By Patrice Lewis
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.
In Part 1, 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.
In Part 2, we’ll look at some tips to increase your chances of succeeding at that business.
Don’t quit your day job – yet
When building a craft hobby into a craft business, you need to recognize it takes time to build your base and become successful. You don’t want to quit your day job and plunge into the financial uncertainty of a startup craft business until you have a solid fiscal foundation.
This is especially important because of non-negotiable expenses such as rent or mortgage, utilities, food, etc. You don’t want to jeopardize your income to the point where you can’t pay your bills on the touching hope that your craft business will be an instant success.
Build your craft business on the side and see if it works before you quit your day job. 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.
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.
Until your craft business is successful, you must live below your means. It does no good to blow your early profit on luxuries like electronics or restaurant meals. Learn to live frugally.
So, before you take the plunge into a home craft business, ditch the debt. Take the time to pay off that credit card, pay down your student loans and vehicle loans, and otherwise watch your spending. You have a much better chance of succeeding with a home craft business if you are 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.
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. This is often difficult. We love our hobbies and our crafts, and that’s why we have dreams of turning them into a successful business. To suggest that not enough people are interested in buying our crafts is … well, insulting. 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.
Catering to passions
Another secret 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 old car. You — the crafter — have the potential to cash in on that kind of passion in two possible ways.
First, you must target your marketing appropriately. You won’t do well selling your hand-crafted lace-doilies and crocheted doll dresses at a motorcycle rally. Motorcycle people are not passionate about lace doilies. It’s not a marketing match.
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 handmade candles to a candle show, for instance, then you’re surrounded by nothing but other candle- makers. However, if you take your specialty Elvis/tractor/airplane/cat/speedboat/whatever candles to events that cater to
people who love Elvis, tractors, airplanes, cats, or speedboats, then people will buy them.
This is why T-shirt vendors do so well — they can modify their product to cater to whatever market they’re selling at 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 just making a few of your craft items. 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?
At the office, a boss and a paycheck are your motivation. But when you don’t have anyone looking over your shoulder, you need to provide the motivation yourself. If you find yourself sleeping late and 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
A formal business plan may not be essential for a home craft business, but it helps 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. A business plan also lets you see where the “holes” are in your goals (such as market research).
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.
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.
Patrice Lewis is a wife, mother, homesteader, homeschooler, author, blogger, columnist, and speaker. An advocate of simple living and self-sufficiency, she has practiced and written about self-reliance and preparedness for almost 30 years. She is experienced in homestead animal husbandry and small-scale dairy production, food preservation and canning, country relocation, home-based businesses, homeschooling, personal money management, and food self-sufficiency. She and her husband have been married since 1990 and have two daughters.