Showing posts with label business. Show all posts
Showing posts with label business. Show all posts

Wednesday, June 19, 2013

How to Write Calls to Action

You're posting to Twitter. You're posting to Facebook. You're writing a blog. You're doing everything, it seems, except making your product, your true love. And while doing everything, you're getting no feedback or response.

What's wrong? Your tweets are informative and not terribly full of hashtags. Your Facebook posts are not "salesy," they're about you and your love of the product you make. Your blog contains articles relevant to your business; they aren't just filling space with articles about your dog. It just isn't making any sense.

The problem could be that you aren't including a Call To Action (CTA) in your tweet, your status updates, or your posts. (Something else? I hear you groan.) Yes, something else.

A Call To Action is a persuasive argument you are making with your followers to do something. Think of it as subliminal messaging. You're not screaming "BUY MY PRODUCT NOW!!!" like a used care salesman; instead, you're nudging your followers step by step. Here are some examples of Calls To Actions:

Join me .....

     Click here.....

          Try this.....

               Download now...

                    I invite you....

                         While supplies last....

                              Get it now!

                                   In a hurry? Call me ....

                                        Act quickly!

                                             Limited quantities available!

                                                  Add to cart

                                                       Reserve your spot now!

                                                            Today only!

How many times have you responded to such language? Personally, I'm a sucker for "Click here" or "Download Now," with my thought being I can always click out of the webpage or delete the download. But I still respond to the ask, which is what the marketers want me to do. 

So, do you feel the pattern? No where in this list do you find the words "BUY MY PRODUCT NOW!!!!" rather, you change your vocabulary to suggestive language, but keep the tone of immediacy. 

Ok. Now you get the idea. But then what? Now you need to implement these Calls to Action in your tweets, in your status updates, and in your posts. 

So your tweet of "#glamorous #red #statement #necklace #sale three left!" becomes "Inventory Reduction Sale! Statement Necklaces 50% off - limited quantities available!"

Your Facebook status update of "Tested new spice samples" becomes "We fell in love with the taste of ____ at this local Thai restaurant and spent all weekend making samples. Share with us your favorite foods and restaurants!"

Your blog post ends with a direction. What was "Until the next time I decide to post" becomes "Don't miss my next post! Add me to your RSS feed today!" or "What are your thoughts about .....?"

So take some time to review what you've written, and turn it into words that make You Do Something!

Don't miss out on more tips to help with your business! Follow me by email today!

Wednesday, April 24, 2013

Your Blog: Connecting Your Marketing Content

Like most bloggers, I work to find ideas for content. Like most bloggers, I work to find ways to bring additional readers to my blog. And like most business owners, I work to find ways to connect all my marketing content.

So I had a V-8 moment last week when I came across an idea on how to combine all three.

Add your electronic newsletters to your blog.

Like I said - a V-8 moment.  You know, the way you slap yourself on the forehead when you realize the obvious is right in front of you.

Last fall I wrote a series of posts about how to develop your newsletter content, how to create your electronic newsletter, and how to market your newsletter and yourself. I truly don't know why it did not occur to me to add my newsletter to my blog.

I wish I could find the article I had read which gave me the idea. Prior to writing this post, I spent an hour looking in the usual places where I store similar gems I find. But alas, it's nowhere to be found. So, without that article as my resource, I'll give you a few reasons why I think adding your newsletter to your blog is such a great idea:

  • Most newsletters are written with customer-friendly content. Most blogs (this one included) struggle with writing content that is customer-specific. Adding your newsletters to your blog enables your customers to search your "archives" in an easier format to learn more about your and your product. 
  • As your customers spend more time "in" your blog, the more they learn about your.  Think about it - your newsletter represents how your product and your brand have evolved. The more your customers learn about you, the more making a purchase from you is a personal decision, rather than a business decision.
  • Past newsletters give your customers a glimpse into your future. For example, I have featured Strawberry scents as the Fragrance of the Month for the past two years in June. What are the odds I'll over it again this year? This can help your customers plan their future purchases.
  • Your newsletters and your blogs can support each other, driving content from one to the other. In addition to linking your products in your newsletter back to your shop, your newsletter can link to your blog for more information. Again, try to keep your customers' attention as long as possible.
  • Adding newsletters together with the appropriate tags can help optimize your search engine results. Aren't we always looking for ways to do that?
So, in the spirit of transparency, click here to view my April newsletter! Seriously, you'll soon see my blog updated with a link to all my past electronic newsletters. I challenge you to do the same!

