Author: Handmade Business

What You Need to Know About Craft Business Insurance

What You Need to Know About Craft Business Insurance

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craftbusinessinsuranceAs craftspeople, we put a tremendous amount of effort into developing our manufacturing skills and business smarts.We’ve thought of it all: taxes, booth design and setup, merchant services accounts, product guarantees, wholesale distributors … the list goes on and on. Gosh we’re just brilliant, aren’t we?

But there’s one teensy weensy little detail craftspeople often forget: insurance.

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How to Create Your Own Brand Identity at a Craft Show

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Selling at shows or in galleries revolves around three things:
• Impeccably crafted, creative and innovative products designed to be “on trend” and developed to fill customers’ needs sell well. Products have to be the right look, scale, color, weight and an entire list of other criteria to make them desirable.
In this current business climate, functionality, be it real or implied, is a big factor in what people are buying. You are more likely to sell a customer something in this era if it has a use. If that use is only to make the customer feel good, it must be made obvious to them.
• You must be a good salesperson to make the most out of any sales venue. So many sales are blown in the greeting stage because artists don’t know how to sell their work. Sales are a language-based skill—when you learn to use effective language when selling, your sales volume will increase.
• The third element in the trinity of a sale is visual merchandising. Creating displays that cap­ture the customer’s attention, draw them into your space and sell your work is the objective! This third element is the focus here. How does one create compelling displays without spending a lot of money? When it comes to displays, it isn’t about how much money you spend, but rather about how creatively you showcase your work.
I always find it so interesting that as creative as artists are with regard to designing their work, when it comes to displaying it, they often take the easy-street approach. Many say, “I am just not good at display,” and give up. If you use shows to market your work, display is a part of your job. Currently, I am seeing a movement where artists are buying commercially available display systems that can be quick and easy, but the net result is that too many booths look exactly alike. This makes it hard for the customer to distinguish what is compelling about your product line, and makes it hard for you to build a recognizable brand.
When customers see you at a show, the visual of your booth should be the projection of a recognizable look—a brand identity. When customers see you at the next show, there should be a connection and memory of your display, your work and your image. I am not criticizing commercial displays or the use of them, this approach is right for some. However, the displays that I see grabbing the attention of customers are almost always custom-made.
Displays that employ conscious design decisions that work with the product line go a long way to create that special look—one that will resonate with customers. Effective custom-built displays not only create a mood and look that is unique to your line, but they also clearly distinguish you from your competition. Good design in your display will result in a sales tool that works for you, your customers and your product line better than any commercially available display.
By using careful and creative display solutions, you can save a lot of money compared to commercially available displays. Do not be afraid to use the same creativity in designing your booth as you use to create your work. If you are daunted by how you will build it, get someone to build it for you.
The first rule is that the display must work with the merchandise and vise versa. Plus, the display must speak to your ultimate customer who will buy the product. Sales will suffer if the demographic you are trying to sell to cannot relate to your colors or even the look of your booth. Keep in mind, your display should stimulate the senses.
The visual sense of your display needs to be one that will draw customers in to your space. Meaning, they will cross that imaginary line between the aisle and the front of your booth. The second sense that needs to be tweaked is the sense of touch. When your displays prompt your customers to touch something, you will see a spike in your sales.
An effective booth must get the customers to stop, take notice and be drawn into your space. When they do come in, something has to hold their attention and get them to touch the products. Your well-honed sales skills should take over at this point and, if you are effective, you will close a sale.
Too many booths send the message “look but do not touch.” Or sometimes things are displayed in such a way that the message is sent that you shouldn’t touch—key among these are shelves that are too deep, tables that are too wide and if the product line is out of easy reach. In most cases with commercial systems, you cannot determine the depth of a shelf (they mostly come as one size fits all).
Custom displays (ones designed by you) have so many advantages over commercially available systems. Realize that first of all, display isn’t “rocket science”—that is really all you need to know to empower yourself to be a display designer. If you go to a couple shows, stores or galleries and observe what creates visual magic, you will realize that you have what it takes to be a display designer. By analyzing your findings and asking a few questions, you will determine what works and what doesn’t. Then, reinterpret all your observations into a design that works for you, your product line and your customers—one that helps you build your brand.

