Friday, March 22, 2013

Your Little Business Plan

The first topic I'd like to tackle in my Etsy 101 series is the benefit of having a business plan.  Let me preface this discussion by saying that I did not have a business plan when I started my shop... and it showed.  I ran my business with an if-it-feels-good-do-it mentality.  What can I say?  I was a liberal arts major in college and I never took a business class.  My plan for my etsy shop looked something like this:

1.  Make buttons
2.  ???
3.  Profit

See that step number two, with all the question marks?  That is the spot where your business plan goes.

If you run the words "business plan" through google, you are going to get a lot of information on how to write a formal business plan.  And if that's what you want to do, go for it!  It certainly wouldn't be a waste of time.  But, personally, I think a 10-page, 16-part business plan is overkill for a little etsy shop.  So, I'm going to tell you how to write a little business plan.

There are three major components to your little business plan.

The first, and most important, component is your Mission Statement.  To write your mission statement, just ask yourself the question: "why am I doing this?"  Is your primary motivation just that you like making stuff and you need a way to unload everything you create?  Or are you in it for profit?  If so, how much profit?  For many etsy sellers, the goal is just to create a self-sustaining hobby.  For others, the goal is to be a professional artist and to make a living by selling your wares.  For most, it is probably somewhere in between.

The next part of your business plan is pretty easy.  What are you selling?  That's your Product.  Consider what you are selling both literally (hand-knit cashmere scarves) and figuratively (warmth, luxury, beauty, etc.)

Finally, you need to figure out where is your Market.  Who is going to buy your stuff?  If you sell baby clothes, your market is probably going to be new mothers.  Try to get as specific as you can when you are defining your market.

And that's it.  That's really all you need for your little business plan.  Just consult these three components whenever you have to make a business decision and you'll be on the right path.