Hey everyone!! It’s a gorgeous Monday morning and I hope you are ready for the latest post in the Business of Machine Quilting series. Today’s post is all about having a business plan and it’s going to be a little different from the previous posts in this series.
Normally, I will talk about my thoughts and experiences on the topic and then interview another machine quilter to provide a different view. The problem is….this topic falls in the “should have done” category. I didn’t have a plan and actually still don’t (eek!).
Instead of trying to sound like I knew what I was talking about, I reached out to Dodie Jacobi for help.
Dodie is a small business consultant that also happens to be a quilter. Her main passion in life is helping business owners reach the next level. She is brilliant…just brilliant! I talked to her for almost a half an hour and could easily have talked longer. Be sure to check out her website and her blog, you won’t be sorry.
To some, a business plan may sound like a hyped-up step in the process or even a huge undertaking. You may be tempted to skip over this step since the “business” aspect of quilting may not sound like a lot of fun. But, after talking with Dodie, I realized that it is very important and not nearly as hard as I thought it would be!
In our interview, The first question that I asked her was the most obvious,
How important is a business plan?
Dodie said that a business plan is important for two reasons. First you may need it to get financing. But secondly, and most importantly, it gives the owner clarity about what you envision your business to look like. Writing it down also allows you see if there are any “holes” in your business, or if there are any areas that you haven’t considered.
I would also add that having a business plan helps encourage you to think about it as a business and not just a hobby! Even though you love quilting, you have to think of it as a business and a business plan will help ensure that you do just that.
What should be in a business plan?
According to Dodie, a business plan should cover 3 things:
Production– In a machine quilting business, production is your quilting. How many quilts do you think you will bring in, and how much money do you think that you will make.
Administration– This includes accounting, book-keeping, supplies, etc.
Marketing– This is all about getting the word out about your business.
Each section of your business plan should include a narrative and a spreadsheet that details the financial impact of what you envision. For the narrative part, you write out how you plan on handling each section and the spreadsheet is the dollar amount that you are estimating that you are going to make and/or spend.
So let’s use my quilting business as an example, and let’s assume that I am working on the marketing section of my plan.
Narrative: I plan on marketing my business by doing 3 things:
1. Through my blog by posting 3 posts a week.
2. I will encourage my customers to refer me to their friends and family.
3. I will be active on my twitter and Facebook accounts.
1. Blog hosting, maintenance, and design etc: $200/yr
2. Internet service $40/month
3. Camera $300
You may not know the exact numbers, and that’s ok. You can always change it once the details be clearer. In any business plan, you are making assumptions….otherwise known as a guess.
What is the biggest mistake people make when putting together a business plan?
Dodie pointed out to me that there are two mistakes she sees new owners make most often. The first is not planning for the time it will take for the business to build income. She suggests being realistic about when you will start making money. When you buy your machine, or decide to start taking customer quilts, chances are that you aren’t going to be busy from the very beginning. (But if you are, than yay for you!)
Secondly, one of the worst things that you can do is to actually stick to your business plan. As circumstances change, respond to the changes. Don’t be afraid to tweak or even completely overhaul your original plan.
Let’s return to my previous example of the marketing section of my business plan. The worst thing I could do is stick to it, regardless of how it’s working out. If I realize 6 months down the road that running my Facebook and twitter account weren’t helping me promote my business, I would need to rethink that item. I could decide to stop doing it altogether (just hypothetically, of course, I love my facebook and twitter accounts!) and replace it with something else that I think would work. Or I could tweak it by paying someone to do it for me. Regardless of what I choose, I need to be realistic about what is (or isn’t) working.
I hope that makes sense! Dodie also mentioned something that should be a mantra for your business, you are always moving towards your business plan or away from it. If you are moving away from it, you have to decide if you need to change where you plan to go or change your approach to achieving your original plan.
I am so glad that Dodie took the time to let me interview her, her experience with both quilting and small businesses make her the perfect person on this subject. This is the one thing that I wish that I had done in the very beginning. When I admitted that to Dodie, she assured met that it isn’t too late to start.She even recommends renewing or revising your plan every year at the least. Making a plan now is better than having now plan at all! A huge thank you to you, Dodie!!
Again, I know that you might not think that this is a fun part, but I can’t stress enough that starting out on the right foot with your business will help ensure your success! If you are still hesitant, there are a number of books available on the subject, or Dodie suggests that you can try out Bizplan, an interactive website that helps you put together a plan. (I am not affiliated or endorsing the website, just including it as a resource!). And of course, if you have any questions, please feel free to post them to the forum so that I can answer them!
Next week, I will still be talking about another plan. Not a business plan but a how-to-run-your-business plan. I will include tips and ideas to help you decide how you are going to handle customers quilts, work efficiently, and tackle different kinds of situations. Be sure to sign up to receive the blog posts by email so that you don’t miss any of the weekly posts. Just head on over to the blog page of my website and you will see the subscribe button on the top right!