So, I’ve done some of the work, built three different items (two types of cutting boards and a photo frame). I’ve got plans for another frame (pretty cool) and some boxes. Now that I’ve built some items, I know the material costs, labor time, and my estimated overhead costs. With that, I can start determining estimated sales cost for each item in order to recoup my time/costs. Time to do some opposition research!
One of the big places to sell arts & crafts online is Etsy.com (I’m sure a lot of you are aware of it). You can purchase a wide range of items, of all shapes and sizes, crafted by people throughout the world. It’s a major “side hustle” location, and lets you create your own Etsy store, where someone can click on and see all the crafts you sell. You can check out your competition there for their prices, quality, and variety of items – and compare to what you are thinking of offering. What did I find out?
I have to improve my game a lot!
Obviously, the items I’m starting with are very easy to make and sell, so there will be a lot of people to compete with. In addition, it’s a worldwide market place, so I will be competing with labor costs that might be well under my estimates (I’m going with $20/hr. for my time). They may also have the ability to setup and make large runs, which can bring down the cost-per-piece of an item. Still, what I’m seeing is impressive:
- Costs are all over the board. There are items similar to mine which are selling for 50% – 200% of what I was going to ask
- Quality looks pretty good. I definitely can’t try to sell stuff that is not up to par
- There are a lot of sellers with 5-star ratings, so when I’m first starting out, I’ll be behind the curve
- The options some of the sellers have are tremendous. One person lets you pick the wood your cutting board will be made out of, the pattern, etc. Other ones do personal engraving. All of this for competitive costs to what I was thinking of charging.
I know I’ll need to build a bigger assortment in order to both compete and to see what sells. I’ll also need to look into making items which aren’t as generic as cutting boards.
At least I’ve got an idea of what I’m up against!
Mr. 39 Months