creative
Free MyCake for Sheffield based businesses
ok, quick post just to link you to the route to achieving this. please note that the business has to be less than 3 years old, be part of the creative industries one way or another and Sheffield based … as minimum criteria
Post Footer automatically generated by Add Post Footer Plugin for wordpress.
Ellen’s views on the 2008-9 benchmark data
Ellen O’Hara, Head of Business Development, Cockpit Arts and Sarah Thelwall, Founder, MyCake had a long chat about this year’s benchmark data over lunch this week and Ellen kindly agreed to pitch in with a contribution based on a comparison of the MyCake post on jeweller’s and her own experience with the data they gather from Cockpit members. The post below can also be read as a commentary on this post which compares the finances of designer makers and artists.
Some interesting observations here – many of which are supported by Cockpit’s own research into the business models employed by its studio holders. Jewellers actually make up the biggest percentage of studio holders at Cockpit (22%), followed by textiles (16%) and ceramics (14%), so I’ve had a look at how each of these are doing and what we can learn:
Jewellers
We hold data on a similar group of jewelers to mycake – all sole traders, a mixture of precious and semi-precious, representing businesses at all stages of their career, including some part time businesses. The main difference seems to be that a higher percentage of our guys outsource manufacture – nearly half.
Our figures also show that, generally speaking, those with relatively high production costs are either gem and/or gold based jewelers. Or they are jewellers with relatively low levels of turnover (below £20k), but who are still investing in stock. These tend to be either part-time business (and have an income from elsewhere), or start ups.
Textiles
Our research shows that textile businesses, along with jewelers, are among the best performing businesses at Cockpit in terms of overall levels of turnover and profit, and growth. Our sample includes sole traders and partnerships, again ranging from start ups to established businesses.
The model here tends to be slightly lower gross margins, but higher volume of sales generated through a combination of wholesale orders, and direct sales via e-shops and selling events to the public. The majority of these businesses fall under the printed textiles banner, producing homeware and stationary, and tend to outsource a large percentage of production.
Ceramicists
All of our ceramicists are sole traders with some catering for the fine market, some for the craft collectors market, and others the high end gift and interiors markets.
We’re afraid to say that these guys seem to be facing the biggest challenges in terms of sustainability and growth.
Despite the lower absolute cost of materials, direct costs are up to 60% of turnover for some start ups and up to 36% for some more established businesses. This means that profitability and productivity tend to be lowest within this discipline.
What do the best performers have in common?
What’s clear is that the most successful makers are employing a diversity of business models and strategies. 84% have a strategic business plan, which includes detailed financial forecasts and budgets, and their business model is fit for purpose.
All have a strong USP, good profile in their chosen market place (however niche), and robust business processes.
The most profitable businesses are split between:
1. Those with higher gross margins, who tend to sell smaller volumes at higher prices and generate sales through a mix of private commissions, direct sales (with Open Studios and other high profile shows such as Origin and Goldsmiths), supported by some gallery / retail outlet sales. For this group, direct costs are a lower percentage of turnover (no higher than 26%), with the mode being just 15%. They become sustainable at around the £60K turnover mark.
2. Those who rely on a higher volume of sales tend to outsource production, and reach their market via trade shows, have a greater dependence on wholesale orders and on-line sales, and take on fewer private commissions. Evidence suggests that turnover needs to higher in order to be sustainable at around the £100k+ mark.
So in addition to Sarah’s sound advice, I would add:
1. Consider gross margins when developing your new pieces and collections. Be aware of which products (or services) offer the most profitability and use this to inform your sales plan.
2. If you can’t increase your margins and need to go for volume sales, ensure you have the production capacity to cope with this level of activity. Explore different options – outworkers and batch production, outsourcing to a factory, collaborating with a partner who does have the production set up, or licensing. Efficient production also means you are more likely to cut down your lead times, which will help encourage repeat orders and respond to those retailers who are employing a ‘just in time’ approach to placing orders at the moment.
