before expanding to Delhi NCR. To me, growth is a gradual process guided by market readiness and location strategies.

Design in Jewellery-Making

Are you wondering if design and jewellery-making play a big role? Let’s hear from the founder, “Design is critical to differentiate a brand from a plethora of other players in the market. Craftier focuses on daily-wear affordability and bold statement pieces that speak to a wide demographic. A unique aesthetic, high craftsmanship, and culturally relevant designs help build a distinct brand identity. For new brands, creative design is a merit to stay ahead of the curve.”

Challenges Faced by First-time Entrepreneurs

First-time entrepreneurs in the lab-grown diamond industry often face challenges such as convincing consumers of the value of lab-grown diamonds, finding reliable suppliers, navigating high competition in traditional markets, and managing costs without compromising on quality. Here are a few ways to tackle these challenges:

• Educate the market on the sustainability and affordability of LGDs.
  
  
• Targeting underserved areas like Tier 2 cities
  
  
•  Leveraging storytelling to build emotional connections and trust
  
  
• Offering flexible pricing or payment schemes

As we come to an end, we asked the founder of Craftier, “Can you share any lessons you’ve learned from building Craftier that you wish someone had told you earlier?” To which Achal Gupta affirms, “From my perspective, the most crucial lesson learned from building Craftier would probably be to first realise the vast but unserved demands coming from Tier 2 and 3 cities; markets that remain ignored but fairly aspirational in spirit."

He continues to add, "Affordable luxury is not an oxymoron; instead, it stands out as a vivid paradigm of democratised desire and an example of how elegance can be rendered affordable. Scaling the brand also requires patience and a vision apart from equipping it with certifications and rigorous quality control procedures. Last but not least, equity for women should be a strategy for growth rather than a CSR initiative. This value proposition resonates well with Craftier’s consumer base.”