The Business Chat - Registering Your Business Part 1

Good for you, you’ve decided to really turn your hobby/passion/obsession into a business. Yay! You want to do things right so you want to register your business, assuming you have to. That is the first question, do you have to register your business?

For those just dabbling let me be clear, if you are selling anything at all you are a business. Registering your business is important because it gives you a Master Business License. This license is an critical tool for your success. First, with that Master Business License you can now buy wholesale supplies. Second, you have a piece of paper that says you are truly in business. One of my Steps to Success is to take your business seriously. Put that piece of paper on a bulletin board where you can see it whenever you are working. If you don’t take your business seriously, why would anyone else?

The steps to registering your business are:
1. decide on your legal structure
2. choose your business name
3. do a name search
4. register your business

In Canada there are three forms of ownership to consider:
1. Sole proprietorship
2. Partnership
3. Incorporation

Sole proprietorship
A sole proprietorship is an unincorporated business that is owned by one person. It’s the simplest kind of business structure. The owner of a sole proprietorship makes all the decisions, receives all the profits, claims all the losses, and does not have separate legal status from the business.
Sole proprietors are fully responsible for all debts and obligations related to their business. A creditor with a claim against a sole proprietor would normally have a right against all business and personal assets, meaning the creditor could seize some of your personal belongings. This is known as unlimited liability.
If you’re a sole proprietor, you pay personal income tax on all revenue generated by your business. This income is reported on your regular tax return – a T1. You may also deduct business expenses on the same tax return.

Partnership
A partnership is an association or relationship between two or more individuals, corporations, trusts, or partnerships that join together to carry on a trade or business. Each partner contributes money, labour, property, or skills to the partnership. In return, each partner is entitled to a share of the profits or losses. The business profits (or losses) are usually divided among the partners based on the partnership agreement.
Forming a partnership is as simple as turning to your friend/partner/sibling and saying, “Let’s be partners.” While a verbal agreement is all you technically need, I highly recommend that you have a written agreement drawn up, preferably by a lawyer. Should you and your partner have an acrimonious split, and your partner runs up a huge debt and leaves, you are responsible for the debt. The advantage of a legal agreement is that it can limit your liability. A written partnership agreement should set out the terms of dissolution in case one of the partners decides to pull out. The other advantage of a written agreement is that it forces you to plan each partner’s responsibilities and duties. Any time spent planning or considering how your business will work is worthwhile.

Incorporation
A corporation is a separate legal entity. It can enter into contracts and own property in its own name, separately and distinctly from its owners. If you incorporate your business, then you are an employee of the corporation.
There are many advantages to a corporation. The main advantage is the limited liability of the incorporated company. Unlike the sole proprietorship, where the business owner assumes all the liability of the company, when a business becomes incorporated, an individual shareholder's liability is limited to the amount that he or she has invested in the company. The other advantage is that corporations pay a lower tax rate. As you are an employee of the corporation, you are only taxed on your salary.
Many businesses start as sole proprietorships and later become incorporated as their growth warrants. A sole proprietorship regularly earning in excess of $50,000 of taxable income annually should think about incorporating. (Taxable income is income after expenses.) Talk to your accountant to see if incorporation makes financial sense for you.

Partnerships and corporations must register their businesses. Sole proprietors do not automatically need to register their businesses. If you are keeping your business very small and operating under your own name then you do not have to register your name. However, if you are a sole proprietor and choose not to register you may legally only operate under your own name with no additions. For example, if I want to run my business under the name “Catherine Winter”, I don’t have to register my business name. I can’t add any descriptors such as “Catherine Winter Jewelry” or “Catherine’s Crafts”. The moment you add anything to the name you must register. (The exception to this is Newfoundland and Labrador, in that province, you do not have to register the name of sole proprietorships or partnerships at all.)

Choose your Business Name
Often your business name is the first impression people have of your work. When choosing your name, I recommend using a unique word or phrase that captures the spirit of your work, or using all or part of your name.
Whatever name you choose, just be sure it won’t limit your business potential. Your style and products will change dramatically during your first couple of years in business. Imagine someone who makes earrings and opens a business called Mary’s Earrings. Great name for now, but what happens if Mary adds bracelets to her collection?

Here’s a couple of tips about names. If you opt for a name such as Mary Smith Designs, then somewhere on your business card or other promotional material, you must list your craft. Designs is too vague, you might be doing gardens or quilts. If someone found your business card on the street, would they know what you do?

Do remember that we are a multi-cultural country and many of your customers are not native English speakers (especially if you are selling online). Don’t pick a name that is difficult to pronounce or has some nasty meaning in another language. (Plug your name in to Google and see what comes up).

What’s trendy right now won’t always be so. Does your name have the staying power for a couple of years?

Your business name should be:

• Unique – make your name stand out from those of other similar businesses.


• Descriptive – a customer should know what you do


• Simple – don’t make your name too long


• Easy to recall – one or two words or initials make it easier for your customers to remember you


• A good fit – it must fit in with your business image


• Legal. Not only are you choosing a name that will bring in oodles of customers, you must also choose a name that is satisfactory to the government. You cannot use a name that implies any association with any branch of government. Your name must be in the Roman language. You can’t use words that imply incorporation; and the list goes on. For a full list of what you can and can’t use go to Registering Your Business Name in Ontario (scroll down to the “Restrictions on Business Names” section)

Do a name search
Next it is a good idea to do a search for your chosen business name to see if it’s in use. Business name registration is no guarantee of exclusivity. (Business name protection is provided by a trademark, not by name registration.) Trademarks take between 4 and 24 months. The Business Names Act doesn't prohibit the registration of identical names, so you could register a business name that another company is already using. If you do, or if you register a name that's confusingly similar, a lawsuit could result so it's a good idea to conduct a name search to see if anyone else is using the business name you want.

There are several different search options you may wish to pursue. Each name search will cost you $8 to $12, depending on where and how you conduct the search.

Searching the business names public record at the Companies Branch (located on the second floor at 375 University Avenue in Toronto) will tell you if someone is already using the business name you have selected and where that business is located, although it will not show variations of business names or corporation names. You can also browse through the Electronic Corporate Index while you're at the Companies Branch, or request a corporate search.