3. Being visible is important, but don’t fill galleries with SOR stock at the expenses of your cash flow unless you know from experience the work will sell and you’ll be paid in a timely fashion. If you are a precious metal or gem based jeweler – consider SOR as a pr activity as opposed to relying on it as income – and be discerning about the outlets you choose to stock. Do keep regular stock takes and pull your work out of outlets that aren’t shifting your work within 3 months (6 months max).
4. Introducing a less precious range, or using a mixture of materials, may be a way of increasing overall profitability. Similarly, you may be able to add value by introducing more ‘precious’ materials, or introducing optional product pricing and offering additional extras to bump up the value of each sale.
5. Marketing budgets are interesting one. On the one hand, if profits are being squeezed then you may need to shave costs. However, this should not be at the expenses of sales. Use a system like Mycake to conduct a cost / benefit analysis of the different marketing activities you engage in – how does the investment compare with the sales (and pr) gained, and under what timescale (in other words, what is the return on this investment and how long does it take to reap rewards?) Could some, or all, of your limited budget be put to better use?
Overall improving you financial literacy needn’t be scary and crunching the numbers can actually be really satisfying once you know what you’re looking at.
Cockpit will be providing plenty of financial related support in 2010, so keep an eye out for our business and professional development events programme.
Post Footer automatically generated by Add Post Footer Plugin for wordpress.
Creative Christmas Shopping
Have you seen the latest delights on Bouf and Joolia … great places to source superb design, unique products and other delightful presents! Here are a few of our favourites … some of them MyCake users!!
the works below are by 
Snowden Flood, Rachel Galley, Product of your Environment, An Angel at my Table
Post Footer automatically generated by Add Post Footer Plugin for wordpress.
Four Questions You Must Ask Before Starting Any Project
Let’s face it, you’re not just in this for the money.
Yes you need to pay the bills, and no, you wouldn’t say ‘no’ to that mansion. But if you’re in a creative profession, you went into it for reasons other than your bank balance.
For one thing, you love the work itself. And if you’re honest, you’ll admit there are rewards on offer that have nothing to do with money — such as fame, critical recognition and hanging out with cool people.
All of which makes for a complicated mix of motivations for taking on any new project. This is part of what makes a creative career so interesting — but it can also lead to a load of confusion, disappointment and recriminations.
Like the time you did the work and didn’t get paid for months afterwards, and only after a fight.
Or the time you did a great job but your name mysteriously failed to appear in the credits, so someone else got the glory.
Or the time you took on a project to get a big-name brand on your client list — only to discover they were a nightmare to work with.
Or the time you thought you were being hired to do the sexy creative stuff, only to spend days and days on the nitpicking boring bits.
Or the time you were handsomely paid by a very nice client, only to see the tacky end product — and now you cringe whenever someone mentions it with your name attached.
If any of that sounds familiar, it could be time to take a new approach.
By untangling your own mixed motivations, and finding out exactly what’s on offer, you could save yourself a world of misery. When you’re clear about what you want, and what you can realistically expect, you can fully commit to the projects that are right for you — and learn to say ‘no’ to the rest.
Here’s how you can do just that.
The Four Basic Types of Motivation
A few months ago I published a free e-book How to Motivate Creative People (Including Yourself), which outlined the four basic types of motivation that drive creative people:
- 1. Intrinsic motivation — the pleasure you take in the work itself. This is what leads you to stay up all night working on something just for fun.
- 2. Extrinsic motivation — rewards for work. These can include money, fame, recognition and new opportunities.
- 3. Personal motivation — the values that matter to you as an individual. Depending on your personality, you will devote more or less energy to pursuing things like knowledge, power, pleasure, security or self-expression.
- 4. Interpersonal motivation — the influence of people around you. We creatives love to think of ourselves as individuals, but you must have wondered why so many of us wear black T-shirts, write in Moleskine notebooks, and insist on using Apple computers.
