There's an Art to Making Money in Crafts

Aug. 26, 2012 — -- You make ceramics, jewelry or carved wooden chairs.

But can you make money?

If yours is a crafts small business, that's a big challenge.

You love what you do. People love what you make. But it's tough to make a living.

"The flood of cheap merchandise from China has skewed people's sense of what a handmade item is worth," said Joel Kurtz of Kylix Design, who designs and produces sculptural ceramics in Oakland, Calif. "You can get a ceramic vase at Ikea for $5.99, so it's difficult to get people to understand and appreciate an artistic vessel at $149."

That's a real dilemma for most artisans.

Virtually everything they make and sell is available in a cheaper, mass-produced version. The design might not be as intriguing or the workmanship as fine, but customers mentally compare prices against what they can buy at the mall.

Most craftspeople launch their small businesses because they love what they design and make. Profits aren't their major motivation. But you need to make a profit if you want to keep making all that wonderful stuff.

If yours is a crafts business, it's time to turn your attention to some down-to-earth business issues. And I hate to tell you — you've got to start preparing now for your most critical season of the year: winter holidays.

Here's a handy guide for your crafts small business:

1. Sell online. The fastest way to get started is online at a crafts-related marketplace.

The biggest, by far, is Etsy. The next largest is Artfire. If you're an artist, consider Zazzle, Threadless or Cafe Press as an easy way to sell your designs on things such as T-shirts or mugs.

Set up your own website if you don't have one already. Choose an off-the-shelf website provider that offers an ecommerce function, such as Shopify, BigCartel or WordPress. Don't worry about making it the perfect website. Just get something up with photos of your work by Oct. 1.

2. Sell at crafts and holiday fairs. You have a chance to interact with customers one on one and people get to see your work close up, so these are great ways to develop raving fans of your work.

Be sure to have a sign-up list to capture email addresses so you can keep in touch. Deadlines are fast approaching to sign up to sell at holiday fairs, so get cracking.

3. Develop a wholesale channel. Look for retailers, such as gift shops, boutiques or art galleries that sell items similar to yours, appealing to the same demographic.

Remember, you'll only get about half the retail price. But these may be an ongoing source of income and possibly prestige.

4. Get paid. If you sell directly, expect customers to want to use credit cards.

On your website, you can use PayPal. At crafts fairs, consider accepting mobile payments, such as Square or GoPayment. If you're selling wholesale, you still may want to encourage credit-card use to ensure fast payment.

5. Get known. "Marketing and merchandising is the hardest. That's the area we artists fall down on," sculptor Kurtz said.

But it's critical for building a customer base. Social media has been a boon, especially Pinterest. You'll also want to build a Facebook page and showcase your work.

Post at least once a week. Reach out to bloggers who write about your type of crafts or art blogs such as Design Milk.

Don't forget traditional media. Getting covered in local press or design magazines can help boost your image, especially when trying to sell to retailers.

6. Set prices. It's good idea to have offerings in a number of price ranges, so the person who loves your one-of-a-kind high-end item can buy a lesser item and still feel connected to you.

"There's a real psychology around pricing," Kurtz said. "If it's too cheap, people think it's not worthwhile. If it's too expensive, it won't sell. If I'm selling through a retailer, I'm only going to get half of what they're selling for on my website. Is that acceptable to me?"

But make sure you can cover your costs and make a worthwhile profit.

Finally, bring the same standards to the business side of your work as you do to your craft. Work on it; improve it. Be an artist in your small business.

On the Web

Crafts marketplaces: • Artfire, www.artfire.com• Cafe Press, www.cafepress.com• Etsy, www.etsy.com• Threadless, www.threadless.com• Zazzle, www.Zazzle.com

Website providers with e-commerce functions: • Big Cartel, www.bigcartel.com• Shopify, www.shopify.com• Wordpress, www.wordpress.com

Electronic payment programs, other than credit cards: • Go Payment, www.gopayment.com• PayPal, www.paypal.com• Square, www.squareup.com

Social media, blogs for artists: • Design Milk, www.design-milk.com• Facebook, www.facebook.com• Pinterest, www.pinterest.com

Rhonda Abrams is president of The Planning Shop and publisher of books for entrepreneurs. Her most recent book is The Successful Business Plan: Secrets and Strategies. Register for Rhonda's free newsletter at PlanningShop.com See an index of Abrams' columns here. Twitter: @RhondaAbrams. Facebook: facebook.com/RhondaAbramsSmallBusiness. Copyright Rhonda Abrams 2012.