You can also search online through OnCorp Direct Inc. or Cyberbahn Inc.; both of these corporations are Primary Service Providers under contract with the Ministry of Consumer and Business Services.

You may also want to get a NUANS report. NUANS (New Upgraded Automated Name Search) is a Canada-wide corporate and business name registry. A NUANS search will display corporations, business names and trademarks which are similar to the name you have searched. To search NUANS, you will need to contact a private service provider (listed in the Yellow Pages under "Searchers of Records") as the Companies Branch does not provide these.

Whether or not you choose to do a name search you should definitely do some online research. Plug your name into Google or another search engine. If there is another company with a name close to yours check out their online presence. If you want Mary Smith Designs (you make jewelry) and there’s a Mary Smith Designs (landscaping) but they’re in a town 1,000 kms away it probably isn’t an issue.

Now that you've decided on your legal structure, chosen your business name and conducted a name search (if necessary), you're ready to go through the actual business registration procedure to register your sole proprietorship or partnership. Next week, we’ll walk through the registration process (it’s easy-peasy).

The Business Chat - Business Registration Part 2

To sum up part one of Register Your Business, first you decide on your legal structure, then pick a business name, possibly do a name search and then finally register your business.

If you are forming a partnership for your business then you must register your business. If you are a sole proprietor then you may not have to register. Those of you living in Newfoundland and Labrador can operate under any name as a sole proprietor without registering. The rest of Canada can operate as a sole proprietor without registering if they operate under their own name only. Mary Smith may operate as Mary Smith only, the moment Mary wants to be Mary Smith Crafts then she must register.

Even if you do not have to legally register I do recommend that you do. The cost is reasonable (less than $100) and you will receive a Master Business License. This allows you to buy supplies at wholesale costs and more importantly, you have an official piece of paper proving you are in business.

New Brunswick
The Corporate Registry is here. Click the tab Forms, click the Forms for Business Names.

Nova Scotia
Ready to register in Nova Scotia? Go to the Joint Stock Companies.

PEI
In PEI you must complete a name search (NUANS search). Click here to ensure your name is unique within the province. Once your name is cleared, you can register your business.

Quebec
If you are starting a sole proprietorship under your own first name and last name, you may register it, but are not required by law to do so. For example, Henry Jenkins does not have to register his Henry Jenkins Travel Agency but may choose to do so. You can register your business using the online service provided by the Registaire Des Enterprises, or in person at one of the Services Québec offices in Québec City or Montréal that provide services related to the enterprise register.

Ontario
ServiceOntario’s Integrated Business Services Application allows you to:
· Search for business names that have been registered
· Register or renew your business name, get a Master Business Licence and, if eligible, apply for additional accounts with different government bodies
To register online, Service Ontario is here.

Manitoba
To find out if the name you have chosen is available, you must file a Request for Name Reservation with the Companies Office. Reserve your name here, Manitoba Companies Office. Register your business here, also at the Manitoba Companies Office.

Saskatechewan
Before a business name can be registered, the proposed name must be searched against all other registered names in Saskatchewan. The Business Registrations Saskatchewan website streamlines all the steps required to register a business with the Corporate Registry, obtain a Provincial Sales Tax vendor's license. https://business.isc.ca/Pages/default.aspx

Alberta
Registration in Alberta is done by authorized Service Providers. A list of these can be found here. Note that there is a government provided list of prices however a service provider can charge service fees so you must shop around for a good service provider.

British Columbia
If you choose to operate a sole proprietorship under any other name other than your own, or want to set up a partnership or corporation, you need to have your name approved by the provincial Corporate Registry before you can register your business. In BC, this means you have to fill out a Name Approval Request Form.

To register a sole proprietorship or partnership, you must fill out a Declaration for Proprietorship or Partnership Registration Form. Instructions and forms are here.

Yukon
The Business Names Registration forms, maintained by Corporate Affairs, are here.

Northwest Territories
All forms are here, the Department of Justice

Now you know.

The Business Chat - What the heck is...

Announcing a new series, the WTHI? series. (What The Heck Is?)

Good for you, you’ve decided to learn a bit more about running a business! Yay! Knowledge is power after all isn’t it? Hm,  where to start? 

You try to read some business books or websites, and they throw around these terms that you have no idea what they are. Nor do you understand how they relate to your little crafty venture, there are too many acronyms and graphs. A lot of the time it seems like the information out there has nothing at all to do with what you are trying to do - sell the fabulous work you make in your spare time. You aren’t a major corporation nor do you ever want to be. 

Yet those major corporations, and all the small to medium size business have exactly the same problem that we do. Starbucks and Sailorgirl Jewelry (my company) have the same goal - we want to sell our products to one customer at a time. We just do it on different scales. While Starbucks has an army of MBA’s figuring out how to achieve this goal, I have one person - me. So I read those books that use the big companies as examples, and I try to understand what they do and how it can apply to me. 

Since I’ve already read the books, I thought I’d pass on what I’ve learnt. Starting today there’s a new series here on the Business Chat. It’s the WTHI series. Every now and then, I’ll write a post defining a business term that it’s important to know. Better still, I’ll explain what this term has to do with you achieving crafty success. 

WTHI? 

What the heck is “what the market will bear?”

“What the market will bear” is a phrase you hear when people talk about pricing. Basically it means what people are willing to pay. 

It is not the cost of making the product. It is not what the product should cost (knowing what it cost to make). It is not the price that the maker wants to sell the product for. Nor most times, is it the cost that people say what they will pay. (What people say and what they do are 2 very different things when it comes to spending money). 

What the market will bear is the price that people will open their wallets and pay for. This cannot be calculated with a formula. It changes depending on the season, the economy, your competitors and the whims of the universe. Large companies do a LOT of research before releasing products. There are focus groups, surveys and trial releases. We do not have these options. For us, it’s a guessing game when you start out. The longer you are in business, the more you know your target market, the better you get at working out “what the market will bear”. 

What does this mean to you? 

