Separating Your Business (My Etsy Saga)

26 Mar

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I’ve been giving quite a bit of thought as to how I will launch my new website. Yes, if you haven’t heard I am going to relaunch ittybittybag.com

My existing site has worked very well for me for the past five years. So much has changed during this time. I still receive a ton of traffic through Etsy, though not very many sales because more than 1/2 of my items are listed as custom or made to order.

So it begets the question, why even have an Etsy shop? I am not sure. My husband and I had quite a debate about it last night and even after the debate was over, I don’t know that we came to a resolution. Here are the facts and maybe you have some advice for me?

In the past 5 years, I have seen a steady decline in my sales on Etsy but the majority of visitors that come to my shop come directly from Etsy.com. So this is a huge stumbling block for my brain. How do I give up the Etsy sales?

When people come to Etsy. I think they are looking for something well made, not expensive and ready to ship. I don’t think people are browsing and looking for designers to make items for them. This will happen but the number I think is very small.

What many don’t realize when they come to my Etsy shop is that doing custom order work is a huge time suck but I love doing it. It takes time to find the right fabrics, there are many emails back and forth and then there is designing a new pattern. All of this could take me several days for one order. In some cases it may take weeks. This is the true life of a designer. So only making “production” salary is like going several days without pay.

When I first started on Etsy. There was no “you might also like” so when an item sold out…the customer contacted me to see if I could make another one. This trend has completely disappeared. It just doesn’t happen anymore.

My husband argues that some may not want to go to two places to shop. And I don’t disagree with that statement but I just don’t see how closing my Etsy shop helps me but also my Etsy shop doesn’t help me with custom work. The biggest problem is that my work brings in clients to Etsy and then Etsy says well you might also like this…and well that item is cheaper & ready to ship. Sold. Again, these people are not familiar with my work or the quality of my items. Most often this was their first time on Etsy. They have no idea how fast I create custom items compared to big stores that take 4-6 weeks to turn around custom items.

This is why you will see over time…I am going to remove my custom listings from Etsy. Etsy and I have both suggested that it is a great idea to offer custom items to increase your sales. This may be true if you only have 10 or so items listed in your shop but once you get up to 100 or so items…I am not sure this is the case. I can’t turn my items around in 24 hours so this doesn’t work for me.

Most of the custom work I receive these days come from friends or people that I’ve met on social media. They follow me so they see how much custom work I actually do. They have no problem with waiting 10 days to receive it for the pure joy of having something one of a kind.

So I am at a crossroads with what to do but I think it is clear that I need to separate my business. What do you think? What has your experience been? Have you seen a huge shift in how your sales have changed?

I look forward to hearing your responses!

xo, Jen

Some items marked down

20 Mar

I have some items in my etsy shop are marked down for a little revenue builder & to offer some new products.

OnSale

Social Media and Your Etsy Shop

20 Mar

I’ve been asked quite a few times about how I used social media to build my Etsy shop. Many don’t understand the reason behind using each platform. For example, I am on Facebook then why would I join Twitter? So I am going to share with you how I use each of them for my business.

Facebook (Personal) Jen Waeger St. Jean

I only friend people I know. I first signed on to Facebook in order to catch up with friends from school & to share pictures of my girls with family. We all need to have a personal page. If your family & friends do not support you and your business then who? This is how my business actually began. I posted a picture of a little tote that I made for myself, friends and family quickly asked me if I could make a bag for them. I shared each completed bag on Facebook and a company was born. When I realized that I might have something here, I moved pretty quickly to giving my company a name and created a business page (see below). Inviting friends and family to like your business page is a MUST. Don’t be offended if they do not “like” your page. It doesn’t mean that they don’t like what you do but inviting them tells them that you exist. They can always come over to your personal page where it will have a link to where you are working now.

Facebook (Business) Itty Bitty Bag Company

Every business needs a Facebook page. It should almost be mandatory. It is important for you to have a daily voice. Your voice tells people that you are in fact a legit organization. Posting pictures in your shop & while you are working is critical. Keeping it interesting and not just posting listings is important. If you have a big event or meeting you’ll want to share it here. If you are going to be away from your shop for any period of time. It is good to update your page and let people know.

How do you get followers or likes? Asking friends to share your page. Or when a friend likes your page it appears in other peoples feeds and so they click on it and then they might like your page. When someone comments on a post then that also appears in the feed. It takes time.

Advertising to get followers is risky. I did advertise through Facebook for a while and then recently I saw a YouTube video about how that may have hurt me & my business page. I now have a lot of followers and I have a very low views & interaction. Quite frankly, my likes may not be real. They could have been liked by fake accounts used to cover up “like scams” or “buying likes” which is prohibited on Facebook.

