Can Your Craft Business Support a Family? Part 2
When a craftsperson is serious about his hobby, it’s common to speculate whether or not the hobby could become a business capable of supporting a family.
Last month, we looked at some of the commonsense basics needed to successfully turn your home craft hobby into a business profitable enough to support a family.
This month, we’ll look at some tips to increase your chances of succeeding at that business.
Don’t give up your day job
As tempting as it may be to take the plunge and quit your job in order to concentrate on transitioning from a hobby to a business, don’t.
The reason is that a business takes time to grow. Seldom does a craft business start out with such a bang that the owner can support her family right away. Such things take time to build in both reputation and sales.
And, if you are lucky enough to have a day job which provides benefits such as health insurance, it would be foolish to risk quitting in the hope that your craft will bring in sufficient income to pay your own insurance. If you’re single and have no children to support, then maybe you can risk it. But if you have a family depending on you, don’t.
Besides, in this uncertain economy it would be foolish indeed to trade security for insecurity. If you have a steady paycheck, don’t jeopardize it until you are certain your craft business can replace your outside income.
However, that doesn’t mean you can’t aggressively build your craft business on the side. Evenings, weekends and holidays all provide opportunities to market your craft, streamline your techniques and otherwise build your business until you reach a point where it begins to rival the take-home pay from your day job.
Of course, until you are rolling in dough from your home craft business, it behooves you to live frugally while you are building your business. It does no good to make $2,000 in a month selling your products only to blow $2,000 on a big-screen TV. Initially, all your profits will be needed just to grow your business. At this stage, patience and discipline are every bit as important as your production techniques.
Before you take the plunge into a home craft business, it’s always helpful to ditch the debt. Take the time to pay off that credit card, pay down your student and vehicle loans, and otherwise watch your spending. Your home craft business has a much better chance of succeeding if you’re not tottering under the load of debt from your more lavish days.
There are endless resources available on budgeting and thrift and other related matters, so I won’t cover them here. However, just keep in mind that those craftspeople who are considered “successful” in their business live within their means.
Sometimes we love what we do so much that we don’t have a balanced perspective on whether it has serious moneymaking potential. We love our craft and that’s why we have dreams of turning it into a successful business. To suggest that not enough people are interested in buying our crafts is…well, insulting.
But—trust me on this—it will save you a lot of grief in the end if you can distinguish between what can support your family, and what should be just a weekend hobby of earning pocket change at local crafts shows (there’s nothing wrong with that!).
By looking at your product unemotionally and rationally, you will be able to recognize what crafts have the potential to be built into a successful business, and what should stay a hobby.
Catering to passions
One of the most overlooked secrets to building a successful home craft business is to be able to cater to peoples’ passions. Remember this: people are fanatic about their hobbies.
Your next-door neighbor might be CEO of the local bank—it’s what he does for a living—but by golly what really makes his eyes sparkle is talking about the 1911 Model T Ford he’s restoring. He will spend thousands of dollars and endless hours of time tinkering on that Model T.
You—the craftsperson—have the potential to cash in on that kind of passion.
Because our home craft business is making hardwood drinking tankards, we learned that people who attend Renaissance Faires will spend lots of money making sure their costumes and accouterments are authentic. Since our tankard designs are historically accurate, they’re a natural fit for history buffs. Same goes for just about every living history reenactment group out there—Civil War reenactors, Medieval, Renaissance, etc. We also cater to Oktoberfests, beer festivals, Shakespeare groups, and other passionate people.
So how does this apply to your craft?
It applies in two ways. First, you must target your marketing appropriately. You won’t do well selling your handcrafted lace doilies and crocheted doll dresses at a motorcycle rally. Let’s face it, motorcycle people generally are not passionate about lace doilies. It’s not a marketing match. You need to sell things that motorcyclists love.
Second, if you can modify your craft to cater to passions, then you gain a lot of flexibility to cross-target your market. If you take your selection of handcrafted candles to a candle show, for instance, then you’re surrounded by nothing but other candlemakers. But if you take your specialty Elvis/tractor/airplane/cat/speedboat/whatever candles to events that cater to people who love Elvis, tractors, airplanes, cats, speedboats, or whatever…people will buy them.