It means that you need to find your sweet spot for pricing your work. If you price it too high people won’t buy it. If you price it too low people won’t buy it. (Or they will buy a lot of it but because you’ve priced it too low you lose money and go out of business.) It’s a lot like Goldilocks. You need to find your just right pricing. 

Often “what the market will bear” is based on supply and demand. If you have the only cure for cancer in the world, the market will bear a very large price tag. If you have the same “Made In China” stretchy mittens that every dollar store has and you’ve embroidered on a flower, well, the market isn’t going to bear much is it? 

For handmade goods look around to see what your competitors charge. Keep in mind, just because they are setting a certain price, it doesn’t mean that they are charging the right price. A lot of people complain of the very low prices on etsy.com. They are low, sometimes ridiculously so. But just because someone else is willing to lose money doesn’t mean that you have to. If you think the prices at a certain market (online or bricks and mortar) then don’t sell there.

If you find that a certain market (like etsy) is pricing work at a too low price, perhaps it’s not the market for you. Knowing what the market will bear means that you must be selling to the correct market. 

Imagine you are opening a high-end coffee shop and you’ll be roasting your own coffee and making the cookies from scratch. You look for a location. Do you open in the ritzy neighbourhood where rents are expensive but so are the other shops? Or do you open in the university neighbourhood full of students who can afford one beer on a Friday night? The same cup of coffee will cost almost double in the ritzy neighbourhood because these are people who understand what you are doing and have the money to pay for it. 

When I hear a maker complaining how “no one will pay that much for my work” my first question is where are they trying to sell. If you’re making expensive high end diamond jewelry and trying to sell it at the local farmers market, then no, the market isn’t going to bear your expensive pricing. Find a better market. (Side note - flea markets may be cheap but the market seriously isn’t going to bear much. Just saying.)

In order to price your work properly you have to understand who you are selling to. Find your ideal customer. Then find where that customer shops. Then look at see what sort of prices that market will bear. It’s a start. 

Next week we’ll go through the process of finding your ideal customer. 

ps. If there is a business term that you want to discuss, drop me a line or leave a comment. catherine@sailorgirl.com

The Business Chat - Celebrations! And a question

Hey, guess what people? It’s my anniversary! I’ve been writing the Business Chat for one year and one week now!!!! WOOOHOOO!!!

Last week I gave you a challenge – the One Word Challenge. It’s the start to a series (not necessarily every week) on creating your brand, your story and your USP. As I went to write the second installment I thought, hmmmm…. I think I’ve touched on this subject before.

Well yes I have in small bits. Here. I want you to read these before I add more to them.

The Elevator Speech
Sell your story
Sell me your item online

There’s another reason why I was trolling over my previous posts. I have a confession. There’s a secret mission behind this column - I’m gathering material.

I will be launching a brand new website soon, very very very soon (this fall). The name is still a secret (because I don’t know it yet) but the concept is Business Thinking for Creative People.

As I’ve mentioned in a couple of posts/rants, making work is easy, selling it is work. If you don’t think of yourself as a business you aren’t one and you’ll end up drifting along if you’re lucky or worse, losing money. That is unnecessary. I don’t believe in the starving artist. When I was explaining this to a fellow artist she looked panicked and wailed, “but I don’t know HOW to think business!” I intend to change this.

My Business Thinking site will offer informative posts, tips and tricks along with the occasional tough love kick in the pants (we all need that). There will be hard facts, step-by-step tutorials, as well as insights on the creative business scene.

Today I want everyone to do a celebratory happy birthday dance for The Business Chat, and then tell me, what are your informational needs? Do you want a step-by-step course on how to set up an online shop? Instructions on setting up your Facebook business page? Learn how to register your business? Help with branding? Pricing? Do you want to meet those people who are running a successful creative business? Need help with craft show displays? Online shop help?

What can I do that will help you get to the next stage in your creative business?

You can leave comments here, or send me an email: Catherine@sailorgirl.com

The Business Chat - Success is...

Thank you! Thanks for all the well-wishing about the new (soon, very very very soon) small crafty business website I will be launching this fall and thank you for your input about what you would like to learn about. (You can read all about it here.)

It was really interesting to read your comments and get your feedback, it took me back to my beginning days. Sometimes I find it amazing that I’ve been running my little crafty endeavour for 9 years now! Where did that time go? I think this is one of the most satisfying parts of running a small business that you love, it doesn’t seem like work. 9 years in a cubicle would have seemed like eternity and yet 9 years of this has gone by in a blink. And I still wake up in the middle of the night with a new idea in mind and wish it were daytime so that I could go to work!

I think the biggest difference between a “regular” business and a crafty business is in the WHY of the business. Regular businesses live for the bottom line, it’s all about the money. The more money a business makes the more successful it is deemed to be. Yet for most of us, the money isn’t the driving force behind what we do. It’s really critical to the success of any craft business that you truly love what you do. Craft businesses are different from “regular” businesses. When you go to a job, you may be really proud of that report you wrote, or the committee you steered, however it’s not your heart and soul. Not like when you make a piece of art and put it out on display. And it’s the heart and soul and You The Artist that a customer is looking for. And because you are pouring your heart and soul into your fledgling venture, no matter how small or part time it is, your crafty business will occupy a part your brain cells 24/7.

So if you are going to pour a portion of your entire being into this little business of yours I think it is really important to know WHY you are doing this.

In a previous life I worked at a software development company. It was fun for a long while, and then it was not. At the same time as it became un-fun we had bought a sailboat down south and I was craving a life beyond the 9-5 of a cubicle. I decided that life was short and should be lived to the fullest. Hence Sailorgirl Jewelry was born. Part of my company mission is to take 3 months off a year and go sailing. I do that every year. Hence I feel that I have a successful company even if, frankly, I would have financially been much better off in a cubicle.

Every time I lead my “Start Your Successful Micro-Business Class” I ask the participants to tell me, why are you here? What do you want from your business?

I’ve heard a great variety of answers from my students, everything from paying for a hot tub, a European vacation, a new kitchen, to the most common, covering the cost of your bead addiction or providing a second income. What it boils down to is that if you don’t know what your idea of success is, then how do you know when you have a successful company?

