Posts Tagged: business

biz notes :: small business start ups

Pretty-Paper-Please-Melanie-KimmettMélanie from Pretty Paper Please is here today sharing her final installment on creating your own product line. In case you missed it, click here for her other posts: consignment vs. wholesale | approaching and the follow up | branding | creating a look book | line sheets + catalogues.

What I didn’t realize when I first imagined starting my own stationery line was the amount of time and work needed to create, produce and eventually market and sell my own pieces. And then there’s the business/financial side! If you’re like me – creative, but no real head for math – that part of running your own business can truly be scary! And if done wrong, could really get you into trouble!

A bookkeeper and/or an accountant can guide and help set you up with good working habits in terms of how to organize and separate all of your receipts. They’ll also help you understand which expenses and what percentages can be written off, as well as give you tips on how to save money month to month! In other words, hiring a business/number-minded person will help shape your business and force you to be responsible about your own finances. If your finances are in order, well, you’re on track for some real business growth.

I asked my bookkeeper if she could put together a list of things she’d encourage any new business to look into and these were her top recommendations:

Decide on whether you are going to Incorporate or be a Sole Proprietor
First understand what either classification means, then decide how either applies to your needs and what sort of business you see yourself being.

Register your business name with the Government
Every country has its own rules and process for Small Business, which is why it’s important to research your options wherever you happen to be. In Canada, you’re required to register your chosen business name (if its anything other than your own given name) with your Provincial Government.

Register your business number with the Government
In Canada, every business requires a business number. If you’re deemed a Small Supplier (your business is making less than $30K/year) you’re unlikely to need a GST number. Depending on which province you’re selling in, or the types of goods you’re selling you may also need to register for a PST number. Contact the Canada Revenue Agency (CRA) to understand where you fit in.

Find a good bookkeeper and tax accountant
Bookkeepers and/or accountants are a great source of information. Getting things set up and done correctly from the start will save you time and money in the long run.

Open a business bank account + Collect your business receipts
The idea here is to have a separate bank account for business transactions. Doing this will make your life easier when it comes to bookkeeping! There are countless items you can write off as a business expense, but it’s important to understand what those allowable purchases are. Always ensure to hold onto your receipts for your bookkeeping as well as for safekeeping. In the event you’re audited, having those receipts handy will save you from any additional stress.

Good luck! And happy making & selling!

Thanks so much to Mélanie for sharing her advice! Check out her links here: portfolio | shop

biz notes :: line sheets + product catalogues

lotusevents_biznotes1After a teeny break, we are pleased to welcome Mélanie from Pretty Paper Please back to the blog today to talk about line sheets and product catalogues! You’ve got your finished product in hand. Your packaging is figured out. Your brand has been fine-tuned. You’ve built a cohesive brand story that exudes confidence and strongly represents you and your product. It might finally be time to reach out to the shops you’ve wanted to, for so long!

Not so fast! I’ve talked a lot about having a professional edge throughout this series thus far, and two imperative pieces to have at the ready are your line sheet and product catalogue. Both documents should be included in all introduction emails, as they provide shop owners with a comprehensive look at your product line, pricing, minimums and refund/exchange policies.

From her own experience as a previous shop owner, Rena Tom is an excellent resource for anyone starting a creative business. If you’re not already familiar with Rena, she’s worth following and will undoubtedly inspire. Thankfully she compiled and shared specific line sheet and catalogue requirements over on her blog a couple years ago. I referred to her list of must haves when it came time to create my own and would suggest you do the same.

It’s important both your line sheet and product catalogue fit within that brand you’ve worked so hard at establishing. You don’t have to get too precious with these – simplicity is key, as you want the information to shine here. When it comes to photography, it’s important that you capture each item properly. Don’t use flash photography and avoid any “busy” or distracting backgrounds. White or simple backgrounds are generally preferred.

I’ve created a mock line sheet and catalogue to help you visualize your own. Your line sheet will typically be an editable PDF, although I’ve known some people to create Excel spreadsheet versions. The catalogue can also be a PDF, but it’s a tiny bit easier to email a link around, so I host my catalogue on Issuu.com (a digital publishing platform). If you’re not comfortable setting these up on your own, reach out to a designer and work with them. It will simplify your life, I promise!

lotusevents_biznotes2PRICING
While we’re talking about line sheets I want to also briefly cover pricing. Generally, shops are looking to retail your items for double your wholesale price. This means you need to consider a few factors. First – the shop’s customer. What are they likely to spend on your item? Second – the shop itself. Is it a lucrative purchase for them? Third and possibly the most important – YOU! DO NOT EVER forget about yourself! You always want to consider your own material and labour costs, while also acknowledging some profit when calculating final wholesale costs.

Here’s a Wholesale Price Formula that is pretty tried and true, although sometimes it’s a bit of a balancing act to find that magic number for everyone: (cost of materials + cost of labour) x 150% markup = wholesale price

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MINIMUMS and MSRPs

Minimums
If the shop is interested in carrying your product line, they’ll typically ask about your “minimums”. What is a minimum, you ask? It is the minimum order the shop will need to place in order to receive your product line at wholesale price. Think about your material and labour costs and decide what minimum dollar amount is worth the wholesale discount.

MSRPs
The shop might also ask about your MSRP. What they’re looking for is your “Manufacturer’s Suggested Retail Price” for each product. It’s as simple as that.

