- MemberJanuary 20, 2009 at 9:49 am
I would think long and hard about running another business alongside mine. I’m not too worried about gross margins, but I am desperately interested in the bottom line.
What I’m trying to say is that a three quid mug, even on a 1000% mark-up, doesn’t leave much money behind to pay the labour to make it, the overheads, and all the other expenses. Also, in my location I would need to spend on advertising and flyers before people even knew we made them. I would lose money by making mugs.
That’s not to say that mugs isn’t a noble profession. Working from home, or high street premises with passing trade (and therefore less advertising requirement) will probably make it work. It must do because plenty of members do it, so I won’t knock it. I’m just saying that it could never work for me.
I’ve used mugs as an example, but the same applies to any highly competitive business and would steer clear of business cards/stationery, embroidery or anything that allows anybody with a bit of pocket money to set up in competition.
To make the big bucks you need to get in early. You need a new idea, the faith and commitment to the project, and the hard work to make it succeed. Then you need to milk it for all you can before everybody copies you and slashes prices. Our own industry provides excellent examples with vinyl cutting twenty five years ago and, more recently, digital printing. There are plenty of examples in other industries too, in fact, it is the normal business cycle.
To be honest, if I couldn’t come up with something like that, I think I’d prefer to rent out my spare space and let somebody else have the worry and hassle of trying to scratch a living out of an already saturated market.
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