Today I am asking you the same question, why do you read this column and why do you want to run a small craft business? What is your definition of success?

Next week is a meat and potatoes column – A step by step: How to Register Your Business.

The Business Chat - Dreaming with your summer brain

There’s a slow and lazy feeling about the last half of August. Humidity is high, cicadas are buzzing and kids are dragging their feet around knowing that this is the end of freedom. No matter how long we’ve been out of school we all feel the laziness now. Add to this the traditionally slow sales of August and we’re all tempted to let the business slide for the moment.

Wrong.

Now is the time for you to work ON the business, not IN it. When you are working IN your business you are making product, selling product, taking photos and listing online, packaging work and doing all the work of making money.

Working ON the business is when you take a step back from the day to day details and think about why you are doing what you are doing. It’s about thinking of where you want this business to be in the future and how you can get it there. It’s also about creating marketing plans, social media strategies, and financial systems. That’s some big thinking.

Fortunately there’s a lighter side of working on the business which is just perfect for this time of year. I invite you today to kick back in your favourite patio chair with a beverage and let your mind wander with the sunshine. Grab your notebook, and your favourite pen, pencil or crayon, it’s time to doodle and ponder.

Vision time.

Think of what a perfect work day would look like. Imagine your perfect work space, is it at home or would you like to have an outside studio? Do you want to work alone or share a space? How about an assistant, yes or no?

In an ideal world where do you want your business to be in 6 months? 12 months? 2 years? How much money would you like to make? How can you make that money? What’s the most awesome thing you’d like to happen in your business? Dream big and silly and write it all down.

Work on your marketing message.

Marketing is communicating what you do to your customers. Before you can tell them, you have to know yourself. What do you make? Now is the time to work on your elevator speech. Think about new marketing materials, do you have postcards yet? A new business card? Take a really good look at your packaging, check to make sure it is the best that it can be. Check to see that it matches your business cards, and your website and your work. Do they all have the same style and tone?

Work on your story

Our customers are awesome, they have deliberately chosen to buy handmade work and support artists. One reason they buy handmade is because they like knowing who made the work and why. People are buying more than a pair of earrings, they are buying earrings that were inspired by the sunset you watched on vacation, or the sunlight on your rosebushes that you tended faithfully all year. They are buying your story, they are buying your magic. Have your magic ready to share in advance. Doodle out why you do what you do. What makes you so special?

Dreaming, scheming, reading and pondering are just as important to your success as making a fabulous necklace or knitting a gorgeous sweater. When the cicadas are buzzing let your thoughts buzz along with them as see what your summer brain can cook up. 

The Business Chat - The price of success

Last weekend I went down to the waterfront to cheer on the runners in the Toronto marathon. I’ve participated in a few smaller distance events and I know how much a round of applause can help you push through a tough spot. And they deserve it. I was positioned at the 37km mark, only 5km to go. At that point the finish line is in sight, all that training was going to pay off, these were the runners who were going to cross that finish line.

It was that training that I was actually applauding. In order to get to that finish line these runners made a commitment a long time ago to train, to work hard. They’ve run on a regular basis several times a week for months or years to get to this point. What I was cheering wasn’t really them passing me that day. I was cheering the stamina of setting an alarm and running for an hour before work on a freezing winter morning. I was cheering the late night runs, the eating properly, the miles and miles they have put in to get to this point.

I cheered these people for setting a goal, making a commitment to doing the work and then doing it.

For every person who passed me I wondered how many people had set the goal and then fallen off the training wagon. How many people said “I’m going to run the marathon in October” and then failed to even get to the start line? It’s a choice you make, when the alarm goes off in the morning, do you get up in the cold and hit the streets or do you roll over for that cozy hour of sleep? Do you do the work? Those that do the work cross the finish line. Some of us on the sidelines aren’t crossing the finish line because we know what it takes and we’ve made the choice not to do the work.

Succeeding in business (no matter how small) is a lot like running that marathon. It’s really easy to say “oh yes, I’m starting a craft business. I’m selling my art”. Words are cheap. Even setting a goal is easy. Go ahead, set one right now. “In the next 12 months I will sell $XXX.” “ I will get my work into 4 galleries and set up an online store”. See how easy that is?

Now here’s the hard part. You have to do the work. Making your art is the easy part of a craft business, it’s selling it that’s the work. This work is anything that isn’t about making. It’s blogging, taking photos, writing product descriptions, researching shipping options, standing in a booth, doing whatever it takes. Understand this, for every one hour I spend making work, I spend 4 hours running my business. This is what it takes. You need to know this.

I know what it takes to cross the finish line in a marathon and I don’t want it badly enough to commit to it. I know what it takes to succeed in my crafty business. This I am committed to doing.

What about you? Are you committed to your own success? Committed to doing the work? It’s your choice, having a small crafty business isn’t the easiest thing. For the few hours in a gorgeously designed booth with your beautiful work there are untold hours of toiling away by yourself preparing. Nobody sees them. Few will acknowledge them. Yet when someone buys a piece from you they are cheering you on and celebrating your hard work.

Those hours are the price of success. For every choice in life you need to know the price of the options and then commit to paying the price. So I’m asking you, are you willing to commit to your own success?

The Business Chat - Holiday bootcamp, get the word out!

In our holiday preparations so far we have worked out our inventory list, spiffied up our booth display, gone over our online shop and ordered our holiday packaging. Now it’s time to let the world know that the holiday shopping season is here and that you are ready! It’s time to market and advertise your work.

Here at the Business Chat, we’re fond of wearing hats. Today we’ll put on 3 hats. First there’s our Marketing Hat, second our Advertising Hat, third our Sales Hat.

Marketing is what you do to get a customer to knock on your door. It informs a customer of who you are and what your product is.
Advertising is the method you use to publicly acquaint your customers with your product in order to get them to buy what your business is offering.
Sales are when you knock on a customer’s door.

