Do The Math
It’s absolutely mind-boggling when you think about tracking.
Statistics aren’t everything, but they sure do help if you’re serious about wanting to make your hobby into a business. Well, okay… a business that stays in the black financially. Keeping track not only of inventory and sales, but also of time, overhead, depreciation, sales trends….
I’ve been musing on this all week. Read about it in Craftrends and The Crafts Report. Dialogued about it on blogs. Discussed it with friends. With family. The myriad responses and reactions were in themselves worthy of a study. The subject is a wide current running through the hobby industry as we all face the realities of tightening up our business belts in face of lower sales volume.
Some people want to doom and gloom about the current financial cycle. Things like Craftrends magazine publishing their last print issue can have people running scared. Shows are changing their venues and raising booth fees, or closing altogether; competition with low-cost imports is on the rise; our customers’ buying habits are changing as they have to weigh competing items and make decisions about where to spend their more-limited expendable income.
Tracking can be a very useful thing, but only if you get the big picture. There are cycles to the hobby industry, and while this particular cycle of the low end is lower than many… it’s not the lowest. Cycles from previous decades will play that out if we can look back far enough.
And perhaps if we take the glass-half-full view, we can see this trend as a good thing. It forces us to take a hard look at how we are spending and tracking and selling and marketing. Because we now have the time to do that — when things were booming, when the customers were banging down our doors to buy our products, we were so busy making and selling as fast as we could that we put off taking that long, hard look. In the glow of the moment, we felt the sky was the limit and we could do the math later.
Well, later has arrived.
So is there hope? Of course there is. Taking a deep breath and remembering that there are cycles to business, and that things will get better eventually. Tightening up the tracking and making necessary changes to eliminate those processes or products that drag on the profit line. Moving with the flow of customer traffic and exposing our preconceived ideas to closer scrutiny.
The potential is that our businesses could come into the next upward trend stronger, tighter, and better fit to face the increased volume.
July 25th, 2008 at 7:01 pm
I have had my soap business for 9 years now, and my craft business for about 3 years. While I do try to keep track of what is going on in the business world, and of course the economy,I try not to focus on those “statistics”. Having a firm client base and offering what the clients/customers want is really important, but I have also found that trying to branch out into too many directions can make your foundation weak and affects quality as well. In these times, I cut back to my top 8 best sellers and concentrate on those. That’s where custom work comes in. I also feel that a lot of the “doom and gloom” forecasts these days are manufactured to make us feel insecure.(Insecurity breeds panic - not a constructive thing). If we would all just take a deep breath and hold fast, maybe we would find that things are not as bad as “they” want us to believe. Positive thinking!!!!
July 25th, 2008 at 7:29 pm
I don’t know if the forecasts are manufactured necessarily. But I do agree that insecurity breeds panic! If we daily hear on the news and read in the newspaper that the economy is bad, well even if our finanical situation is fine, we may tend to hold back on our spending.
Of course it’s not just hearing bad news though, in all fairness. Higher prices at the store and the pump are certainly cause for being careful and not spending with abandon.
As a craft supplier, though, you and I are still in a good spot. People who are crafty may turn to purchase supplies from us for making their own holiday gifts when money is tighter, rather than buying more expensive premade gifts. Quality, cost effectiveness, and uniqueness stand in our favor.
August 20th, 2008 at 6:45 pm
arts and craft ideas…
Really interesting, i’m not sure when was the last time i eared something similar, but in general it’s a great idea, contratulations!…