I’ve never purchased likes on Facebook. I only paid money to advertise my page to people I thought would like what I do. I still think back in the day when I did advertise that it did attract a great audience but the advertising dynamic has changed. You can set a very low budget so this may still be a good low cost way to get likes.

Twitter (@ittybittybag)

Some companies only tweet about business. And for large corporations like Walmart that probably makes sense. Compare that to Martha Stewart, who is a company and a brand. People want to know what she is cooking & what her garden looks like. So her voice is very different than Walmart.

I use my twitter voice in many ways. Mostly, I want people to see that I am a person. I want people to really get to know me. Yes, I make bags but what are my interests. What do I like to do in my spare time. This allows people to find ways to connect with you. When people chose to buy handmade they are really buying the story. You are not just a business. You are a person. This is what makes handmade so special. If people just wanted the goods and didn’t care about the person then they could just easily buy mass-produced through a department store.

When I see an Etsy shop just tweeting listings. I tend to unfollow them. I probably already follow them on Etsy. I see all their listings in my daily activity feed so I don’t need to see them again. Once a day is ok and not excessively but listing after listing is a quick way to be “unfollowed”.

When I see an account that only has posts that direct me back to their Facebook page then I stop following them as well. Many accounts do this where they “auto tweet” from other social media platforms. This is bad. Social media is meant to be social, it is a conversation. Nothing like talking to yourself in an empty room.

Scheduling tweets is also very risky. So much happens in the world that you may forget about your scheduled tweet & now you are tweeting about your favorite recipe when the world is on the brink of collapse (totally exaggerating but it has happened, the tweets not the world collapsing).

How do you find people to follow. You can look for #hashtags for things you are interested in like #dachshund if you want to follow other dachshund owners. You can look for the name of the town you live in or a geographical area to find local tweets. You can also import your contacts and find people you already know. I found this most useful during some bad storms we’ve had. I also met a great group of local women through twitter. They have over time become my best friends. It is like letter writing. You get to know people online and then one day you might have a “tweet up” and meet them in real life. This is not as creepy as it might sound. Usually meet ups are a larger group of people with like interests.

Instagram (@ittybittybagco)

Is a form of Art. So just posting pictures of your product probably won’t go over so well. Sharing pictures of you working in your studio, what you see outside your studio or even behind the scenes in a photo shoot are definitely of interest.

I find people like seeing pictures of my puppies and running. Those are my most liked photos. My dachshunds are my friendly office companions. They make me laugh. I also share pictures about my other passion…health. I have always been very passionate about exercising and eating healthy. I hope that by taking pretty pictures & using hashtags, I’ll get to know more people on Instagram.

Pinterest (Jen St. Jean)

Pinterest boards are fun way to share recipes, DIY projects, interior design and fashion. Yes it is ok to pin items from your shop or a team you are on but your pin activity should not just be your product. If you pin other peoples Etsy items, they may return the favor. Then other people see the pins and there is a link back to your shop. This is how people discover you. Pinterest as a whole is quite confusing as it is mostly cupcakes & workout pics. lol.

WordPress (IttyBittyBag)

I have my WordPress blog to share my handmade business journey. I talk about everything I go through running a small business, being a work-at-home mom, personal stories & sharing new products or current items that I am working on. It is a way that I can share more than just what a listing might say.

You can have a much bigger voice on WordPress than other social media platforms where you are restricted to a certain number of characters per post.

LinkedIn (Jennifer Waeger St. Jean)

This is completely business. It is a online resume in my opinion. I also don’t add people that I don’t know. Other people use it to connect with people in the same field but I haven’t used it this way. People can recommend you for for skills that you have such as “marketing”.

MailChimp (The Itty Bitty Bag Company)

I try to send out a communication about once a month or every two months. Why so infrequent? I hate emails. I am inundated every single day with them.

When I send out a newsletter it always generates a response. Sometimes in the form of a few sales and other times with just comments about how people are excited for what is happening in my company.

Google+ (Jen St. Jean)

What is google plus? I am not sure yet but I’ve been told it might replace Facebook someday. I’ve set up my account but I haven’t really spent much time on it. If anyone wants to share or add in the comment sections how they use it, I would love to learn.

Flickr (IttyBittyBag)

This is where I share product photos, my online lookbook and also fabric swatches for custom orders. You can interact with people here and follow groups, teams and individual people.

