Creative hobbies are a good way to relax and unwind and they’re particularly good for keeping the brain active and improving mental health. But have you thought about making more of your creative talents and starting a craft business? It’s a brilliant way to earn some extra money on the side to put towards family trips or just to make it a little easier to cover your living expenses.
For some people, this is enough and they don’t have any plans for expansion. But if you think that your craft business has the potential to be big, you might decide to look for investment to help you set it.
Asking investors for a loan is very daunting, especially if you are just a keen crafter and not an experienced entrepreneur. There are a lot of craft businesses out there already, so you need to do something special if you are going to convince them to back your new venture. These are the main things you should include in a pitch for your homemade craft business.
Show Them The Product
Your crafts are at the heart of this whole thing. It was your love of creating things that got you started in the first place and it’s important you don’t lose sight of that, even though you are trying to turn it into a business. So, make sure that you bring some of the best examples of your product with you to show off. This is how you can hook them into the pitch and get them excited about it.
Provide Market Research
If you go on sites like Etsy, there are countless handmade craft businesses you will be competing with. Investors will want to know what makes your product different and whether people will buy it or not. You need to do a bit of market research so you can prove that there is demand for your crafts. If you’ve already started selling them, give information about your sales figures as proof that people are interested.
Create A Break Even Analysis
Showing investors your crafts is the way to hook them, but you won’t secure investment unless you can prove that you are on top of the numbers. Remember that they are handing over their money and even though they might love your crafts, this is still a business transaction. They will want to know when they’re likely to see their money back, so you need to create a break even analysis to give an indication of when the business will become profitable. If you don’t see yourself making a profit for a long while, this will be a worry for investors.
Discuss Marketing Options
Your break even analysis tells the investors when you think you will start making a profit, but investors will still want to know how you plan to do that. Before you pitch, think about how you are going to market your craft business. Will you rely on Etsy as a platform or create your own website? Do you have a social media strategy? If you can’t answer these questions, you will struggle to get the investment you need.
As long as you can cover these important elements in your pitch, you stand a good chance of finding investment.