In Part 1 of this 3-part series, we looked at the supply costs of creating a greeting card. In Part 2, we looked at other expenses of a greeting card company, expenses like overhead, wages, commissions, taxes, growth and your salary. Now, in Part 3 of this series, we'll see if the margins are good enough for you to build business around greeting cards.
We have figured out that we can sell an A7 (5 x 7) card for about $5.50 on Etsy. Our supply costs for that card come to about $1.14.When we add in Etsy transaction fees, etc, the cost of each card shoots to about $2.18. Selling that card for $5.50 leaves us with $3.32 to cover all our other costs, including our own wages, etc.
At that rate, we'll have to sell 62 cards per day to cover all our expenses and to make a little profit, which we will then re-invest in the company.
Unfortunately, you don't always sell 62 cards per day, day in and out, so does this mean that the entire greeting card business is not a business but is, in fact, nothing more than a really expensive hobby?
Not necessarily. Let's look at ways you can round out your business to make it profitable.
Etsy is a fantastic venue where you can sell your greeting cards to a willing and available audience. Unfortunately, there will be slow times on Etsy, especially as you build your reputation, your product line, and your business.
Selling 62 cards per day is not, then, immediately realistic. Sadly, your bills are reality and expanding your horizons beyond Etsy might be a good idea.
There are a couple of theories of thought about branching out from Etsy. One is that you should expand to other markets because you don't want to put your so-called eggs into one basket. After all, what if Etsy crashes? Or their fees become unmanageable, or you get kicked off (it happens)?
The other theory of thought is that you should not branch out from Etsy and should, rather, put all your effort into building that one business into something big.
Yes, having multiple ecommerce sites can be a pain. You have to learn the rules of each, they each have different pricing structures, it can be a pain to manage. I get it. Still, you have to remember that each venue has its own audience. People short of time and wary of kitchen table businesses probably won't shop on Etsy. Rather, they'll probably stick with Amazon, or another similar shopping portal.
Another reason to venture past Etsy alone is that there are multiple venues you can set up and, basically, walk away from. OK, you need to check in with them from time to time, but a lot of the business is taken care of for you.
Sites such as Redbubble and Spoonflower allow you to put your designs on their sites - not only for greeting cards but for other items such as t-shirts and stickers and wrapping paper. They then sell the items and send you a commission if and when something sells.
As a greeting card designer, you might not think that this is a great option for you but you might find, going back through your designs, that you have a few you can modify to fit the needs of a different product. While you are growing your greeting card business to 62 card sales per day - and beyond - you can cover a lot of expenses through these set-it-and-forget-it sites.
There are some natural products you can expand your own line into that will help you to reach your yearly goal of $75,000 (or whatever it is), and will lower your need for selling 62 cards per day. These products include t-shirts, tote bags, coffee mugs, note pads, journals, stationery sets and art prints.
I started out years ago selling art prints, first on Etsy, and then through multiple ecommerce venues. It turned out that a book of mine, The Complication of Sisters, began to sell a lot and people began asking for a number of the micro-stories on art prints. Since i was already selling prints of my paintings, this was a natural.
Eventually, people who saw my sister-themed art prints began to ask for the same messages on cards. That was my back entrance into the greeting card business.
It turned out, though, that my messages were not only appropriate for cards and art prints, but also made sense on coffee mugs, tote bags and other items/ So I expanded laterally. Soon, I was creating more greeting cards than paintings and I began to shift my business model over.
You can do the same thing, but begin with greeting cards and expand into new ventures. Of course, you might think, "but I know nothing about making t-shirts and coffee mugs." Well, today's marketplace makes this easy for you.
There are a number of companies that will print your coffee mugs, t-shirts, etc., on demand. This means that you don't have to order and store inventory. As soon as you get an order, you alert the company and they print out the product and ship it out for you under your own label. Printful and PrintAura are two such companies.
When you are selling through multiple venues and selling a variety of products, the burden on your greeting card business lessens. Now you you don't have to sell 62 cards per day to pay your bills. Yes, you want to build it up to that and more, but by branching out you can do so without panicking.
The important thing is to know your margins - how much your cards and your business cost, how much you need to make, how many items you need to sell in order to make that amount, and what your profit will be.
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