Business Tips Part 31: Trade Shows Part 3

Last week we began to look at trade shows in terms of research and planning. Today we will look a little more in to planning how you will take orders. Imagine the week of the show has arrived and you will no doubt be excited - that's completely normal! A word of advice though when at the show - don't get too excited and misplace all of your orders, take a folder with you and keep them in there. Take the folder home every night and keep the orders safe.

Another word of caution over orders, it can be very tempting to accept any order that comes your way but you must consider three things:
  1. Realistic lead times,
  2. Quantities expected,
  3. Who do you want to carry your product line?

There is nothing worse as a seller than not being able to deliver an order on time. Keep a schedule book and enter all of the orders and be realistic - especially if you make your own products.

You may find that you are asked lots of questions about minimum orders and lead times - that's the nature of wholesale. Some buyers will ask you for a catalogue so they can place an order at another time. If this happens, as for a business card in return so that you can track any potential leads.

Unless you are superman/woman (and aren't we all!) you will find a tradeshow exhausting especially if you have no assistance. If you need to book a hotel nearby check with the organisers as they are likely to have a partner hotel that will offer a discount and a shuttle to the venue.

But even superheroes need a sidekick and I could not recomment more bringing someone with you - I would take my mum! Be selective, this sidekick will be representing your company meaning your reputation is at stake. They must know and understand your products, order terms and lead times. But having a show buddy will free up a little time for you to walk around, take a rest break and if you're like me - they will offer reassurance.

Overall, a trade show is a big step for your business. They are costly and tiring but exciting at the same time. If you are ready for the commitement - give it a try!

Coming on the next Business Tips blog on Friday: Being a Salesperson

Monday, 29 March 2010 | 0 Comments

Business Tips Part 30: Trade Shows Part 2

Earlier this week we started to look at trade shows and how they can be ways to sell your items. today I want to look a little more into what happens once you have secured that booth. Simply put: PLANNING! You will need to start planning at least two months before the show.

You might decide to promote the fact that you will be attending the show so give thought to pre-show promotion. You could head to Vista Print (or other similar places) and create some postcards including the dates, booth number and a photograph. Send these to your stockists and potential future stockists.

If the show is your first one ever, I know you will want to crete as much stock up as possible but this isn't always a great idea. You will not know what product lines will be popular and rather than spend every waking minute creating items, take samples of your entire range and have a production plan for each of them including delivery times.

In your planning you will want to give thought to the booth set up and display, this can often be overlooked but with so many people displaying, yours will need to be memorable so PRACTICE. Remember that your products are the star of the show and the display should highlight this not steal the limelight. It is also an idea not to over clutter the space but have it well lit, easy to assemble, portable and not overly designed.

The next stage in planning it transport - vital really unless the show is quite literally on your doorstep! How will you transport everything to the show? If it is a distance you may need to inlist a haulage company or another car at least. If you are worried about transport, especially if you have booth fixtures and fittings to take, contact the events manager and see if they have a list of reputable companies you can hire from.

Coming on the next business tips blog on the 29th, Trade shows Part 3!

Friday, 26 March 2010 | 1 Comment

Butterfly-Crafts Is Almost A Year Old - Are You Ready?

Yes that's right, Butterfly-Crafts is almost a year old, the big day is coming on March 26th (this Friday) and there will be cake to celebrate - if only you were nearby to share it and the pancakes I'll be having for my tea!

Anyway, to mark this special day I am going to be running an extra special sale! Usually when I have had sales I promote them here and on Twitter, Facebook etc but not this time! The sale will be exclusively for recipients of the Butterfly-Crafts Newsletter so if you want to be part of the sale you'll need to sign up to the newsletter which you can do HERE.

I send out a newsletter every four to six weeks and include details of new items, special offers, developments in the business you might find interesting and often share a fabulous handmade store I have stumbled across.

So what are you waiting for? Sign up before the 26th to receive the special offer!

Tuesday, 23 March 2010 | 0 Comments

Business Tips Part 29: Tradeshows Part 1

Its always good to dream big and being a small business owner is no reason to reign in your dreams. If your big goal is to sell your products nationwide then a trade show is likely to become part of your annual calendar. There are many trade shows and each usually cater to a specific market i.e. jewellery, gifts, pets, eco-products. As a rule, trade shows are mostly wholesale for 'trade' only but there are some that will include a retail element - you will just have to do some super research.

