I have had the blessing of being approached by various artisan groups, nonprofits, refugee centers, and others about “selling” …. While I never know if I am really helpful, I am starting to get a few of the same questions, as such, I thought it was time to share what I have learned (the hard way) so that maybe when you are ready, you can avoid some of my mistakes and get to the making impact a lot sooner!
I think it is also fair to state our assumptions. I am assuming you already: have a group of women that need to make money, are a charitable organization, and meet frequently at your location.
If income is a constant struggle for your ladies and you want to help earn— why not start a business? Here are some questions to ask before you get started. These aren’t to scare you or dissuade you. To the contrary, here are some questions that I learned to ask and think through after making the opposite choices and ending up in the negative a few too many times.
1. What do your constituents know how to do? What is culturally appropriate and speaks to the mission of your organization?
Work with your strengths and play those up! Maybe the women you work with know how to cook – no one knits, no one sews, no one wants to… If you are a group of Refugees and amazing cooks, consider finding a corporate kitchen and making spice mixes! Although the selling of food is not ideal due to limited shelf life, the bottom line is that you need to think about what makes sense for your group! Likewise, if your mission is about financial security or community, make sure to open the group up to everyone. If you’re at a total loss for consistent talent, bring in someone to share their talents and teach the group something… yes, it will take a little longer, but the joy is in the journey too.
(remember, no kids! It would be fun to teach them cross-stitching and you can, but nothing they make can be sold— we are past the industrial revolution and can’t promote child-labor).
2. Know your cost of goods and your supply chain. This doesn’t mean getting everything donated. You’re starting a business and need to have reliable access to a consistent supply of the same color/leather you show your sample of. Make sure your supplier’s supplier is reliable too! You are about to work out your pricing model (see below) and you want to be sure you don’t lock in your product at a loss. If a customer sees a red scarf, you need to be able to fill an order of red scarves. Save yourself the embarrassment of having to call your hard-earned customer to tell them you can’t do what they wanted. That just makes everyone sad (been there, done that).
3. Replication! While one-of-a-kind pieces are great and do sell well at craft fairs, they are limited and can’t be sold online because each piece will vary in cost, which will make it difficult to price each item? Additionally, you must consider the time it will take to photograph, price, and describe the item you are selling online. Basically, unique items are unadvisable because you lose a lot of time per item. That said, it is also important to make sure that your group can all collectively make every item on your list. We have had entire orders held up because one person was gone or missing but no one else could make that unique item… that’s not great for the group long term. We lose customers for the group that way— not just that one. All for one and one for all… means ditch the variety, make something together!
*This is also great when you’re super successful you can bring on more women/jobs and not upset the product quality or offering! The group is scalable for larger impact.
4. Pricing relates to your cost of goods, but what I have learned is that there are a few other things to consider as well before you solidify your design and retail price. Firstly, what are you making and what is the market demand? For example, while scrunchies are trending right now, we can’t guarantee that the demand will stay forever. Secondly, you want to be competitive. Going back to the scrunchie example, there are a lot of scrunchie makers on the market right now which would make it difficult to compete there.
I’m not a math major, but if you’re the maker of this product you might be a little offended. Don’t be. Your opportunity is on the mass production and hopefully you don’t have to spend a lot of marketing money if you get a distributor to help you reach the wider market. Keep in mind you need to make this work. Thirdly, ask yourself what the perceived value of your item is and whether it will sell at the market. If not, then go back to the drawing board. For real impact, you want to move a lot of product, so think long term even if you are producing and selling retail. Keep those margins as opportunities to partner. Remember, everyone needs to double their money. If they can, they will be back to buy more.
Here is a sliding example of how to think through pricing:
$ cost to produce
$$ distributor cost
$$$ wholesale cost
$$$$$$ retail cost
We have a lot of great partners on our site but not all of them have these steps in pricing available. That’s ok. We aren’t out to make a ton, but we can’t take them to retailers because they don’t have the margins for traditional brick and mortar, so they have to hope we find the end-user. It’s ok— just a slower approach.
5. Participating in a local market will be a large part of your focus for your nonprofit or artisan group in the early days. You want to make sure you get a lot of practice, a steady market of customers, the chance to hone your craft, and see what people like. Here, you can build on your menu and have multiple successful items. The local market is also easier to ask for feedback and update your products. Keep a pulse on what they like, what they are saying, and respond to that with new ideas!
6. Going international? Great. Now ask for help. Do you research on prints, colors, fads, and uses of your product. I cannot tell you how many times I have heard,“but these are so popular with tourists,” and then after I buy all of them with the last of my life savings (yes, I did), no one here bought them. Why? It’s because shoppers here are not on vacation. They don’t have an emotional connection to that beaded zebra or bracelet made with local tea boxes. Here, they are looking for a birthday gift for mom who has never left the country. She might have loved that on holiday… but she’s never going to wear it to the grocery store, so no. Make something the international buyer can relate to and literally buy-in. You might have to change a color, but that’s ok.
All in all, keep in mind your margins, cost of goods, estimated production time, and ensure that everyone can step in and make all the parts! These factors are critical to achieving the impact you want to create.
If you still have questions, shoot us a note. We love brainstorming and helping to crack the nut of how you are going to make the world a better place! And who knows, maybe you’ll decide to one day sell to Branch Out Market.