I am putting up another article from our friend Patrice Lewis. She has a great series of work at home articles that you will want to check out if you missed the first articles in her series.
Enjoy! Tawra
Efficiency vs. Quality
Improving Your Techniques In a
Home Craft Business
Patrice Lewis
www.donlewisdesigns.com
In the past articles, I’ve discussed various and sundry factors associated with the concept of making a living from home by making and selling your crafts. We’ve covered such basics as marketing, startup costs, loving what you do, frugal living, pricing, and how long it takes to succeed.
These are all important aspects, but one critical thing is missing when it comes to the idea of turning your hobby into a business.
For purposes of definition, when I refer to a “business,” I mean a business that supports your family and replaces the income that you would get from an outside job. That’s a pretty tall order. One of the distinguishing factors that separate the craft hobby from the craft business is how efficient you are at making your product.
How Long?
If it takes you a week, or two weeks, or three, to make ONE of your product, then you’ll either have to (a) sell that item for two or three thousand dollars in order to earn a living wage, or (b) keep your craft a hobby rather than a business.
Some items can indeed be sold for a high price. Extremely specialized quilts, custom furniture, select jewelry, and certain musical instruments are some examples of what might sell for thousands of dollars. Either these will be custom-ordered items with a buyer lined up (and even a down-payment secured) before you spend the time making such an item; or you have a retail outlet which places orders for your high-end product.
But for most of us, it won’t take nearly as long to make our craft. This is good, because it means we have the potential to speed up our manufacturing process.
The Quality Debate
As you know, we make hardwood drinking tankards (like beer steins, out of wood). We maintain a certain level of quality that goes into each tankard. Since we guarantee the tankards for a period of three years against leakage due to our workmanship (not customer stupidity!), it behooves us to make each piece with enough attention to detail that people won’t be returning a leaking tankard to us for repair.
Over the years, people have suggested various improvements that would increase the “quality” of the tankards. Most of these improvements, I should point out, have to do with the external appearance of the pieces rather than improvements in function. For example, it has been suggested that we give our tankards a third sanding with a 220-grit sanding belt to make the wood feather-soft to the touch Or it’s been suggested that we give the tankards a third shot of varnish to give them a higher sheen.
We won’t do it. To add these extra touches would increase the amount of time it takes to make each tankard, which in turn would translate into higher prices for the customers. Since our customers are satisfied with the current quality – and prices - we see no reason why we should increase our prices just to make them prettier.
This isn’t just theory on our part. We’ve made these “improvements” and test-marketed them at higher prices to reflect the additional time and materials used, and they did not sell as well.
Saving Time
A major factor to consider in the efficiency vs. quality debate is how to shave off slivers of time from the manufacturing process for your product.
Why slivers? What difference does it make if you increase your speed by a few seconds per step?
It’s because slivers add up. If it takes you ten minutes to do a particular step, and you manage to shave that down to nine-and-a-half minutes, it doesn’t sound like a big deal. However, if you’re making a hundred of the items, then those extra thirty seconds multiply until you’ve saved nearly an hour on just that one particular step. If you have forty steps to go through from start to finish on your product, then the potential for saving a great deal of time, and money, is high.
For example, one of the production steps in making our tankards involves gluing the individual side staves together into the body. For years we did this step by laboriously tightening a series of strings with a stick around the body of the tankard, three strings per tankard.
It was horrifically time-consuming, something like five minutes each. The un-winding of each string after the tankards dried took just as long, five minutes each. If this doesn’t sound like much, multiply this by a pile of one hundred and fifty tankards that need to be glued up (we do a production run of this size about every week), and you’ll have an idea how much we dreaded glue-up days. We thought and thought and thought about ways to make this step go faster. We tried and discarded a dozen different ideas. Nothing was better than those hated strings-and-sticks.
So one summer, when work piled up, we hired a temporary worker and cannily gave the poor guy the dreaded glue-up job. Clyde stuck it out for two hours and then finally said, “Why don’t use guys use surgical tubing and wrap that around the tankards?”
We stared at him, stunned. In two hours, Clyde managed to do what we had failed to do in three years: come up with a simple solution to our problem. Thanks to Clyde’s suggestion, we now use surgical tubing, and it has decreased the total time spent on gluing each tankard from about ten minutes to one minute. Multiply this by the tens of thousands of tankards we’ve sold over the last thirteen years, and you’ll get an idea of just how much time – and money – we’ve saved.
Oh yeah, we paid Clyde a bonus for his brilliant insight.
Not Worth the Effort
Sometimes we come up with a nice product idea that turns out not to be so nice in terms of efficiency.
For example, a couple of years ago we started making some twelve-sided tankards to supplement our usual six-sided tankards. Because of the increased number of sides, these tankards had a more circular (instead of hexagonal) shape. They were also a pain in the posterior to make.
And the funny thing was most people didn’t seem to notice that these pieces had twelve sides instead of six. They sure as heck didn’t want to pay more for them, despite the fact that they were more time-consuming to make. We ended up making these twelve-sided tankards for only one season, because they weren’t worth the effort.
Another item bites the dust in our quest for efficiency.
Don’t Sacrifice Quality
Now comes the fine line between efficiency vs. quality. Obviously your goal should be to look for ways to improve the former without compromising the latter.