When wearing our marketing hat we create the message we want people to know about our work. The question you have to answer here is “what do you make?” This is really important during a holiday season when all your competition is screaming loudly trying to get their message out. You need a crystal clear message in order to rise above the noise. The following will help you define your message:

• Create your elevator speech


• Take the one word challenge


• Have a great tagline


• Be a real live artist

Once you have your message it’s time to switch hats. Advertising takes the marketing message and gets it out to the public. You can pay for ads in places like blogs or facebook or you can use social media. Me, I’m not paying for ads.

A total old-school but very effective way to advertise your work is to wear it. NEVER leave the house without wearing jewelry (and do NOT wear any jewelry other than your own) and carrying your business card. A good idea is to carry a small flier with your show list on it. When the cashier at the supermarket comments on how nice your necklace is, hand her a business card and a flier. Seriously. Do it. It works.

Of course you should always advertise to your own mailing list. People on your mailing list are already committed fans, by letting them know about holiday shows or special items in your online store you will make sales. They like you. They want to buy. Send them directions on how to buy in your newsletter (and newsletter part 2 here).

For those without a mailing list and a newsletter rush immediately to your To Do list and write “create a newsletter” and “start a mailing list” on it.

Your blog is another place to create awareness of your holiday sales. Next is your Facebook business page and then there’s twitter. Here’s a list of ideas for how to advertise using these channels:

• List your upcoming shows


• Post pictures of new work


• Talk about the new work, get excited


• Tell your readers what is so fabulous about your work, tell them why it makes such a great gift


• Post pictures of your gift-wrap and tell them about how this feature will save them time


• Let people know about shipping deadlines


• Remind people of your upcoming shows


• Remind them again


• Suggest items for various people, dad gifts, kid gifts, hostess gifts


• Let them know when a new item goes into your online store

For those without a facebook business page or a blog rush immediately to your To Do list and write “create a facebook business page” and “start a blog” on it. These are important business tools for success. If you haven’t time to do it properly right now, put these tasks on our 2012 list and start researching how to do them now.

Once you have done your job wearing your Advertising hat, it’s time to put on your Sales hat. You already know how fabulous your work is and why. When the customer is standing in your booth, or sending you’re a question online, tell them all about the jewelry. Tell them why it makes such a great gift. Tell them how you made it. Sell them the work. You already know the story, simply share it. And make that sale.

The Business Chat - Financial sanity step one.

Does this sound familiar? You went to a craft show and sold some work, did your happy dance and deposited the money in the bank. Because you’ve sold some work, you ran straight to the supply store to pick up those lovely shiny objects you’ve been coveting. Then you ordered some more supplies online, then paid for some business cards and sent a cheque with a craft show application. Then on the way home you bought some groceries. No problem, you’ve been selling work lately. 

Meanwhile, your husband/wife looked at the bank account, saw money and paid some bills. And now you’re looking at the bank account and what the heck? Where’s the money? 

You’re not sure how much money is going in or out. Budgeting is overwhelming. Costs are rising, and you're losing track of where you stand. You know you “should” be earning more based on sales volume. 

In practice, you still can't make ends meet and you never seem to have enough cash in the bank. You wish you could run reports (expenses, income), but you can't access the figures (because it's all mixed together). 

One of the biggest mistakes new entrepreneurs make is to mix their business and personal bank accounts. 

No matter how small your enterprise, if you sell ANYTHING, you are in business and in order to be in business successfully you must track every cent you make and spend. 

Do yourself a favour and separate your personal and business bank accounts. 

No more co-mingling of accounts, no more gray area. No more personal checks for business expenses. No more spending business funds for personal items. 

Whether you open a second personal account or a business account depends on where you are in your business career. Many makers who are just starting out haven’t yet registered their business, a business bank account requires that you be hold a Master Business License which you obtain by registering your business. (Registering your business is not legally required in Canada, you can sell under your name without registering). 

A business bank account is not free so for makers who are new, or who are selling very part-time, justifying the cost of a business account is hard. My suggestion for those who fit this category is to open a free personal account and use it for business only. 

Make it your business bank account. Deposit ALL of your sales income into your business account. Pay ALL of your business expenses from this account. DO NOT pay any personal expenses from this account. If you want to pay yourself, move your “wages” to your personal account and note how much you are paying yourself. At the end of every month go over your bank statement with an eagle eye and make sure you know where every cent is. 

Get a separate credit card to manage all expenses like online shop fees and PayPal transactions. Remember: A credit card is free as long as you pay off the balance every month, and there are plenty of cards out there with no annual membership fees. 

By separating your accounts, your personal financial choices (good or bad) can’t affect your business — and vice versa. You'll also find you have better control and far more sanity when it comes to your finances.

The Business Chat - Time to Review

The last of my online orders are out the door, the phone is quiet, the sales season is winding down. Of course at the same time I’m realizing that hey, Christmas is next week and I need to shop! With business slowing down I can focus on personal for now. Or can I? The answer is yes and no. Yes I can take some personal time however I cannot just drop all business matters just because I have no sales.

It’s very tempting when business is slow to let it drift, after all there’s no sales happening and there’s cookies to bake! Even though I may not be selling or making anything right now I still have to put some work in. Back in August when sales were slow we focussed on working on our business instead of in it. Now it’s time to do that again.

With 13 days left in the year I have one major business task left on my list for 2010, my annual review. My review is not just how I functioned in my “job”, or how well the company did, it’s also about setting goals and milestones for the upcoming year. No matter how small your company is I think a review is critical to your future. A review allows you to see exactly where you are now so that you can map out how to get where you want to go.

My annual review consists of 3 steps:
Step 1: Review the Previous Year
Step 2: Outline Goals and Overall Focus for Next Year
Step 3: Plan how I will achieve these goals.

The point of step 1 is to see what I managed to achieve in the past year (and pat myself on the back) and to see where I currently stand. To start I look back on the year and ask myself a series of questions. The questions start very simply:
What went well in 2010?
What did not go well in 2010?

Since I did a review last year I look over the goals I set to see how I did with them. Did everything happen as I expected? Probably not, but it’s interesting to compare results with expectations. In a micro business such as mine, goals aren’t just about dollar figures. I also have goals for learning, goals for balancing business and personal, as well as milestones for business.

