What you need before opening a small handmade e-commerce business: a plan … or at least a pla

So you’ve decided you want to sell your handmade products online! Now what? You’re going to need a plan … or at the very least, a “pla”.

This plan and your planning process absolutely do not need to be intensive – in fact, I think you get the most value from starting with something and learning through experience. But putting in some forethought will help save you time and potential headaches and blockers down the road. Even the spaghetti you throw at the wall to see what sticks has to be boiled first.

I’ll also add that these plans focus on foundational operational to-dos – the things you – as a maker – need to figure out to hit the ground running with your business. I don’t touch on verticals or specialities like creating a marketing plan or setting up bookkeeping. While those things are important, they can be next steps after you get this foundational groundwork established.

So here’s what I think you need to think about before launching your creative business:

What you will sell. First and foremost, you need to figure out what products you are actually going to sell. I elaborate more on the things to consider when deciding what you’ll sell in a separate post. But to summarize, you’ll want to choose products that you can produce at scale (for example, if you want to sell your beaded bracelets, you’ll need to make sure you have the time and materials to make enough of them), that you stand behind in terms of quality, and that you can ship.

Your selling platform. I highly recommend starting a handmade small business on Etsy. Etsy is a marketplace created for makers who want to sell their products, so it does a lot of work for you and includes features that were built with you in mind. And if you’re not keen on Etsy specifically, there are other marketplaces (however they’re lesser known than Etsy). If you are a savvy marketer in addition to a maker, you may have more success on an e-commerce platform like Wix or Shopify. Those sites have more flexibility than a marketplace, and each has its own set of pros and cons. Where you sell online is completely up to you, and is an important decision. It’s worth investing the time to research, estimate costs, and compare options.

Your pricing. Since you want to open your own small maker business, you’re obviously wanting to make a profit — or at least recoup the cost of your supplies. And you want your products to sell. So you will want to dedicate some time to thoughtfully determine your prices – taking into account the cost of material, your time, and operating costs. There are several pricing calculators online to crunch numbers, and I also recommend doing some competitor research to ensure you don’t price yourself out.

I also want to add that you can definitely adjust your prices over time, so what you choose now is not set in stone. But come into setting up your small business with a plan for pricing so at the minimum, you’re not starting off by losing money on every order.

Your policies. Not the most exciting thing to think about, but an important one! Having policies in place from the start means you always have something to refer back to in case you and/or a customer run into a problem. Hopefully you won’t have to enforce your policies right out of the gate, but they’re essential to put in place to CYA. You’ll want to establish a return policy, and you will also want to determine if you need terms of service, a privacy policy (especially if GDPR applies to you), and/or other policies related to buying and selling online. Many selling platforms have pre-written sets of policies you can use. Additionally, marketplaces bear the responsibility of establishing and enforcing some policies, like terms of service, because the marketplace, as the middleman, is the one facilitating the transactions. If your selling platform of choice doesn’t have policies you can use, you’ll want to consult a legal professional to draft yours.

Where you will ship. Picture this: You finally open your shop, and you get your first sale (YAY!!). You do a happy dance … and then you look at the order details to see what the customer bought. Turns out, the order is going to another country, the address information is in a language and alphabet you don’t know, and you accidentally had free shipping turned on. So you’re on the hook to pay to ship your product halfway around the world, you need to figure out what kind of postage to buy, and you have to fill out that customs form correctly. If there’s a problem, you and your customer are likely going to have a hard time communicating to solve it. Not to mention the margin you lost from the cost of shipping.

Wanting to ensure your products are accessible across the globe is great, but international shipping can be complicated. Laws vary by country, all packages must clear customs — requiring additional documentation, and some countries have unique regulations (like packaging requirements in Germany, for example) that all sellers need to abide by. You don’t get an exception just because you’re a small business or one-person show. I highly recommend starting out shipping domestically only and expanding from there. Set yourself up for success by keeping it simple.

How you will ship. This might sound a little silly, but trust me. As with where you will ship, you also need to know how you will do that. This includes understanding the various mail classes, what packaging is acceptable (because yes, the Priority Mail boxes are free – but no, you can’t use them for Ground Advantage), and a basic sense of how package weights & sizes impact your options. Another facet of this is packaging supplies. You will need to make sure that your products arrive undamaged, and you won’t want to be in a situation where you have to ship an order late because you’re scrambling to find packing materials (and probably overpaying for them at the post office). For example, if you sell glassware, test out different padding options like bubble wrap versus honeycombed paper versus a sturdy cardboard box, and have some of those supplies on hand and ready to go.

State and local laws. Small business ownership laws vary state-to-state, and it’s important that you are compliant with your state’s applicable laws. Search “[your state] small business”, and you’ll be able to find the resources relevant to you. I’m in Ohio, and in my experience, it was easy to find the information I needed. As with policies, if you choose to sell on a marketplace platform like Etsy, they are responsible for some of these requirements because they are facilitating the sale — here again, why I recommend starting on a marketplace. But no matter what, you will want to research what it takes to operate a business in your state and remain in good standing.

Of course, depending on your business and level of uncertainty or “learn as you go” you’re willing to roll with, you may need to add to this list. But having these in place will get your basics covered for making and shipping your first order. And the sky’s the limit from there!