big stores stealing from indie designers… again

knickerocker
This keeps happening, and it breaks my heart every time. The fashion industry is one of the hardest industries to fight over intellectual property (anyone see The Devil Wears Prada?). Stealing is wrong no matter the size of the business, we speak volumes with where we spend our money, and with social media we have the opportunities to make our views heard. I implore you to read Nichola’s story and take to social media to pressure them to do the right thing.

Being an indie designer is tough. It’s bad enough that hobbyists will try and copy our designs and undercut us, but when a giant retailer with a huge presence does it, they might as well just tell us to close up shop. We choose this path for the passion, most of us don’t expect to be swimming in money, we just want to do what we love, bring fun and new things to the world, and make enough money to keep on keepin’ on. By supporting Nichola, you’re helping one more person do what they love.

If you need more incentive, and you’re a derby girl, she also makes killer derby shorts. Spreading the word is what I’m asking you to do, spending some money in one of her shops will be going the extra mile. Okay friends, go forth and fight the good fight!

biz chat: the costs of doing licensing shows

the cost of doing licensing shows

I mentioned at the beginning of this year a friend asked if I was going to do roller derby rec-league (since the league I was skating with broke up in January), and I told her “I can’t afford it”, my response was met with a perplexed look. The reason I couldn’t afford it was because we were cutting back on selling spring shows, had just made our last 1K payment for Surtex, and still had to pay for a hotel in NY for a week and two plane tickets. Exhibiting at Surtex cost us 4k, that’s cheap because we were exhibiting with Cultivate Art Collective, had we done it alone, our numbers would have looked more like this.

In April we added exhibiting at Licensing Expo (meaning we were now cutting out our major summer selling shows). Licensing Expo cost us 6K, and that’s cheap because we exhibited in the Launchpad area, where the booths were only 2k. We were advised to remove the majority of our tees online, so that we can license the designs instead, lessening our online income. November 1st we have to pay for a local art show that’s almost two weeks long, and the cost for that is around 3k (not including cost of goods, and could be higher depending on how much the costs of displays will actually be). To have more time for building up our portfolio we stopped accepting web/design clients, in fact, we’re closing our web/design business next month (there goes another revenue stream!). Between now and April we will be paying for the 3k local art show, smaller holiday show fees, exhibiting fees for Printsource in January, Surtex in May, a full booth at Licensing Expo in June which will cost around 10k, and BLE in October. We’re looking at a minimum of 20k in booth fees a year, over double what we normally spend on booth fees.

Robo Roku Licensing Expo Launchpad Booth
Robo Roku Licensing Expo Launchpad Booth

I now tell people “I’m broke”. The reason I’m “broke” is because we made the leap from “selling shows” to “licensing shows” without having a big enough cushion. With licensing it can take up to a year and a half to start getting paid. The licensee (company licensing our work) needs time to produce the products, sell the products, then we start getting paid (normally quarterly). I’m not living off instant noodles or anything, I just have a strict budget; my budgets always includes a “fun money” category, I just don’t have as much fun money as I’d like. I cut back on that category to reallocate the funds toward booth fees. When I was adding up the expenses for Licensing Expo, I had a moment when I thought “there are so many other cool things I could do with this money!”, but to make money, you gotta spend money, so that’s what we’re doing. I don’t regret making the transition to focus more on licensing, maybe just wish I’d planned it out better. I just didn’t want to wait another year to “do it right” I wanted to dive in and get started.

Soon enough (and I mean soon) we’ll have new stuff online for sale which will get us closer to our normal income level. I’m excited to share with you the things we’ve been working on this summer. We normally do big launches for a year, and then sprinkle in smaller batches of new stuff here and there. In order to be structured better for all the licensing shows, we’ll be switching to releasing collections, like the fashion industry does. Very soon we’ll release our A/W (autumn/winter) collection and then our holiday collections, which will be released at least a month before the holiday. I’m excited to get on this schedule, I am such a lover of routines.