In step 2 I think about the year to come. What is my focus this year? And within that focus what are the actual goals I want to achieve.
Think of your own business, what do you think you can achieve in the next 12 months? Goals can be anything: participate in one craft show, or sell 10 pairs of earrings, enrol in a class, start a blog (and keep it up), get a website, apply for a grant, whatever you think you want to do.

Remembering that the goals need to be measurable is one of the most important predictors of success in the coming year. The more specific a goal the more likely it is to happen. Rather than saying “I want to sell my work” a better goal would be “I want to participate in one craft show next summer” or “I want to set up an online store by June 1”.

For step 3, I take each goal and think, “What do I need to do to achieve this?” I list the steps needed to reach that goal in as much detail as possible and then put those steps on a calendar.

Once I’ve completed my review my calendar with milestones is put on my wall where I can see it. I also enter these into my online calendar so that deadlines (like show application dates and class enrolment dates) don’t pass by.

Starting and running a small business is hard work. Balancing a personal life on top of this is tough. Trying to do this without a map would be insane. As busy as we all are at this time of year you owe it to yourself to set aside a bit of time and plan out how you can conquer the world in the next year. Set your goals high. Take some time to do this right, and you’ll thank yourself later.

The Business Chat - Are you willing to pay the price?

Last week we went to watch a marathon race in the little town where we are vacationing. I’ve participated in a few smaller distance events and I know how much a round of applause can help you push through a tough spot. And they deserve it. I was positioned at the 40km mark, only 2km to go. At that point the finish line is in sight, all that training was going to pay off, these were the runners who were going to cross that finish line.

It was that training that I was actually applauding. In order to get to that finish line these runners made a commitment a long time ago to train, to work hard. They’ve run on a regular basis several times a week for months or years to get to this point. What I was cheering wasn’t really them passing me that day. I was cheering the stamina of setting an alarm and running for an hour before work on a freezing winter morning. I was cheering the late night runs, the eating properly, the miles and miles they have put in to get to this point.

I cheered these people for setting a goal, making a commitment to doing the work and then doing it.

For every person who passed me I wondered how many people had set the goal and then fallen off the training wagon. How many people said “I’m going to run the marathon in October” and then failed to even get to the start line? It’s a choice you make, when the alarm goes off in the morning, do you get up in the cold and hit the streets or do you roll over for that cozy hour of sleep? Do you do the work? Those that do the work cross the finish line. Some of us on the sidelines aren’t crossing the finish line because we know what it takes and we’ve made the choice not to do the work.

Succeeding in business (no matter how small) is a lot like running that marathon. It’s really easy to say “oh yes, I’m starting a craft business. I’m selling my art”. Words are cheap. Even setting a goal is easy. Go ahead, set one right now. “In the next 12 months I will sell $XXX.” “ I will get my work into 4 galleries and set up an online store”. See how easy that is?

Now here’s the hard part. You have to do the work. Making your art is the easy part of a craft business, it’s selling it that’s the work. This work is anything that isn’t about making. It’s blogging, taking photos, writing product descriptions, researching shipping options, standing in a booth, doing whatever it takes. Understand this, for every one hour I spend making work, I spend 4 hours running my business. This is what it takes. You need to know this.

I know what it takes to cross the finish line in a marathon and I don’t want it badly enough to commit to it. I know what it takes to succeed in my crafty business. This I am committed to doing.

What about you? Are you committed to your own success? Committed to doing the work? It’s your choice, having a small crafty business isn’t the easiest thing. For the few hours in a gorgeously designed booth with your beautiful work there are untold hours of toiling away by yourself preparing. Nobody sees them. Few will acknowledge them. Yet when someone buys a piece from you they are cheering you on and celebrating your hard work.

Those hours are the price of success. For every choice in life you need to know the price of the options and then commit to paying the price. So I’m asking you, are you willing to commit to your own success?

The Business Chat - bank accounts and your sanity

Does this sound familiar? You went to a craft show and sold some work, did your happy dance and deposited the money in the bank. Because you’ve sold some work, you ran straight to the supply store to pick up those lovely shiny objects you’ve been coveting. Then you ordered some more supplies online, then paid for some business cards and sent a cheque with a craft show application. No problem, you’ve been selling work lately. 

Meanwhile, your husband/wife looked at the bank account, saw money and paid some bills. And now you’re looking at the bank account and what the heck? Where’s the money? 

You’re not sure how much money is going in or out. Budgeting is overwhelming. Costs are rising, and you're losing track of where you stand. You know you “should” be earning more based on sales volume. 

In practice, you still can't make ends meet and you never seem to have enough cash in the bank. You wish you could run reports (expenses, income), but you can't access the figures (because it's all mixed together). 

One of the biggest mistakes new entrepreneurs make is to mix their business and personal bank accounts. No matter how small your enterprise, if you sell ANYTHING, you are in business and in order to be in business successfully you must track every cent you make and spend. 

Do yourself a favour and separate your personal and business bank accounts. No more co-mingling of accounts, no more gray area, no more personal checks for business expenses. 

Whether you open a second personal account or a business account depends on where you are in your business career. Many makers who are just starting out haven’t yet registered their business, a business bank account requires that you be hold a Master Business License which you obtain by registering your business. (Registering your business is not legally required in Canada, you can sell under your name without registering). 

Rarely is a business bank account free so for makers who are new, or who are selling very part-time, justifying the cost of a business account is hard. My suggestion for those who fit this category is to open a free personal account and use it for business only. 

Make it your business bank account. Deposit ALL of your sales income into your business account. Pay ALL of your business expenses from this account. DO NOT pay any personal expenses from this account. If you want to pay yourself, move your “wages” to your personal account and note how much you are paying yourself. At the end of every month go over your bank statement with an eagle eye and make sure you know where every cent is. 

Get a separate credit card to manage all expenses like online shop fees and PayPal transactions. Remember: A credit card is free as long as you pay off the balance every month, and there are plenty of cards out there with no annual membership fees. 

By separating your accounts, your personal financial choices (good or bad) can’t affect your business — and vice versa. You'll also find you have better control and far more sanity when it comes to your finances.

