There are plenty of people making handmade goods and earning a profit from them. But earning a living? That’s a whole different kettle of naturally dyed yarn.
That’s not to say there’s a rule that your business has to grow. Maybe a part-time gig that helps you earn a little extra cash is exactly the right fit for your life. Or perhaps selling some of the things you make is a way for you to cover the costs of a hobby that you love. (Though even if that’s the case, do keep reading: these tips are useful for any business.)
To help those who are interested in turning their side business into a full-time career, we asked a few seasoned entrepreneurs for their advice. Read on for their tips, and share your own in the comments!
1. Create the right mindset
“Once I started thinking of what I was doing as a creative business, it allowed me to grow more rapidly,” says Darya Mohler of Royston, B.C., who creates and sells jewellery under the brand Gras ’Roots Urban. “It also gave me permission to purchase the tools that I needed and to invest in things like a website, business cards and proper tools — things that I wouldn't necessarily purchase if I was thinking of it as a hobby, or even as a hobby that pays for itself.”
2. Be realistic about revenue
Kristy Miller, owner of candle company The Scented Market in Guelph, Ont., started out with just $200, enough for supplies to make 12 candles, and grew the business for quite some time solely by reinvesting what she earned. But that doesn’t mean she was making a living from her new enterprise, at least not right away. “I did have an income stream coming in from my other business,” she says. “Also, my husband works full-time and his job was secure. So that definitely was a helper and made it a less stressful thing to do.”
For many businesses, it can take a while to be able to pay yourself enough to live on. Make sure you have a plan in place to make ends meet in the meantime.
3. Find your market
Diane Lai, an executive who teaches in the entrepreneurship program at the University of Toronto, says one of the basics to creating a viable business is understanding your target market: Who is going to buy your product? How often will they buy it? And how much are they willing to pay?
For instance, Lai says, you might conclude that your customer base is women aged 18 to 55 who buy your type of product twice a year and spend $10 to $20 at a time. The next questions to ask, she adds, include: How many of these customers exist that are close enough to ship to? Where do they spend time, either online or in person, so that you can advertise to or communicate with them? And how many similar makers are you competing with in that space?
4. Do the math
Not every business idea is viable, and it’s a good idea to find out as soon as possible if yours has potential. That means analyzing the numbers to see if you can earn enough money from your work. “I would sit down, put a timer on and record how long it actually took me to make something,” says Mohler. “Then I'd look at what it cost me to purchase the materials. And if I sold this item for, say, $30 — would I actually be able to make money? And would it become a sustainable income?”
For Lai, it all comes down to one simple question: “How many people are out there that are willing to buy my product at a price point where I can make a living wage?” For instance, if you can make a profit of $10 on a single item, and you can make 100 of them in a week, that’s a potential profit of $1,000 per working week — assuming they all sell.
When doing these calculations, be sure to include all the expenses involved in running your business: not just materials and your working time, but things like professional fees, website costs, studio time, transportation, and all the time you spend doing the things that keep your business going, like recording Instagram Reels to boost your reach. And don’t forget vacations and days off!
5. Price for the future
Speaking of math, when you work out your pricing, make sure you include future expenses, too, so that you’re covered if and when things change. For instance, if getting into retail is one of your goals, it’s important to work that into your overall budget. “It’s great if you price things lower and it sells really well at a market,” says Mohler. “But then if you have a store come along and see you at that market and they want to wholesale your work, all of a sudden, you can't make money wholesaling at those prices.”
6. Hire help where you can
Even if you don’t have the budget to bring on staff at the beginning — or even a bookkeeper — there’s still the possibility of hiring someone to set up your processes and teach you how to do specific tasks. “I wish that at the beginning, I had hired somebody to teach me basic accounting and how to build a basic website,” says Mohler. “It can be very costly if you hire people to do that full time. But the amount of hours I put into learning — it would have been better to have invested that time in the making, and had help from a professional to get me started.”
