We all make mistakes. It’s part of being a human being. You are not perfect, and you will never be perfect. Still, the fear of erring can be huge – at times keeping you from doing what you know you really want to do.
Often, the most powerful weapon you have against failure is how to know what NOT to do before you begin. When talking about a crafting business, there are some mistakes that are made over and over again that can stop your small business before it even starts.
First and foremost, the novice seller will price their product too low in hopes of selling it quicker thus insuring success. Unfortunately, this has a backwards effect on the business. You end up working yourself to the bone to sell your product for just a small profit and saturate the market with your work.
Remember, you should not only make sure your pricing includes your materials, but there are other factors to work in as well. These include marketing (flyers, show feeds, traveling expenses, etc.) and your labor. After all, you want to make money and this IS your business. You should expect to be paid for your time.
You should have a solid business plan to refer to at all times. You don’t need to hire a professional business planner, all you need is to have a well-thought out strategy as to how and where you will be selling your crafts.
Think about what shows you plan to attend and the costs associated with being at those shows along with pricing supplies and your marketing materials. When you think these things through and write them down before you start selling, you will be more apt to stay on track and keep you from over-extending yourself throughout the course of a year.
Of course, there are times when a business plan needs to be modified, so prepare for this as well. You may hit on an amazing product that sells like wildfire, and you will have to adapt to meet your market and customers. Look at your original business plan often and make changes as needed according to your needs.
Don’t bite off more than you can chew. Starting off too big is a huge mistake that many beginning crafters make. Many will borrow thousands of dollars in anticipation of being able to pay it back quickly. This very rarely happens, so keep your initial investment low and grow as your business does.
Buying the best of everything might seem like a good investment at first, but when the “salad days” come, those loan payments can break your business in a hurry.
On the same note, you should begin selling your crafts at local craft shows to begin with and move your way up to the top-rated shows. Local craft fairs will have more reasonable booth fees and increase your profit margin. Once you’ve succeeded in a local market, then you can look at the bigger shows.
Be wary, though of attending the wrong shows, especially if your craft is fine art. If people are paying out the nose for hamburgers and hot dogs, you would tend to think that they won’t complain about the price of your high-end crafts. This is completely and totally wrong!
Fine crafts and artwork belong at shows where customers can appreciate the work involved. This show is not a street fair; it’s more a showcase of professional artists.
Most people hate to make budgets. I know I do. This is mostly because they can be constraining and difficult to follow. Because they hate to even try to put a budget together, many people just don’t.
A budget is not some elaborate financial statement that takes days to write. It’s simply a way for you to tell your money what to do instead of your money telling you what it is going to do.
At the end of each month, plan next month’s budget based on your performance. Start with minimum expenses, which are things you must have to function like show fees,
supplies, etc. Then work your way down the list to thing you would like to do if you make enough money.
When planning your budget, be sure to allow for savings that will get you through the lean times – and there will be some lean times. That amazing show you attended last year might not be as profitable this year. This can put a huge dent in your profits and expenses and make you upside down.
If you have funds available for emergencies, you will be able to stick it out through the times when you don’t make enough money to meet expenses.
It’s best to keep three to six months of operating expenses in savings. Sure, this could be a substantial amount, but having this type of savings readily available, in times of need, can mean saving your business.
Some people will like your product, and some people won’t. It’s a fact, so get used to it. There are all types of people out there, too. Not everyone will be nice when looking through your wares.
Two comments you can almost count on hearing at nearly all events are:
“I can get that for half the price at Wal-Mart.”
“I’ll just make it myself.”
I have come up with some snappy comebacks specifically for these rude comments. You may choose to say them or think them, but they seem to work pretty well. Try:
“I can get that for half the price at Wal-Mart.”
“Say Hi to the greeter for me”
“I’ll just make it myself.”
“But will you?”
Unfortunately, there are obnoxious people in the world and it seems many of them like to practice their offensive skills at craft shows. It’s important that you not take any negative comments personally. Put very simply – Don’t listen!
Seriously, if these people had the creativity, skills, and dedication that you do, they would be at home making their own crafts instead of making rude comments to you. Pay attention to construction criticism (such as adding a color), but do not beat yourself up because of comments from someone who has nothing else to do than harass crafters.
Be careful of following trends. You decided to go into the crafting business with a product that you love and are good at making. Too often, new crafters will see a fellow crafter sell their product like wildfire and think that they should follow suit with the same product at a different show.
Remember that trends come and go. Craft business owners who follow those trends come and go too. Of course, you should create a product that may be trendy in the interest of your business. If snowmen are “in” for the holiday season, create some to complement your other items, but never ever change your product line completely to follow the crowd.
Having a business means you will have to pay taxes. Like it or not, Uncle Sam will get his cut of your profits – and you need to plan for that. One of the number one reasons
for small business failure is poor tax planning. If you want to stay in business, plan for those taxes.
It’s always best to have an accountant, but you can use QuickBooks or some other money management software to do your taxes. The main thing to remember is that when you make money, there will probably be taxes due. Don’t wait until April 15th to try and find the money that will be due. Plan to have it on hand.
Keep a separate checking account for your business. Keep any tax savings in this account for easy transfer. Believe me, you’ll be glad you have it there and won’t have to worry when tax filing time comes.
Finally, don’t spend too much on your new business. Do you really need a brand new trailer to haul your display and inventory from show to show? Go for the used trailer instead or buy a larger vehicle like a van.
The same goes for equipment and supplies. Used equipment does the same job at half the cost. This includes anything you invest for your booth like a canopy or cash register. Scout out the Internet for discount wholesalers for your supplies. There are plenty of places out there who can save you money on everything you need to make what you will sell.
Remember! you’re in business to make money, not spend it!
When you start a business – and this will be a small business – there are many things to take into consideration. You will definitely need to figure out how to market your product, so you’ll need to devise a marketing campaign. One unique part of an effective craft marketing campaign is telling your story.
We hope you enjoy this full craft fair guid to sell your crafts at craft fairs, this is the Third Part, find the full parts here:
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