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Home Craft Business - Licenses and Permits



Before you actually start a home based craft business, you should know what legal responsibilities you have. Most state and local governments require some kind of license to operate a business.
 
Some agencies may have a very fast turn around time for issuing permits and licenses, but others may take several weeks. It is important, therefore, to research this aspect of your home craft business as soon as possible, so that you have everything in place before you are actually ready to start selling your crafts.
 
I want to stress that the information here is not legal advice and is only intended as a guide to help you find the resources needed to start your home craft business. Any advice contained herein should not supersede your own common sense. Remember it is your responsibility to know and understand any laws pertaining to your business before you open it.
 
Local Business License
Odds are you will need a business license at the very least. These can be obtained through your local city hall if you are in an incorporated city. If not, check with your county government offices. 

The fees associated with a small home craft business license are typically low. Many however will require you to run a fictitious name statement in your local newspaper, prior to issuing your license.
 
State Business License
State business licenses are required for certain types of businesses, such as doctors, hair dressers, auto mechanics, contractors, etc. This type of license is typically for professions that require certain types of training and is not likely to apply to home based craft businesses.
 
State Tax License or Sellers Permits
Nearly all states require some kind of reseller permit or tax license. This permit allows you to purchase wholesale supplies and sell your crafts. In most states the State Franchise Tax Board is the governing body for this type of permit.
 
Builders Permit
If you plan to build a commercial storefront or remodel one, you will need a builders permit. Check with your local planning department to see what local building codes are and what sorts of ordinances you may need to conform to.
 
Zoning Permit
Before signing any lease, be sure to check the zoning guidelines with your local planning department. You may need to purchase a zoning permit.
 
Health Permit
If your craft business involves food in any way you should check to see if a health permit is require from your local health department. Different states, and even different counties within each state will have differing requirements.
 
In some states, California for example, you need a health permit even if the food products are completely packaged at all times. A gift basket business is a good example of the type of home based craft business that may need a health permit.
 
Home Occupation Permit
Some local governments will require you to have a home occupation permit if your business is home based. Also, be sure to check with your home owners association or rental manager to be certain there are no rules against running a business from your home.
 
Some helpful websites where you may find legal advice for your craft business…
 
Business.gov - Official Business Link to the U.S. Government

U.S. Small Business Administration – Small business resources, links to local resources.
 
 

Where to Sell Your Handmade Crafts 


Tips For Selling Your Crafts Offline

 
 
There are many avenues to selling crafts in addition to the online methods. As with most things in life, it is best not to have all your eggs in one basket. So like any good financial advisor, I will tell you to diversify.
 
Selling your crafts from a variety of venues, both online and offline will create a more stable income long term. Explore the different techniques for selling your crafts and determine which methods work best for you.
 
Below are some suggestions for ways to sell your crafts offline…
 
Craft Fairs – Selling crafts at craft fairs and shows is one of the most common methods of selling handmade crafts. Craft fairs take a lot of time to prepare for, usually require an entry fee and can be exhausting. On a more positive note, a good craft fair can reap serious profits.
 
Talk to other crafters in your area that sell their wares at craft shows and find out which ones are the best. Make sure you have more than enough of your craft products stocked up prior to the show so that your display will look nice and full even if you sell a lot.
 
Craft Malls – Craft malls are a lot like craft fairs. You get a small stall to set up your crafts and pay rent for it. Included in the cost of renting your space, is someone to monitor the mall and make sells. Some craft malls require vendors to spend a set number of hours each week, working sales.
 
This is a great way to keep your crafts in the public eye at all times and with little time on your part. On the downside, craft malls are not likely to see high traffic compared to craft shows and your profit margin may be lower.  
 
Specialty shops – Many small or specialty shops will accept high quality hand crafted items for sell. Sometimes they may purchase your crafts to resell, but most frequently they will offer your crafts for sell on consignment.
 
Home Craft Parties – You can sell your crafts at home craft parties, much the same way as people sell Tupperware or Avon. Home craft parties can be done like an open house where your crafts are on display and people come and go and buy as they like, or as a demonstration of your crafts.
 
Another kind of home craft party method is to hold a mini-workshop where you demonstrate techniques and even have guests make their own crafts.
 
