Starting an Art Business: the Brainstorming and the Business Plan
This is post number two in a series about starting an art business that focuses on convention based selling.
Why do you want to start an art business? This was one of the first questions I asked in my first piece. I encourage you to reflect on your answer as we go through each post so you can always have a clear vision of your goals.
If you have decided that you want to start an art business, the next big question is how does one start an art business? I often find that starting something is the hardest part (that's definitely part of my ADHD though). Maybe starting things for you is easy, but you are still lost in all of the facts and advice out there. I'm here to try to help you make sense of it all. Or at least a little more sense.
Let us start with some basic business world facts.
Starting any business is difficult. The IRS reports that half of all small businesses close before their fifth year. Technology is advancing at such a rapid pace that strategies from 3 years ago can be no longer viable. Art and art sales are both very competitive and very large fields. From pandemics to recessions, people are wary of losing their investments and their safety nets. When people think of doing any kind of art for a career, the phrase "starving artist" immediately springs to mind.
Am I saying these things to scare you?
Only a little bit.
All industries prey on the uninformed. Why is "starving artist" so ubiquitous a phrase? It is what people who are not professionals in this industry think is happening. If you don't think a company should be paying you, that company is not going to tell you any different.
You may have learned that Michelangelo painted the Sistine Chapel frescoes, but did you also learn that the church paid him a lot of money to do it? He got paid for his work. He also had people helping him find patrons and supporters, helping him with his business strategies. I will try to guide you on how to build an art business that will work for you.
Am I guaranteeing that you will be the next Michelangelo? Of course not.
Am I guaranteeing anything? Only that you're not alone, and I believe in you!
Let's started on the process.
In my previous post in this series, I laid out my 9 step plan to go from "Artist" to "Artist and Small Business Owner." The first five steps will be addressed in this writing as they are all a part of the beginning of a business. In this section, we will be addressing the first one (goals).
There are a million ways to start a business and even more writings about starting them. This writing will be specifically focusing on businesses that sell art and art products at conventions. If you would like more general information, I encourage at least one full day of searching "how to start a business" on any search engine. There are tons of resources and writings already made by business and financial experts designed for people at all levels. To start, here is an article about general process on starting any business. This article helped me when I started!
To start a business, we first need the idea of the business. Luckily, we already have the general idea mapped out. We want to create a business that sells art and art products at conventions. This is not enough to fully start on though; we need to be more specific in our intentions.
This phase of planning is what I like to call "The Brainstorming" as it is a time to throw down all the possible ideas we have. I'm going to list all of the questions you should ask yourself that are essential to this phase of the process; if you are serious about starting your business, I encourage you to make your own answers to the questions as you read along. If you don't know the answer to a question immediately, that's okay! I might answer it later in this piece, or might have to put on your research hat to go find it.
Answer all of these questions as you begin your planning:
What kind of art do I want to create? Style? Medium(s)?
What formats do I want my art to take? Comics? Commissions?
What kinds of products do I want to make? Pins? Charms? Bags?
Do I want to sell my products only at conventions, or do I want to sell at other types of art events as well?
Do I want to sell my products online?
What kinds of conventions do I want to sell at?
Do I have a target audience in mind already?
What is the overall goal for my art and products?
What do I already have that can help me with this goal?
How far am I willing to travel to make my goals happen?
How much am I willing/able to spend to make my goals happen?
Do I want to do this business financially by myself?
Do I want to do this business by myself or with a partner/employees?
What do I need to do to make my business legal?
How am I going to get the information to the questions I was unable to answer?
Wow, that was a lot of questions to get started with. If you have any ideas for your business that I did not cover with the questions (ex. branding, marketing), be sure to write those down as well. Anything you come up with here will help avoid problems or delays later in the process. Hopefully any answers to the questions you don't know I can cover for you in this writing and future writings, but if not, you can always research it yourself by reaching out to a professional in that specific field.
Looking at your answers may be overwhelming. Maybe you thought you were more prepared for this and are realizing you are not. Maybe what you thought you needed to know and have, don't matter at this stage as much as you thought. Remember not to panic and to breathe! If there are a lot of things you were unable to answer, keep reading along to see if I already have your answers figured out.
Remember that you are still at the beginning of the process. Everything can change at this point and it will still be okay. There is always time to adjust things, and all this planning now can prevent a lot of financial problems down the line.
Now that you have at least some of these answers, what do we do with them? With the ideas of what you want to do a little more solidified, let's start actually planning things! Luckily for us, the business world has already created the perfect tool we need: The Business Plan.
THE BUSINESS PLAN
What is a business plan? It's okay if you don't know. This term is only thrown around in business classes and white-collar type jobs. I did not learn about it myself until studying business things in college.
