Thursday, April 22, 2010

Business Plans

When I initially opened my Etsy shop I started with listings for finished knitted items.  Things like hats, scarves, coasters, and shawls.  Many were things I had already knit with no intended recipient.  As I started to knit things specifically for the shop I found that I wasn't enjoying the knitting itself much any more.  I have always loved dying yarn but found that I was limiting myself in that area because I can only knit so fast.  And so, with the idea of reclaiming my knitting time for me, and enabling myself to dye yarn to my hearts content, I switched the focus of my shop to hand dyed (painted) yarn.  In particular, I have focused on sock yarn.

The issue that I am currently confronting is the issue of selling retail (from my etsy shop or some other site) versus selling wholesale to local yarn shops.  Selling retail means a much higher profit margin but not much visibility.  I have been using Twitter and this blog to get my name out there but it is really slow going.  And, yes, I know I need to add Facebook to the mix (I really don't like Facebook so I'm dragging my feet.).  Selling wholesale means I have the buying public of the local yarn shops that would carry my products.  This way, I would get my name and my products in front of those knitters who are at the shops buying and who may not be in my sphere of influence on line.  Wholesale means more work, less profit per skein.  But the potential for a higher volume of sales would make up for that.

I have decided to try the wholesale route.  Whether or not I can get any yarn shops to place an order remains to be seen.  I have done quite a bit of research on local yarn shops lately.  My goal is to get five on board by October (six months from now).  I am approaching shops one at a time. My criteria for a shop that I want to work with is pretty simple.  First and foremost, it has to be a shop that I would want to not just shop at occasionally, but be a "regular" at.  Secondly, I don't want any market overlap of the shops.  I want each shop to be the one and only place a patron of the shop would find my yarn without travelling outside their normal 'home' area.

My other goal that I am starting to work toward is a vendor booth at Maryland Sheep & Wool Festival and/or Rhinebeck in 2011.  That's a year away for MD, and 18 months for NY.  I will be able to get the information/application for MD as soon as this year's festival is over (May 3rd).  

Initially, I didn't like the idea of keeping large inventories on hand because of the amount of money that gets tied up in that.  However, I have come to realize that if I want to start doing these kinds of fiber festivals the only way I will have enough inventory is to gradually build it up.  The nice thing about doing that is that I can also keep making new colors...something I so love to do.

So, there's a peek into the thought processes I am going through as I continue to grow and develop this business.  And, yes, I know it might be a little easier if I just wrote a business plan.  I'll get right on that.  As soon as I figure out what that plan is...

1 comment:

  1. It is hard to get going. Thanks for sharing your thought process! I wish you much success!