. . . and how I stopped the negative cash flow
After a super motivating weekend with Christy Wright's Business Boutique, I set out to make my Etsy shop a success. I saw amazing women entrepreneurs on Instagram with piles of orders ready to be shipped. I saw them do beautiful, creative work. With credit card in hand, I set out to do the same, or better!
I had amazing branding, beautiful products (watercolor Bible page prints and hand-painted wood signs). In 2016, my shop earned 140 five-star reviews and made 10K in revenue! Sounds great, right?
$10,000 would have been great if I hadn't spent $15,000 on the business. #buzzkill
Finally looking at the horrible numbers put me in a pit of gloom until I decided to make some drastic changes. I close my shop, pivoted the type of work I sold, and got a grip on my finances. The biggest step was taking Dave Ramsey's Financial Peace University. I had been foolishly avoiding this course for several years. I was surprised that I could understand it and that it brought unity to my marriage!
My business is now debt free! And I've reopened my Etsy shop because there's nothing wrong with Etsy. The problem was not having a financial plan that kept my spending down.
I'm using my creativity to run my business very low cost. (My bank actually penalized me for not spending enough on my business!)
Here are some ideas to cut cost in your biz:
1. Minimal Cost of Goods
The cost of goods (COG) when selling physical products can put you out of business.
Before I would spend money on everything from a new scroll saw to ink-jet watercolor paper.
My first year in family photography, I spent all my earnings on props. Moon-shaped cradles, real bunnies, and sofas that I put in the middle of an apple orchard.
I called my delusional, presumptuous thinking "optimism". #dreamchasers should #dreambig right?
Now I sell only digital products. I sell my photography as digital image downloads. I create websites, branding and commercial photography - all of which are digital services. I reopened my Etsy shop but all I sell how are moodboard image bundles. I don't spend a lot of time on my Etsy shop as I am focusing on what brings in the most money.
2. Very low CODB
The cost of doing business (CODB) is tricky for a self-employed entrepreneur because we tend not to consider our time as an expense.
For a creative, time is a difficult concept. In order to produce creative, amazing work, we must be in the right side of our brains. Unfortunately numbers and time are regulated in the left side of our brains.
Stress is another factor that can negatively affect creativity. If I am on the clock, the stress short-circuits my creativity.
So I would take on projects that would take me FOR-EVER to complete. Once I edited 937 photos for a school and sold only 30% of those photos. When I finally did the math, I realized I had made under $2 per photo which had taken me 30-60 minutes each. Really? I could make much more money flipping burgers.
Now I organize my time and priorities. I find creative ways to run my business with very little cost. My business is debt-free and I am growing at the speed of cash.
These are my fave FREE online services:
Wunderlist is my favorite task manager because I can organize my tasks how I want to. It also let's me tick the box for completed tasks and gives me a satisfying "ding!" when I do.
WUNDERLIST TIP: Set recurring tasks so you can check the box and still have it pop up the next day.
You don't need Photoshop to make professional title graphics. I have been proficient in Photoshop and Illustrator for literally 25 years and sometimes I just use canva.com to create a graphic because it's easier! I even wrote a blog post about creating great graphics using canva.com
CANVA TIP: You can now add 3 color hex codes for free to the "your brand" section. This will help keep your brand consistent when choosing colors for graphics and fonts.
This email marketing service is my favorite because it integrates with Squarespace seamlessly. Although I loved the automation features MailChimp offers for sending email campaigns, their free account version is all I really need for now.
MAILCHIMP TIP: I send one designed email to myself from MailChimp, then I create template out of it. (reply >> copy all >> paste into new canned response") When I get an email or a sign-up, I click the email address, select the canned response and send. It's a super fast way to send a designed email in gmail.
This collage maker is super easy to use. Fitting photos in a collage can be tricky in another program. I just slide things around and drag and drop to get the perfect layout.
PICMONKEY TIP: Since their free version doesn't have the color swatches I need, I upload a small jpg of my color to the "add images" section.
3. Free Advertising
Don't Pay to Advertise on Social Media
If your business is small, competing with companies who pay Facebook or Pinterest tens of thousands to promote their ads, is just lost revenue.
Instead, find like-minded entrepreneurs to collaborate with. Serve, give, love others. Then the same will be returned to you.
Perfect SEO and auto-repeating your ad several times a day will not have near the impact that remarkable work will have. Quality shouts out louder than any sales pitch.
Word of Mouth
Loving my job and who I am working for is how I give great customer service. It's not an act, I really love serving them and going above and beyond. As a result, they are happy to tell their friends about my work.
The key to remaining in a creative, loving headspace with my work is to slow down. Did you catch that? Slow. Down. Stress is the enemy of creativity and loving service.