How to Start a Crafting Activity Site

Start a Crafting Activity Site by following these 10 steps:

1. Plan your Crafting Activity Site
2. Form your Crafting Activity Site into a Legal Entity
3. Register your Crafting Activity Site for Taxes
4. Open a Business Bank Account & Credit Card
5. Set up Accounting for your Crafting Activity Site
6. Get the Necessary Permits & Licenses for your Crafting Activity Site
7. Get Crafting Activity Site Insurance
8. Define your Crafting Activity Site Brand
9. Create your Crafting Activity Site Website
10. Set up your Business Phone System

We have put together this simple guide to starting your Crafting Activity Site. These steps will ensure that your new business is well planned out, registered properly and legally compliant.

Exploring your options? Check out other small business ideas.

STEP 1: Plan your business

A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:

• What will you name your business?
• What are the startup and ongoing costs?
• Who is your target market?
• How much can you charge customers?

Luckily we have done a lot of this research for you.

What will you name your business?

Choosing the right name is very important. Read our detailed guide on how to name your business. We recommend checking if the business name you choose is available as a web domain and securing it early so no one else can take it.

What are the costs involved in opening a Crafting Activity Site?

Because your crafting activity site can be operated out of your home, initial costs are fairly minimal. The following should be considered when writing the “initial costs” section of your business plan:

• Website - The cost for your new website could range from a few hundred dollars to several thousand. Whether you decide to complete the build yourself or hire a designer, your site should be secure, user-friendly, and have all the features necessary to conduct your business with ease.
• Computer and internet
• Camera and video recorder
• Supplies - At the very least, you will need enough supplies for yourself so you can lead students through each project. Entrepreneurs who sell craft kits or furnish each student with a class supply kit should partner with a wholesaler for competitive pricing.
• Online education platform - The platform you choose should allow you to collect payments, set up recurring payments, upload printable course materials, and host your video content.
• Advertising
• Insurance and licenses

While you do have the advantage of being able to work from home, it is important that you set up a dedicated workspace. This space should look professional and be free of all outside distractions.

What are the ongoing expenses for a Crafting Activity Site?

Fortunately, overhead costs for this type of business are fairly minimal. Once you have made your initial investment in supplies, you won’t need a lot of funding to keep it going. Your ongoing expense budget should include website maintenance, wholesale supplies, shipping costs, and insurance. Your most valuable investment, which is difficult to put a price on, is time.

Who is the target market?

At its core, your target audience possesses the desire to learn new techniques and build their art skills. This includes adults, school-aged children, and/or families. While this offers you an expansive pool of consumers to choose from, you will need to narrow things down a bit. Asking yourself a few key questions regarding your target market will help you build crafting kits geared towards their interests and skills, write scripts for workshops/classes, and identify the proper marketing tools and strategies to employ.

Details to consider when defining your buyer personas include:

• Age group(s)
• Location
• Interests (both inside and outside the artistic community)

How does a Crafting Activity Site make money?

As the owner of a crafting activity site, you can generate money through a variety of channels:

• Online sales of project kits
• Paid online workshops (live class)
• Paid recorded classes

Educators offering a bevy of courses can charge students:

• One-time fee for a specific course
• Monthly subscription fee for access to a variety of classes
• Monthly subscription fee for access to basic courses with the option to pay additional fees for more advanced courses

Consider market demand and where your skill set fits into the equation when defining your business model and determining how your website will generate revenue.

How much can you charge customers?

When setting your prices, you will need to consider your costs - both time and money spent on supplies. Crafting kit prices will vary depending upon the level of difficulty to assemble and supply costs. Online courses range in price from $50 to $199.

How much profit can a Crafting Activity Site make?

Fortunately, creating a sustainable and scalable business in this industry is fairly easy. Assuming you have identified industry needs and carved out a niche based on those needs, you have the potential to earn a significant profit. If you teach a $149 class to five students three days a week, you stand to earn $2,235 in weekly revenue. This results in over $116,000 (minus overhead expenses) in annual profit.

How can you make your business more profitable?

While your initial business model may be fairly limited, you will want to expand the goods and services you offer over time. This will not only increase the business’s profits, it will help solidify your place as a thought leader in the industry. A series of classes and/or crafting kits that build on each learned skill will keep customers coming back for more. Industry leaders also recommend hosting in-person workshops and craft-themed parties, as well as selling your own hand-crafted products.

STEP 2: Form a legal entity

The most common business structure types are the sole proprietorship, partnership, limited liability company (LLC), and corporation.

Establishing a legal business entity such as an LLC or corporation protects you from being held personally liable if your Crafting Activity Site is sued.

You can form an LLC yourself and pay only the minimal state LLC costs or hire one of the Best LLC Services for a small, additional fee.

STEP 3: Register for taxes

You will need to register for a variety of state and federal taxes before you can open for business.

In order to register for taxes you will need to apply for an EIN. It's really easy and free!

There are specific state taxes that might apply to your business. Learn more about state sales tax and franchise taxes in our state sales tax guides.

STEP 4: Open a business bank account & credit card

Using dedicated business banking and credit accounts is essential for personal asset protection.

When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.

Open a business bank account

Besides being a requirement when applying for business loans, opening a business bank account:

• Separates your personal assets from your company's assets, which is necessary for personal asset protection.
• Makes accounting and tax filing easier.

Get a business credit card

Getting a business credit card helps you:

• Separate personal and business expenses by putting your business' expenses all in one place.
• Build your company's credit history, which can be useful to raise money later on.

STEP 5: Set up business accounting

Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.

Make LLC accounting easy with our LLC Expenses Cheat Sheet.

STEP 6: Obtain necessary permits and licenses

Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.

STEP 7: Get business insurance

Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.

There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance. This is the most common coverage that small businesses need, so it’s a great place to start for your business.

Another notable insurance policy that many businesses need is Workers’ Compensation Insurance. If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.

Is this Business Right For You?

Are you a crafter that, time and time again, hears “I wish I knew how to make that?” Have you been looking for a way to quit your day job to focus on a career that brings you joy? Are you ready to be more present in your home life? If so, sharing your craft with others through a crafting activity site could be a profitable way to turn your dreams into a reality.

What happens during a typical day at a Crafting Activity Site?

The specifics of your day are defined by your specific business model. Some activity sites teach students various crafting skills through live and/or recorded classes. Many send out a list of supplies, requiring students to purchase supplies ahead of time; others ship all supplies, ensuring students have everything they need for the workshop. Yet another business model forgoes the online classes, focusing solely on selling crafting kits that provide the client with everything they need to complete a specific project.

Regardless of which business model you choose, your days will be spent working with supply wholesalers, planning new classes and projects, shipping out supplies, addressing client questions and concerns, and marketing your new business. If you decide you want to take things a step further and add workshops and/or recorded classes to your services, part of each day will be dedicated to performing class-related tasks.

What is the growth potential for a Crafting Activity Site?

At the very least, you will need a background in crafting and a firm understanding of basic art skills and concepts, including color mediums, shapes, and lines. If you plan to offer online classes and workshops, communication and teaching skills should be a part of your skill set. Industry leaders recommend CreativeLive’s Master the Art of Teaching video for aspiring educators who have never taught before. Additionally, the annual conference, Craftcation, is an excellent way to hone your craft, network, and support the art community.