How to manage your stock
Running a crafting business, as a full-time concern or as a side-line hobby, is an exciting time. You get to spend your days being creative and developing products, finding those that you know your customers will love. There are also some important aspects to making your business successful and sustainable.
Important aspects include looking at ways to manage your accounting as well as finding out, do you need insurance to sell handmade crafts in the UK? There will be different implications depending on the types of products you create. It will also depend on where you sell your products. Finding out the answers to these types of questions early on means that you can then focus on making your beautiful products.
Another element of a successful crafting business is managing your stock. There are two key areas relating to this. Storage and inventory. You need to consider both of these.
Storage
When it comes to storing your products and the materials that you use to create them, you need to consider:
- The space you have available for storage
- The location of your storage, whether this is in your home or a dedicated crafting space.
- The best storage solution for your items, such as storage boxes or a larger shelving unit
- Safety aspects related to your storage solution
- Ensuring your insurance covers your storage. We can tell you exactly which insurance you need to sell your handmade crafts in the UK.
There are a lot of different storage options available. It is best to choose one appropriate for your products and materials. Make sure that you consider all the materials you use when looking for solutions. It is important that you store these in a separate space to your finished products. You may also need to consider how you will access your materials. To make the most of your crafting time, you will want these close to hand.
Inventory
This consists of all the materials you use to make your products, along with your finished items. There are four distinct categories of items in your inventory.
- Materials that you have bought and use in your products. These can also be materials that you use to test new products.
- Work in progress. These are the products that you are currently creating and are not yet ready to sell.
- Finished products you have ready to sell to your customers.
- Products that are sold through third parties, if on a sale or return basis.
You can keep a track of these inventory items using a simple spreadsheet, through the use of accounting software or specialist inventory software. The option that you choose will depend on the size of your business and the budget you have available.
A simple process to follow is to record all the materials that you buy and give them a code. This code is bespoke to you and doesn’t have to be anything complicated. In the spreadsheet, you can then list the cost price of this material, which will also help in your product pricing.
Next, you create a tab in the spreadsheet for your work in progress. Here you can give the item a new code. For ease, you can start this with WIP and then add a number. You can record the materials that you have used and the time you have spent.
Finally, you record all the items that you have for sale. These should have an item code, a description and a colour option. By creating this inventory sheet, you can then transfer this information over to your sales platform. If you create different colour or flavour options for a particular product, add extra code into your inventory.
For example, if you sell earrings, you may use the code ER001 for your first product. If you were to sell these in red, yellow and blue, you might adapt the code to be ER001-r, ER001-y and ER001-b so you can distinguish between them.
Stock control
Once you have your storage space defined and your inventory in place, you can start managing your stock.
If your products have a use-by or best-before date, you will need to ensure that you rotate your stock. This means taking any new products that you make and placing them at the back or bottom of your storage for that particular product.
By checking how many products of each type you have available, you can see what products are selling well. You can note the stock figures on your inventory, and this will help to inform you whether you need to create more of a particular product. It can also help in identifying whether you might want to hold a sale. This is useful for products with a limited lifespan. It can also help you understand what products you may need to make or develop in the run-up to popular holidays such as Easter and Christmas.
It is important that you carry out a full stock check on your products at least once a year. You will need to carry out a check on your materials much more often.
Final thoughts
Take some time out of making your products, during a quiet period for your business and take stock of your products. If you haven’t set up an inventory yet, you can find some great templates online. Set up codes that are relevant to your business. You can transfer these over to platforms such as Etsy and Shopify if you utilise these for sales. The codes will help you track your product levels across all your sales platforms. Ensure you have adapted codes for colour and flavour variations. Regularly check your stock levels and replenish if needed.
Finally, you will need insurance to sell handmade crafts in the UK and we can give you the right advice and get a policy in place. This may include cover for attending craft fayres and fetes to sell your products.