Happy sales!


P.S. - I'll add the link to the article I read with more information....just as soon as I find it!

Wednesday, March 20, 2013

Inventory Management, Part 2

As your business continues to grow, you'll need to develop a system for inventory management. In a previous post, we discussed the why an inventory management system is necessary; today we'll discuss how to develop your system.

Consider the variety of your products. What do they have in common? If you develop a variety of products, try to align them similar to how you would shop a department store: bedding, kitchen, clothing, decor. If your products are in a similar line, such as jewelry, align them around similar functions: necklaces, earrings, bracelets. And don't be afraid to be specific.

When I first started my inventory management system, I grouped my products similar to the sections in my Etsy shop: container candles, tea lights, votives, etc. For the most part this worked.....but then I needed a way to differentiate between three container candles I carry.  While "container candles" creates a category of similar enough products, I have a different pricing structure for my 7 oz and 12 oz candles. So in addition to the tea lights and votives, I now have separate product categories for my 7 oz. container candles, as well as my 12 oz. status jar and 12 oz interlude jar candles.

You'll also want to be able to differentiate between sub-categories. At D'Lites by Dorene, I use a sub-category of fragrance. If your product is jewelry, you may choose a sub-category of metal or stone; if your product is paper products, you may choose a category of notecards and a sub-category of stamped or stenciled.

Why are sub-categories important? Because at some point, you'll probably want to cross reference your products to understand your best sellers. For example, I can easily identify by my Etsy sales that tea lights are my best selling product. But what if I want a better understanding of my best selling fragrance? This is where having a sub-category and the ability to sort comes in handy. Think of how you could get a better understanding of which stone sells best or whether your stenciled or stamped products are most preferred.

As I've mentioned before, I utilize the online system Stitchlabs to manage my inventory. What's nice about this system is it has already developed dashboard functionality to show my sales trends.

This can also be easily accomplished using Excel or another spreadsheet software. Here's a snapshot of the same information:

And, using a little Excel Pivot Table Magic, here are my top ten fragrances for the same time period:

But what if most items are similar but a few are unique? I have a category for my clearance items, many of which are five or less. The pricing structure is different, but it's still a way for me to collect "similar" products yet use the same formula to be able to analyze my results.

As you grow, you'll find yourself creating a unique identifier for each item - a shorthand method for you and your customers to place and to analyze sales.

What questions do you have? My intent is to "build" this information in segments.  Our next chapter will be on how to use our inventory system to develop sales sheets to distribute to retail and wholesale vendors.

Until then, Happy sales!


Wednesday, February 20, 2013

Inventory Management

As your business continues to grow, you are going to need to consider an Inventory Management system at some point in time. I can hear your groans now (and trust me, I've groaned a bit myself), but if you're serious about quitting your day job, developing a better understanding of your inventory is going to help you manage the business side of your art.

I can hear you now, "My business is small and I do custom orders only." Well, please consider the following reasons to begin a finished goods inventory system:

  • Craft shows - It can be difficult to track every item sold if you get busy. Knowing your beginning and ending inventory can help you reconcile your sales at the end of the event.
  • Planning for your heavy sales season - Do you prepare a larger amount of product prior to the holiday shopping season? Enough said.
  • Consignment sales - Some consignment stores have formal contracts for items you have delivered, others are extremely informal. You need to be able to identify the amount of product you have placed in a store to be able to reconcile your sales at the end of your month or other time period, as well as an understanding of your cash outlay in product.
  • Wholesale sales - As your business grows and you get additional wholesale orders, you will need a method to track on an ongoing basis how much product to make in consideration of how much finished product you have on hand. You may also need to produce additional items to prepare for imperfect or damaged goods.
  • Costs of goods sold - Dig out your accounting books! If you remember the difference between FIFO and LIFO inventory accounting, you know the costs of goods can vary over time. 
  • Cash flow - Your inventory represents liquid assets - an item to be converted to cash. Granted, this conversion doesn't take place until the product is sold. Conversely, your supply inventory is a sunk cost you cannot do anything with until you make a product (unless you sell supplies, which is a bit different discussion).
  • Taxes - As mentioned, your finished goods represent liquid assets for end of year accounting purposes. Which is why a good accountant will tell you not to replenish your inventory at your fiscal year end if you can help it. 

These are just a few practical applications of inventory management. Our next few weeks will involve a discussion on this topic, specific to your finished goods. While I use Stitchlabs online system to manage my inventory, the principles we discuss will be useful for all systems, even a simple Excel file if necessary. 

So please let me know your questions, thoughts and concerns, as well as your experiences and challenges with managing your inventory! 

Until then, happy sales!


Wednesday, January 30, 2013

Managing Your Contacts

I confess: I can be a database geek.

In my primary job, I am the Director of Data Management and Training for a local nonprofit. I work with our database and manage information on our donors, our prospects, and more and then train our staff on how to use it. I spent the majority of my time today analyzing the effectiveness of our direct mail solicitation. (I'm pleased to say our revenue in this area has grown 27% since I first started working with it!)

So, it's only natural for me to gravitate to other databases, be it for my hobbies in genealogy and knitting or my home fragrance business. My goal is to share with you today the importance of managing your contacts and information you can glean from them.

As I stated last week, I manage my inventory through Stitchlabs. I was able to begin using this platform when the basic plan was offered for free. For other Etsy sellers, Etsy offers an application with Craftybase, which seems to be most similar.

Take a minute to think about the variety of contacts in your business:

  • Vendors
  • Suppliers
  • Customers
  • Prospects

For each contact, you need to collect the following information:

  • Name (individual or company)
  • Contact (person at a company)
  • Shipping address
  • Billing address
  • Phone number, including cell phone if you can get it
  • Email
  • Website
You may need to track additional information for each type of contact.  For vendors and suppliers you may need: 
  • Tax identification number
  • Resale license
  • Payment terms
  • Distribution agreements
  • Purchase orders
For your customers and prospects, you may need to track the origin of the sale - for example, is your customer from Etsy, a craft show, or the neighborhood?

The benefit I found with Stitchlabs is the real-time sync with my Etsy shop. With every sale, a contact is created or synced, saving valuable data entry time. As you'll see in future posts, this sync also tracks your inventory and your sales.

Of course, you can track this information with a simple Excel spreadsheet or even a table in Word. Your Etsy sales are also able to be exported, which can work as long as you copy and paste current month sales and update your existing file. You'll have to be sure to clean your file for duplicates should you choose this method.

What are the benefits of managing your contacts? Here are a few benefits I have recently used:
  • Invite customers to sign up for your newsletter, to follow you on Twitter, to like you on Facebook.  Be sure to check for anti-spamming laws with Twitter and Facebook, as well as with Etsy and any other online vendor.
  • Create  newsletter specific to your wholesale accounts.
  • Mail a "See What's New" postcard to customers, especially those who have lapsed over the past year.
  • Identify your geographic spread. For example, the states I ship to the most are California, Ohio, Pennsylvania, Texas and New York. This is especially important with the recent increase in shipping rates.
  • Understand the breakdown of your sales. For example, I learned 46% of my sales for 2012 came from Etsy, 28% from my wholesale accounts, 13% local customers, 11% consignment shops, and the balance from craft shows. This is great information to help me establish my 2013 sales goals and actions.
  • And of course, know your best customers. I recently created a referral program to reward my best customers for their purchases.
  • As my business continues to grow, I hope to be able to know just what my best customer's preferences are and to create target marketing plans for them.
Some of this does require an advanced knowledge of Excel to be able to export your file and to manipulate your data into useful information. 

