It’s taken me a while as an Etsy shop owner to really recognize the difference between revenue and profit — and they aren’t always connected.
Ideally, the more revenue you had to your shop, the more profit you’d take home into your personal bank account.
However, sometimes I’ve found that business owners have higher overall shop revenue WITHOUT having more profit, and it can be super disheartening and discouraging to figure out that you’ve worked more and had more sales without actually increasing your take home pay.
This can happen for a variety of reasons - not charging enough for your products, not having good ways of tracking the money coming in and going out, or just simply spending too much money on things that are not directly related to increasing your overall revenue.
Today’s blog post is all about ways to increase your revenue AND your profits, so that you make more money in your shop and you take home more money in your paychecks.
Sell more products
This one seems kind of obvious, but if you sell more products, you should make more money.
However, you can accomplish this in two ways - selling more of the products that you already have, or expanding your product line to increase the amount of products that you have in your shop.
Both methods will net you more overall sales, but I would venture to guess that your actual profit margins would be higher if you stuck with the same products you already have and sold more of them, because you’ll have less overhead and inventory that you’re carrying.
Diving deeper into the products that you have without expanding wider into different product lines and more inventory is a great way to streamline your business and not incur those extra overhead costs that come from running multiple different product lines.
People are SO afraid to do this, but one way to net more income while doing the same amount of work is to increase your prices.
Explore the market a little bit, see what other sellers are charging, or explore the ways that your product can add a unique spin to make it worth more money.
One way I’ve continued to charge more for my products is to have a very fast turnaround time to ship out items.
I have personalized items so everything is made to order, and with lots of Etsy shops the time until it ships will be 4 -6 weeks.
I can turn things around a lot faster than that, and I’ve had sales where the person explicitly told me that they are paying more for my item because of the faster shipping speed.
Holding inventory and sitting on a bunch of overhead is the death of a small business owner.
You want to decrease those expenses as much as possible, whether that is through narrowing down the options that you offer, or by finding a supplier that can provide things for cheaper so your overhead is less expensive.
I often see Etsy shop owners who are still paying retail for items - they are buying craft supplies at Joann Fabric or Hobby Lobby, shipping supplies at Amazon, paying retail at the post office counter, and don’t have any kind of business legalities set up to write things off.
Being able to decrease your costs is a no brainer - if you can provide the same quality products at the same prices (or raise your prices — see tip #2) while having them cost you less to make, it is a win all around for you as the business owner.
If you can master these three things - increasing your sales, decreasing your costs, and potentially raising your prices, your revenue is sure to increase through 2019.
Leave a comment below and tell me what kind of revenue you’re going to be bringing in this year?