{pre-made or made-to-order? The Handmade Seller’s “How to Decide” Production Guide}

Summer always hits in the most fast + furious way. Here in Minneapolis the weather warmed up rather nicely in April, so much that I had my summer tan a bit early. But the calender pages flipped over rather quickly and suddenly June was upon us, and now the end of July. And so is the humidity. Finding enough energy to run a handmade shop can be hard to maintain as shopping patterns + the weather forecasts change throughout the year, and of course when a beautiful day is gifted to you and all you want to do is enjoy some time away from work…

And guess what? If you’ve set things up correctly you CAN enjoy some time away from your shop once-in-a-while and yep, your business will run itself just fine. That’s the beauty of running your business in a way that truly makes the most sense for you + your family. And good news, I’m here to share my experience on how you too can get there with my “pre-made or made-to-order? The Handmade Sellers “How to Decide” Production Guide”.

A FEW TIPS TO SETTING UP YOUR HANDMADE BUSINESS SO IT CAN PRACTICALLY RUN ITSELF…

Before we dig into the “this way” or “that way” — which way is best?, production guide, one of the first things you’ll need to decide is whether it makes more sense for your business to have pre-made or made-to-order items, and in order to do that you’ll need some definitions.

Pre-made means they are already made, making them immediately ready-to-ship. When an order is placed the only task is packaging.

Made-to-order means once an order is placed it needs to be made from start to finish. Once that is complete the item can be packaged.

Over the last three years I’ve learned a lot about how to run our handmade business. We’ve tried a variety of options + techniques here at Gussy Sews, whether it be with hiring, prepping/production, or shipping processes, and I’m happy to report the way we do things now is the best way for our business to be run. And, I report to you this with confidence. Today I’m going to share my experience with prepping/production in terms of a pre-made or made-to-order workflow.

First things first: Gussy Sews is entirely debt-free. This means all transactions are run through our business checking account(s). We do not own a credit card {and never have, yeow!} and because of this it’s easier for us to make logical based decisions, not emotional based decisions. I looooove shopping for fabric, but knowing there’s a cash flow limit, like with how much fabric I’m able to buy at one time, helps me to buy only what we need ~ not what I think we need or want us to need. I realize not every business is able to work off cash/debit cards, some necessary expenses can be quite large, and so a credit card may be necessary depending on your situation.

But if there’s any teensy way for you to work with cash/debit cards I really encourage you to make it happen. It will do wonders for your business in terms of financial planning + future success. And yeah, I get it. There was a time when spending $500+ on fabric at one time seemed Absolutely Impossible. Capitalization intentional. But we’ve been able to do this quite a few times now and yes, it’s still scary. But we’re able to do it nonetheless and that is soooo exciting! Operating under a “pre-made” production workflow has helped us gain enough capital to make larger purchases, which in return lets us focus on our future successes.

Some more important background info: A few years ago Zack + I decided we’d put a small bit of our family’s income into the business to start gaining capital. Gussy Sews was just starting out and the funds needed to come from somewhere. (Since we create a product we needed money to purchase supplies, etc.) It was less risky to invest some of our savings than to take out a line of credit on a brand new business. Over time we’ve been able to shift the funds so all purchases are entirely funded by the business, as well as a savings account for the business. This was definitely a huge milestone for us. I also transfer funds every couple of weeks from our business account to our family account, which is a casual way to state I have a salary, which is super exciting!

A couple of years ago we didn’t have a lot of answers to the questions we had, or the experience to know where to get the answers. So we did the best we could and spent time researching, along with trial + error, and found contentment in doing so. We played it safe with many things. This meant it was at times a bit harder to predict sales {and rely on them} so at the time we made the decision for all items in the shop be made-to-order. It was like we were running a real life sweat shop as we were working in our small apartment in downtown Minneapolis. Sales would be slow + steady, then all of a sudden WHOOSH! the orders would come in and we had lots of work to do. The small room I sewed out of was hot {hence the name above, giggle giggle}. It was a bit chaotic at times. Things were a more often unpredictable than predictable but it was safer to run our business this way, because there was less risk.