Hate Elvis or tractors or airplanes or cats or speedboats? It doesn’t matter. Remember, if you can’t tap into your own passions, tap into someone else’s. That’s the best way to succeed in a home craft business, by tapping into what people enjoy spending money on.
Why do you think that people who sell T-shirts do so well? They modify their product to cater to many markets by silk-screening appropriate slogans and pictures. If you can do the same with your product, your sales will increase.
It’s one thing to put your spare time into a hobby. It’s another thing entirely to apply yourself full-time to a home craft business. Can you motivate yourself?
Motivation is easy to come by when you’re doing something fun like piecing a beautiful quilt top or polishing a wooden tankard for a friend’s birthday present. But will you feel the same way when you’ve been working 20 hours per weekend, every weekend, making your product? And what about boring stuff like keeping accurate records for tax purposes? What about market research? What about advertising? What about all the not-so-fun things that are absolutely necessary for a business to be successful?
When you’re at an office with a boss and a paycheck providing the motivation, that’s one thing. But when you don’t have anyone looking over your shoulder, you need to provide the motivation yourself.
If you find yourself sleeping late every day and spending hours playing solitaire on the computer rather than facing your shop full of half-finished product, better rethink your plans to go into business for yourself.
The dreaded business plan
While I won’t go so far as to say that a formal business plan is essential for a home craft business, it sure does help to have goals written down, as well as the means to achieve those goals. Somehow when things are in black and white, they’re more doable. Or, more tellingly, you’ll decide they aren’t doable. Enough said.
It never fails to amaze me how those with a home craft business somehow think they’re excluded from the need to act professional.
Your preschooler may have the most adorable googly-voiced lisp this side of the moon, but that doesn’t mean he has to answer the phone during work hours. Just as you wouldn’t meet a client for lunch dressed in your pj’s, you probably shouldn’t answer your door that way either. And please, don’t print business cards full of froufrou and frills unless your business specializes in froufrou and frills.
In other words, when someone parts with his money to buy your product, they expect to deal with a professional. Be one.
Learn to talk
Learning to sell your product is obviously an integral part of your business. However, a surprising number of people aren’t able to talk about their product with enthusiasm, knowledge or salesmanship.
I recently attended a very large venue selling our crafts. Because of the sheer number of people that usually throng the booth, I hired a very nice young man to assist me in dealing with customers.
The trouble was, he was very soft-spoken. Customers could barely hear him, especially over the noise and chatter of the crowd. Even though he was enthusiastic to help and knowledgeable about the product, he didn’t generate any interest among the customers because he didn’t sound enthusiastic or knowledgeable. This may sound like a trivial issue, but when the difference is a show’s profit or loss, I assure you it’s not.
Learn to sell your product through speech. If you can’t discuss with animation and enthusiasm the merits of your craft, how can you expect anyone else to listen or agree? Or buy?
The 80/20 rule
The old axiom says that 20 percent of your efforts results in 80 percent of your sales. What this means is you should direct your efforts into aspects of your business that you know will bring the greatest results.
We knew a family who attempted to start a bed-and-breakfast. Superficially they had everything going—beautiful location, gracious hosting skills, elegant home. Trouble was, they directed 80 percent of their efforts into beautifying the house and only 20 percent into marketing, advertising and otherwise getting the word out that the house was open to visitors. Bottom line—they had a gorgeous place but no customers.
Had they flipped these efforts around and directed 80 percent into marketing and 20 percent into beautifying, they may have succeeded. Unfortunately, after two years they were forced to close their doors.
Dull but necessary
It’s the commercial side of things that can make or break your business. You might be the world’s greatest expert in your particular craft—I hope you are—but you must also become an expert on the dull but necessary business side of things as well.
One of these dull but necessary issues is taxes. In next month’s issue, I will feature tips and suggestions from bookkeepers and tax preparers who specialize in small home craft businesses. Because, like it or not, the tax man cometh to us all.TCR
Patrice Lewis is cofounder of Don Lewis Designs. She and her husband have been in business for 15 years. The Lewis family lives on 40 acres in north Idaho with their two homeschooled children, assorted livestock, and a shop which overflows into the house with depressing regularity.