Turning your craft hobby into a real money-making business can be a really exciting adventure, but there are some steps you need to take to be sure you have your business set up to be successful so you can start making money right away. This checklist of things to do to start a craft business that actually makes money are things that need to be done before you start selling. These tips and tricks will get you off to a successful beginning so you can grow your craft hobby into a profitable career.
Some of these steps can be fun and others will have you saying “Do I really have to do that?!” I can tell you that you should do all of the things on this list to get your handmade business set up properly and then you won’t have to worry about any problems down the road. I’ve tried to set them up in the order they should be done to make it easier for you and keep you from being overwhelmed by all the things that need to be done before opening your handmade store.
Checklist Of Things To Do To Start A Craft Business That Actually Makes Money
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- Decide where you want to sell your handmade items. You’ll want to consider online and in-person options for selling your crafts. There are lots of places you can sell your items online but the most popular are Etsy, Amazon Handmade and Ebay. In person you can sell at bazaars, craft fairs, and farmers markets. Or you can get your handmade items in retail shops on consignment.
- Choose a name for your craft business. You’ll want something easy to spell and easy to remember. I made a guide to help you find a name for your handmade business.
- Reserve your craft business name everywhere online. You’ll want to reserve your own website name even if you don’t plan to sell from your own site right away. You have to plan for what you might want for the future. Buying a domain name is really cheap if it’s not taken. You can check if your domain name is available here. Go to Domains at the top of the page. You’ll want to reserve your craft business name on all social media channels as well. Don’t forget Pinterest! Pinterest can be a huge asset to your craft business.
- Check on business licensing laws. You can check for laws by state on startingyourbusiness.com to see if you need a business license. They also explain the different types of businesses you can set up like an LLC or sole proprietorship so you can see what is going to be best for your situation.
- Research handmade product ideas to be sure you make things that people want to buy and figure out how you can make your products unique. I wrote a post to help you do your own research and find best selling craft items you can make and sell. I also have lots of posts on ideas for crafts to make and sell here on my site. I researched to find items for those lists that I know will sell well.
- Define who your ideal customer is. Create a complete picture of who your target customer is, what they do, what they like, where they live, etc. You can learn how to do this in this post I wrote about finding the right customers for your handmade business.
- Decide where you’ll buy your materials. When just starting out, you may not have a license to buy wholesale or the need for that type of volume. You may be buying from the craft stores. Figure out how much your materials are going to cost so you can calculate pricing in the next step.
- Decide how much to charge for your products. I like to look at what other people are charging for similar items, but I don’t price my items based on that. I just want an idea so I can calculate my own price and be sure it fits in around the same range as other handmade sellers are charging. There are lots of formulas to figure out pricing for your products. Figure out how much you want to make per hour and how long each product takes to make and what your selling fees are. Then put those numbers into the formula: (Cost of Materials + Cost of Time + Selling Fees) x 2= Sales Price
- Set up your workspace. In my house, I use an extra bedroom as my supply storage room and my dining room is my work area. You’ll need to figure out how much space you need to make your items and what area of your home you’ll use. I would also check into tax laws regarding home workspace and how much you can write off. In my state, I can only write off 300 sq. ft. and I use much more than that for my business. So take that into consideration when creating your work area in your house.
- Make your first product line. Now is where the fun begins! Make examples of your first products. I would recommend having at least 10 items to start. More is better, especially if you’re selling your crafts online. The more products you have the more chances you have of being seen and of someone purchasing. However, don’t stress yourself out trying to make a million products in the beginning. You have to start somewhere. Get your first 10 handmade product examples ready and you can add more as you learn what your customers really like.
- Learn how to take great product photos and get photos of your first product line. Even if you’re selling in person and not online, you’ll still want beautiful photos to post on social media and other places online. You don’t need fancy equipment to take good photos of your handmade products. If you only have a smartphone, you can still get amazing pictures with it. Check out YouTube if you need some tutorials to take better pictures.
- Set up your store. If you’re selling on Etsy, get your shop set up. You can get 40 free listings for your new Etsy shop! If you want to sell on Amazon Handmade, you have to apply. It’s an easy process. They just want a description of how you make your items and photos of some of your items and your workspace. I think this is just to make sure you’re actually making the products and not trying to sell in the handmade category with mass produced products. Once you’re approved, set up your listings. Amazon doesn’t charge for you to list your items. There’s a fee once your items sell though. For your online shops, be sure to fill in all of the information. In the “About Me” sections, be sure to tell a heartfelt story about why you decided to open your shop, how you make your products and why they’re unique. If you’re creating your own website, get that set up. If you want to sell at craft fairs, contact them and see what you need to do to get a space set up. Remember you don’t need to do all the things at once. Start with one selling platform and add others later if you want so you don’t get overwhelmed.
- Decide what type of packaging you need. If you want to gift wrap your handmade items, you may need tissue paper and ribbon. Plus you need to figure out what you’ll ship your products in. You can order free Priority Mail boxes from USPS. If your packages are light enough for first class mail, you can get boxes in bulk for cheap on Amazon.
- Set up shipping. If you’re selling online or in any way that you’ll need to ship your craft items to your customers, you’ll want to have shipping figured out. You can hand label your items and go to the post office (I don’t recommend this since it’s time consuming and hand writing the labels can result in errors on the address). If you’re selling online through Etsy or Amazon Handmade, they have negotiated cheaper rates with the post office. You can use your home printer to get started. No fancy equipment necessary. I buy these labels on Amazon and set up my printing preferences to print 2 labels per page. It’s super easy! Don’t be afraid to try shipping through Etsy and Amazon. When I first started my handmade business, I was hand writing every address and going to the post office and standing in line to ship them. I was afraid if I used the shipping labels through Etsy that I would mess something up. I have to tell you that using Etsy’s labels has made my life so much easier and I haven’t messed anything up so far! Now I just print the label, stick it on the package and drop it off at my post office without having to wait in line. You can even schedule to have your postal carrier pick up your items at your door in some areas if you print your labels online.
- Save every receipt and keep track of any expenses for your craft business start up. Be sure to keep records of anything you pay for online since you likely won’t have a receipt for those items. Check your tax laws to see what items you can write off to be sure you’re getting the full benefits. I’m not a tax expert by any means.
Now you’re ready to start selling your crafts from home for extra cash!
Hopefully this checklist for starting a craft business gets you well on your way to start a craft business that actually makes money. Working from home making handmade products is such a rewarding experience. It’s so awesome to think of hundreds or thousands of people buying and using your items every day. Not to mention, that being able make extra cash to support your family with a business that you can do from home is just about the best feeling EVER!
I’m in awe of my craft business every day. I thought it was only a dream to be able to turn my craft hobby into a career where I can work from home and be my own boss, but I quickly realized that it is a reality. I’m not saying it’s super easy. It takes hard work and patience, but it’s so worth it in the end! The most important part is just to begin. If you’re doubting yourself and wondering if you can run your own craft business and make it successful, change your mindset, believe that you can do it and just go ahead and get started. If you think your negative thoughts are sabotaging your success, be sure to read my post about changing your negative mindset about money.
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