Should You Invest In Coaching? from Beth Andrus on Vimeo.

It’s time once again for The Women’s Small Business Expo.  If you live in Southern California, or plan to be here on April 28th, I highly recommend attending.  I went last year, and compared to all of the other events I’ve attended, it is the most fun and the best value.  You will get real information that you can actually use.  

Registration is $169 through March 31, after that the price goes back to the normal $200.  The event starts at 8:00am and ends at 5:00pm. There is a continental breakfast, a beautiful networking lunch, great speakers, and a networking table where you can place your marketing material.  Throughout the day there are many organized opportunities to network and interact with the speakers, sponsors, and other attendees.  And if, after all of this, you feel you did not get your money’s worth, there is a 100% money-back guarantee, no questions asked.

If you have a small business, or are thinking about starting a business, check it out.  I believe there is something for everyone.  If you do register, let me know so we can meet up. 8th Annual Women's Small Business Expo

I was watching I Love Lucy last weekend. It was the episode where Lucy and Ethel go into business selling Lucy’s salad dressing. When they realize they’re losing money on each individual jar, Lucy says “We’ll make it up in volume.” She could not have been more wrong, which makes for a great episode, but our businesses aren't sitcoms.

I am always a bit surprised at the number of people who set up their business and start selling, without having a clear picture of their costs.  If you don’t know your costs, you can’t know if you’re making a profit.  I know I’ve talked about this before, but let’s review…

Revenue (money that customers pay you)

Direct Costs (everything that goes directly into making your product – setup costs, labels, packaging, any materials used in production, production labor, and anything else needed to produce an item)

Gross Profit (Revenue minus Direct Costs)

The Gross Profit is then used to pay your rent, phone, advertising, employees, yourself etc…  Whatever is left is your net profit, so hopefully you have something left.

Now, if you have more than one type of product or design, it’s best to cost out each item separately.  That way, you can tell which make money, and which (if any) lose money.  Some people lump certain direct costs in with overhead/sales costs.  If you do this, you can’t tell which products are profitable.

For example, if you have a graphic tshirt business, complex designs may have an initial setup cost of up to $500, and simple designs might be $100. 

If all other direct costs are $4.00 per shirt and you sell the complex design for $9.50, that leaves you with $5.50 per shirt to cover the setup cost.  You must sell 91 shirts before making gross profit on that design.

If all other direct costs are $4.00 per shirt and you sell the simple design for $6.50, that leaves you with $2.50 per shirt to cover the setup cost.  You must sell 40 shirts before making gross profit on that design.

Because you pay your rent, utilities and yourself with your gross profit, you only want to carry products that earn a gross profit.  You make more per shirt with the fancy shirt, but if you only sell 50, you've lost money. If you sell 50 of the other shirt, you're $25 ahead.

I have oversimplified this example, but hopefully you can see how important it is to understand how much it costs to produce your goods.  I know accounting and numbers are painful for some of you, but this information will let you know what works and what doesn’t.  And only then can you make necessary adjustments to your product line. 

Aunt Martha's Old Fashioned Salad Dressing

Choose Your Words Carefully from Beth Andrus on Vimeo.

If you’re just starting your product business, arts & craft shows, gift fairs, etc… are a great way to test the viability of your product.  You will get instant valuable feedback, even if that feedback is zero sales. Also, selling at these types of events is a relatively inexpensive way to gain visibility, build a customer base, and promote your online store. 

Start at local farmers markets and annual shows in your city, and if you get favorable results, expand your reach.  You can get a comprehensive list of these types of events from Craftmaster News. The annual subscription is $48.95 and includes 6 bi-monthly printed issues of the publication, e-mail updates of the latest event information, and online access to their entire database of events (updated daily).  And maybe you can split the cost with one or two other business owners, to make it even more affordable.

The list includes arts & crafts shows, street fairs and festivals, county fairs, state fairs, home and garden shows, farmers’ markets, antique & collectible shows, music festivals, car shows, holiday gift fairs, and more.  There are two separate lists, one covering the Western U.S. and another for the Eastern U.S.

Once you’re up and running, you need to get the word out about your product.  I think this is a good way to go for some businesses.  Try a local event first, and if you see some marketing benefits, check out the Craftmaster News list.  You have 30 days to cancel, so it’s as low-risk as you’re going to find.

As you know, I’m a big supporter of DIY (do-it-yourself).  Sometimes it’s your only option, especially in the early stages of business.  There are tons of books, courses, seminars and webinars out there, covering everything from PR to accounting.  And many of these are good.  But even if you learn everything and understand what needs to be done, there are only so many hours in the day. 

Frequently, after taking a course, we realize we don’t have the time or interest in handling the tasks ourselves.  When this happens, we are inclined to hire the person that taught the course.  There’s nothing wrong with that, but assess your time and personality before shelling out money for anything. If you think might hire a professional in the end, don’t waste your money on the DIY course.  Instead, put it toward hiring a professional. 

If your budget won’t allow for that, and your schedule won’t allow for you to do everything, there is an alternative.  Take DIY courses and/or read some books, and then hire a temporary assistant, virtual assistant, or bookkeeper to do certain things for you. 

Once you know the what, how and why of certain business activities, you can direct someone to do what you would be doing (if you had the time) at a fraction of the cost of hiring a professional.  The more you know, the less likely you are to overpay for relatively simple tasks, or to hire an unqualified person.  Learn as much as possible about all aspects of your business.  Then do what you can, and farm out the rest.  Taking this approach will save you some money, and keep you from hating your business.

Venting from Beth Andrus on Vimeo.

Whether it’s marketing, social networking, PR, or sales, there are a lot of experts out there. And every 12 to 18  months, a new star is born.  Everyone worships at their altar – for a while, anyway, until the next “business genius” steals the spotlight.  I believe many of these people have a lot to offer. Their experience and knowledge gives them a certain perspective, and this insight helps people who are trying to get their business up and running.

But I believe we all need to be selective when taking the advice of others.  Not necessarily everything someone else has done will work for you.  Your business and goals are unique, so an approach that propelled them toward their goal could actually put you on a detour away from your goal.

So how can you avoid that?  Get clear on what you want your business to look like and what you want it to do – for you and for your customers.  Once you know what this means for you, step onto your path with confidence.  Then you can easily determine what will assist you in reaching your goal.  There is so much good advice out there, but treat it all like a buffet or dim sum. Take only what will work for you.

The 2^nd Annual Unique Los Angeles Spring Show is scheduled for April 24^th & 25^th, they are now accepting vendor applications, through March 10^th.  Unique Los Angeles puts on two-day shopping events twice a year; a spring show and a holiday show.  If you’re an independent designer, it’s a great opportunity to display your products.

Unique Los Angeles events have quickly become one of the city’s premier shows for designers and artists.  Last December, their holiday event was attended by over 11,000 people. I strongly advise that you apply today.  

If you aren’t in Southern California, you could find a way to create our own opportunity.  Do a Google search for similar events in your part of the state/country. If you still can’t find anything, you could always pull together your own event. It’s been a long, hard winter. When spring finally arrives, people are going to be ready to get out of the house. A local designer show may be just what they’re looking for.  Here are some ideas to help get you started.

Lessons From RollerSkating from Beth Andrus on Vimeo.

This video is a rerun. I will have new videos, again, starting next week.