Tumblr (IttyBittyBag)

Is a photo sharing picture blog? I haven’t spent too much time here. I do have some of my blog posts go here automatically. You can follow people and see their updates. I don’t use it very much. Again, if you have more information to share about Tumblr then please share in the comment section.

I hope this helps shed some light on the different options that are out there and if you have a favorite don’t forget to share it here.

Happy Networking!!

xo, Jen

Keeping Track of Expenses in your Etsy Business

18 Mar

I wanted to share some thoughts on keeping track of expenses for your Etsy Business.

I just finished entering January and February sales & expenses. I am about $100 in profit over my expenses for 2 months of business. Say what?? I haven’t even paid myself. Ugh!

January & February are notoriously slow months for me for sales. I tried to offset this by doing a couple of fun promotions & some fabric destash. I guess this was essential because if I hadn’t then I would be negative.

I depleted a lot of stock during the month of December and I had to replenish in January. So I don’t expect my expenses to continue to come in at the same rate as the first two months of this year.

This is why it is so important to keep strong books & records. I use excel. It is easy & it gives me all the data I want. And most computers come with this program so it is free. This is why I get so upset when I see other sellers selling items at cost. They must be losing money if I am break even. I don’t mark my items up a lot. I use a very simple business formula to calculate my price. I know I have been told before that my items are too well made and I should be charging more. It is already hard enough not selling at materials cost.

I know my supporters know this but to the extent that I am helping other small businesses get started, this is a reality. You have to price for profit or you won’t be around in a few years to ask what did I do wrong?

Oh lets hope things pick up this Spring.

3 years ago, I sold Easter Baskets and I must have made 50 of them. It gave me massive carpel tunnel embroidering that many. This year…the sales have not come in very quickly. I know we all have to make wise spending choices but handmade IS WORTH IT. And then some. I am so happy to hear that my friends & customers are still using their baskets today. Buying items that can endure the test of time rather than disposable is a much better investment.

Only Worth the Time Put In

14 Mar

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“Doing it all by hand, ’cause when everything is handed to you, it’s only worth as much as the time put in” ~ Automatic by Miranda Lambert

This song has significant meaning to me. I even threw a shout out to Miranda on Twitter.

Everyone keeps saying that our school aged children haven’t had a full week of school this year and you may be right! Having a home based business makes this abundantly clear to me. I have a schedule for when the kids are home on the weekend and when they are at school and a very different routine over the summer. I love having them home but the in and out of school routine is getting old.

I like to makes lists and get them accomplished during that week. If I don’t then it makes next weeks tasks more difficult to finish or to stay focused on my business plan. Planning ahead for holidays or to promote new products.

Here are some of the things in my shop that take time that you might not consider when making a handmade purchase.

People always ask when setting up an Etsy shop what are billable hours. Are the conversations back and forth with a client? Photographing & listing your items online? The endless amount of social media to get the word out about your company? Accounting & record keeping? Cleaning my studio? These are all tasks that you have to do and if you don’t do them then you have to pay someone to do them, so yes!

Coming up with the design, picking the fabrics, ordering fabrics & supplies. Having over 200 fabrics in stock to make such unique creations. This all takes time too.

Measure, Measure, Cut, Press, Pin, Sew…sounds simple enough but some of my bags have several parts to cut, press, pin & sew. Sometimes there is overlap and steps are repeated. Changing my patterns is not a difficult task but it still takes time to plan & measure.

So in addition to the materials cost, my labor for making my items…there is really so much more happening here in my shop. If we just charge cost then we will never get ahead.

If mass produced items take less time to make and are produced in large quantities by machines then that is what you get out. You get the limitations of machine made and no opportunity to change the pattern to meet your needs. This works for some items that we need in our lives but also why handmade should not cost less than factory made.

And this is why I think handmade is so fabulous!!

I love that bags have so many functions. Just like shoes. There really is a certain bag for each task in our lives. You could own a fancy clutch, a tote, a small purse or a cross-body bag. You wouldn’t use one of these bags in place of another. Each has a purpose or a place in time.

So if you can’t find the right size bag, then contact a designer whose colors or style inspire you and ask them to make you one. Each request I receive inspires a whole new line of bags. This is in fact how my company was born. I made a small tote (my personal preference) and a friend asked for me to make one larger (not so itty bitty).

Now I need to get back to making Easter baskets.

xo, Jen

What is the cost to sell Internationally, Import Duty and VAT (sales tax)?

5 Mar

A recent Etsy forum question prompted me to do a little bit of research “The customer refused to pay the international customs fee?” I wondered how much that custom fee could have been to refuse to pay.