And at a certain point, there’s no way for your business to grow without bringing on team members. “For me, it was a little bit out of desperation,” says Miller. “I was growing so fast that I was working 18 hours on my feet on the concrete garage floor every day, and I started having back issues. So my body told me it was time to hire help.”
One thing to remember: it’s not full-time or nothing. Bringing on part-time, temporary or contract staff is a very reasonable thing to do as your business grows. Just ensure you’re following labour laws when it comes to compensation, hours and other factors.
7. Consider custom work
Lai points out that it can be extremely difficult to earn a living simply by making and selling handmade goods en masse. “If people have a unique talent or a unique product, I often encourage them to do custom,” she says. “Because I think you can charge much more, and I think people value that in a different way.”
8. Educate your customers
Not everyone is a maker, and not everyone understands how much time and effort it can take to create an object that might seem simple at first glance. It’s up to you to teach them, so they understand why your prices are higher than items produced in a factory.
“My number one goal is always to educate people on what's different about my product,” says Miller. “I think where a lot of entrepreneurs go wrong is they don't value their product and their time. But I truly believe in my product and in the quality of my product. So that's where I think I went really right.”
9. Promote, promote, promote
There’s a reason big companies spend huge amounts of money on marketing and advertising. It’s a crowded marketplace, and it’s not easy to get your products in front of potential customers. “I did everything that I could to get seen and get my products in people's hands,” says Mohler. “I knew that my product was good quality and well made, and that people would fall in love with it. I just needed to be able to get it in front of them.” (Check out our Marketing section for some tips and tricks on social media, SEO, email newsletters and more.)
And don’t forget about your existing customer base as an important source of future sales and word-of-mouth promotion. It’s one reason to focus on relationships as a key part of business development. “You have to put your customers first,” Miller says. “They're the ones that will drive your business forward with their feedback and their gifting of your product to other people.”
10. Think incremental growth
Building up a business doesn’t happen overnight, notes Mohler — it can take time to plant a seed and help it grow. “I grew my business in slow steps,” she says. “Once I got in one store, more people started seeing my work. And then I started getting more direct sales because they saw my work at the store. Then once I got on social media, it really started growing rapidly because I was getting in front of more people again.”
11. Understand your business
It’s essential to know where your revenue and profits are coming from — and to stay on top of your expenses. Whether you do this on your own or with professional help, reviewing your accounts should be a regular part of your routine. “Every month I sit down with my bookkeeper, my accountant and my bank manager, and I go over numbers and financial forecasts,” says Miller. “You really have to have a good grasp of what your numbers are, and get good advice from people that are educated.”
12. Be consistent, and patient
As the saying goes, it’s a marathon, not a sprint, so it’s key to pace yourself. “The main thing is to be consistent with the effort that you put in,” says Mohler. “It can be easy to feel discouraged if [success] doesn't happen right away. Knowing that it will take time will help you to not feel so anxious about getting it going.”
13. Edit your product line
As your business evolves, it’s important to regularly reassess your product lineup and to try new things. Not only will this help you refine your offering and optimize products, but it’s good for your creativity and even your health, too. “There are specific jewellery pieces that I don't wholesale because they are too time-consuming or the material cost is too expensive,” says Mohler. “And there are products that I have not continued doing.” One technique, for example, caused her a lot of hand pain, so she decided not to make that design anymore. “For the long haul, I just couldn't fabricate multiples of them on a daily basis without risking injury.”
14. Ask for support
“Surrounding yourself with people who want to see you succeed and who can help you succeed is huge,” says Mohler. “I can't stress that part enough.”
And while family, friends and neighbours were a huge source of support for Miller, she also counts the wider Scented Market community for helping her business evolve. “If we need to hire or we need help or I'm stuck on something, I ask my community of followers or go on Instagram and poll people,” she says. “I've gotten so many great hires from right here in our community of people who already know our products and our brand.”
15. Stay true to yourself
“You are what makes your brand or your craft unique,” says Mohler. “And it's your voice that people are going to be intrigued by or find interesting. And so I always stress to people to stay true to themselves. That's what's going to make it a long-lasting brand.”