Weekly-ish notes on navigating big change

income

How to stay on top of your accounting

So, not to freak you out or anything, but tax season is coming. And I'm a little overwhelmed by how many people are saying things like, just worked on my taxes for 10 hours. WHAT?! Doing your taxes and tracking your business numbers does NOT need to take a million hours. In today's episode, I'll talk about exactly how I did my accounting for years while running my business. Download the transcript (using the form at the bottom of this page!) and I'll also send you a link to the video I made about the accounting software I use now and show you how it's saving me tons of time over my previous method of accounting! Listen in at TaraSwiger.com/podcast149/

So, not to freak you out or anything, but tax season is coming. And I'm a little overwhelmed by how many people are saying things like, just worked on my taxes for 10 hours. WHAT?! Doing your taxes and tracking your business numbers does NOT need to take a million hours.

In today's episode, I'll talk about exactly how I did my accounting for years while running my business. Download the transcript (using the form at the bottom of this page!) and I'll also send you a link to the video I made about the accounting software I use now and show you how it's saving me tons of time over my previous method of accounting!

Resources:

  • Pay Yourself is open! Join us here.
  • The list of expense categories from the IRS is here.
  • Sign up at the bottom of this post to get the transcript with a link to my accounting software video!

How to listen

  • You can subscribe to it on iTunes (If you do, leave a review!)
  • You can listen to it using the player above or download it.
  • Subscribe or listen via Stitcher (or subscribe in whatever you use for podcasts – just search “Explore Your Enthusiasm” and it should pop up!).

Find all the podcast episodes here.

Lessons from Real Income Reports

What do people REALLY make in their handmade businesses? Two years ago, after seeing tons of income reports from bloggers & coaches I started to wonder what an income report would look like from a maker. So I created a survey, where you could share your numbers and your feelings with me. And I’m doing it again this year. You can go to taraswiger.com/income and share your response with me totally anonymously. Listen to the episode to find out why it's important to know your numbers, and also to put them in context: TaraSwiger.com/podcast146/

What do people REALLY make in their handmade businesses?

Two years ago, after seeing tons of income reports from bloggers & coaches I started to wonder what an income report would look like from a maker.

I decided to hold a survey to collect income reports for 2 reasons:

  1. The reports I saw from bloggers and coaches were just NOT comparable to a handmade business.
  2. It’s way more useful to know what lots of people are doing than what ONE superstar is doing.

So I created a survey, where you could share your numbers and your feelings with me.
And I’m doing it again this year. You can go to taraswiger.com/income and share your response with me totally anonymously.

Listen to the episode to find out why it's important to know your numbers, and also to put them in context.

More resources

How to listen

  • You can subscribe to it on iTunes (If you do, leave a review!)
  • You can listen to it using the player above or download it.
  • Subscribe or listen via Stitcher (or subscribe in whatever you use for podcasts – just search “Explore Your Enthusiasm” and it should pop up!).

Find all the podcast episodes here.

A messy path to profitability

A messy path to profitability

Last week I shared a bit of my story, of what it was like to have to figure out how to pay myself once I quit my dayjob. But I left out the messy middle. The part where I had to take apart my whole system of profit and look at it piece by piece.

When I first started selling yarn, I did what most of us do, I looked around and priced my work according to what else was out there. But it soon became clear that I could barely afford the skein of yarn I was dyeing at that price. I had to buy in bulk, at wholesale prices in order to have ANY kind of margin.

But then, I had to look beyond the expense of that particular skein (also called Cost of Goods Sold) into my overhead: paper, ink, dyes, time, and figure out how that was going to get covered.

And when I get to this part of  a conversation with a maker, I usually get two reactions:

But I can only raise my price so much! 

True.

But I can only reduce my expenses so much! 

Also true.

And this is where the exploring breaks down, because you just know there's nothing else you can do so you better stop looking at it before you discover something really awful (maybe you shouldn't have a business, maybe you'll never be a success, maybe this is crazy).

Honey, I know. I know that looking at these numbers brings up all kinds of panic. And I know that you're afraid that there's nothing you can do to make it work. I know because when I got to this point of my numbers-crunching I freaked out. I wanted to stop looking and just hope that the math would magically resolve itself if I just worked harder. 

But it didn't. (And I gave that magic solution a good long time to show up.) What did resolve it was looking at other options. Revisiting the numbers and figuring out what else it told me. Just like with your marketing: explore what has worked and build from there. 

So now I also know that there are lots of things you can do to make it work. You can introduce a new product, you can try a new income stream, you can shift your focus a bit.

There are a zillion things you can do to make it work, and none of them involve giving up. 

These zillion things are what we're going to explore in Pay Yourself. We'll find out what's not working, sure, but then we'll focus on what is working and build more profit from there.

 

What has your path to profitability been like? What have you learned? What are you afraid to look at?

The first step towards a profitable business

First Steps toward a profitable business

When I quit my dayjob to make yarn full-time, I had worked for months towards an income goal. But then, life fell apart. In one month, my car caught fire, my husband lost his (only-part-time-anyhow) job, and my house was broken into (yep, everything electronic was stolen. Thank goodness they didn't how valuable my little wooden spinning wheel is!)

Since that inauspicious start, my creativity has been my ticket to paying bills, traveling the country, going to movies and generally living life. In the beginning, I didn't know what to do except: SCRAMBLE. And, to be honest, sometimes it's still a scramble.

But I make it work.
 I take my family to a hotel + fancy dinner + the Chocolate Lounge for Mom's birthday. I take a week off to be in San Diego for my Dad's birthday party. {This was the year both parents turned 50. It was a big deal. But don't mention it to them!} I get stuck overnight in an airport and can afford to get a hotel room at the last minute. I drive 3 hours and get a hotel to visit my husband's grandpa before he dies, then the next week for the funeral…then the next week for Thanksgiving.

These aren't glamorous rolling-in-the-dough stories. But this is real life.
I'm a 30-year-old married French major who likes to eat at Plant at least once a month, and can't bear “office casual”.
I bring home the puppy chow from my ideas and my words and my hands.

And in the nearly 4 years of doing this full-time, I've learned how do it, and do it with some ease.

And so, I think long and hard before I answer a question like the one Laura asked: “How do you create the income of your dreams when creating the products by hand?”

The answer is GINORMOUS.

But it's also kinda small: Profit. 

Everything you sell, every project you work on, and every new “opportunity” you jump on must be profitable for your overall business to be profitable.

But doing that! It involves…math, my dear friends.
And it involves bold honesty. And we tend to avoid the things we're not-so-comfortable with. So I created a class that walks you through all of it. From individual product profit-testing, to the things that keep your whole business paying you. It's the systems I use (and that I've helped other crafters in the Starship use) to launch new products, find new income streams, and pay the bills.

The class is Pay Yourself, and you can register for it here.

But in the meantime, I can begin to answer Laura's question in today's video, with the very first step of profitability: Knowing your numbers.

Once you know your numbers, it's time to Pay Yourself

Got a question? Ask me!
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Podcast: Multiple Streams of Income

I'm super happy to be talking about growing your craftybiz with multiple stream of income over on the (new!) CraftyPod 2.0.

You can preview it below, or click “buy” to listen to the whole thing (it's free!)

Diane does a great job of getting to the heart of the issue: how do you fit it into your business?

Cupcakes!

If you're hoping to spice up your business with different kinds of income (ie, money!), here are a few other things I've written about it:

 

(the cupcakes don't really have anything to do with income…except that I'm obsessed with making them (3 batches in 2 days)…maybe if my frosting technique improved, I'd have another source of income?)