With made-to-order you have a less going out in materials each month. You only need to buy the bare basics to keep things running smoothly. When you have a large increase in orders you then buy only what you need. Our experience meant we were are able to have a longer turn-around + shipping estimate because we were waiting until we have a handful of orders before getting started on them.

Made-to-order is acceptable in a few situations: when you are offering a custom order (but even then, you are charging more for the custom piece so the higher costs are offset) or you are testing something out and the knowledge you will gain outweighs the financial risk you are taking. With made-to-order you don’t need to have a lot of capital built up, something that is hard to do when you are a new business owner with limited sources of revenue.

But with made-to-order comes higher expenses. They may be safer purchases, less-frequent purchases, but they cost more. You aren’t able to buy in the exact quantity you need so you pay more to buy less. It’s like Target verses Costco. Retail verses Wholesale. Made-to-order verses pre-made. You get the idea :)

Once your handmade shop has passed the vague test of “time”, you start to become more comfortable with your business as your savings account and capital builds up. You are confident with the different variables handmade shop ownership brings {sheer emotional buying, seasonal influxes, vacation influxes, going viral, becoming a solid brand} and your knowledge is starting to outweigh any potential financial risks. You decide you are ready to move from made-to-order to pre-made.

But how exactly do you do that, you ask.

Your solid, clear vision for your handmade business, in the form of a business plan, mission statement, consistent sales patterns, and the like, has you in high-energy for a pre-made production process. This is an exciting time!

One key feature of pre-made is it allows you to buy more materials at a greater discount. Think of it like a wholesale purchase: the more you are able to buy the less it costs. Pre-made allows you to introduce a limited run of product quantities. It helps you to organize your time in the best way possible. Want another perk of pre-made? You are able to focus your time on other things, like taking time off from work one afternoon each week, working on another project, or scheduling creative time. Really, the list of positives with pre-made goes on and on…

When Gussy Sews was still in it’s first year we did a lot of made-to-order production work. This helped us get our feet off the ground {because we weren’t spending a lot on materials at once}, but it also helped me to learn quickly what fabric combinations customers were interested in owning. I was able to only buy what we truly needed {instead of risking a larger purchase without having sold the items those materials would make}, but like I mentioned earlier, made-to-order cost us a lot of money.

We learned quickly that our products had to be priced higher because our costs of goods were higher. We weren’t able to make the items in the most-efficient way possible because we were constantly going back + forth between types of products during production. When you sew, changing the thread, getting up to press a seam, constantly cutting different patterns and working with new fabrics — these things take a lot of time to start + stop. And my educated guess is that that’s pretty much across the board for any handmade product. If your customers aren’t willing to pay more for a product that could be made for less — and yes I’m still talking about handmade here — then you won’t be able to sell enough product anyway to justify the higher costs, let alone put some money in your personal accounts for bills + living expenses. Handmade, at times, is like walking a tight rope, you need to learn how to walk on it.

Unless you can accurately charge what made-to-order really costs you as a business owner, this isn’t always the best long-term plan for your business. And yeow!, handmade sure knows how to dance around that line. Accurately pricing your handmade items is fine line but it’s so important to figure it out.

Cost of goods + cost of time + cost of overhead + desired profit = product price.

Shipping costs can be calculated by adding the cost of shipping goods to the cost of time. Don’t cut corners here, you’ll seriously only hurt your business down the road. Trust me, I see it happen all the time and have experienced it myself. Once we realized our pricing + production ways were off kilter we got very serious about finding a better, long-term solution. We spent weeks reviewing our pricing, the shop’s overall design, shipping costs and the like and re-launched the shop in January 2012 with an updated workflow.