According to Entrepreneur.com, a business plan is defined as "A written document describing the nature of the business, the sales and marketing strategy, and the financial background, and containing a projected profit and loss statement."
Now, I'm going to be contrary to what this section title might make you believe, I do not believe that you need to fully write a business plan to succeed in this field. What I do know is that a business plan offers just that, a plan for your business. With this section, I plan to highlight the specific pieces of a business plan that will get us on track to our convention selling goals. Side note, if you ever plan to get funding the traditional way (ex. loans, investors), many will require to see a completed business plan from you.
I am not a business or financial expert, so I am not going to write a "How to Write a Business Plan" article. I am going to highlight the parts we are interested in in this writing. If you would like to see full explanations of a business plan, one second on a search engine will give you more writings than you have time to read. I like this simple and easy article by Shopify, and this very thorough article on Inc.
Business plans are divided into sections based on the different processes to start and maintain a business. Different institutions disagree on what the exact layout should be, but all section layouts are all similar and eventually do the same things. The sections suggested by Inc.com are:
Overview and Objectives
Products and Services
Sales and Marketing
You may think these sections seem familiar; A business plan will answer the first 5 steps of my 9 step business process:
Access goals for the business
Calculate the cost of all needed materials
Determine how to acquire funding
Decide what level of time to commit to starting the business
Create a plan to achieve those goals including a timeline
A business plan has more steps and sections than my general process outlines. A general rule in planning is that the more details you know beforehand, the better. Let's delve into what the business plan can help us with in this business we are creating.
The best news of the executive summary is that, if you're following my process, you already did most of this! The executive summary is the introduction to the document. It should explain the who, what, where, when, why, and how of your business. If you are planning on finalizing this business plan, then you will need to edit it down to a couple of sentences, but I personally recommend saving this section for the end so you know exactly what to put here.
Consider the executive summary section as a written elevator pitch - if someone asked you to describe your business, what would you say?
Overview and Objectives:
This section is more useful to other people reading your business plan than for you while making it, but it is a great place to put the things we discussed at the beginning of this writing - your goals. With this section think broadly, what do you hope to achieve with your business and what are you going to do to make that happen?
Products and Services
Do you plan on offering commissions? Do you plan on selling products? This section is the place to put down all of your thoughts on what you want to sell. A business has to make income to survive, and this is where you can figure out some of the numbers you will need.
If you plan on offering products, here are some questions to ask and answer for this section:
What products do you plan on offering?
How do you plan on acquiring these products?
Are you planning on making them yourself?
What supplies do you need to make those products?
Will these be a set product or will they be customizable?
If you are outsourcing them, where are you purchasing these products from?
What do you need to purchase them?
How much do these cost to make?
How much will you sell them for?
If you plan on offering commissions, here are some questions to ask and answer for this section:
What types of commissions do you plan on offering?
What supplies do you need to make your commissions? Software? Hardware?
Will these be from a set template or will they be fully customizable?
Do you plan on utilizing any help for creating these?
How much do these cost to make?
Will you be charging a set price or an hourly rate?
What is that price/rate?
The rest of the money questions will be answered in the Financial Analysis section. If you have any other product ideas, add them here.
How much experience do you have with conventions? Online selling? The section would/will be of large interest to any potential investors that you have for your business, but this is also a great place to share what experience you have. How well do you know your products and what is the potential audience for them? What edge do you have in this market? If you haven't done any research, this is a great place to write down what you don't know and how you're going to find the answers.
Sales and Marketing
What is your marketing plan? How do you plan on generating sales? Where? When? This section is where you want to plan out ideas for getting your products in front of your customers. Since this is based selling at conventions, you know already know the basics of where and when; however, what specifics do you know about selling at those venues? How will you draw customers into your setup?
This section is also where you would want to write down any of your ideas for your brand. What ideas do you have for a business name, logo, color scheme, table design, or anything else? Are you planning on advertising? How and where?
How well do you know your direct competition? This is a section that many artists want to skip over in their general planning, but deciding to skip it will be a fatal flaw for your business. If you can't be honest with yourself about your offerings and how you compare to others, you put yourself at risk of not being compensated fairly and disrespecting your peers. I believe we should view other artists in our fields as allies, not enemies, but you won't be able to be a part of the group if you don't understand where you fit in.
For an example, one of your favorite movie series just got a new release. It should be easy to make merchandise for that correct? Well, that always depends. What were you planning on creating? How many other people are making that merchandise? What is that film company's policy on fan merchandise? What kind of products and content are the official merchandise? What kind of products are the fans buying? What kind of products would you buy?