booth-brand-identitySelling at shows or in galleries revolves around three things: 
• Impeccably crafted, creative and innovative products designed to be “on trend” and developed to fill customers’ needs sell well… 
• You must be a good salesperson to make the most out of any sales venue…
• Creating displays that capture the customer’s attention, draw them into your space and sell your work is the objective…

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Which Business Insurance Is Right for You?

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inding business insurance that’s “just right” for your art or craft business can make you feel a bit like Goldilocks (of the Three Bears fame). Having too little or the wrong type of coverage could be disastrous for your business; paying too much for your coverage because the insurer lumps you in with bigger businesses can be just as bad.
Luckily, your search for the right business insurance can have a happy ending. All it takes is a little understanding of the different types of available coverage and a good assessment of your art/craft business needs.
Depending upon whether your art/craft business is a part-time endeavor run by one person, or a full-time operation with several employees, your business insurance needs can typically be handled by one or more of the following four types of policies:
Homeowners Policy
In-Home Business Policy
Business Owners Policy
Event/Show Insurance
It is very important to make sure you have the right kind of policy and coverage for your business. Each of these policies fulfills a certain need and has its place. Let’s take a quick look at each one and learn about the factors that may help determine what coverage is best for your art/craft business.
Homeowners Policy
It’s common for people to run art/craft businesses from their homes or apartments. While they may assume their homeowners policy will cover their business, most home-based business owners are unaware that a homeowners or renters policy probably does not cover their business. A typical homeowners policy provides only minimal coverage for business equipment and doesn’t offer any coverage for liability, business interruption and business activities that take place outside your home (such as craft shows). That means you’re likely not covered adequately if your equipment or inventory is damaged, lost or stolen, or if a customer visiting your home slips and falls, resulting in an injury.
Your homeowners policy might let you add an endorsement to increase the business equipment limit. Still, that limit may not be adequate to cover the true value, and it will generally exclude any type of business-related liability, or will only cover on-premise occurrences, leaving you without liability coverage at craft shows and other events away from your home.
Overall, you may find that a homeowners policy is not the best choice to protect your business risk. Fortunately, you have other options.
In-Home Business Policy
If you operate an art/crafts business from your home, you may want to consider an in-home business policy. This is a policy you purchase separately from your homeowners coverage. These policies are designed specifically to handle the business insurance needs of a home-based business and cover business personal property (equipment, inventory and supplies) and business-related liability. In addition, an in-home business policy can provide coverage for lost income and the loss of valuable papers and records that occur as the result of a covered loss.
An in-home business policy provides coverage for losses or damage from business activities conducted in your home or off-site at some other location. That means your coverage can extend beyond the boundary of your home to include protection for your business property while you are in transit and provides liability coverage when you are performing business-related activities at a craft show or someone else’s residence.
Better in-home business policies are reasonably priced, starting at around $150 per year for $300,000 in general liability and $5,000 in property coverage for your business. Depending on your business needs, higher levels of coverage are available. You should know rates will vary from state to state, and not all types of home-based businesses will qualify for this coverage.
The in-home business policy strikes a good balance in giving you most of the features of a business owners policy, but at an affordable premium amount, provided your business qualifies.
Business Owners Policy
A business owners policy (often referred to as a BOP) is the most comprehensive solution to insuring your business. This is what a full-time business owner with a storefront will often secure to insure their business. The BOP was designed as a commercial insurance solution for small and mid-sized businesses. This type of policy should be considered if a home-based art/craft business operates from multiple locations or manufactures or keeps business property at a location other than one’s home. For example, if your home-based business uses an off-site storage facility for inventory and supplies, then you probably need a BOP to make sure you have proper coverage.
The coverage on an in-home business policy and a traditional BOP will be very similar. The key differences are that the BOP may offer higher limits and broader eligibility. That broader eligibility also means a higher minimum premium—usually starting at around $1,000 per year.
Event/Show Insurance
Most craft show and festival promoters require exhibitors at these events to carry liability coverage that protects you (and them) in case an accident happens and someone is injured during the event. The amount of liability coverage needed will vary from one show to another; however, $1 million in coverage is fairly standard at a cost of about $100 to $200 per event.
You can usually get that level of liability coverage from your in-home business policy or BOP, so you may already meet the liability needs for the art or craft shows you plan to attend. If so, you would not be required to purchase additional insurance for each show. Be sure to check each show’s liability insurance requirements ahead of time to make sure you get the proper coverage.
Important Factors to Consider
Now that you know the four main types of insurance available for your business, here are some important items to consider or questions to ask yourself which can help determine the type of coverage your art/craft business can or should have.
Location
Where your business is located is a very important factor. Is it at home, a studio or store? Also, is all of your business property kept at home? Or do you have business property that’s kept at a storage facility or some other location? If all of your business property is located in your home, then you may qualify for an in-home policy. If you run a store or keep materials somewhere other than your home, you probably need a BOP.
Type of Business
The type of business you operate can affect the type of policy or coverage you can buy or receive. For example, some business insurance policies may not cover handmade toys. And some policies may exclude candle making. As a general rule, be as specific as possible when talking to your insurance agent about the nature and scope of your business. Your insurance agent can help you determine what’s best for you and make sure your business is properly categorized. How much you sell will also make a difference in both eligibility and rates. This is usually determined in terms of annual sales volume.
Value of Business Personal Property
Smaller businesses with up to $50,000 of business property will often get a better price on an in-home business policy. For higher limits of coverage, a BOP policy will be the better choice.
Be sure to purchase coverage limits equal to the full value of your business property. Your policy may not make full payment if you don’t. This is another reason why it’s important to regularly talk with your insurance agent and update coverage levels as your business changes.
Do your research
Armed with this information, you can find the right insurance coverage for your business. You can learn more about in-home business coverage and other insurance options by searching online and then by talking to an insurance agent about your business and your needs. TCR

