Saturday, January 9, 2016
Tiny but finished. My PQ challenge quilt "After the Party is over: Under the Couch. It is made of black Kona and satin ribbon. This one measures 8 x 8 inches. It has a knife edge instead of traditional binding and is machine quilted.
Not what I started out to make but finished is always better than still in the imagination.
If you want to see all of the quilts check out Project Quilting and Challenge quilts on Facebook and flickr or drop by Kim's blog for all the details and links.
Tuesday, January 5, 2016
As much as time and resources allow.
If you don't take it, you can't sell it.
As much as you can fit in your car.
A cash value greater than the dollar amount you want to sell.
Yes, those are the standard answers to the eternal question. How much stock do I need to have available at a large show. Of course you are going to make as much as you have time for. Of course the amount of money you have available for raw materials is going to affect how much you can make. Of course it has to fit into your vehicle and you have to be able to carry it in and set it up in the time allotted. And, of course if you want to walk out of the show with $3000 you need to walk into the show with more than $3000 worth of stock,
The next question, the real question is what does that actually mean? How does that translate to my products at any given show? How can I even begin to figure out what to expect to sell, how much to expect to earn? How best can I prepare for my show?
There are several ways to estimate numbers that will help you determine what to make and bring. I find it useful to try and estimate the maximum number of sales I can possibly make over the course of the show and work backwards from there. There are two different ways that I do that. One is to calculate it based upon the amount of time it takes to complete a sale. The other is based upon the number of expected attendees. Both methods give me a high end estimate of what could happen if absolutely everything is working to my advantage (weather, booth location, fit with customer base, turnout...).
First, lets talk about the time constraint on the maximum number of sales you could make during the course of a show. How long does it usually take you to interact with a customer from the time you first engage with them to the time you hand them their filled shopping bag and receipt?
My sales tend to be pretty quick. I estimate that my average sale takes 2 minutes. That means that at the very most, I can make 30 sales per hour. If I have help, which is a must for me at a big show that number could be as high as 60 sales per hour. That is clearly nuts. In addition to working with individual customers, I need to consider the logistics of moving that number of customers (plus their friends and kids) as well as an even greater number of browsers through the booth. Taking all of those additional factors into account, my best estimate for a busy show is about 5 minutes per sale. That translates to 12 sales per hour. Multiply the open hours of the show by this number and you get a number equal to the greatest number of sales you can possibly make during the show.
If the time you spend with a customer is 10 minutes then you cannot expect to make more than 6 sales per hour of show. You don't need to make enough stock to handle 20 sales per hour because you simply are not able to interact and make that many sales. Also keep in mind that most shows are not going to have full capacity traffic so you really can't expect your maximum sales per hour over the course of entire show. You will have rushes and down times.
One good place to look for real data is your Square sales report. It tracks sales per hour over the course of the day. You could use it to get all fancy and make a bell curve but we are into quick estimates around here.
If the show you are doing has huge numbers of visitors you may want to plan your layout and staffing to increase your capacity for making sales. How can you move people through your booth? Is there a typical bottleneck you can eliminate? Can you bring in some one to take the money and package the goods while you move on to interacting with the next customer? Anything you can do to increase the rate at which you can make sales will increase your maximum sale potential.
Once you know your maximum possible sales, you need to multiply it by your average items per sale. This may even vary for different products as well. Let's try some simplified examples here to make it easier to explain...
Maximum sales per hour 10 x 10 hours of selling time at the show = 100 sales
That is, the most sales you can physically make over the course of the show is 100.
If you sell pink widgets then you need to make 100 pink widgets.
That is pretty simple. Particularly if you only make pink widgets. If however you make pink widgets and blue gizmos you need to do some more estimating.
Lets say that by looking at your sales book you see that half of your customers buy pink widgets and the other half buy blue gizmos. Then you need to make 50 pink widgets and 50 blue gizmos.
But as well all know, customers are never that simple. Some of them, let's say 10% buy a pink widget AND a blue gizmo. That means you need to make an extra 10 of each. If your average customer buys 3 items then you need to make 3 x 100 or 300 items to be sure you can cover the potential number of sales. And so on.
If time and resources allow, you can make 100 of every item in your inventory to cover the potential sales at this show. Look at your receipts from previous shows or do your best to estimate what percentage of sales is represented by each item and go from there. (OK. I know that it is a total crap shoot as to what is going to sell today versus what sold yesterday. But most of us have a general idea of what our best sellers are. This simply gives us place to start thinking about prepping our stock.)
Another way to figure out how many sales you might be able to make is to estimate the number of potential customers. I do this by estimating what percentage of actual attendees end up buying from our booth. At one show we do on a regular basis we sell to 5 - 10% of of the people who come to the show. While that sounds pretty cool, don't get too excited it is actually a VERY small number. For several reasons, it is an extremely high number and one I only use to estimate stock for that show. At most shows the number of sales is to 0.5% - 1% of the show visitors.
For a 10,000 guest show that means I would expect to make between 50 and 100 sales. (10,000 x 0.005 = 50)
As in the first method, you take that estimate of number of maximum sales and multiply it times the number of items per sale and/or your estimate of the percentage of those for each item.
You are going to have to track and estimate your ratio of sales to attendees to get the best number for you. If you have a niche product (i,e.targeted toward new mommas, or middle-aged men) you will have to base your estimate on the likely number of attendees that fit that description. A show with 10,000 guests may only have 500 new mommas. That reduces your potential customer pool to 500 but also increases your likelihood of selling to them. You may make sales to 20% of the new mommas who visit your booth. My products seem to sell across the board so I use the general attendance number.
Going back to the pink widgets, if they are generally appealing then you can expect to sell them to 50 customers over the course of the show, thus you need to have at least 50 widgets made and ready to go to cover that potential.
I have to emphasize again that both of these methods give you an estimate of the BIGGEST POSSIBLE number. Rarely are you ever going to meet or exceed that number. You are going to have off days. Green whatchamacallits may be the big thing at this sale and you only have 2. The audience may not turn out. The weather is bad. And I can't say that I have ever done a show where the traffic was steady and at capacity for the entire time. Yes, it can happen. Yes, we all dream of that day. But do NOT stress out if you don't have the time and resources to make 50 pink widgets. This is where you fall back to the position of as much as you are able to make and transport. Use these estimates as guidelines and targets. I make them to keep myself motivated to make the extra stock when I might otherwise slack off and write a blog post or something.
Hopefully this gives you a place to start thinking about your inventory and a notion of what sort of data you might want to collect as you go about your shows.
Update: You can also use these numbers to estimate the amount of money you might make at a show. Simply multiply the number of sales by your average sale dollar amount. That is a high end estimate. If that isn't enough to cover fees and travel costs with a tidy profit it is probably better not to apply.