I wanted to share all this info with you so you can have an idea of what doing trade shows can do to your bank account (and maybe your lifestyle). I love what I do, and maybe this year I don’t have as much money to spend on fun stuff, but in a few months things will start leveling out. Ah, the things we do for what we love. If you’re interested in going the same way, I highly recommend looking into Make Art That Sells by Lilla Rogers for getting your art prepared, and learning from Tara Reed to make sure you understand the business side. If you have any questions about shows, I’m happy to share what I’ve learned.

surtex prep pt. 2

It feels weird not posting new works or making up a storm for cons this time of year. Prepping for Surtex (as a newbie) just takes a lot of time. I didn’t know for sure we were going until we were in the beginning of holiday show madness, so we haven’t really been able to focus on our collections for Surtex until this year. Most people prepare for Surtex year round, we have less than five months to have a minimum of 20 collections done.

“Collections” in the licensing world vary just a bit by what your focus is (patterns vs placement artwork). A collection is a grouping of four to twelve (or more) pieces of coordinating artwork that make sense as a story. A collection could be a nautical theme full of nautical icons like anchors and sailor hats, or a set of patterns that use the same colors. I love surface design, so I’ve been building up the This Creative Life line of pattern collections in any spare time I have on my iPad. I almost lost it a few weeks ago when my pattens on my iPad weren’t showing up. After a reboot of the iPad all was right again, but boy my heart sank and face went pale for a few minutes. Since Robo Roku’s work is done more in tandem, that’s where our finished collections are lacking right now. We have our designs planned out, and have characters created for them, we just have to round out the collections. I really wanted to have 50 collections done for Surtex, and I am still aiming for that, but I’m not going to beat myself up if we don’t make it past 20. I just know the more we can show, the more possibilities there are.

This month we had to turn in our business card design to the collective for printing for Surtex. On one side will be our design, on the other Cultivate Art Collective’s info, our name, and booth number. We modified our old mural design for the cards, we’ll also be using a variation of this design for our booth banner (which we’re really excited about!). What do you think?
RoboRoku_MuralCollage-BC

XO
-renée

biz chat: are craft shows worth it?

Robo Roku booth RCF

Doing shows are a lot of fun, a great way to meet people in your industry, get your name out there, and ideally make money. When you’re just starting out, shows are a fun way to broaden your reach, and learn what people think of your goods. After at least a year of doing shows small one-day ones to bigger 300+ booth shows you’ll need to start realistically crunching the numbers on the shows to see if they’re worth it anymore.

First, you’ll need to do a check-in with yourself on how much your business needs to be bringing in. Add up your monthly expenses including mortgage/rent, utilities, phone, gas, groceries, savings, everything you need to pay each month. Multiply your monthly expenses by 12 and now you have your must-have income goal.

INCOME BREAKDOWN
Let’s say your needed amount is $50,000/year
(and you’re going to work a typical 40 hrs/week with 2 weeks vacation time)
40 hours a week x 50 weeks = 2,000 hours
$50,000 / 2,000 hours = $25/hr

That hourly wage gets factored into your pricing structure.

SHOW BREAKDOWN
If you do a 2-day show that’s open eight hours a day you’ll probably end up working 22 hours from set up to tear down.
22 hrs x $25 = $550 (increase this number if you have booth helpers)
Booth fee $500
That’s $1050 you need to make just to be reimbursed.

DID I PROFIT ENOUGH?
If at the end of the show you have $1050 in your pocket, you didn’t profit, and the show was not worth your time. Remember how we price?
You have to deduct your costs of time and materials of everything you sold, so $1050 then becomes $787.50.
You also have to pay taxes, so that’s another deduction from the money you have in your pocket.
Did you buy tables and fixtures for displays? Another deduction.
Did you buy food while at the show (or before the show to pack a lunch)? Another deduction. (even if you can write it off, it still counts)

IF I DON’T DO THE SHOW, HOW WILL I MAKE MONEY?
By skipping a show that has proven to not be profitable you can spend that time reaching out to magazines, stores, and blogs.
You can use that money on advertising, put it toward doing bigger, more profitable shows, or expanding your product lines.