What do you use to track your contacts and how do you use the information? If you don't start today, even with a simple Excel spreadsheet. You'd be surprised just what you can learn about them!

Wednesday, January 23, 2013

Selling Wholesale - Information Management

As my Etsy sales continued to grow and as I began to participate in craft shows, I knew I needed a better method to track my inventory. Particularly before and after craft shows, it seems I was always writing my inventory on a note pad then transferring the information to an Excel spreadsheet, let alone it seemed I had no way to track my product in consignment. As before my wholesale accounts began to place orders, I realized my inventory conundrum was going to be even bigger as my sales grew.

I began looking for an inventory management system, not quite knowing what I was looking for. In my "day" job, I manage a database for a non-profit organization, so I had some idea of the interaction and capability I needed. At that time, there was only one inventory management system that was fully integrated with Etsy, and it just so happened to be offering free access to its basic usage.

The system I chose is Stitchlabs. Please know, this post is not a paid endorsement, and since I began using Stitchlabs, other inventory management systems are now available to sync with Etsy. The thoughts I share with you here are based upon my experience, and items you need to consider before committing yourself to any system.

  • Contacts - Before adding my contacts to a database, I was managing my contacts through rogue spreadsheets: one for wholesale account, one for local customers, one for Etsy customers which I downloaded.
  • Inventory Management - Stitchlabs has the capability to track how many units are complete, how many are in production, and how many have been sold. As orders began to increase in quantity, I had no way to manage how many units of 12 oz candles were needed or how many different products of one fragrance were needed.
  • Order tracking - Etsy is good for simple counting of number of sales. But I had nothing to integrate my local customers let alone my wholesale sales into one information system.
  • Expenses - Sigh. My business is still operating on a cash accounting basis (sometimes simple cash flow basis) and aside from basic checkbook accounting, I had no method to track profit and loss or cost of goods sold (an important factor which is extremely important as your business grows).
  • Reporting - I had none. No way to track my best customer, no way to track my best sales. I knew from my general observation that tea lights are my best selling product, but it caught me by complete surprise that Lavender was my best selling fragrance.
  • Integration - Direct import of Etsy sales is a huge benefit! Additionally, I want a system to which my sales reps can log in to place an order, eliminating the need for them to scan an order, especially one that may include credit card payment information (a huge compliance issue in my book!).
My intent is to explore each topic on my weekly Wednesday blog posts. If you have a question or problem that you are trying to solve in your backend office that you feel can be answered in this series, please write it in your comments. Your questions really make it so much easier to look at each topic through another person's lens.

Until next week,

Happy sales!


Wednesday, November 28, 2012

Selling Wholesale: Thinking about Costing and Pricing

One of the first challenges with any business is determining your pricing structure, and many businesses go under because they are not charging enough. If your marketing strategy is to be a low cost leader (think Walmart) this may work for you as the volume of sales will drive your revenue. But when starting a business, we're often think about any sales, not yet volume of sales.

The first step in determining pricing is to be knowledgeable of your costs. Be sure you have a clear knowledge of cost per unit when calculating your product costs.

For example, assume I make a necklace comprised of three simple pieces.  Piece A is available in units of 10 for $1. Piece B is available in units of 12 for $1. Piece C is available in single units for $1.  Your units costs are:

Piece A = $1/10 = $0.10
Piece B = $1/12 = $0.08
Piece C = $1/1 = $1.00

Now, assume the necklace needs 7 units of Piece A, 5 units of Piece B, and 3 units of Piece C.  Your products costs are:

Piece A = $0.10 x 7 = $0.70
Piece B = $0.08 x 5 = $0.40
Piece C = $1.00 x 3 = $3.00

Total cost = $4.10

But don't forget about labor and overhead costs.  Yes! You need to pay yourself! This example is going to assume $10 per hour labor, although I know your time is valued at much more than this!  Assume it takes 15 minutes to make one necklace. Total labor cost for one necklace is:

