running a creative business | making profit-based decisions

Marian Parsonsmy business story, Running a Business

I wrote a post answering a reader’s question about how I balance business and the rest of my life.  The short answer is I struggle through it.  Sometimes successfully and sometimes not.  You can read the long answer HERE.

I received an e-mail from a fellow creative-business owner and blogger, Cassie from Lovely Weeds, about balancing different aspects of our kind of business.  Here is her e-mail…

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I can’t tell you how helpful your business posts are. A creative business is such murky territory! I know you just posted about balancing work and family, but it got me wondering about how you balance the online side of your work with the physical part. That’s my biggest struggle right now.

I have a tiny blog that I love writing, and a retail business where I sell my own handmade and repurposed furniture and goods from a consignment shop and at two local fairs each year. I love both “jobs” and don’t want to cut either out, but I’ve had a hard time finding the most efficient way to use my time for both. My retail business is what makes the most profit, and I have some really exciting things happening in the spring (I’m making a mini-shop from a trailer, ta-da). At the same time, I feel my blog is coming to a crossroads where I need to make some changes that involve more of a time and financial commitment from me – if I’m going to take it seriously.

I know it’s important to diversify (thanks Building a Creative Business 2.0!), it just feels like I’m not doing either part of my business justice right now – no matter how hard I work at each.

I would just love to know your take! Do I need to prioritize one over the other?

Cassie Thompson

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I think this is such a great topic and something I’ve had to work through over the years, so I thought I would share the whys behind my own decisions in the hopes that it will encourage others, like Cassie.  And for those who aren’t business-owners, it might be interesting to “peek behind the curtain.”

First of all, to those business owners who feel this way, if you don’t read anymore of this post, read this…

You cannot do everything well.

Don’t feel like you need to.  Don’t feel like you’re failing if you can’t.

I recently shared about the time in my business where things really started taking off.  In a six month period, I got three magazine features, two new freelance writing/photography jobs and was invited to join two retail spaces.  I felt like I needed to say yes to everything.  We needed the income and honestly, I was so excited about each opportunity and afraid of missing out, that I couldn’t say no.  I didn’t think about how I was going to fit everything into my schedule.  I just said yes and plowed head-first at a frantic, break-neck pace.

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Because I love what I do so much, I didn’t feel that for a while.  I felt on the edge of being too busy, but I felt like I could manage it all.

And I did.

But…

It meant that I hardly ate and, when I did, I wasn’t making healthy choices.  It meant that I was going to bed at 1:00 in the morning most nights, waking up again at 7:00 to get my kids ready for preschool.  It meant a brush was in my hand or my fingers were pecking away at a keyboard every spare second.  It meant living in sweatpants.  It was unhealthy on many levels, as you can imagine.

I then took on a third retail space and accepted a book deal and started the process of launching a paint line and I started to crack.

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Just like you, Cassie, I felt like a failure in my successes, because I wasn’t doing anything really well.  I was getting by, but I couldn’t make my retailer spaces as great as I knew they could be.  I was having to rush through my book and didn’t go back and fix as many things as I would’ve if I had the time.  I was posting “reruns” on my blog, because I didn’t have the time to create new content.

Once I met my existing commitments, I had to take a big step back and assess my business.  I knew I couldn’t do everything I wanted to do, so I had to make some choices based on numbers…what was most profitable.

It was a very difficult thing for me to do, because I enjoyed all aspects of my business and I didn’t really want to drop anything.  I also didn’t like making choices just based on profit or profit-potential, but that’s when I had to have a big-girl conversation with myself.  That was really the first time I viewed myself as an entrepreneur and business owner, not just a stay-at-home mom who turned a hobby into something that was making some money.

 It was a business and I needed to treat it like that.

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So, I looked at my profit and expenses.  And it was evident what choice I needed to make.

I was stunned to see that 70% of my expenses were going towards stock to resell in my retail spaces.  I would also estimate that I was spending about 80% of my workweek on those retailer spaces…shopping, painting, pricing, tagging, styling, etc.  I then saw that about 80% of my profit didn’t come from retail, but from my blog and other freelance writing and photography projects.

I was spending most of my time and capital on an aspect of my business that only brought in 20% of my profit!

What would happen if I dropped the retail space and put more time and energy into aspects of my business that were most profitable?  I knew the answer, but I avoided it for about a year!  I just didn’t want to give up retail.

After about a year of continuing to do nothing to the best of my ability, I finally made the tough decision to leave my retail space and just sell occasionally online and at one or two events each year.

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I had a knot in my throat as I made that call and I shed some tears over it, but I felt like a weight had been lifted once the decision was made.

Every business is different.  Even every season of a business is different.  Businesses are dynamic and need to be pliable, which is why diversity is important as well as looking at your numbers regularly to make sure you’re keeping on track and making necessary adjustments.

Diversity doesn’t mean you do everything, though.  It means you do a few strategic things that work well together to maximize your profits and minimize risk.

So, if you find yourself torn in a few different directions by your business and feel like you’re failing amid all of your successes, it’s time to take a look at the numbers and see what they may be telling you…

running a creative business | making profit-based decisions

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