BUT SO & SO SAID IT WAS AWESOME!
What’s “awesome” or “good” to one person, may not be “awesome” or “good” to you. Consider the source. Is this person making a living off their business? Is this a part-time thing for them? Is this person a one-person operation? If you run the business with a partner, both of you need to be compensated. The bigger your business is, the more expenses you have, they may not need as much income as you.

If you’ve never done the show before ask someone that is doing it full-time. Ask them “was the show worth it?” this is a very direct question, and if you pay attention to their face, you’ll have your answer. Vendors don’t want to bad mouth shows and get a reputation, but if you ask a direct question, and really pay attention to their answer, you’ll find the truth. Check out Unanimous Craft for some reviews, too. Just remember vendors don’t want to bad mouth shows, your best bet is reaching out to someone personally. I’ve seen friends post on social media that a show was great, though they told me personally it was terrible (including figures). When you make a good chunk of your income from shows you don’t want organizers to see you complaining publicly.

biz chat: being prepared for tax time

Craft Inc. Worksheet
(Photo of one of the worksheets in the Craft Inc. Business Planner)

 
Last week I received several emails asking for tax advice, prompting me to re-visit this tax post idea I had. Taxes can be scary and not very fun. I paid my quarterly sales tax earlier this month, which is made easier by my strict rule of putting aside sales taxes for when it comes time to pay “the man”. I know some people don’t do that, they spend all their income, and struggle come quarterly tax time. That’s a good sign that you are not pricing your goods properly. Here’s a refresher on pricing. Just because your business is based on creativity, that doesn’t mean you don’t have to operate as a real business. If you want to do this full time, you need to have a pricing structure that pays your costs and you for your time, and you need to keep accurate records to protect your business, and keep you informed on the costs of running your business.

The best advice I can give you in regards to doing your taxes is to find a CPA. Ask your local friends if they have any recommendations for one, because there are some duds out there. I love my current CPA, but my last one was not so great. You want someone that understands your position, especially if you are self employed. Last year I was really busy when tax time came, and I didn’t want to deal with getting all my receipts together (I didn’t have a good system in 2012), after my CPA worked on everything, I got a call. She said “you don’t have as many deductions as last year, what changed?” I was busted, she caught me being lazy. She filed an extension so I could get everything together. I may have been busy, but it’s more important to keep good records and take advantage of the options available to small business owners, if you want to do this full time. Having a CPA is so valuable, they will know of deductions you may not. They can also handle the researching of depreciation value on your electronics. It’s a better use of your time to let a professional handle this while you continue creating, they will most likely do a better job.

Some of these tips might be better suited to keep you on track for this year, but they will also help you get prepped for you to process your taxes from last year.

 

TAX TIP TIME!

GET ORGANIZED
Find a way to have 12 folders, a folder for every month. You could use a filing cabinet, an accordion style folder, a binder, a notebook full of pockets, file folders on your computer, etc. You want to have a file folder/pocket for every month to file away receipts and records of mileage. Choose the way that works best for you to keep organized.

>>In my monthly files I keep invoices, monthly sales data, receipts, and records of mileage. I keep digital and paper records, to keep things backed up in case of fire or digital data loss.

KEEP YOUR RECEIPTS
Something incredibly important to remember about receipts is that a lot of them can fade. Here are some ways you can keep your receipts that will last come tax time.
– The Expensify app is pretty fab! >>This is what I use, and I LOVE it.
– Scanner Pro on iPhone and link to a receipts folder in Dropbox (this tip brought to you by Meredith of smallerbox.net)
– Scan your receipts in as soon as you get home, print out and staple the original to it and put in a file folder for that month.

