The Jewelry CFO Playbook
SECTION 1: ROLES & RESPONSIBILITIES
1.1 Financial Planning & Control
The CFO is responsible for the complete financial architecture of the chain from individual store P&Ls to consolidated group reporting
Responsibility
Details
Budgeting & Forecasting
Annual budgets per store and at group level; monthly reforecasting driven by gold price and seasonal demand shifts.
Seasonal Cash Flow Planning
Jewellery is intensely seasonal Eid, weddings, Diwali, New Year. CFO must model cash needs 90–120 days ahead.
Capital Allocation
Deciding investment split between new stores, inventory refresh, marketing, and technology.
Management Reporting
Monthly P&L, balance sheet, cash flow, and KPI dashboards for ownership or board
Cost Control
Monitoring store opex, staff costs, rent, and overheads against budget.
1.2 Inventory & Working Capital Management
This is the single most critical area for a jewelry CFO. In most jewelry businesses, 70–85% of total assets are tied up in inventory. Poor inventory management can silently destroy the business.
Responsibility
Details
Daily Inventory Valuation
Gold, diamond, and gemstone inventory must be valued at current market rates daily not at purchase cost.
Owned vs Consignment Tracking
Clear segregation of stock owned by the business vs. stock on consignment from vendors often mixed incorrectly.
Slow & Dead Stock Management
Regular ageing analysis unsold inventory for 12+ months must be actioned (melt, return, or discount).
Open-to-Buy Budgeting
Controlling how much new stock can be purchased based on current inventory levels and sales velocity.
Vendor Payment Cycles
Negotiating terms with gold suppliers, diamond dealers, and manufacturers to optimize working capital.
1.3 Treasury & Commodity Risk Management
Gold is a globally traded commodity with significant price volatility. A jewellery retailer holding large physical inventory is inherently exposed to commodity price risk. Managing this is a core CFO responsibility.
Treasury Function
Detail
Gold Price Hedging
Using forward contracts or gold loans to lock in metal costs and protect margins.
Foreign Currency Management
Gold is USD-priced globally; local currency exposure must be actively managed
Gold Loan Management
Managing gold loans from banks borrowing gold, selling it, buying back at maturity common in the trade
Banking Relationships
Maintaining credit facilities, overdraft lines, and LC facilities for import purchases
Cash & Liquidity Management
Daily cash position monitoring across all stores and bank accounts
1.4 Compliance, Audit & Regulatory
Jewelry retail is classified as a high-risk sector for money laundering globally. The CFO bears significant compliance responsibility.