Let’s get back to learning about a pre-made production workflow. Pre-made has so many benefits, but it does require initial startup capital and cash flow management.. With pre-made you estimate the total number of products to launch, then you break down all necessary costs including materials + labor needed to get all of these items pre-made. Remember that once the items are made your main focus is to sell them. You have higher costs to start but with your knowledge of handmade/marketing + your online community working with you you have confidence they will sell, and quickly.

*Note: don’t get too giddy once things start selling. Make sure you’re setting aside enough money from this huge flood of sales to reinvest into your business (capital), save for future products/purchases, any employees you may have, and remember you need to be paid a salary, too.

One scary part of a made-to-order workflow for us was the fear that fabric may suddenly become unavailable. What do I do if we sell ten pouches but suddenly I can’t re-order more fabric? That was a risk we had to weigh with every product/fabric combination we created. For you this may look a little differently but it’s definitely something to consider. What is your back-up plan if this happens to you?

What other scary situations could you find yourself in with made-to-order? And the same goes for pre-made. What if you make too much of something, what is your solution then?

 

I’d love to hear your thoughts. What successes have you found from either type of workflow? What struggles are you currently facing, what do you fear? Leave a comment below so we can connect!

 

Comments

  1. 1

    says

    thank you for this!

    i SO,SO wish i could run a premade shop!! since I make bridal bouquets out of fabric flowers, obviously everything is 100 percent custom. However, I am learning to still buy in bulk!

    Anyways – once again, great tips! you should write a book :) i for one would buy it!!

    • 2

      says

      @Emily, even though your shop requires a made-to-order feel you can still buy in bulk like you said — make sure you offer a variety of options for them but do know it’s OK to set limits on what you can offer (unless you are going to charge more). it’s also crucial for your items to be priced accordingly. if that is set up you should have no problem running made-to-order successfully (and with a profit). :)

  2. 4

    says

    WOW, this gave me a lot to think about!! I opened up a handmade shop a couple months ago, so I’m still new at this. right now it’s more of a hobby then a “job,” but I hope to grow it into more of a job in the not-so-far-away future!

    right now I’m selling on a made-to-order basis. I see what you mean about my costs, because I buy my fabric a few yards at a time. I’ve feared exactly what you mentioned, about fabric not being available, on back order, etc. so for now I just make sure to only list however many quantities I could make out of my current stash. that won’t always be practical, though.

    what scares me about pre-made is, what if I make several of something, then it doesn’t sell? didn’t I just waste money? or is that where knowing your shop comes in handy – that after some time, i should have a better idea of what sells and what doesn’t? because even in two months, I can sort of see those trends beginning to take shape!

    I love reading your business tips!!

    • 5

      says

      @stacey [hope: handmade], pre-made comes in handy once you feel like you know your audience + customer base super well. making X items beforehand doesn’t seem like too much of a risk because your quantities are balanced with your audience/customer size. you may have items that stick around for a couple of months, but remember, once they sell there’s only once step to complete: shipping. this will cut down on costs significantly! when you have a pre-made shop your items are also made in the most efficient/cost-effective way possible, also cutting down on costs.

      if you have a little more product leftover than you feel comfortable with you can use that stash for giveaway items (to help advertise your shop) or for donations (also advertising, and tax deductible). xoxo

  3. 6

    says

    Gosh, Maggie…you make this all look so easy. I wish I had your business sense!!!

    Recently I’ve heard {more than once} to pay yourself. In the eight years I’ve been doing this I’ve never paid myself. I mean, I’ve blown money sure. But, I’ve never really given value to my time.

    You’re pretty amazing! Thank you for this post!

    • 7

      says

      @Melissa @jonahbonah, GIRL YOU MUST PAY YOURSELF! go now and re-calculate your costs so you are getting paid. don’t do anything else for your shop until you have this figured out. without paying yourself (not only a salary as the owner, but for your time packaging products, designing new work, the actual production, etc.) you aren’t able to afford employees. maybe that’s not what you envision for your business, but you could change your mind in a couple of months (like i did, years ago when Lisa Leonard challenged me with something similar). set yourself up for success, pay yourself ~ YOU ARE WORTH IT! xoxoxo

  4. 8

    Nicki says

    Great post Maggie! I completely agree with @Emily, you SHOULD write a book! You are full of great information!