They were shipping from the United States to Ireland. I am not sure what the item was that they shipped but the items in this persons Etsy shop is around $40. This is the price point I used to do my research. Many of my items are $40 or less so I felt like as a seller I needed to understand the impact of selling items to other countries.

I used google analytics recently to track my top 10 countries. Recently, I updated my shipping prices to these countries. This forum post kind of freaked me out a bit because it might have been for not. If you knew that you’d have to pay a custom duty fee and tax that would cost you double, would you pay it? I don’t think I could pay double. I think I would try to find the item elsewhere first.

As a seller, we’ve been instructed to include a statement in our policies that tell buyers that they are responsible for any fees that their country imposes on them. So what does this mean exactly?

In the United States, I can make a purchase online from anywhere worldwide and I don’t pay custom fees or taxes. If I am on a trip and physically return with items then I have to pay duty fees & taxes. If I am buying from a small business owner online in the same state (Connecticut to Connecticut) then I pay sales tax. This sales tax number varies from state to state. If I buy from a small business owner out of state then I don’t pay sales tax. If I buy online from a large company then I pay my own state taxes.

Pardon for all of the explanation on this but I am hoping that international buyers might be reading this as well. So it is helpful to them to understand how it goes on here in the US. We all pay fees or duties on items we purchase. We just call it different things.

If the United States charged me a 100% tax on something. I probably wouldn’t buy it. I’d learn to do without. I thought it was interesting that in some countries if you buy a bike from China, that they charge an 85% disposal fee when you purchase it because of the toxic paint.

I am a dork and totally find all this fascinating. It is kind of like in the United States you aren’t able to bring certain produce across the lines because they are afraid of bugs that can kill Orange crops. This all makes sense. It is to protect our Agriculture. Some things I don’t understand. I digress.

I make handbags that are non-leather and made from natural fibers like cotton. My items are held to a different standard than someone who makes leather bags. Also, it matters where the materials are sourced from which is also very interesting.

You can see it is just as cumbersome for us here in the US as it is for you. Here is a map of sales taxes on purchased goods in the US. There is also a higher special luxury tax and special tax on other goods.

Here are the top 10 Countries that come to my Etsy shop. I gathered this information on Google analytics. For the purpose of my calculation I assumed the purchase price was $40 and it was not insured.

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source: Duty Calculator

I hope that my customers find this chart helpful in deciding on what items they would like to purchase from me. For most countries given the price of my items, it is really not much more than paying sales tax just like we do here in the United States. There was only one country that I researched and was completely shocked about, and that was that Israel, they have an Import Fee of $36 for goods from the US. I just don’t even know what to say. I guess they don’t want to do business with small businesses in America. This is totally cost prohibitive.

I just wanted to get an idea of what I was up against. I hope this helps you all out who like to sell internationally as much as I do.

xo, Jen

**These are my personal opinions. They are not fact though I’ve tried to provide reliable sources. This information is for illustrative purposes only. I am not in any position to provide tax advice or international sales law advice. This is just one example that I used. Other items may have different fees and expenses internationally. You should do your own research to decide if it is right for you as a buyer or a seller.

****Just found another interesting piece of information. As a seller it is illegal for the seller to pay the taxes imposed on the buyer by their country.

Working Hard This Week

3 Mar

I have a long list of to do’s in my shop, at home & fitness goals for this week. I think I am on track. We don’t have snow storms that will impact my work week so I am very confident I’ll get it all done.

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I’ve reached out to a few local stores about working with them on some specific designs. Cold calling is not my thing but hoping that it all works out. Nothing to lose by asking.

I have a mentor meeting this Wednesday with a crafter friend who is looking to open up an Etsy shop.

I crafted my elevator pitch and I think it is a good one. The part that I struggle with the most is watching sales slip to other sellers who are either not making their items or have it discounted at materials & labor. Some bricks and mortar shops back when I started had reached out to me to sell at their location. I went to their websites & low and behold, they are not around anymore. It is a tough market, retail sales. You have to know your price & you have to own your price. My price is not the cheapest but I am not the most expensive. I charge what I need in order to stay in business. There are so many other business costs other than materials. Where will this money come from? The best part about working with me is that the incremental cost of me working in a studio outside my home is not there. I have a huge studio at home which is great in so many ways.

Please take a moment to really think about the cost of running a business. Allow small businesses to charge what they need in order to stay in business. It matters. For those of you that have continued to support me & my business model…you know who you are, you have no idea how much it means to me. I am so grateful beyond words.

I hope you all have a happy & productive week. Make a list and try to get a few of them off it.

xoxo, Jen

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