Put the four motivations together in a matrix, and you end up with four basic reasons for saying ‘yes’ or ‘no’ to any project:
A dream project is the one that ticks all four boxes: you’re paid shed loads of cash to work on a fantastically inspiring project with famous people who turn out to be a blast to work (and party) with. When it’s all over, you see your name in lights and win all the awards going. Which leads to an inbox full of offers for similarly lucrative and sexy projects …
Well, I did say that was the dream project. 
More often than not, you find a project with a big tick in one box, smaller ticks in the other two, and bad news in the final box. So you have to decide whether the pluses outweigh the minuses.
Often, it’s not a problem to take on several projects like this — as long as the total pluses and minuses are fairly evenly distributed in all four boxes. So for example it’s fine to take on that boring proofreading job to pay the bills because it means you can afford to do that funky website job that won’t pay you much cash that will get your name noticed by the right people.
One of the critical skills in any creative career is making sure you get the balance right over the long term. Too many years working on cool projects for no money, and you’ll start to wonder if the stress is really worth it. At the other extreme, you’ll bore yourself rigid if you play it safe too often, doing routine work for a regular pay cheque.
The Four Questions You Must Ask about a New Project
1. Will I enjoy the work?
You don’t need me to tell you how quickly the hours go by when you’re doing something you love — and how the minutes drag when you’re not. This isn’t just about the quality of your working life. You do your best work when you’re enjoying yourself. And you have more energy to push through the inevitable problems.
Bottom line: a creative career is not sustainable, creatively or commercially, unless you are getting personal satisfaction from the work.
2. Will I enjoy working with these people?
Again, pleasure and performance go together: when you enjoy your co-workers’ company, you encourage each other and spark ideas off each other. You help each other out. When you don’t get on, the work suffers as much as you do.
Bottom line: when you enjoy the social interaction with other people on a project, you do a better job together.
3. What’s in it for me?
This is the nitty-gritty. Will you be paid? If so, how much — and when? If not, what else is on offer? Get specifics. In writing, if possible. Be wary of vague promises of future paid work or ‘opportunities’.
Bottom line: when you are clear about the personal rewards offer, and happy with them, then you’re free to focus all your attention on doing a great job.
4. Will I be credited?
There are times when a prominent credit can be more valuable than a cheque. The bigger your reputation, the bigger the future opportunities and rewards you can command. Is this project a chance to boost your reputation? If so, get written assurances of exactly where and how you will be credited.
And maybe there are times when you’d rather people didn’t know. So if you’re an avant-garde novelist writing trashy romances to pay the bills, or a film star advertising cigarettes in Japan, you may want written assurances that you will not be credited.
Bottom line: publicity can make or break your career — make sure you get the right kind of public recognition.
What Questions Do You Need to Ask?
Which motivations are most important to you in your career?
Which of the four questions do you most need to ask before deciding whether to accept a new project?
What questions would you add to the list?
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
About the Author: Mark McGuinness is a coach and trainer for creative professionals and innovative companies. He writes two popular blogs about the business of creativity, Lateral Action and Wishful Thinking. For bite-size tips and inspiration, follow Mark on Twitter.
Post Footer automatically generated by Add Post Footer Plugin for wordpress.
Percy Emmett’s new site
I would say that Percy Emmett has been giving invaluable advice to creative entrepreneurs for longer than i’ve been eating cooked breakfasts but that might conjour up the wrong impression of his age and my eating habits. However he’s been telling me about his impending website for an age so now that it’s launched I can send people to it.
Percy is a superbly experienced advisor, great not only at helping creatives grow and succeed but also a man to turn to when things are looking sticky and you need help working out how to dig yourself out.
Post Footer automatically generated by Add Post Footer Plugin for wordpress.
Subscribe
Search
Popular Posts
The MyCake twitter feed
- Latest news on the case for arts and culture wp.me/puRBC-1w1 3 days ago
- They are making an exception for me! 3 days ago