Starting a home based small scale business is quite difficult. I myself planned for many years to pursue my hobby as my business. and when I started, I came to know it's not difficult at all to start.
In this instructable, I'm going to explain all stages I went through which took me years to learn and apply. From choosing a business name to getting my first order, from loss on every customized order to huge profit on each keeping the price same, from being unprofessional towards customers to great dealing and much more all with my own experience.
Step 1: Choose Your Product
First of all, choose what you want to sell. If you do multiple things like making jewellery, handmade cards, baby books, needle felting, cooking & baking etc DO NOT GO FOR ALL. Remember “jack of all trades master of none” so choose one or more products which could be summed up in one category. I choose scrapbooking and remaining tips in this instructable will be related to this.
Step 2: Choose Your Brand Name
Now you’ve a product, think relevant names according to that. Visit similar business pages for ideas or seek help from google or friends. List down all the ideas you came up with and choose one of them which suits and sounds best for your product
- Choose a name which collectively describes all products you’re selling
- Name has huge impact to derive audience to your business, so choose attractive name.
- Choose easy name so that people can remember, search and suggest you anytime.
- Before finalizing the name, search it on web and social media. The name should not pre-exist, at least not in your local area / state.
- Do not go for “made with love” or “heavenly handmade” type names as they aren’t describing about what you’re trying to sell. Choose self-explanatory name
- Don’t use your product or your own name as brand name.
I choose paper creations as it sums up that I’ll be selling scrapbooks.
Step 3: Step3: Choose a Platform
For small scale business which you do in parallel to office work or etc I’ll suggest social media profiles. I work as software Engineer but have passion for crafts and usually don’t take more than 2 orders a week. But if you’re planning to start proper full day business, you may go for etsy, shopify or can also have your own website or blog too. For now, I choose Facebook and Instagram.
Buildup your page with attractive description and sample images. Pictures have huge power to attract customers. Here is the link to my favorite instructable on Basic Photo Editing.
Now, every business needs investment whether it’s on big scale or small you always have to put some amount in. In case of online business, you invest in the form of paid promotions. Almost all ecommerce related sites provide you the option to feature your brand or paid promotion of your product or page. It totally depends on your budget and how you want to grow your business. Initially, $1 per day will be enough on any site.
Step 4: Getting Your First Order
Now when you’ve set up everything and got nice audience, you’re good to go. Make a nice draft of initial message which you’ll reply to every customer asking for price of your product. Briefly describe specification of product and 3 4 related packages. You should always be available for your customers. In today’s busy life, nobody like slow communication.
For start, don’t go for advance payment options, cash on delivery is good. Think from customer’s perspective you, yourself as a customer, will definitely not trust a new brand to pay in advance.
Always include shipping while telling the cost. If your product is for $10 and shipping is $4 always say “it’s for $14 including shipping charges”.
Initially, introduce offers on almost all occasions to attract customers, keep the price as low as you can, even if you gain only $2 or 3 profit, it’s ok in the start, My first order was at a loss of $3 but one order made at a loss of $3 brings a lot more order of $30 profit within a month. I know $30 a month seems very less, but remember it’s start and online sale is always slow due to trust issues between client – owner and due to tough competition now-a-days.
Send a small thank you note or card or some sentiment along with product to create a positive impact on customers. After delivering the order successfully, ask the customer politely to leave a review. Clear them that you’re not asking for a happy but for an honest review. Ask them what could be improved. Make it a habit for every order.
Step 5: Cut Down the Cost
A little more initial investment in materials and tools can go long time. For example, instead of buying $10 die cuts for embellishments again and again, spend $75-$150 on die cutting machine and metal dies, this will go long time. I just spend $75 on machine and accessories and my profit goes up to 200%.
Do not go for full paper packs and then wasting half of them because they are different from requirements, go for open stock papers. You can buy papers according to your required theme and customer demand and there are less chances of paper wastage. This saves up to 30% of the cost you spend on buying papers.
Never go for less expensive supplies, remember if you use low quality stuff, it’ll increase your revenue per order but it’ll bring negative reviews. So, always go for the stuff which is a bit expensive but could be used on many projects
Step 6: Keep Track of Profit Loss
For small scale business, use excel sheets to keep track of your material cost, orders, product codes, In progress products, reviews, improvements which customer suggests and most importantly profit on each order as well as total profit. This will help you keeping track of which areas you should improve.
For a large scale business, you may go for automated solution like a POS or any desktop or mobile application.
These are all the things I learned so lately on where to start, how to derive audience and cost cutting etc. It takes a lot of failed experiences to excel your business but it’s definitely not something to keep yourself away from it. Just be confident and start planning your business today!
Best of Luck....