insurance2Finding business insurance that’s “just right” for your art or craft business can make you feel a bit like Goldilocks (of the Three Bears fame). Having too little or the wrong type of coverage could be disastrous for your business; paying too much for your coverage because the insurer lumps you in with bigger businesses can be just as bad. Luckily, your search for the right business insurance can have a happy ending. All it takes is a little understanding of the different types of available coverage and a good assessment of your art/craft business needs.

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Overcome Doubts About Running Your Own Craft Business

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pokenochips

Trish Hodgens of Poly Clay Play tried a number of crafts to make some money, but “most people look at crafts as something to keep women and children busy…not a legitimate way to make an income.” Of all the excuses people use about why their hobby could never be turned into a business, the most insidious and devastating are those inner voices—the creeping doubts from within—that tell you why you’ll never succeed.

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How to Restore Your Craft Business After a Medical Crisis

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Some disasters aren’t easy to prepare for. Kelly McLain, a glass artist in Seattle, started her day in May 2006 with a headache. By the end of the day, she was blind in one eye and within 24 hours, she was in surgery with three brain aneurysms. For a month, doctors kept her sedated and for another two months she was hospitalized. Then she moved to Michigan for several months of recuperation in her sister’s care. In all, McLain was out of commission for almost nine months, and is still at risk of seizures.

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How to Get Customers 4x More Likely to Buy

How to Get Customers 4x More Likely to Buy

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basilsign

Once a customer holds something in their hands, they are four times more likely to buy it.

Many times it is the sign that gets them to stop and take notice, and then to interact with the product. This is the key. To convince passersby to look more closely, or better yet to pick it up! When used in retailing, signs are often referred to as “silent salesmen.”

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