  5. 9

    says

    I run a made – to – order handmade business. All of my bags are 100% made to order as they are all personalized with machine applique. I totally related to your post. I do pay more for less…I also carry a pretty hefty turn around time. I have a fabric substitution policy. Meaning…if a certain fabric becomes unavailable, my client is welcome to choose another bag…or I can make a substitution of like color. I’ve never had a problem. Thanks for the post. A lot to absorb!!

  6. 12

    says

    You know what I love about you? {and Lisa Leonard and allora handmade and the pleated poppy} You are {all} willing to help others. It’s evident.

    I’m not sure any of that comes through as it is in my head. LOL

    There are so many makers of wristlets, and wallets, and pouches, and bags {myself included}….yet you’re still willing to help others.

    I love that you recognize there’s enough business for all of us.

    Thank you for helping me. Encouraging me. And being YOU!

    Gussy, you rock!

  7. 14

    Rebecca Smith says

    Excellent post, Maggie. I think this works super well for your biz. Some businesses are based on customization options, however. I do this fairly cheap by buying my fabric in bulk and wholesale. I offer 50 fabrics to choose from, a select style of bags, and a limited number of add-on options. All add-on options use the same zipper color and size (if it’s a pocket), so made-to-order doesn’t always mean increased cost if you plan it right.

    Thanks for the insight on pre-made, though! I’m planning on hiring some women from my community of Detroit to create a new line of pre-made bags, so this was super helpful to read!

    • 15

      says

      @Rebecca Smith, Even with high-customization shop you can run a successful made-to-order business if products are priced accurately — I totally agree! What makes me shrivel up is when handmade businesses aren’t able to make a profit because their financials aren’t set up properly, which often goes back to the type of production workflow they offer.

      Thanks so much for your comment!! :)

  8. 16

    says

    I’ve been debating this very thing. I make custom, personalized dolls to sell from my etsy shop as a hobby, however due to family constraints, the time just isn’t there for me to spend on custom orders right now and my shop is on a permanent vacation. Given that I’ve sold over 100 dolls, I know the most popular choices (hair and eye color) for customization, but that leaves out the aspect of adding a personalized message. Working on the idea of having some premade with an option to add personalization to a premade. But that’s only going to happen if this mama of (almost) five gets her homeschooling routine down and finds a little time in the afternoon/evenings when family responsibilities are completed first ;o) . Appreciated your insight on this topic!!!

    Shameless plug (even though I’m on vacay ;o) ) if you’re interested: http://hiddeninmyheartdolls.blogspot.com/ or http://www.etsy.com/shop/HiddenInMyHeartDolls?ref=em

    • 17

      says

      @kiley, What if you were able to sell a limited number of dolls a month, to keep your creativity flowing, your customers the option to purchase, income flowing? You could do something like Blah Blah Dolls offers, they have select times each month when they accept new orders. Then the shop closes. Could be an option for you, although I totally understand what you’re saying about needing to nail your home routine down first. XO

  9. 18

    says

    If only I could figure out how to make these dresses pre-made. That would be AMAZING to have the work done on the front end. But, that’s also a LOT of money out in the front at 2 yards at least per dress…hmmm….good thoughts to ponder! Thanks for this very informative post!

    xoxoxo

    • 19

      says

      @Annie, First off, making sure your fabric costs are as low as they can be. Is there any prep work you can do beforehand? You can always run a made-to-order shop, just promise me your prices will allow for long-term success :)

  10. 20

    says

    Great post with great timing! I’ve been reconsidering changing my shop from custom to pre-made for a few weeks now. Mainly for time reasons. I have two small kids, a husband, house, etc to take care of and they need me first and foremost.
    I recently semi-closed down the shop just because everything became way too overwhelming.
    I’m so thankful for the success that I’ve had in such a short time but I need to refocus my self and the business.
    Thank you again for the great post!