A show can run from three to five days and a broad range of retailers are represented from the tiny independent shops to the much larger department stores who often attend purely for buyer research.

If you are interested in attending a trade show the first and most important question to ask is how much is the fee? The smallest booth may set you back £750 / $1000 as they are charged by the metre/foot. The fee should hopefully cover the minimum such as a table, chair, rubbish bags and lights and then you will organise curtains, table coverings and drayage (moving your freight from your vehicle to your booth) - but sometimes it might be the other way around. If the fee scares you and you approach a friend to share the booth, best check with the organisers first as there are likely to be guidelines.

Once you have signed up, you will be issued with a contract. Before you sign it, check where you will be on the floorplan and who you will be next too, as with housing, location is key!

Coming on the next business tips blog on Friday: Tradshows part 2.

Monday, 22 March 2010 | 0 Comments

Business Tips Part 28 - Approaching Shops Part 2

Earlier this week we looked at the first stages of approaching shops for wholesale or consignment. Today we look at what to do once you have secured the appointment with the owner/buyer.

Ensure that you arrive on time and are dressed appropriately. Have your hair and nails done if it will boost your confidence and you can afford to have it done! Also bring order forms, samples, a catalogue, relevant business information, price list and the most important part.....a pen! I have some pens created on Vista Print that are branded with my business logo and colours, they were pretty cheap but look professional. As the buyer or owner looks at your items, sit up straight and pay attention. What feedback are you getting? Do they seem excited? Make sure you note anything down because a comment from a retail buyer is invaluable.

If the buyer decides to purchase, write up the order, discuss the terms and how long delivery will take. Once you have delivered the products, follow up with further literature so that the sales staff have an understanding. Also remember to visit the shop so that you can check out the display.

If you do not get an immediate sale, try not to get too discouraged. A buyer will need to consider the 'fit' of your product in their shop, what it may compete with, actual capacity of the shop, their customer base and your prices. Sometimes a non-purchase just comes down to bad timing in regard to the shops cash-flow, budget or simply being wary of a new seller. If you do get a 'no' for purchase, ask if they would consider a consignment, because for you, any presence in a retail shop is good business!

But, no matter if you have achieved an outright purchase or a consignment, be sure to follow up with the buyer to see how your products are selling and if they might need to reorder.

Coming in the next business tips blog: Tradeshows

Friday, 19 March 2010 | 0 Comments

Business Tips Part 27 - Approaching Shops Part 1

If you run a creative business like I do with Butterfly-Crafts, I am going to take a guess you dream of getting your items into a retail store? A great way to start off small is to approach local independent shops in your area and then this may grow into being a big player at wholesaling.

The best place to start is with a list of the top five shops in your area you would like to target that your items are appropriate for. Simply target number one and then work down the list but if one shop agrees, think very carefully before approaching another on the list because often independent shops want to have something unique and not something that can be found in all the local shops. However, if you have a range of products for example jewellery and model figures, you could offer one shop one product and another shop the other range.

The second step is to go and investigate the shop you are going to approach. Look at their product range, packaging and prices but do not introduce yourself as a creative business owner as this will come a little later. Make sure you also find out if they have an online presence as your products might feature on their website.

Once your research is complete on all of the shops on your list now what? Telephone the shop and ask to speak to the owner or buyer. Introduce yourself and let them know that you will be sending or hand delivering a package of your items for their consideration. Once you have made that call it is important to follow up promptly with a personalised package including:

  • A covering letter that requests an appointment,
  • A catalogue,
  • A line sheet / wholesale prices,
  • Samples if you are able to spare them,
  • Your contact details & website,

If you do not hear back within two weeks then follow up with an email or phone call. In an ideal world, you'll secure that appointment!

Coming on the next business stips blog on Friday 19th: Approaching Stores Part 2

Monday, 15 March 2010 | 1 Comment

Business Tips Part 26 - Wholesaling Part 2

Following on from the blog on Monday about Wholesaling, today I will talk about getting paid from your wholesale accounts. Generally the business of wholesale requires a little give and take, you give your product and then it is time to collect payment and the way in which you do this will be layed out in the terms section of your wholesale agreement.