The Business Chat - bank accounts and you

Does this sound familiar? You went to a craft show and sold some work, did your happy dance and deposited the money in the bank. Because you’ve sold some work, you ran straight to the supply store to pick up those lovely shiny objects you’ve been coveting. Then you ordered some more supplies online, then paid for some business cards and sent a cheque with a craft show application. No problem, you’ve been selling work lately.

Meanwhile, your husband/wife looked at the bank account, saw money and paid some bills. And now you’re looking at the bank account and what the heck? Where’s the money? You’re not sure how much money is going in or out. Budgeting is overwhelming. Costs are rising, and you're losing track of where you stand. You know you “should” be earning more based on sales volume. In practice, you still can't make ends meet and you never seem to have enough cash in the bank. You wish you could run reports (expenses, income), but you can't access the figures (because it's all mixed together).

One of the biggest mistakes new entrepreneurs make is to mix their business and personal bank accounts. No matter how small your enterprise, if you sell ANYTHING, you are in business and in order to be in business successfully you must track every cent you make and spend. Do yourself a favour and separate your personal and business bank accounts. No more comingling of accounts, no more gray area, no more personal checks for business expenses.

Whether you open a second personal account or a business account depends on where you are in your business career. Many makers who are just starting out haven’t yet registered their business, a business bank account requires that you be hold a Master Business License which you obtain by registering your business. (Registering your business is not legally required in Canada, you can sell under your name without registering).

Rarely is a business bank account free so for makers who are new, or who are selling very part-time, justifying the cost of a business account is hard. My suggestion for those who fit this category is to open a free personal account and use it for business only.

Make it your business bank account. Deposit ALL of your sales income into your business account. Pay ALL of your business expenses from this account. DO NOT pay any personal expenses from this account. If you want to pay yourself, move your “wages” to your personal account and note how much you are paying yourself. At the end of every month go over your bank statement with an eagle eye and make sure you know where every cent is.

Get a separate credit card to manage all expenses like online shop fees and PayPal transactions. Remember: A credit card is free as long as you pay off the balance every month, and there are plenty of cards out there with no annual membership fees.

By separating your accounts, your personal financial choices (good or bad) can’t affect your business — and vice versa. You'll also find you have better control and far more sanity when it comes to your finances.

The Business Chat - 5 ways to kill your own success

“The economy is terrible! All those third world products! All the copying! No one appreciate handmade work! There are too many jewelers/soap makers/print makers/knitters for anyone to make money!”

We all dream of having a wildly successful little business don’t we? (That is why you’re reading this I assume.) Many of us will do just that, set up shop and work out way to our own version of success. And many will not. 

For some the dream just doesn’t seem to happen no matter what they do. The ones who don’t succeed are so busy blaming everything around them that they don’t realize most of the time, the blame for their failure is actually themselves. 

So often people sabotage their own success, without even realizing it.  

Here’s 5 things that self sabotagers do. 

1. All research no action. 

Ooh, wouldn’t it be great if you learnt how to -insert new skill here - before you did a show? And what about that book on marketing, you should read that first. Oh, and maybe you should buy and learn how to use accounting software? And web design? You can’t possible open an online shop until you learn how to code your website. Wait, there’s still lots to learn about marketing!

Argh, you can’t possible do anything until you’ve researched all there is to know in the universe! 

You’re right, there is a ton of stuff to know. Your little business is more than just making some pretty work. 

However. 

You will never know it all. That is not possible. 

At some point you are going to have to put down the books and just do it. 

You can’t succeed if you don’t start. 

2. Quitting too soon

“Well, I made some stuff, I took photos of a few of my best pieces and then I opened an Etsy shop. Only 1 piece sold in 3 months! I did one show, it was okay, but I didn’t sell nearly as much as the girl beside me and it was hard! So I closed up. You can’t make any money selling handmade work.” 

Oh sigh. 

If all it took to be successful was a few photos, and a handful of pretty things then the world would be jammed with success stories. There is no shortcut to success in the handmade world. Expecting overnight success is like someone picking up a guitar for the first time, playing a few times and then wondering why they aren’t selling millions of songs. EVERYTHING takes practice and business is no different. 

It takes time to learn the business of how to sell. Time to put together a really good collection of work, time to build up a clientele, to learn how to sell online, to selling at shows, to actually making a profit. 

If you thought this was a quick way to get rich you’re in the wrong game. Buy a lottery ticket. 

When you are starting out you are up against people who have been doing this for years. What makes you think you can just jump the queue? 

If you’re not in it for the long haul, don’t start.

3. Looking for all the pitfalls. 

“I can’t put my work online, someone will copy it!” 

“In this economy? No way can you run a business these days.”

“Have you seen what it costs to be in a show? There’s no way you can make any money.”

There are a million things that can go wrong in your business venture! Spending your mental energy cataloging every possible pitfall will suck the lifeblood out of your success. 

YOU and only you are responsible for the success of your business. 

Focus on the positives and quit whining about the economy, your competitors, and all the other ways life can dump on you. No one wants to hear it. 

When life give you lemons, make lemonade. 

(or add vodka, either way you have a nice beverage.)  

4. Scattered attention

I know, you have SO many ideas it’s hard to pick one isn’t it? And so you pick several. Yes your jewelry is awesome, but so are your knitted scarves, and your painting, why not combine all 3? Or start 3 businesses?  

Because you can’t possible focus on 3 things at once. 

Especially when you’re starting out and most likely have a job as well, not to mention family, friends, and a life. What’s going to happen is that nothing will get the time and attention it deserves and when something has to go it will probably be the thing that isn’t making any money - your business. 

You can do it all, just not at the same time. Focus on one thing at a time. Especially during the beginning stages of your business when you have a lot to learn about running a business. 

5. Waiting for the stars to align and everything is perfect

Imagine this, your work is the best it can be, your website is amazing, your photos are world class and your product descriptions are riveting. The weather is guaranteed for your outdoor show and your booth display is awesome. Now imagine unicorns dancing around rainbows and showers of money falling from the sky because that is about as likely to happen as the first scene. 

Nothing is ever perfect. You can always improve and you will need to. 

Do the best you can all the time but get your work out there. Evolve as time goes on. 