Labor = $10.00/4 = $2.50
Add product costs = $4.10
Total cost so far = $6.60

Then the dreaded overhead costs: rent, marketing, insurance, utilities, machinery.  For easy math, let's assume these costs equal $10.00 per day.  Total overhead cost to make one necklace per day is:

Overhead = $10.00
Add labor costs = $2.50
Add product costs = $4.10
Total cost so far = $16.60

Your wholesale price should be at least twice your costs.  Therefore:

Wholesale price = $16.60 x 2 = $33.20

Whoa!!!!! That's what I'm selling my necklace for as retail!!!! It is so easy to fall into this trap, because we know what a similar product may sell for in similar online shops, and even in our local department store. The online competitor may sell for $25.00 and the local department store for $15.00.  But, you say, mine is hand crafted with better quality items. Cost is not always a deciding factor with the customer, sometimes quality is.  But you still need to be competitive.  That's where selling wholesale can help you break even and become profitable.

Let's use the same example. You know you can make a single necklace in 15 minutes, but because of working in larger quantities, you can make 6 necklaces in one hour.  Now, your costs looks like this:

Product costs = $4.10 x 6 = $24.60
Labor costs = $10.00
Overhead costs = $10.00

Total costs = $44.60
Per unit cost = $44.60/6 = $7.43
Wholesale price = $7.43 x 2 = $14.86

Now you're competitive! The necklace can be sold for retail price of wholesale x 2 = $29.72, which I would round up to $30.00.

This is truly a contrived example, but it demonstrates what I like to call Economies of Time. We're familiar with Economies of Scale, in which buying larger quantities drives down the cost per unit.  With Economies of Time, doing repetitive tasks successively can help you to build speed, allowing your to accomplish more per units of time.

But I also use this example intentionally, as it's the model on which I base my pricing.  I sell my candles wholesale for $10 each, and cases of 12 for $120.  Pretty simple math.  But it takes just as long to make 12 candles as it does to make 1.  (Think preparing a batch of cookies then putting only one into the oven). I use Economies of Time to provide a 10% savings to the buyer if each case is one fragrance only.  I'm willing to pass my savings in time on to the buyer and sell one fragrance case for only $108.00.

Now, as someone just beginning to gain wholesale orders, I realize it will take some time for a buyer to want to buy an entire case of one fragrance. But I believe they will see this as an incentive as as they become more comfortable and intrigued with my product!

What also goes unsaid in this example, is the extra costs of supply inventory for unmade product. Using my batch of cookies example, when I only bake one cookie, I have not only excess flour, sugar, and butter (supply inventory) but excess unbaked cookie dough (product inventory). This carries a cost as well as the excess flour, sugar and butter are opened and will only be used when I make another batch (sunk costs), and I can't sell the dough until I bake again (inventory).

This week I encourage you to think about you can maximize your time by producing in larger quantities. Even in the example above, each necklace will be slightly different due to the natural variance in hand crafted items. But if our goal is to make money from our craft, we need to analyze the costs associated with our business.

I welcome your thoughts, feedback, and questions. Until then, happy sales!


Wednesday, November 21, 2012

Selling Wholesale: Being Prepared

I began thinking about selling wholesale in early last summer. How I made that decision was based upon my desire, not only to get more product into stores, but to increase my revenue. Yet, for as much as I write about being prepared and making sound business decisions, once I entered the wholesale market, I found I was not as prepared for selling wholesale as I thought I was.

Here's how it started: I knew I needed more revenue. I know it's just as easy and no less time consuming to pour five candles as it is to pour one. So my logic at the time told me that if I could sell more candles, I could make more money! And working full time, I did not have the time to market my product, so why not find someone to do that for me?