WHAT CAN I WRITE OFF?
So much! Here’s a little checklist of things you might forget (remember to keep receipts for everything listed):

Supplies, marketing materials, packaging, displays, etc.
Business meeting meals, meals you eat while selling at a show, and meals you eat on a road trip to a show.
Parking, toll, and gas (if you choose to write off gas vs mileage). I prefer mileage deductions. I write the name of the event I’m attending on these receipts. If you do mileage, don’t forget those local shows!
Booth payments.
Advertising payments.
Studio rent.
Utility bills.
Banking fees and credit card processing fees (for example PayPal, Stripe, Square, etc)
Shop fees from places life Etsy, BigCartel, Shopify, etc.
Services fees – web design (if you paid someone), or the cost of a site template, your CPA (hint hint), HootSuite (or other business related apps), web hosting, domain name fees, newsletter fees, etc.
Rental car.
Airfare.
Business books (e-books and e-courses count) I am even able to write off some magazine purchases. Most of the magazines I buy are $12+ and cover design, web development, business, and crafts. I write these off and the September issues of magazines (since the September issues show the fall trends).
Conference fees (don’t forget the food you ate during the conference!).

Whenever I am checking out of a place I do a quick run-through in my mind to see if my purchase is tax deductible. Don’t be too shy to ask for a receipt, often I have to irritate parking garage attendants asking for one. A Beautiful Mess has a list with more things to consider.

EXTRA BIZ TIPS!

GET REWARDS
If you get a business credit card you can get rewards for your purchases. I use American Express, and love them. I have a friend that loves Capital One. Do some research and find one that’s right for you.

READY TO CALL IT QUITS?
I’m not sure if it’s the same for other states, but in Texas, you just call the Comptroller office and tell them you are no longer in business. If you don’t do this in a timely manner you will have to pay a small fine.

Recap:
Make sure you are pricing to afford to run a business and pay your sales tax
Get Organized
Keep Receipts
Look for Rewards

Craft Inc. Business Planner

I strongly suggest you find a CPA, but understand that it’s an added expense that is not easy to pay for when you are first starting out. Definitely buy the Craft Inc. Business Planner, it’s great for starting out! If you have any questions or tips of your own, leave them in the comments below. I hope this was helpful and encourages you to keep better monthly records to make tax time easier.

New Year, New Goals

fat mum slim photo a day
I’m trying Fat Mum Slim’s Photo A Day Challenge again. This challenge can be hard for me sometimes because I work at home and don’t always leave my house. I’m hoping to change that this year. I made my list of things I want to achieve this year, I can already feel one of them may not happen, not by choice, but by circumstances, I’ll just have to see how things
play out for that one. Here’s my list:

1. Create More
– Design 5 patterns a week
– Finalize 1 character a week
– Finish 1 painting a week

2. Get Moving
– Skate
– Bike
– Do Yoga
(this goal is just putting back into practice the first things that go when the holiday season hits)

3. Communicate More
– Blog more frequently
– Have weekly meet ups with friends
– Mail REAL letters

4. Be More Intentional
Sometimes I can have a laissez-faire approach to life. It trips up my obsessive compulsive nature, but it also stems from my belief that everything happens for a reason. Robo Roku has survived the last six years on people approaching us with opportunities, but our first year I was more proactive. Going into our seventh year of business I’ve learned a lot. We have tried so many things, and now I can take things we did in the past (like me being more proactive), plus all the new avenues we’ve learned about and product testing we’ve done and take Robo Roku to our next level.

2013 was a learning year for me. Our sales dipped a bit in 2013 (which was tough to handle since in 2012 we doubled our 2011 sales), but we took the summer off from shows to focus on our art, and we knew we were taking a risk. I really think 2013 was all about prepping us for what 2014 has in store for us. We learned so much, made great connections with other artists, and we’re on a path that feels effortless to us. It’s almost like we’re going back in time to when we were fresh and eager, but with so much knowledge in our back pockets. I’m so ready for 2014. How about you? Do you have exciting things you’re looking forward to this year? I’d love to hear your goals, maybe you have some I should add to my list. You can never have too many goals.



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