Many people have successfully established their arts and crafts businesses from a simple hobby. Today when more and more people are losing their jobs and some cannot find another that fast, setting up a small business is a practical alternative.

Setting up an arts & crafts business does not require huge amounts of capital. Most can be funded from as little as $300 to $1000 depending on the kinds of products to be produced. Paper crafts such as scrap booking, personalized cards, and recycled paper making, can be set up at a very minimal cost.

Crochet and needlepoint crafts,woodwork and metal work, pottery, quilting, doll making, and beadwork have higher costs of capital requirement.

There are many hobbies you can convert into a small business venture and it is best to start on a conservative budget rather than putting in big investments and folding up very quickly later.

First, try to work out a business plan, like how much capital you have at hand, how much raw materials you will need, and the fixed costs and the incidental costs that will have to be accounted for.

Second, have your business name registered at your local city or town,
and have the proper business permits and
licenses to operate. Have the necessary clearances for fire/health
inspections, and zoning permits, if required.

Initially, you will have to keep your own books, like the Cash Receipts Book for Sales and Income, and the Disbursements Book for Expenses and Purchases. You will also need a box of stock cards to keep a record of all your materials and how many are being used. There is usually a plus and minus
column with the date and measure/number of materials used or purchased.

If you can get a bookkeeping program in CD for record keeping purposes for your PC, that would cut recording time. But books are handy because you can see at a glance the day's transactions, and you don't need electrical power to view it.

Thirdly, have your business cards printed with your name, business address, and telephone number for clients and customers who will buy or order from you. If you have ready products photographed, you can also
print out your own brochure, indicating product price and terms of retail and
wholesale orders.

Ask a printer to have a set of "Sales Invoices" and "Delivery Receipts" printed. If you need to have these registered for tax purposes, do so.
Have a booklet of "Purchase Order" form
printed in the same number as the invoices. Customers need to sign it
when placing orders from you.

Consider too how your products will be
packaged and how much it will cost.
List all the materials you have used in making the product, calculate the man- hours you spent making it and assign
yourself a "rate" of pay if you were to hire someone to do it for you. If you
pay someone to crochet a bonnet for two hours, $1.00, then you have to add that to the cost of your product as "labor charge". Compute all costs such as electricity (for embroidery machines, sewing machines, wood cutting machines, etc.)

Where to market your product? Look into
listings of trade exhibits/fairs, flea markets, town festivities, and even church fairs, where you can join and sell your products. Most are listed in craft magazines and scheduled all year round. Joining will require a registration fee that is minimal compared to the market exposure that you will get.

Advertise your product in magazines and indicate a lead time for production and delivery.

Communicate with your customers how
payments can be made and whether shipping and handling costs are included.

In case you get volume orders from customers and you require a bigger capital, where do you go for funding?
Inquire with banks and financing institutions about microfinance, these are small short term loans you can avail of for materials and production
costs of volume orders. After delivery and the customer has paid the order, you can pay back the loan and have a small interest on it, depending on the
terms.

Some institutions are non-government and non-profit and are there simply for
financial assistance and payments of loans are on installment basis.

If you can get a small bank loan or line of credit, so much the better. Be sure to calculate how you will repay the loan and if the volume order will be
remitted promptly so as not to delay your loan settlements.

Lastly, have confidence in your products
and innovate continually to keep pace with customer demands and preferences.
Always present new items for every fair that you attend. Develop good customer
relations and strive to keep "repeat"
customers. Remember that a satisfied
customer is your best advertisement.

As you proceed with your business, you will find satisfaction in doing what you enjoy doing, and you are getting paid for it.