But here are some issues I was struggling with:

  • Branding - I wasn't happy with my branding. Like most entrepreneurs, I did not have a lot of revenue to invest in graphic design. But in my for me, much of my product line needs to be sold with graphic design. Until you can smell through your computer, I needed something else to help me sell my product.
  • Inventory or financial management - I didn't have an inventory or financial management system. Yes, I promote the fact that I create my product at the time of order. And yes, I was keeping track of my revenue and expenses. But I did have a small inventory that I kept for craft shows and farmer's markets.
  • Promotional materials - If you followed my newsletter series, you know how much I enjoy marketing. I didn't think developing promotional materials would be too big of a task.
  • Policies - I had a vague thought in my head of $100 minimum orders and payment upon order, but that was it. I hadn't thought about policies for samples, shipping, order processing, returns....the list goes on and on.
I had approached some local stores before about selling my products. I had even sent sample tea lights and basic information. But I wasn't getting anywhere. When I found a site to place a free listing for representation, I decided, why not? 

So, imagine my surprise when two days later, a representative did in fact contact me about repping my line!

My wisdom to you today is to be prepared.  If you're struggling with an aspect or two of your business as it exists now, the problem will only magnify when your sales become larger. Take time out of your busy schedule now to identify a problem. Maybe you know you have an issue but can't identify exactly its cause. Or identify where you have an opportunity to do better. Then take time to think through how to resolve it. Reach out to other business owners if you need to. Ask for help from friends. But don't think that by waiting "until you get that large order" means you should avoid dealing with it now.

With Thanksgiving and the holiday shopping weekend ahead of us, I know many of you won't have as much time for my weekly business lessons. The next few weeks, we'll address each of the issues I listed and how they were resolved. If you have struggles with any of these problems or other issues and concerns, please let me know.  Let's work on them together over the next few weeks and start 2013 with a bang!

Wednesday, November 7, 2012

Reflections on selling wholesale

A few months ago I entered into the world of wholesale. And yes, it is a whole new world. It's been a learning experience for me, and as my business continues to grow, I'm sure I'll continue to learn more along the way.

Many artists approach wholesale as if it were a four letter word. Why? They fear losing the integrity of creating a unique piece with every artistic effort. Now, I realize there is a difference between the business of selling jewelry, photography, or ceramics and selling candles, but there is also a strong similarity: the word BUSINESS.

If you're not in business to make money, why are you in business? It's certainly ok to have a hobby and a talent from which you can earn additional revenue. But if your goal is to earn a living from your craft, you need to approach your work as a job, and as a business.

And to do so, all business models should be considered, from online selling, to craft shows, to consignment, and to wholesale.

As each of your items is handmade, each item will be slightly different from the next, even if using the same style and materials. You lose no artistic integrity in the process! In fact, you can gain from quantities of time as you mind becomes trained in repetitive tasks, and more importantly, quantities of scale as you are able to purchase supplies in greater quantities and lower costs.

Another fear artists vocalize is pricing. An elementary formula for your pricing should be Cost x 2 = Wholesale Price, and Cost x 4 = Retail Price. The fear here is that you're only earning twice your costs in wholeselling, versus the perceived "100%" in retailing. But the part that is overlooked is volume. Not only can you buy in larger quantities and reduce the per item cost, but you're able to generate more sales. And more sales begets more sales. And more sales drives people to your website, perhaps to place a custom order. And more sales begets more sales.

And if you're not trying to generate sales, why are you in business? I'm not trying to discourage anyone, but I am trying to suggest we all review why we spend the time doing what we do.

A good friend and mentor asked me, "Are you in business to make candles or to make money?" It's a question I've repeated to myself many times. If my answer, if your answer is, "to make _____", that's ok!!!! If this is the answer, I encourage you to reflect on how you are using your time and what the return on that investment of time is. If my answer, if your answer is, "to make money," then I encourage you to review what you are doing to make money. Ask yourself, what is the return on my time?

Selling wholesale may help answer this question. My next series of blog postings will address my experiences of selling wholesale. While not an expert, I've learned many lessons, which I hope to share with you and help you grow.

Please leave some comments. Please ask some questions. Please share some experiences and lessons you've learned. I truly enjoyed the dialogue we shared in my newsletter series and hope we can have the same with the topic of selling wholesale.

So until next week,

Happy sales!

Related Posts Plugin for WordPress, Blogger...