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    8 Replies Latest reply on May 2, 2010 2:11 PM by Mongoose

    Need Help With A Good Problem To Have With A Start-Up!

    Spunkybear Adventurer
      A friend of mine and I from church are starting a home-based (for now ) business using our creativity and sewing and crafting skills. Our first item is what looks like a fleece blanket that we can personalize or embellish with different colors. We made a few of them to test the local market, and we have been blown away as well as blessed at the response we have gotten. We have local teams and non-profits that are interested in selling them for fundraisers. However this has brought a few challenges, albeit good ones, that we could use some constructive feed back on.Here's what we have accomplished so far.

      We have lined up some wholesale fabrics suppliers for the fleece material we use. Not all companies carry the same prints or colors so we are trying to line up more so we don't leave our eggs in one basket.

      We hae approached everyone we know to get them interesed. The schools are interested, but the question has come up how soon can we get the orders. We have told folks that it depends on the number of orders we get from them. When their ordering period is done, we will detemine a delivery date at the time the order is placed.

      Knowing that they want these in time for football season here, we know it would be difficult to do the larger orders in a timely fashion by ourselves. We have contacted a few companies about the cost of sourcing the manufacturing so we can concentrate on sales and marketing, and delivery of the orders once we personalize them. Among the companies that we have contacted, is a local organization for people with disabilities that contracts with various companies for manufacturing of their goods. They are close by so we thought that would help to save on shipping. However, we are looking for more sources in case this does not work out.

      We are currently looking for sources for the wholesale fleece, and suggfestions on companies who might might make the blankets for us. We are also looking for addtional sources for wholesale fleece. We currently have prices of around $5.00 per yard. Retail is about double that tin some cases.

      We are starting this on a real shoestring and realize that there maybe some challenges accordingly, but are excited about the possibilities for our families and to give make to our communities.

      Once we can find a ggod source for making them and handling the larger orders, we want to expand beyond our local area. Any suggestions to get the word out beyond the local markets?

      When it comes to pricing, how do you separate or figure out a reatail v. wholesale priuce?

      Thanks for everyone's time and best wishes on the continued success of your own ventures.
        • Re: Need Help With A Good Problem To Have With A Start-Up!
          Spunkybear Adventurer
          Please forgive my typing errors. This is only my second post and I looked for a review/spell check button but did not see it. Now I do.

          Thanks for any constructive suggestions you might have.

          Have a great day!
          • Re: Need Help With A Good Problem To Have With A Start-Up!
            Spunkybear Adventurer
            I know what a busness plan is, but can anyone suggest one that is easy to follow? What I had is a abit hard to follow. Thanks!
            • Re: Need Help With A Good Problem To Have With A Start-Up!
              DomainDiva Ranger
              You need to visit your local SCORE office and sit down with a seasoned business professional who can help you get your priorities evened out. (I am excited that you have these problems, it's a good thing, you just need business guidance). Trust me, hands on people, designers & craftspeople are NOT business people. I say this from experience.

              Manufacturing is a step by step process. Not only do you need a business plan you need a business entity, legal help and an accountant. A SCORE representative can help guide you through the selection process. If you have an accountant and an attorney ask them for help and to be on your advisory board as well.

              Meanwhile you need to sit down and figure out all the steps to get one piece from beginning to end. Meaning start with design, materials, labor, sales, delivery etc and make a flow chart so you can 'see' the process.

              Good luck! dd
                • Re: Need Help With A Good Problem To Have With A Start-Up!
                  Spunkybear Adventurer

                  Dear Diva,

                  I realize that it seems like we are puttiong the cart before the horse, but we are working on much of what you talked about. Some of this has fallen into our lap. We have an attorney lined up for us to go see, It seems like our church that we go to is full of docotrs and lawyers. No Idian Chiefs yet....

                  There is not a SCORE office here. I hae tried to contact the SMall Business Incubation Center (which I think has a connectin to SCORE and/or SBA) where I come from. No luck yet. We are setting the business entity up as we speak, and gave access to an accountant. Sorry for not mentioning this sooner. We still have to debate between an S-Corporation and an LLC.

                  From what you listed below, we have the designs covered, sources for the material covered, sales we have covered with a deffinate path in mind, delivery we have lined up. My partner is dealing with an unexpected death in her family and dealing with estate matters, so I am doing what I can, till she is available to come back here soon.

                  We are looking at finding a company to manufacture them for us, so we can focus more on sales, marketing, and design.

                  Thanks so much for the feedback.
                • Re: Need Help With A Good Problem To Have With A Start-Up!
                  Spunkybear-- Good luck with your business and may you sell LOTS of blankets.
                  • Re: Need Help With A Good Problem To Have With A Start-Up!
                    SunnyStuff Wayfarer
                    The old rule of thumb is that the Retail price is double the Wholesale price.
                    At, we are a distributor of Wet Products, Inc products. We set a lot of our retail prices based primarily on the competition. Since we focus on low prices and customer service as our differentiator, we'll almost always undercut the competition.

                    We're not the manufacturer like you, so obviously that is set for us. But typically, the wholesale price is dependent on your cost of manufacturing and business operations. As you're starting out, I'd recommend that you place a wholesale price with a smaller margin (small profit). Throw all profits towards sales/marketing efforts. Going forward, your margins will naturally increase as you grow by reducing manufacturing costs through quantity discounts.