In order to turn your inventory into cash you will need to send your retailer an invoice which is pretty much a list of what they ordered and a total sum due. You may also include the date of order, an invoice number, your company details, mailing address and phone number. It is also essential to include the terms of payment and the buyers purchase number. If the order was prepaid with a credit card or cheque make a note of this on the invoice. Something you might also want to bear in mind is to write INVOICE really big and central to let your buyers know that it is a bill and consider offering a small (like 1.5%) discount if it is paid early or charge a daily interest rate if it is overdue - just make this clear on the invoice.

Credit Cards
Paying by credit card is easy, quick and convenient but there are costs associated with it. If you have to purchase processing equipment you will be subject to various charges but using PayPal or some merchant card processors you can escape these charges by processing the transaction over the internet. In order to accept credit card payments you will need to set up an account through your bank or merchant card processor, do some research to see who has the most competitive rates and always keep in mind that you may be able to negiotiate. When you do accept credit cards, maintain good financial records of the transactions incase there is ever a dispute with the card holder. If a problem arises and you are unable to provide sufficient evidence your processor will withdraw the amount from your account along with any charge back fees.

Cash on Delivery
Accepting cash on delivery allows the buyer to pay at the time of delivery (kind of obvious wasn't it!) Once the item has been put in the mail you will need to let the buyer know and then a cheque can be raised. Upon delivery, the buyer will then send the payment to you, I would strongly suggest you insist on registered post!

Net 30 Day Terms
Getting paid on 30 day terms is a much slower form of payment so bear in mind you could offer 15 days for payment but also know it might not be you setting the payment terms, if you are lucky enough to work with large retailers, you will have to accept their requirements which might even be 60 or 90 day terms. What ever the term, the general idea is that you send your buyer an invoice and they have 30 days in which to pay. This form of payment does carry risk in that you run the risk of not getting paid. If you end up with a cheque that bounces, call the buyer immediately and see what they will do about it. To counter-act this, consider keeping their credit card details on file with an agreement that it will be charged if a cheque bounces.

Billing and payments can be a hard part of business to manage, you will need to be efficient and keep up-to-date with invoices and chasing payments to keep your cash flowing. If a buyer is late with a payment, keep hold of their order until the bill has been settled. New business owners can be incredibly shy when it comes to payments and bills because you want to keep hold of the buyer but if you dont, you may end up in debt just to keep your cah flow moving. You will still have supplies to purchase and bills to pay so you need to get paid to.

Coming in the next business tips on Monday 15th March: How to approach a store.

Friday, 12 March 2010 | 1 Comment

Business Tips Part 25: Wholesale Part 1

This blog is coming up at the perfect time for me as i am looking into wholesaling with Butterfly-Crafts!

Just hearing the word wholesale can put such fear into craft people because it gives the indication of selling goods in vast quantities are heavily reduced prices - not so. Wholesale can mean selling 5 of one item or selling 5000! If you are interested in selling wholesale, like I am, what does it mean to you? Do you want to get a presence in a few local stores or independent stores natiowide or are you looking to compete with the big guns? What ever your aspiration, there are a few things you will need to know, and here I shall cover the basics (they really are the basics, you will need to investigate further!)

Line Sheets
A line sheet displays the names, item numbers and prices of your products. Its also good to include contact information, sales and delivery policies, minimum order requirements, lead times and shipping costs.

Minimum Order Requirements
There are two types of minimum order to consider. The first is a minimum monetary value for an opening order and reorder and the second is a minimum purchase quantity per item. The minimum opening order will vary depending on what products you sell. For example I may set my minimum at £50 as my prices are lower than say a high-end jewellery seller who may set their opening order at £200. The minimum quantity requirements will tell a buyer that they need to purchase, say, 20 bars of soap in a particular scent or 5 quilts in a particular pattern. When you start out it is helpful to keep minimum quantities lower to encourage buyers to purchase and take a chance on you. It will also enable smaller shops to purchase. Be confident in the minimums you set because if a buyer wants your product they will adhere to your requirements.

Order Forms
An order form will allow you to easily take orders from your retailers. Be sure to have space for their name and company information, terms and the purchase order number. Larger companies cannot pay for their order unless it has a PO number. You may decide to combine the order form and line sheet into one document.

If you are asked what your terms are it means payment terms and is especially important with new account holders. Typically before a buyer has established themselves with you and has your trust you should expect COD (cash on delivery) or prepaid via a cheque, credit card or Paypal if international. When you have an established buyer and trust them you could offer 30 day net terms which will allow them 30 days to pay from the time the order has been received.