  11. 21

    says

    Gussy,
    I am so appreciative of your willingness to share your wisdom & to help others.

    lil’ alice is a debt free company too and I am very proud of that. It started out as a hobby so I would save the money from a sale to use on the fabric for the next order. I wasn’t taking from our family savings. Then when I went business in Jan 2012, I had a nice chunk of cash to put in the account.

    My dilemma is tracking my hours. I have a job during the school year, I have kids, I have sports, I have dinner to make & a husband home in the evenings. I have it balanced out where I only sew/work when it convenient for the family/household. So there are times I am sewing for 1hour after the kids go to school but before I go to work. That’s my challenge for the 3rd quarter, track my hours. My husband rides me about this.

    Also, paying myself. I don’t. To be honest, we don’t need the money in our family account. Husband has a job & I have my job outside the home. So I am not relying on the money to pay bills. Any advice to sway me differently?

    Again, this post was wonderful & you did a great job. I just ordered some biz books through amazon. Any biz books you would recommend?

    Thanks.
    Katy

    • 22

      says

      @Katy (lil’ alice), I guess my question is why wouldn’t you pay yourself? Why don’t you think you’re worth it? Especially if it’s taking time away from your family, having a salary could allow your family different benefits because you are working a little bit. Like pay for braces, vacations, paying off debt, etc.

      If there is ever the day you need to hire help, how will your business move forward if you don’t have money to pay them? Not paying yourself most likely means you won’t have money to pay them, too. Why run a business if you’re paying everyone else but yourself. How is that helping your family?

      You know I write all these things in love :)

      As for biz books, I love The Handmade Marketplace + Entreleadership.

  12. 25

    says

    Awesome post, Maggie. Like Melissa there I really wish I had your business sense and the organization and guts to start my own business. I hope to put all your tips to good use one day!

  13. 26

    says

    I’m in the middle right now, so this post was perfectly timed for me :D

    I was doing pre-made, and doing very well with it, but fortunately (I think!!) My demand was more than I anticipated, so I am now making my “premade” items as the orders come in. It’s a good problem to have, so I’ll take it,lol!

    It really is a great feeling when you find what your audience likes, and are able to create and deliver a product that sells. It makes all of those long sweat shop days totally worth it <3

    Thanks for the post! Great info and perspective <3

    • 27

      says

      @Angie @ gathered and sown, If the demand is there, try your best to make more product at one time so you are able to profit more once you’re done. If you are making one item from start to finish, then making another item (even if it’s a totally different item) your labor costs are going to be high.

      And YEOW for knowing what your audience likes. That in itself is nearly priceless :)

  14. 28

    says

    Thanks for all the helpful info / things to think about. I have been on this handmade adventure for over 18 months now, and it took off in a way that I never expected. I CONSTANTLY think about the custom vs. pre-made battle, and just haven’t had the confidence / guts to go pre-made, though I feel like it would be very helpful for me / my business / my family. With a second little one on the way this fall, my time will be even more limited, and I definitely need to get smart about what I’m doing! No big decision is easy, but it’s nice to read about your experience with it!

  15. 29

    Carissa says

    Great post! I’m glad you added how to determine product price. I have been working on setting up an Etsy shop, but have been struggling to figure out how much my products should cost. Thanks so much!

