Is your Business Actually Profitable? Things You Might Not Be Taking Into Account

Are you really being profitable in your business? Or are you dipping into your own bank or your spouses account to make things work without knowing? Scary part: Most small business owners don’t actually know unless they have a separate bank account just for their business.

If you are not pricing yourself correctly, you could be selling yourself short… literally. Or working for free, or worse; PAYING people to buy your items. Let’s take somethings into account that you may not be thinking of. I know this post is a little bit of a Debbie Downer, but you NEED to know what your spending your money on. Selling a $50 dollar scarf does not mean you profit $50. You may not have profited at all when you take everything into consideration.

Not sure how to find out your profit margin or what it is? Click here:

Let’s base this blog post off the product you’re selling as a $50 scarf and it has a $15 profit margin. We will base off of working a week in advance of a market.

Booth fee’s and hours to work them:

Say you sign up for a one day market, and the fee to have a table is $75. It’s an 8 hour day and the minimum wage in your state or province is $10. Just to break even on your one day market to pay for your time being there and your booth fee, you need to make $155. This does not mean that you can sell three $50 scarves and call it a day and then say you’re onto making a profit… cause you’re not. It’s that $15 profit margin (noted above) that pays for your booth fee and time. The remaining $35 is paying for your materials and time to make that physical item. In actuality you need to sell 10.3 scarves ($155 divided by $15) to make up the difference before your business even starts making money. PS did you grab a coffee that morning to rev up for your day? Grab food from the food truck vendors outside so you don’t become a hangry bitch? Yeah… though you can’t claim it on your taxes (unless at an out of town market), your profits should be paying for that too, unless you want those to come out your own pocket.

Total cost to make up: $155

Booth Setup

You want your booth to stand out, so did you buy a table cloth for your booth? What about some wire stands or a mannequin to prop your knit toque or scarf on so that your product looks bomb-ass? Maybe some wooden crates – that you of course spray painted a different colour cause it looks nicer! Price tags? What about bags to put your items in, to hand to your customer who just purchased? A banner from Vista print with your logo? What about business cards – those definitely don’t grow on trees. Oh speaking of logos, did you get a designer to make it for you? Don’t forget about that cost either. Everything up to the tupperware boxes that you purchased the hold your stuff during transport needs to be added.

Table cloth – $10, Wire Stands: $30, Two wooden crates: $20, Spray paint: $7, Price tags: $10, bags to put items into: $50, Banner from Vistaprint: $13, Business cards: $16, Logo design: $100, Tupperware: $30

Total cost to make up: $286

Marketing and Advertising

Chances are, you did some social media marketing before this upcoming show (above). You pumped it, you mentioned it, maybe you even sponsored or boosted a post about it and spent $15 in the week leading up. Take that cost out of your profit margin too. Also note: How long did it take you to craft your post? Did you buy props for the photo? You need to add those costs into your bottom line, and pay for your time there. You don’t get to just steal that time from your life without actually paying yourself for it as a small business owner.

5 hours of social media marketing per week: $50, Boosted post: $15, 1 hour to photograph posts: $10, Props to use in photo: $5

Total cost to make up: $80


Total for all of the above: $521

Meaning that you have to sell a MINIMUM OF 34.7 scarves to just pay for the week leading up to your market, and your market days BEFORE you start to profit and start putting positive dollars into your bank account.


Shipping / Packaging / the Works / Etsy Fees

Small business means that we get to add the special touches to every order we send out. We love sending thank you cards, writing personal notes, packing up items really nicely in tissue paper etc before we slap the item into a poly mailer and pay the shipping fees. Don’t forget that each of these items also cuts into your bottom line. Charge for the poly mailer, charge for the business card, charge for the thank you notes. They may be additional touches, but that shouldn’t come out of your own dime. They should be a part of your price.

Thank you card: $1, Business card: $0.50, Tissue paper: $2, Poly Mailer: $1, Shipping label: $0.75, Return address sticker: $0.25, Etsy listing fee: $0.20

Total to make up: $5.20

That’s on each of your items. 


Things you can do:

  1. Raise your god damn, mother effing prices. This will solve the biggest portion of your problem. Bump that profit margin. You should have a MINIMUM of a 75% profit margin on every item you sell.
  2. Start working more efficiently. Can you cut down your marketing time, or photography sessions? Cut out the food truck vendor at the market and bring snacks. Use the same prop twice. Be more time efficient!
  3. Source cheaper materials. Can you do wholesale with a specific company to cut your costs down? Can you find a local vendor so you don’t have to pay for shipping and can pick up instead?
  4. Track your expenses and make a budget: This is the most important step. If you are tracking your sales and expenses it will be easy to see if you are in the red or not. Do not ignore the problem. Deal with it and create yourself a budget so you know your limits.

I know this all sounds like a panic attack, but you cannot ignore it and hope it goes away. Please note down everything you spend so you can charge accordingly. Want to learn more about pricing your items? Click here.






2 thoughts on “Is your Business Actually Profitable? Things You Might Not Be Taking Into Account

  1. rusticmapleelizabeth says:

    All very valid points! I’m hoping to do shows next year and have already put the cost of hard items (bags, crates, totes) into my business money. I have a separate bank account and debit card for my business. I even keep cash (local clients often pay cash) in a separate little wallet in my purse for ‘quick’ purchases so that I’m not tempted to take the money out of my ‘family’ money. Then I put the receipt in the same little wallet and account for it every few days.


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