Done is better than perfect. 

See anything in here that you can relate to? 

The Business Chat - August slow season

There's a slow and lazy feeling about the last half of August. Humidity is high, cicadas are buzzing and kids are dragging their feet knowing this is the end of their freedom. No matter how long we've been out of school we all feel the laziness now. Add to this the traditionally slow sales of August and we're all tempted to let the business slide for the moment.
Wrong.
Now is the time to really put some muscle into your business. Yes sales are slow at this time of year. No we don't feel like working. Suck it up and do the work (remember last weeks post?). When September rolls around and things pick up again you'll be busy working IN the business, take this slow time of year to work ON the business.

Here's 5 thing to work on during a business slow season:

1. Vision time. Grab your notebook, your favourite pen, pencil or crayon and doodle and ponder. In an ideal world where do you want your business to be in 6 months? 12 months? What's your idea of a perfect work day? How much would you like to make? How can you make that money? What's the most awesome thing you'd like to happen in your business? Dream big and silly and write it down.
2. Work on your marketing message. Marketing is communicating what you do to your customers. Before you can tell them, you have to know yourself. What do you do? Now is the time to work on your elevator speech. Think about new marketing materials, do you have postcards yet? A new business card? A logo? Redesign your blog or plan on starting one. Create a Facebook business page.
3. If you haven't booked any Christmas craft shows now is the time to do so. Larger craft shows book 6 - 12 months in advance. If you haven't booked a show yet look for smaller shows. Why not decide to do a larger show next year and start researching them now?
4. Improve your photography skills. If you are sellling online, or plan on selling online soon you'll already be aware that the most important thing you need is brilliant photography. Online shoppers can't touch your work so your photos are what sells an item. If you create one product that is reproduced 100's of times then you can afford to hire a professional to take amazing photos. Most of the time it si not financially viable to pay someone to shoot images so you will need to do them yourself. Photography is a skill, that means practise, practise, practise. There are great tips and tutorials online to help you (check the Etsy forums). Go for it.
5. Build up your online community. A lot of creative people work at home, especially if you are doing this part time, and it's hard sometimes to remember that we're not alone. Your community is important not just for the moral support but for information. Your community will tell you how fabulous you and your work are, they'll let you know about craft shows, deal on supplies, important blogs to read and advertise on and which online venues are good for selling on. Your community can be the key to success. Take some time now to find your online community. Make friends on Facebook, read blogs (and leave comments!!!), when you find a blog you like check out who they read. Cruise around Etsy, Artfire and DaWanda. Where ever you visit online send emails to people who's work you like and make connections. The world is a big place.

Dreaming, scheming, reading and pondering are just as imporant to your success as making a fabulous necklace or knitting a gorgeous sweater. This is one of those times when spending a few hours cruising the internet isn't time wasting, it's research.

The Business Chat - Shout it Out Loud!!!

Yes, I admit it, this is a repeat from last year. Because I'm busy packing up to go to a show and you know what? You can never shout it out loud enough or enough times. Most of us are businesses of one person. If you don't shout out your message who will? 

In our holiday preparations so far we have worked out our inventory list, spiffied up our booth display, gone over our online shop and ordered our holiday packaging. Now it’s time to let the world know that the holiday shopping season is here and that you are ready! It’s time to market and advertise your work.

Here at the Business Chat, we’re fond of wearing hats. Today we’ll put on 3 hats. First there’s our Marketing Hat, second our Advertising Hat, third our Sales Hat.

Marketing is what you do to get a customer to knock on your door. It informs a customer of who you are and what your product is.
Advertising is the method you use to publicly acquaint your customers with your product in order to get them to buy what your business is offering.
Sales are when you knock on a customer’s door.

When wearing our marketing hat we create the message we want people to know about our work. The question you have to answer here is “what do you make?” This is really important during a holiday season when all your competition is screaming loudly trying to get their message out. You need a crystal clear message in order to rise above the noise. The following will help you define your message:

·                  Create your elevator speech

·                  Take the one word challenge

·                  Have a great tagline

·                  Be a real live artist

Once you have your message it’s time to switch hats. Advertising takes the marketing message and gets it out to the public. You can pay for ads in places like blogs or facebook or you can use social media. Me, I’m not paying for ads.

A total old-school but very effective way to advertise your work is to wear it. NEVER leave the house without wearing jewelry (and do NOT wear any jewelry other than your own) and carrying your business card. A good idea is to carry a small flier with your show list on it. When the cashier at the supermarket comments on how nice your necklace is, hand her a business card and a flier. Seriously. Do it. It works.

Of course you should always advertise to your own mailing list. People on your mailing list are already committed fans, by letting them know about holiday shows or special items in your online store you will make sales. They like you. They want to buy. Send them directions on how to buy in your newsletter (and newsletter part 2 here).

For those without a mailing list and a newsletter rush immediately to your To Do list and write “create a newsletter” and “start a mailing list” on it.

Your blog is another place to create awareness of your holiday sales. Next is your Facebook business page and then there’s twitter. Here’s a list of ideas for how to advertise using these channels:

·                  List your upcoming shows

·                  Post pictures of new work

·                  Talk about the new work, get excited

·                  Tell your readers what is so fabulous about your work, tell them why it makes such a great gift

·                  Post pictures of your gift-wrap and tell them about how this feature will save them time

·                  Let people know about shipping deadlines

·                  Remind people of your upcoming shows

·                  Remind them again

·                  Suggest items for various people, dad gifts, kid gifts, hostess gifts

·                  Let them know when a new item goes into your online store

For those without a facebook business page or a blog rush immediately to your To Do list and write “create a facebook business page” and “start a blog” on it. These are important business tools for success. If you haven’t time to do it properly right now, put these tasks on your 2013 list and start researching how to do them now.

Once you have done your job wearing your Advertising hat, it’s time to put on your Sales hat. You already know how fabulous your work is and why. When the customer is standing in your booth, or sending you’re a question online, tell them all about the jewelry. Tell them why it makes such a great gift. Tell them how you made it. Sell them the work. You already know the story, simply share it. And make that sale.