From Hobby to Business: Navigating the Craft Industry in 2024

Posted by on May 01, 2024

Print this Post


To sell your crafts these days you don’t need to pay for a booth at local fair and wait for browsers to transform into buyers. While that’s a lucrative approach for some creators, online marketplaces and promotion make it easier to turn a hobby or passion into a source of income.

Now that you can compete with almost anyone in the world, things get a lot more complicated. Not only do you have to think about other crafters, multimillion dollar companies are also trying to act like they’re DIY to grab a piece of the handmade market. 

To build your brand and sales, you need a strong strategy. Below are important areas of focus as well videos who go into depth on the challenges and hacks for selling crafts.

Identify Your Target Market

Before diving into a new business or even launching a new product line, it's crucial to identify your target market. What demographic will appreciate and purchase your craft: Tweens who dig amigurumi dolls? Design-minded fashionistas who appreciate upscale handbags? 

Understanding their interests and purchasing behaviors will help you effectively tailor your products and marketing. That understanding can particularly come in handy when developing a search engine optimization (SEO) keyword plan for pay per click (PPC) campaigns. For example, if the tote bags you sew will be liked by fans of the company Miu Miu, you can use related terms to position those products in search results. 

Once you know your target market, you probably want to analyze your competitors. What they are doing well? How you can offer something different or better? Clearly defining your niche means you can tailor your products to meet specific customer needs and stand out in the market.

Pricing Your Products Appropriately

Setting the price for your products will be influenced by your costs, desired profit margin, target market and competition. You want to cover costs and make a profit while remaining competitive in the market. That said, underpricing can devalue your craft, and overpricing may deter potential customers. 

Richard Bellando of Craft Retailers and Artists for Tomorrow warns against waging a price war with big box retailers, even ones selling products that appear handmade. “The closer you get to them at price point, the more difficult it is for you to survive because you can’t compete with them,” says Bellando. Most big companies are outsourcing labor and buying materials in bulk. Upsell your work by focusing on the differences rather than boiling down your sale down to dollars and cents.

Building Your Brand

In a crowded marketplace, fostering a strong brand is essential for standing out and gaining customer trust. Your brand should reflect your unique style and story, resonating with your target audience on a personal level. 

Craft businesses can focus on storytelling and authenticity to differentiate themselves. Tell the story behind each product and highlight the craftsmanship involved. Use social media to engage with your audience on social and humanize your brand. 

In the above video, Deborah Engelmajer explains how to define your ideal customer and establish “brand clarity.”

Optimizing Product Specification

In a competitive market, refining and optimizing your products is crucial for staying relevant, maintaining profitability and meeting customer demand. Depending on the sites you’re selling your products on, you may need to create PDFs for your patterns or spreadsheets filled with the appropriate SKUs. 

Depending on the systems, you may need to convert product specification documents from PDF to Word to streamline certain processes. Word documents can be easier to edit, update, and share with team members or stakeholders. 

As for the products themselves, ask for feedback from customers and keep tabs on industry trends to adapt and innovate accordingly. You may want to experiment with new materials that will improve your profit margin, and attempt designs that will keep your product line fresh, appeal to your target market and even find new customers. 

In the above video, Creative Hive explains mistakes she’s made that she would never do again, including making custom orders. While plenty of crafters offer to customize products in order to improve sales, this extra effort can cut into your profit margin and devalue your time.

Managing Finances

Financial management is the backbone of any successful business. Budget, cash flow and tax liability are just a few things that must be carefully monitored for long-term sustainability. 

Craft entrepreneurs must maintain separate personal and business “ledgers” to effectively track expenses and revenue. Consider investing in accounting software or hiring a professional accountant to streamline financial processes and ensure compliance with tax regulations. A part of preparing your taxes is keeping your expenses and receipts organized. 

“For online purchases, there are many software options you can consider for receipt storage and tracking,” explains CraftyBase. “A good option for small business expense tracking is Expensify, which offers a small amount of receipt scans free per month. They also offer a handy mobile scanning feature for your offline receipts. 

While the practical aspects of running a business are crucial, keeping your creative spirit alive is equally important. Regularly set aside time to explore new ideas and techniques without the pressure of commerce. This fuels your passion and can lead to innovative products that set your craft apart in the marketplace.

Log-in to Post a Comment: Craftfoxes shadow Google shadow