India has been home to artisans and craftsmen since time immemorial. Be it the Pashmina Shawls or the Zardozi embroidery, Indian art and handicrafts have mesmerised the entire world. Needless to say, there’s both national and international demand for authentic and good-quality Indian handicrafts.
The Handicraft export business has always been considered a little unconventional and hence experienced sporadic demand. Fortunately, in the age of Internet e-commerce and personalised products, a handicraft business can flourish without constraints.
However, before you start a handicraft business, you need a proper plan in place. Here are the steps to follow to start a handicraft business and make it profitable.
1. Identify a gap in the market
The first step in starting a handicraft business is identifying a gap in the market. This involves determining which products are in demand and why. To achieve this, you need to conduct thorough market research.
First, analyse the trends of the handicraft market and identify the products that are popular. This will give you an idea of potential gaps in the market and how your products can fill them.
For example, suppose the trend reveals a rising demand for organic and eco-friendly products. Then, you can decide to offer handicraft items made only of natural materials to cater to this demand.
Next, you also need to identify your competitors in the field and their products. This will help you differentiate your product from those already available on the market.
2. Know your audience better
The number one rule of any business is to know your audience inside out. This is even more important for an unconventional business such as a handicraft export business. Knowledge of your potential audience includes their age, gender, demographics, purchasing behaviour, preferences, and interests.
Once you have this information, you need to answer three simple questions about your audience to develop a solid production and marketing strategy: What are they purchasing (product)? How are they purchasing (cash/credit etc.)? From where are they purchasing (online/offline etc.)?
For example, for handmade fashionable jewellery, your target audience would be young women aged 20 to 30 years with disposable income. They would prefer online shopping. Your marketing strategy for the same would include advertising on popular social media platforms. Since their primary mode of purchase is likely to be credit cards, you can include credit card offers to boost sales.
3. Create a business plan
“Give me six hours to chop down a tree, and I will spend the first four sharpening the axe.”
Abraham Lincoln succinctly put the importance of preparation in the above quote. Once you have successfully identified a gap in the market and examined your target audience, you are ready for the next crucial step: creating a business plan. A business plan should be clear and concise, with tangible goals and ways to track progress.
Your handcraft business plan should include the following:
An overview detailing the business vision and objectives.
Product description and advantages.
Market research identified gaps and competitors.
Analysis of strengths, weaknesses, opportunities, and threats (SWOT).
Marketing strategy based on potential audience.
Quarterly and yearly financial projects and targets.
A business plan is the blueprint of your handicraft business and a testament to solid preparation. The final business plan should be such that it helps you stay focused on the determined sales and expansion goals of your handicraft business.
4. Set up your handicraft store
After making the business plan, you are ready to get into concrete specifics. First, you need to open your handicraft store.
You might want to consider an online selling handmade items store to start the business quickly. If you are familiar with the basic workings of an e-commerce platform and website design, you can go ahead and start designing your online handicraft store.
Make sure to customise the website's visual appeal to your target audience. For example, if your market research indicates a young target audience, make your website colourful and spunky. Whereas, for an upscale corporate audience, you should choose a more sophisticated design.
After the design, the next focus should be ease of accessibility and use. Websites with easy-to-find products improve customer experience, boosting sales.
5. Market and sell your products
As a hand craft business owner, your goal is to sell more handicraft products. Marketing would help you obtain, retain and increase customers. You can employ a mix of several tested marketing strategies, such as:
Email marketing:
Sending emails to customers regarding new products, offers, and updates is an effective way to stay connected with them and ensure customer retention. However, make sure to effectively customise your emails to target the different customer segments.
Social Media Marketing:
Social media marketing is important to any digital marketing strategy. Through social media, customers can view product photos and read product descriptions. You can also employ many effective customer engagement strategies through social media, such as games, quizzes, and product giveaways.
Search Engine Optimization (SEO):
Along with social media marketing, SEO can help increase your business visibility online. To take complete advantage of this, ensure your website is SEO-optimised for search engines with suitable keywords and meta tags.
Multichannel Selling:
To expand your reach, you can make your products available on multiple online shopping platforms besides your website. This is called multichannel selling.
6. Manage and grow your business
Now that you own a handicraft business, you must focus on managing it. Business management would include keeping track of sales, revenue, profit margins and customer satisfaction.
You also must track the progress in achieving the business plan's objectives. You can consider using a business programme or hiring professionals to accomplish these tasks.
Final Thoughts
Now that you know all about starting a handicraft business, it’s time to discuss the question of funding. While you can use your savings to fund your handicraft business, we suggest taking advantage of business loans. These are convenient options that allow you access to capital while helping you retain your hard-earned savings for the future.
What’s more, you don’t have to look far for a reliable financial institution.
Tata Capital provides customer-centric business loans with competitive business loan interest rates. Further, you can secure a business loan from Tata Capital with minimum business loan documents required, easy eligibility criteria and a smooth application process.
28 May 2024
6 mins read
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