    Oh, and I also think that you should write a book. :)

  16. 30

    says

    GREAT post – as always! After a decade of made to order items being the backbone of my business I have started to make the switch, myself, to pre made – ready to ship. It free’s up so much time, energy and thank God – that huge wait list (lol) I made the switch soley because I wanted to make what I wanted and then be done – the wait list was haunting me in my sleep – constantly looming over me day and night…..but since Ive switched my focused I feel invigorated – and free. I’m much more creative and excited to get into the studio. Revenue is definitly up – so much so that I was able to cut back to part time on the day job a month ago (yay!) You are and will always be a huge inspiration to me – you popped up onto the handmade scene and the world has been a much lovlier place since you’ve arrived! XO

  17. 32

    says

    Ahhh..I second what everyone is saying above–thank you so much for sharing what you have learned over the course of starting your business! I appreciate it greatly and like some of the other commenters, I too am looking at making the switch to more premade vs mto. Cost and time being the two biggest factors.

    I am curious how you go about paying yourself however. Is it a percentage of sales, a set amt weekly, or other? In the past I have made the mistake of buying too many personal items from my business account and losing control. I no longer have business debts and i now have money in the bank and really don’t want to screw up again!

    • 33

      says

      @Lisa Lee, First off no personal purchases should be made from your business account. That’s a big no no! :) For my salary, it’s usually a percentage of what I’ve made in sales. Since every week is different my pay fluctuates accordingly, but I always pay myself including adding money to our savings accounts and employee tax savings, etc.

      It’s all about finding balance and knowing that having sales fluctuate is normal… don’t let that stress you out or discourage you. xo

  18. 34

    says

    Oh.My.Goodness. Maggie – it’s like you read my mind! I have been pondering the made-to-order vs. pre-made decision for months!!

    I do a little mix of both. I do offer a “design your own” feature meaning they can pick out which fabrics they want for a particular item. But I always have that fear of 2 people requesting the same fabric at the same time and running out of it!

    As you had mentioned, the made-to-order and for me the design-your-own was great at the beginning to get a buzz going but I’m beginning to realize it’s not financially successful. And if I’m being totally honest, I would so so rather someone purchased a ready-made item then a design-your-own, partly because I like to do the designing myself! haha! I prefer the pre-made but I’m afraid my customers will miss the design-your-own. My turnaround time is pretty long too and I know that is frustrating when you are excited about your purchase but I can’t figure out how to make it go any faster. Maybe I could offer the design-your-own on a limited basis somehow. Did I mention I’ve never taken a paycheck since I started 4 years ago? Yeah. Somethings gotta change!

    I don’t know – as you can see, it’s been on my mind for a while! If I were transition to pre-made…do you suggest setting a re-launch like you did and closing up shop in the meantime? I’m thinking about doing that in the next few weeks – we’re getting married 9/21/12 so I’m going to close up for a few weeks anyways! EEEK! :)

    Thank you so much for sharing your knowledge and experience!! It is so helpful and so very much appreciated!! :)

    -Michelle

    • 35

      says

      @Michelle @ theLoveMichCollection, OH YOU’RE GIVING ME A HEART ATTACK. Please please please make sure you take time *soon* to make sure you’re able to pay yourself. You are the designer, you most certainly deserve to be paid. Regardless of what you do with the money you make (put it back into the business, move it to your family savings account) ***you have to pay yourself***.

      OK, now that I’ve made my point :) — I would recommend closing shop for a short amount of time to get everything pre-made. Make it fun, have a countdown happening online, email your newsletter subscribers letting them know of the exciting new changes. Share preview photo sneak peeks online. Make it fun and your re-launch day will be even more exciting :)

      PS. congrats on getting married this fall! yeow ♥

      • 36

        says

        @Gussy Sews,
        Thank you SOOO much! :) The first thing I am doing is going over pricing and making sure there is a way to pay myself! I guess for a while I was just happy having enough to keep the business going and feeding my unnecessary fabric buying habit but now it’s time to re-evaluate! Thank you for reminding me I deserve to be paid!!

        Thank you so much for the advice! Those are such great ideas! It is so helpful and your post is awesome too! I took notes! ;)

        xo – Michelle

        p.s. – thank you!! we’re super excited!