Lead Time & Shipping
Once you have an order you will have to let the buyer know when to expect their products. Calculate the lead time on how long it takes you to create the items and package them. As a general guide, manufacturers at trade shows will say a four to six week lead time. You will also have to give information on how the order will be shipped, shipping costs and who will pay for these.

Return Policy
When you sell your items wholesale, the buyer is buying your goods outright however it is good business practice to have a returns policy. You need to set a time frame in which to accept returns i.e. 14 days and the items need to be in a resalable condition in their original packaging. If like me, you do custom orders, it is advisable not to accept returns for these. Be clear about your policies.

Other Policies
You can have policies about pretty much anything but they can only be enforced when they have been started upfront. You might want to have a policy on cancellations of orders, especially custom orders, or how to sell your goods. You may even create a policy about promotion for example if a bulk order is placed, say, over 100 bars of soap, then a small discount is given.
That really did end up being a long blog post! Have you any tips on wholesaling?

Coming in the next Business Tips blog: Wholesaling Part 2.

Monday, 8 March 2010 | 2 Comments

Business Tips Part 24: Consignment

Have you always wanted to have your products on sale in a physical shop? Well don't be a chicken, approach a store and see if they accept consignments.

When you place your products for sale in a bricks and mortar shop yet retain the legal ownership it is known as consignment. This is a precursor for setting up a wholesale account with a retailer. The shop acts as the sales representative but takes a commission on any sales. The commission could be anything between 25% and 50% but there is usually room for flexibility so barter for a rate you are happy with.

Some shops have a limited buying budget and therefore taking on consignments allows them to try out a range of goods and test the salability before offering to buy outright with a wholesale deal.

It can be really exciting to think that you will be getting your items into a real life shop but you will need to be cautious at first, extra cautious if the store is quite a distance away that you are unable to visit too often in person.

It is extremely important to have a consignment agreement with the shop. At minimum this will include the details of how, and how frequently you will be paid (i.e. monthly or quarterly) and who will cover the postage costs if this applies. More often that not a shop offering consignment will expect you to absorb the postage costs. When you do receive payment, make sure you are given a detailed list as to what has sold, this will ensure that you have been paid correctly but it will also be necessary for your records. If you have any concerns or reservations with a shop, start off with a small quantity until they have gained your trust.

Here are some further points to consider:
  • Is the shop well established and been in business for long? If it is new you will need to be extra careful,

  • Are most of the goods on sale in the shop bought outright/wholesale? If so encourage the owner to do the same with your pieces,

  • Contact other designers/artisans who have pieces for sale in the shop for their feedback on the shop and business practices,

  • Ask if the insurance documents cover consignment items,

  • Find out what will happen if your items are stolen or damaged - will the shop pay you?

  • How long will a product be on the shelf? If they are not sold within the set timeframe how will they be returned to you? It isnt ideal to have items sitting on the shelf for long periods of time as they may become damaged and you will be unable to sell them.

Do any of you do consignment? Have any tips you would like to share?

On the next Business Tips blog: Wholesale Part 1

Friday, 5 March 2010 | 0 Comments

Business Tips Part 23: Craft Fairs part 2

So you've researched and found a craft fair and booked the table but now what? Well, you need to think about how you want to display your items.

A visitor to a craft fair isn't necessarily looking for something specific but wants to see what is on offer on the day. Keep this in mind when you set up your table so that your items can be accessible and ready to be picked up....and purchased! Your stall needs to be inviting, uncluttered, simple and have the prices on display.

Consider using some props so that people can see the uses of your items. This is not so relevant for the cards at Butterfly-Crafts but I could show different ways to use a crochet flower brooch such as on a cardigan, a hat or even on pretty ribbon for wrapping a present. Also think about raising some items up off of the table to eye level or use display boards along the back. No matter what you do however, practice before the big day so that you can tweak the stand until you are happy.

Some additional tips:
  • Keep a record of your inventory before and after the fair,

  • Have a method of recording each sale and if you have an assistant make sure they know how to do this too,

  • Consider tying down items that may appeal to slippery fingers,

  • Bring an assistant to help you package and talk about your products, keep you company when it is slow and let you have a break,

  • Set yourself a target such as make three times your table money, or sell all of one type of product.

But my number one tip: Have fun!

On the next business tips blog: Consignment

Image from EmilyClaireCreations

Monday, 1 March 2010 | 1 Comment