As an example: we coat the insides of our tankards with a food-grade epoxy resin to render the wood waterproof and suitable for hot or cold beverages. The only way to do this is to hand-brush the inside of each tankard with the epoxy resin, let it dry, rebrush it, and let it dry again. We are quite good at this now, and can first-coat a tankard in less than one minute. We usually watch a movie or something while we do this, so time can pass rather pleasantly.
However, like every other step in our manufacturing process through the years, we’ve looked for ways to improve the speed with which we coat tankards. One method we tried was to fill a spray gun with the epoxy resin, and spray the inside of the tankards with the use of a compressor. This would mean that each tankard would take about ten seconds to coat. Since we already had the equipment to spray the outside of the tankards with varnish, it seemed like a logical solution.
NOT.
We tried it – again and again. But the sprayed-on coating was too thin and it slopped over onto the handle (meaning we had to slap a piece of masking tape on the handle to keep the black epoxy resin from getting on it – yet another step). Worst of all, when we filled each tankard with water to test it, a standard step, we had an incredibly high leakage rate – something like fifty percent instead of our usual one-half percent.
Clearly our quality had suffered.
So we went back to hand-brushing each tankard. The amount of time it would have taken us to repair each of the leaking tankards far surpassed the amount of time it took to hand-brush the tankards to begin with.
The Gray Areas
It is not just the actual making of your product where you can increase your efficiency. What about the other aspects of conducting your business? How can you increase your efficiency there?
One of the ways we increased our efficiency was to make our business predominantly wholesale instead of retail. This meant that we no longer had to hit the road as frequently to peddle our wares. As a result, our efficiency skyrocketed.
Selling retail by attending crafts shows, etc., is an amazingly time-consuming way to sell. Since we live in a rural part of north Idaho, we were automatically a long distance from any event that would make us enough money to justify attending as vendors. If we wanted to go to, say, an Oktoberfest (which, you must admit, is a great venue for selling wooden beer steins), then we had to travel at least seven hours in order to sell. Multiply this by the sheer number of shows we had to attend in order to make a living making wooden beer steins, and you have a problem.
In the early days of our business, we booked every show we could get our hands on. Eventually it got to where we were on the road almost every weekend. We traveled on Friday, sold on Saturday and Sunday, traveled back on Monday, and then frantically made more tankards on Tuesday, Wednesday, and Thursday.
Needless to say, the stress level was high and our efficiency was low. How can you make enough stock in only three days of work to supply a weekend show…especially when a minimum production run takes about seven days?
It couldn’t. The harder we worked – the more shows we booked – the farther behind we fell. It took a serious look at our efficiency (such as the time and expenses of being away from home) to make the decision to go wholesale.
It would be a different matter if we were “buy and sell” vendors, because then we wouldn’t be making our own products. The three days a week (Tuesday, Wednesday, Thursday) when we would be home could be used efficiently in simply ordering more products. But when you’re trying to be both the manufacturer and the retailer of your products, you need to take a serious look at how efficient you are.
It took us awhile to understand that “show time” is not the same as “shop time.” Yes, we make money at shows, but we also had expenses in terms of time and money. We had driving time (plus gas and oil for the vehicle), we had to learn to pack the vehicle efficiently (and perhaps buy a vehicle suitable for craft shows, such as a van), we had motels and meals to pay for, we had booth fees…it went on and on. Being on the road also meant we had to put off having children or acquiring livestock.
Most importantly, we had less shop time. And NO free time.
By the way, it might be argued that the quality of our products suffered during those early days too….since we were too tired and too stressed to make things to the best of our ability.
Other Business Practices
There are other things besides the manufacture of your product where you need to question efficiency versus quality. Consider advertising.
For example, a few years ago we decided we were going to target the beer-drinking market with our wooden beer steins. We selected several high-quality magazines in which to advertise. We looked at their circulation, their demographics, and their advertisement costs. We pulled together a handsome color advertisement. Our costs? Approximately four thousand dollars for all of the ads.
That is a huge amount of money for us, but we hoped that the high quality of the ads would produce a huge increase in sales.
It didn’t.
Yes, we paid for the ads, but barely. We made no extra profit as a result of spending all that money. In the end, it just wasn’t worth it. The “efficiency” of the printed advertisements was not worth it for us.
Although too large a subject to be addressed in depth in this article, the internet can be an efficient advertising mechanism. A webpage can be one of your most cost-effective tools for selling.
If your webpage is straightforward and is merely for information (as opposed to on-line sales which require security features), you can get a good webpage for free. Can’t get much better than that.
(On a personal note, we now have our retail web page back up and running – please come see us at https://www.donlewisdesigns.com. Sorry, couldn’t resist slipping in a plug.)
And On It Goes
There are so many other aspects of a home craft business that can be made more efficient.
How do you do your bookkeeping? Your taxes? Your billing? Can your products be made assembly-line fashion or do they have to be made one at a time? Can you turn your business into a wholesale business instead of retail? Can you buy your raw materials bulk? Can you keep your business in-house (employing just your immediate family members) or do you need to hire outside employees? Can you work in your shop or barn or basement, or do you need to rent or buy an outside shop or office?
It is always in the best interests of the home crafter to try to increase efficiency. Sometimes the result will improve your bottom line. But even if the result only gives you more free time…well, “country living” and “free time” are one of life’s greatest combinations.
Patrice Lewis is co-founder of Don Lewis Designs (www.donlewisdesigns.com).
She and her husband have been in business for thirteen years.
The Lewis’s live on forty acres in north Idaho with their two homeschooled children,
assorted livestock, and a shop which overflows into the house with depressing regularity.