  19. 37

    says

    I kinda do a bit of both and right now it seems to be working well and right now I am focusing on having certain items in stock that sell frequently. Because I do personalized items, my work is a lot of custom work, but I have learned to pare down the process by prepping materials then just paint burlap, assemble and ship. I’ve learned to buy in bulk more and this has made a huge difference. I find that if I set aside time to make sure things are properly stocked, then I have more time to spend on promoting my business instead of running around like crazy getting materials when orders start pouring in. I’m still learning (starting my 2nd year) but it’s been a really amazing learning experience. AWESOME blog post. This was great!

  20. 39

    says

    I always admire your way with words, especially when it’s helping the handmade community. I am debt free, too, but mine is kind of on the fence of being pre-made & made to order, since all the runners are cut, stitched & ready, but I just add the embellishments as the orders come in. I tried the ready to ship route, and just couldn’t keep up.

    Thanks for the great advice!

  21. 40

    says

    Thank you for all the helpful tips! Even though I’ve had a shop for almost two years now, I finally feel like I’m getting a groove! I like to pre-made because it helps me stay debt-free and build upon what I have (not buying a bunch of little things that I may not need in the future). For many of my items (such as the love birds), the process is tedious (and messy) so I make a bunch at one time and that saves me A LOT of hassle :) On the other hand, I do like to offer customers an option to customize or recreate an item they see in my shop. At this point, if I have what I need, I work with them. If I have to go and buy a whole bunch of supplies I only need for this one project, I give them more defined options (such as a hoop size or color option I have in stock). One problem I seem to have is learning how much to wittle away for myself? I think I too often put back into the shop or give what I make, but I’d like to put it aside for us. Would you suggest a putting away a percentage or how would you suggest knowing what to pay yourself?

    • 41

      says

      @Nicole J, Depending on your budget // overhead, what kind of ending balance do you have each month? Salary doesn’t need to be a scary word, I told a commenter above it’s just a fancy word to mean you receive fixed regular payments. My experience is to pay yourself a fluctuating rate. When sales are great, you definitely earn more (or put more in savings). When they are low, this has to be altered a bit.

      You should make a set hourly rate, in addition to a salary. If you are doing the making, that is. Otherwise your set hourly rate is going to an employee, but still *you* are making a salary as well. Make sense?

      xoxo

  22. 42

    says

    Girl you should write an ebook!

    As a customer I would have to say I also like premade shops as I know I will get my item sooner. I once ordered from a made to order shop and her success grew bigger than what she was able to manage. Long story short I never got the product I ordered because she was so overwhelmed and ended up having to fight for my money back through paypal. I feel like I can trust a business that I know has in stock what I am buying. Plus like you mentioned, it seems a lot less stressful when you have all product premade. Great tips!

    I do not do handmade but my husband and I do wedding photography and have had to make the same rules when it comes to putting a cost on what our time is worth. In the beginning it feels great to do well because you offer a low cost but I don’t want to be known as the “cheap photographers.” We have had to raise our prices that have lost potential customers away…but there are people out there who are willing to pay more for a good product and you have to make that a priority for yourself!

  23. 43

    Laura says

    This post was JUST what I needed as I have been developing a business plan for the same thing. I was just working on my website last night and deciding on what would be best for me pre-made or made to order. Since I first subscribed to this blog, you have inspired me to take my sewing further, particularly being in the same situation of trying to find work and struggling. Except the big difference being on the other side of the world (Australia). Thank you for the inspiration!

  24. 44

    says

    I’ve had a handmade shop for (nearly) a year and have probably only sold 10-12 items. I don’t know what I’m doing wrong. I have people tell me that my bags are cute and that they love them but they just don’t seem to be selling. Do you think this is a sign that I need to reevaluate my designs? All of my items are pre-made but also (usually) one-of-a-kind. So, there’s usually no turn around time or waiting for orders.