The way to find these answers is to do analysis of the market and your competition. If you do not plan on doing any research, doing things just because they're popular at the moment is it good way to waste time, money, and effort.
Another small piece of advice, do not go up to an artist you think that successful and ask them for all of their market research. Do not ask them what is guaranteed to sell. You need to find what works for you, and trying to copy your peers' success is only going to get you ignored by your community and make you struggle.
This section is where you can lay out your process for your business. How long will you spend making products? How long will you spend doing the accounting? How long will you spend doing maintenance on your equipment? Cleaning your space? Filing paperwork? Going to the bank? Traveling? Researching? Every activity for a business takes time and you only have so many hours everyday. Try to figure out how much time you want to spend doing what every work day. Make sure you plan for breaks and holidays! Planning on working without any rest will only lead to burnout and an end for your business.
Are you doing this business by yourself or are you working with others? Most artists that own their own business are working alone. It's important to know if you will have employees or coworkers for our next writing topic, taxes and official forms. How many people are on your team officially will change a lot of financial structures for your business. If you plan on working with other people, utilize this section to write exactly what you expect the other people on your team to be doing and why. You will also want to tie this into your operations section. If you are working alone, utilize this space to write down exactly what you will be responsible for to ensure that your business will continue to run.
The financial analysis is where all of the numbers come together. What is the base cost to run your business? How much money do you need to make to be able to sustain this business? How much do you need to earn to make a profit? How much profit do you need to make to make a living from this business? Are those numbers possible right now? In the future?
I highly recommend this article by Creative Hive that explains how to calculate exactly how much you need for income to not lose money. If you do not know the exact numbers, you can guess them to get a general idea but round up. There will always be hidden costs you didn't calculate for or the prices for things may change.
If you want to present this plan to investors they will want to have as close to the real numbers as possible. In a real business plan, you would also want to forecast the potential growth in profit as your business continues (usually to at least five years). Even if this plan is just for planning purposes and not an official document, you will want you reevaluate the previous sections with the knowledge from your financial analysis.
Once you have gone through every step in the plan, return to the beginning the executive summary and make sure it matches the rest of the document. Did you change your mind about any ideas? Do you need to do a lot more research before you can decide some things? Were there any sections that you had not yet put any thoughts into, or did you already know the answers to everything?
MOVING FROM PLANS TO ACTIONS
As I stated earlier in this piece, I don't believe that you need to have an official business plan to be successful. A business plan is a standardized way to layout information about a business. The questions that business plan creation ask you are the most useful piece of this concept for our uses. In this process I am guiding you through, the answers to those questions will give you the information necessary for the next steps, beginning the official and legal business creation process and continuing your research.
The first official steps will be covered in the next writing all about taxes and forms. A short overview is that you need to register your business with the government, and then figure out what forms you need and what taxes you will need to pay. In the USA, a lot of those answers vary by location, but the main process is the same. All of this will be in full detail in our next Conventions 101 post.
As far as more research goes, what questions were you unable to answer in your business plan? Do you have a name for your business? Is someone already using that name on social media? Where will you be doing your art business? There are legal limitations on home businesses in many locations. If you plan on working in a group studio, how much is the membership fee? Did you decide on what products you want to sell? There is a limitless amount of questions to research here, but you should focus on the answers that will get you to be able to begin working sooner.
In the meantime between my posts, I highly recommend reading the research that has been shared by other artists. I am definitely not the only person writing about conventions! Here's a post from NattoSoup about lessons learned the hard way. There are many more writings out there. I also recommend following on social media, RSS, or subscribing to newsletters by other artists, especially artists that are making and selling the things you want to create. See if there are any art groups that you could join. Learning from as many people as possible will lead to improvements!
Don't forget to keep practicing your craft. Practice also taking breaks and stretching. As we saw so many times in 2020, health is the most important thing to be able to keep going. Be kind to yourself and to others.
Thank you so much for reading! Special thanks to all my peers the Artist Alley Network International for helping me with their own advice and asking questions for this writing. If you would like to ask questions for an upcoming topic, follow Caramel Comics on social media or subscribe, and then watch for one of our posts about upcoming questions! And of course, thank you to June Streetman for being my editor and supporter always.
If you liked what you read, please subscribe to my mailing list to read more, or send me a tip on Ko-fi so I can keep working this job. ★
Sorry for the delay on this second entry. I'm so serious about the stretching and breaks I mentioned, because this delay was caused by me typing too much for this entry, and then tearing the muscles in my arms! Yikes! Always remember that projects can wait. Better to be a bit late then seriously injured and also very late. Here's to trying to make 2021 the best we can!