In the fall of 2017, it took 1000 hours for me to produce one handmade item. I revolutionized my handmade business and production went from 1000 hours per order to 11 minutes.

Ok, so it wasn’t really 1000 hours, but seriously, it felt like it.

While your process may not be the same as mine, the outcome potentially could be. Having 100 open orders and a bloated manufacturing process caused me to revolutionize my business and become more efficient.

I hit my breaking point and I decided something had to change.

My journey to improving my business lead me to the 4 P’s – Process, People, Profit, and Product.

Process

When I was in the beginning stages of starting my Etsy shop, I was pretty desperate for sales.

Any. Sales.

I’m sure many of you reading this can relate (and for those of you who can’t, congratulations on getting consistent sales so quickly. The rest of us hate you, wink wink). But seriously, it’s a normal part of a business lifecycle.

Because of that desperation, I wasn’t concerned with how long it took to make each item, let alone the inefficiency of custom orders.

When I wasn’t very busy, it seemed okay for items to take a decent amount of time to make. Back then, it didn’t seem like the process to make my products were taking that long anyway. But, I wasn’t actually timing anything.

Because I thought, some sales are better than no sales, right? I gotta start somewhere, don’t I?

Yes….and no.

This philosophy worked for the first year of my business, as it was only a part-time job during college. I was only getting a few orders a month and it was easy to keep up with demand. But, during the fall when my sales rate increased 9-fold in one month, my time-consuming items became a nightmare and I was quickly falling behind on orders.

I was falling behind because I didn’t have a process! Here’s how I use Trello to keep track of orders through their production process.

But did I care? Heck no!! I was breaking my personal records left and right. #goalachiever

My dreams of having my own business were finally coming true and I was ecstatic that all of my hard work was starting to pay off!

My excitement only lasted about a month working 80-100 hours a week. I rapidly burned out and I grew to resent my popular items that were selling like hotcakes and sucking up ALL of my time.

I stopped all of my important business development tactics. I quit updating listings. I quit taking photos. Worst of all, I quit making new products. I only worked on making orders. And I absolutely HATED doing production-only tasks for an entire day. But I’m stubborn and I simply told myself that this is just the way it is. I thought this what I always wanted. I made my life this way so I better get used to it.

My non-fixer mindset let this bitterness for my business continue during the entire Christmas season to the end of 2017.

Thankfully my mindset has changed and boy, how wrong I was. It’s crazy to look back and think about how different things are today.

Solution:

  • Storage:
    • Previously, my products were in a random order where ever I sat them down last. At one point they were spread across the entire house. I was constantly searching for an item or tool and was often frustrated, as I was wasting time I  didn’t have during the day. To fix this, I created storage solutions for each stage of the process. These one-time costs helped me to stay organized and know exactly where all of my orders were in production, greatly increasing efficiency. I also created storage bins for inventory and supplies.
  • Sign Production:
    • Wooden sign production went from a 22-step process (yes, I’m serious) for a 2-layered text sign to 6 freaking steps!!! This also lead to a drastic difference in the amount of time per sign: from 27 hours drying time (wood stain and paint) + 63.5 minutes production = 28 hours 3 minutes 30 seconds to 11 minutes per sign. That’s a 99% decrease in time per sign!!!
    • Why count drying time? After all, I wasn’t really “working.” Drying time matters because it determines the window I have for completing rush orders. Customers are more likely to buy when they don’t have to wait. Because of back-stock production and my insane increase in efficiency per sign, I am now able to rush orders and potentially get them shipped the same day they are ordered. Before my minimum rush production timeline was 3 days and I often couldn’t meet customers deadlines. Drying time also limits the amount of orders I can store in my location. The faster orders go out, the less space I need to store orders in production.
  • Packaging
    • I altered my packaging process for signs from brown paper to polybags. Polybags were slightly more expensive than brown paper, but the polybags were packaged 10x faster and gave me a more professional appearance. Remember, your time is important! Don’t save a couple pennies for an hour’s worth of work.

   

Questions to ask yourself for process improvement:

    1. Do you have materials scattered across a room that you can organize in a better way?
    2. Is every part of your production process necessary?
    3. Is there anything you could change without compromising the quality of the product?
    4. Can you find a better, easier way to achieve the same outcome in one area of production?

People

My husband ended up getting laid off from his job around the time my orders started going crazy, which ended up working out to our benefit. I know for a fact I would not have been able to finish all of my orders on time without my husband. He worked 8 hours a day and I worked 10-12 hours a day for 5 weeks straight to get all of my orders done. I was so bogged down in getting orders out on time with such a narrow focus that I couldn’t see how to improve what we were doing.

Solution:

We discovered just how much two brains are better than one. He was able to point out things I was doing that didn’t make sense. He asked me questions because he wanted to understand my process. When I tried to explain my logic, I realized things didn’t make sense. For example, I had sign templates stacked in piles all around the cutting machine. He was frustrated by the amount of time it took to find them so he started hanging them around the room. Why didn’t I think of that? I was too busy making things to stop and think about improvements.