Friends and Family – This is what gets many crafters inspired to start a home craft business. Friends and family are frequently the first people to express and interest in buying your crafts. Their enthusiasm for your crafts may be the catalyst to get you started building your home based craft business. 

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Finding Crafts That Sell

 
Crafts that sell are crafts that… 
 
do not have too much competition – Actually these crafts probably do sell, but the competition will be stiff, possibly so stiff that you can’t break into the market. If you do choose a competitive craft market your crafts will have to be exceptional in every regard.
 
are enjoyable to create – Your love of your craft will show through even if you are unaware of it. As with nearly anything you love, your enthusiasm will spill over into other aspects of your business and you will see better results.
 
Your customers will see you love your craft and they will be more enthusiastic about it, as well. If you enjoy what you do, you will take more care and be able to spend more time at it. Find your passion and then figure out where there is a market for it.
 
can be made uniquely your own – Crafting is as popular as ever, more so really, so odds are there are other doing what you do. You need to stand out from the crowd.
 
Modify your designs, add embellishments, use different materials, always keeping in mind who your target market is.
 
you won’t grow tired of creating – This goes back to finding crafts that are enjoyable to create, but you need to think long term. Understanding your own personality is important to finding crafts you won’t grow tired of.
 
If tedious work bores you after a time, needlework may not be a good idea for you. Or if making the same thing over and over will become too tiresome, then look for crafts that can evolve over time.
 
fill a market niche – Try to find craft ideas to sell that can be sold to a specific niche market. This is critical when selling crafts online, because it is so difficult to break into broader markets online.
 
You do this by making your crafts in such a way as to appear to a certain demographic or by developing a marketing plan that targets a specific market, or most likely, both. Don’t worry, as your craft business grows you can expand into broader markets.
 
can be sold with a reasonable profit – Following your passion is all well and fine, earning a profit from crafts is the bottom line. Take time to really understand your costs for materials, shipping, overhead and labor (yes your time counts, too).
 
are structurally sound enough that customers will be happy with them long term – Even small craft businesses have to be concerned about quality control. Most of the online services, like Etsy or Ebay, have ratings systems where clients can give feedback.
 
Your reputation is on the line with every transaction you make, so make certain that your crafts are of the highest quality. Package carefully and ship in a timely manner. Your customers will be judging you every step of the way.
 
Finding crafts that sell may seem like a daunting task, but these are just some general guidelines. Remember, the most important factor in creating a successful crafts business online is to be passionate about what you do.
 
 

So many people would like to start their own business, but coming up with craft and home business ideas can be difficult. Get some tips on brainstorming craft business ideas...


Creating Your Craft Business – Its okay to start small

 
Everyone is different and one person’s craft business plan may not be right for another. One thing a lot of us may have in common is a desire to start small when creating our online craft business.
 
Not everyone is ready to start creating an online craft business from the ground up. Luckily the Internet is ideal for the crafter that wants to start small. If you are interested in creating an online craft business, but not ready to commit to a full scale website, you might want to start by selling just a few crafts on Ebay.
 
Once you have a bit of success on Ebay, it may be time to create your own online craft store on Etsy. This is a great way to go for the beginner, since there is no start up fee and it only costs 20 cents for each craft item listed. That’s simple so far.
 
Maybe you’re content now with the amount of traffic and sales you receive from Ebay and/or Etsy. But if you are producing more crafts than you’re selling, you will need to do some promoting yourself to boost sales.
 
You can do that by creating a craft blog and/or creating a craft website which you can use to drive traffic to your store. Just keep adding content, link to your store and eventually you will start climbing the search engines and increase the traffic to your online store.
 
If all this is sounding intimidating to you, don’t worry. Try to get to know other crafters online that have created their own craft business. You can do this by joining craft forums. You can learn a lot about creating an online craft business from participating in craft forums. 
 
Craftster is a huge community of crafters and another place to find fellow crafters. It is a great resource with a lot of very experienced craft business entrepreneurs.
 
The Switchboards is another online community of crafters many of whom have created their own online craft business. It is a very friendly site and much smaller than Craftster. 

Are you ready to start earning money by selling your crafts online? Alright, lets get started!

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