Get out there and introduce yourself! You’re ready to sell! Good luck!

next post: The Business of Running your own Product Line.

biz tips :: creating a look book

MelanieKimmett_LookBook_July2012_3Mélanie from Pretty Paper Please is back today as part of our wholesale and consignment series to talk about the ins and outs of having a “lookbook”, how to create one, as well as weighing its importance. Catch part one, two, and three by clicking the links!To those of you who aren’t familiar with the concept of a lookbook, Wikipedia describes it as a “…collection of photographs compiled to show off a model, a photographer, a style, or a clothing line.”

If you’ve ever watched Tyra Banks’ Next Top Model series, you might remember the contestants were building their lookbooks with every new photoshoot, episode to episode.

In the fashion world, this particular lookbook is then brought around to meetings with potential clients, such as fashion labels, photographers or model agencies. These photos provide the model with a story or some context, helping the client imagine them in their clothing, future photoshoots or a new face at the agency.

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No, there’s no disputing that the term “lookbook” is deeply rooted in the fashion world. But in the last several years many other industries have adopted its concept and applied it to their own needs. After all, we all have a story to tell. And in this crowded, advertised world we live in, it’s important those of us with our own product lines provide some context into what makes us special, and help us stand out amongst our competitors.

In any great story, the storyteller wants to create a feeling, a setting. They’ll have characters, scenes and some sort of dialogue. The storyteller may want to speak to their audience in a way that is relatable and real or maybe create a whole new dialogue instead – anything that demands attention and garners them an audience. Using the lookbook format to tell your story through pointed-visuals (and some text) invites your audience into a romanticized world that is unique to you and your product line.

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I planned, styled, photographed and designed my own lookbook last year and I’m currently working on this year’s new book as well. I’ve also been using Issuu.com (a digital publishing platform) to host my lookbook online. It’s much easier to email a link around then having to worry about the size of the attachment and risk having your email fall into a junk folder.

If you don’t feel as capable of designing, photographing or organizing your own lookbook, I’d advise approaching designers and/or photographers to help you in this area. If you’re going to invest your time in the development of a lookbook, you should probably be open to investing your money as well. Believe me, people appreciate and notice the effort when you’ve done it right.

As I’ve previously mentioned, it’s not imperative everyone with a product line create a lookbook, but it will certainly give you a professional edge when you finally approach prospective shops.

Context is key when you’re trying to reach a desired audience. You want your audience (including prospective shops) to imagine themselves in your world, and hopefully if all goes well, they’ll eventually invite you into theirs.

next week: Create your own Line Sheets + Product Catalogue

biz tips :: consignment vs. wholesale

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I am thrilled to introduce Mélanie Kimmett from Pretty Paper Please to the blog to talk to us about her experience with consignment / wholesale and creating your own product line. Mélanie has been a great help while I put together a catalogue and as I prepare to expand my own line of handmade goods to retail shops. She’ll be covering a lot of information, so make sure to follow along! – Andrea

When I first explored the idea of developing my own stationery line, I found most information about how to approach wholesale opportunities strangely allusive. Over these next several posts I’ll cover all relevant topics I wish I had been privy to before venturing into the world of consignment and wholesale myself.

Now, I also want to preface this by saying I’m really not an expert, but I’ve certainly gained some real life insight from my own trial and error ways. Hopefully you can all benefit from those lessons. Feel free to add your own points or comments in the comment section below. I’d love to treat this as an ongoing conversation!

Here’s the outline of what I’d like to touch on over the next coming weeks:

1. Consignment or Wholesale?
2. How to Brand and Package Yourself
3. Create your own Line Sheets + Product Catalogue
4. The Business of Running your own Product Line

First things first, let’s understand the top-level difference between selling goods on consignment vs. wholesale. Here are the dictionary’s definitions for selling on consignment or wholesale.

Consignment – With the provision that payment is expected ONLY on completed sales and that unsold items may be returned to the one consigning.

Wholesale – The sale of goods in large quantities, as for resale by a retailer.

In simpler terms, one option provides you with monetary compensation now (wholesale) vs. later (consignment). Either way you look at it, someone (whether it’s you or the retailer) is taking a gamble on your product, especially if you’re just starting out and haven’t made much of a name for yourself yet.

Where wholesale seems like the favourable choice when you’re first starting out, I’d like to mention that consignment is often times easier to come by, but it should also be recognized as a personal investment in yourself and product line. While it exposes your product to the marketplace, it also provides a testing ground for items you were maybe questioning and could help you streamline things in the future. Another strong point is that you sometimes profit more (per item) from selling on consignment. Most consignment shops offer you a 60/40 split on all goods sold, whereas in wholesale you have to find that magic wholesale price point that works for both you AND the retailer, which can get tricky. I’ll delve deeper into that in my ‘Create your own Line Sheets + Product Catalogue’ blog post in the next coming weeks.

Most shops make a clear distinction on whether they are consignment or wholesale-based, but some will entertain both options. Some wholesale-based shops may want to try you on a consignment basis to minimize some risk on their end. Be open to this as an option, as this flexibility can strengthen your work relationship with the shop owners. If after a trial period of a few months on consignment you’ve proven to be a good fit and your product is selling well, you should then think about approaching the shop about wholesaling with them.

Check back as we cover topics such as ‘How to Approach Prospective Shops’ and ‘the Follow Up’!