Eventually, my husband found another job and I knew I didn’t want to keep working alone. I liked running the business, but I didn’t like making every item. This is the moment I transitioned from being self-employed to being a business owner. When you are self-employed you are the do-er, manager, and dreamer. I hired someone to help with the production so I could focus on the management, development, and growth of my business.

I only realized how inefficiently I was spending my time when I saw someone else doing that same task. Remember to take a step back in your business every few months and look for improvements for your employees and for yourself.

Questions to ask yourself for people improvement:

    1. Do you have a process someone else could repeat?
    2. Can you explain each step of your process to someone else?
    3. Do you know someone you could try to teach and ask for feedback?

Profit

The biggest issue in my profitability was the fact that I wasn’t timing my hours. The first year I didn’t realize how underpriced some of my items were for the amount of time they take. I was only thinking of material costs, not including labor. I fell into the trap of thinking that if my time doesn’t get written off then it doesn’t matter how long I take.

This was another mindset shift from seeing myself as self-employed to a business owner. My time did matter and eventually, I knew I was going to pay someone else to do these time-consuming tasks. I only changed my behavior once I realized how much it would cost me to pay someone else to produce my orders.

Solution:

Even if you don’t plan to hire someone, remember how valuable your time is. The less time it takes to produce orders, not only will you be more profitable, but you’ll also have more time to grow the business. This also frees up time to find better deals for your supplies.

Questions to ask yourself for profit improvement:

    1. Do you know exactly how long each item takes to make?
    2. Can you take a step back, assess the situation, and find a faster way to achieve the same outcome?
    3. Can you find better rates for your supplies for your business?

Product

When my husband and I finally finished our tasks for the day at around 11 pm, he would just sit and let me vent, cry, or whatever I needed to do to in order to keep working the next day. He finally asked me a series of questions that revolutionized the way in which my business was running. My husband asked me, “Why are your signs painted? Do your customers actually care that they’re hand painted? Would anyone notice if they weren’t?”

When I was getting started with signs, it seemed like all of the sellers on Etsy were hand painting them so I thought that I had to as well. I assumed this is what customers wanted without actually verifying it. I was using the mentality “If everyone is doing it, it must be right” and that mentality was really hurting the passion I had for my business. I didn’t have a good answer when my husband asked me those questions and all of a sudden I knew that was a really big problem.

This would be a huge turning point for my business; I just didn’t know it yet.

I finally realized that something had to change. As much as I hated change, I needed a change to happen.

Solution:

I made 2 identical copies of my signs (one painted and one vinyl) and took these to my friends and people I knew in my community. I wanted their opinion on which sign they preferred without telling them which sign was painted and which had vinyl. They ALL preferred the look the vinyl had. It was crisp, clean, and looked more professional than the painted sign that had imperfections. I asked them if they cared one was vinyl over hand painted; a few said they liked the idea of hand painted, but preferred the how vinyl sign looked in person.

YESSSSS!!!! This was exactly what I wanted to hear and I knew this would change how my business functioned for the future.

Because of the change in production in my signs from paint to vinyl, I was able to completely eliminate the use of painter’s tape and spray paint, increasing profitability. This doesn’t even include the insane amount of labor being saved as well.

I then began to question how I could decrease other expenses without compromising the integrity of my product. I changed to a more raw cut of wood. The cheaper wood actually looked better because of the uniqueness of the wood grains. I got rid of half of my wood stain options that were either too similar or the least popular choice of my customers. If it wasn’t selling I got rid of it. It’s also too much work to keep 10 wood stains in back stock; 5 was much easier to keep up with and store in my garage.

Questions to ask yourself for product improvement:

    1. Do you have your why for every component of your product? If not, question why that component might be important. If it isn’t important, consider a production change.
    2. Can you cut down on variations of any products that don’t sell often?

Conclusion

I began to implement all of these changes after over a year in business and with more than 800 orders under my belt. It’s never too late and there’s no better time than.

Right. Now.

Question every single aspect of your business including design, production, shipping, workspace, etc.

Be able to specifically answer, “Why?”, “Does this make sense?”, and “Does this matter for my customer?” for any part of your business. Don’t assume things you like are also aspects the customer will pay extra for.

My business was growing fast enough that I was just kind of throwing things together without thinking, especially my workspace and how my items were created.

With a growing business, you want everything to as efficient as possible. I was tired of running all over my house moving things back and forth and in and out.

In short, I needed a system. A system that made sense to me and so that an employee could step in and get to work right away with little training.

I guarantee there is some aspect of your business that could be more efficient or an area that could decrease some of your costs. These are 2 things that can greatly increase your profit margin, helping you to earn more money by working fewer hours. Isn’t that the dream?! Start questioning every aspect of your business and find ways to improve. And, remember, this is a continual process. Get started now to revolutionize your handmade business.

Related: How To Use Trello As An Order Management System For Handmade Business