    And pricing is a whole ‘nother thing. I pay myself very little. If I’m completely honest, my items sell at wholesale cost which I don’t like because if I ever want to make my items available in local shops, I’d have to double them for retail and I know they won’t sell at double the price. I’ve done everything I can to get prices as low as possible but I don’t think it’s working out. Is that a sign that maybe I should close up shop for now and revamp? I have high standards for what my products should be and I don’t want to cheapen them because I don’t think they’d sell that way either. Thoughts? :/

    • 45

      says

      @Jill, I think there are a lot of things we could discuss, maybe a mentorship session would be the best fit for that? Things like product (and material) pricing, marketing your products, creating limited edition productions, email marketing campaigns, long term + short term goals. Here are the details, I would really love to chat and know it would bring added value to your business :)

      http://www.gussysews.com/mentorship-program/

  25. 46

    says

    Wow, I really needed this today as I am busting my tail in my own “sweat shop” making some monogrammed chevron pillows. I am making my way to pre-made, and them just adding the initials when people order them. Thanks for all the wise advice!

    Also, wondering how you know how much to pay yourself? Do you do a percentage of sales or profit? I just started my business account in January, and I am having trouble knowing when to transfer money over to our personal account.

    (my daughter’s name is Maggie Claire, I just love thinking that one day she will be an adorable grown up Maggie like you!- cheesy, I know, lol)

    • 47

      says

      @Hilary Surratt, I suggest a percentage of your sales. Remember that when your sales are high so is your pay, when they are low so is your pay. ALSO, any work you do aside from your business profiting is also your pay. Make sure you’re paying yourself hourly if you are doing any of the production, shipping, etc. Making a profit is another factor in the pricing equation… It’s not the same thing as paying yourself hourly :)

  26. 49

    says

    Maggie this message is so timely for me, I struggle so much with these 2 options. I make crochet accessories & custom jewelry in my Etsy shop & the items that I have as a custom or made to order item (like baby cocoons & matching hats) I’ve tried to pre-make them but they’re the items that take the most amount of time & supplies to make & when they don’t sell I feel like its a waste of my effort & supplies. On the other hand when a mom-to-be or photographer needs the cocoon for a newborn photo shoot or just as a gift, they usually ask me if they can get it sooner than the proposed lead time I give them. I so desire that every customer is happy & satisfied with their purchase so I tend to rush through those orders to appease them & it effects the quality of my work…I hate when that happens. Even if I pre-made or only did made to order items, I ALWAYS struggle with time constraints. I work full time outside of the home & am very heavily involved with my church in my spare time (I’m the new Children’s Pastor) so the time I do get to work on shop inventory is pretty minimal; so much so, I feel its really kept me from being able to take off with my teeny tiny business unless I was able to quit my job & devote my time or even part time to my business if my church was able to hire me part time also. Either way (pre-made or made-to-order) I still feel stuck :-(

  27. 51

    Jessica Norris says

    This post has been SO helpful! My husband and I are currently working on setting up our own handmade business – I’ll be doing all the sewing but he’s still my business partner (and CPA actually lol). Anyway, we’ve been trying to figure out the whole pre-made vs. made-to-order ourselves. We’re starting out by selling Kindle/e-reader and iPad covers. I want to eventually branch out to do other technology or organization-related items. We want to run this debt-free, so we’ve decided to start out made-to-order. My problem is, I would love to eventually move to pre-made, I’m just not sure how it would work. There are so many different versions of e-readers and tablets right now, and then they’re always coming out with new ones. Should I only sell the most popular ones pre-made (once I figure out what those are), and allow custom orders for older or less popular devices? I want to reinvest as much as we can to get to pre-made as quickly as possible because it seems like it would be so much more efficient, especially around Christmas time. I know I haven’t officially opened yet, but we’re planning ahead! :)

  28. 52

    Jessica Norris says

    Oh my goodness! I knew you sold totes and pouches, but I was just looking at your shop and didn’t realize that you also sell tech gadget cases. I really wasn’t meaning to be rude or seem like I’m copying! The ones I want to do are a completely different style. Ugh, I feel like I’m digging a hole here lol. Just know that I think you are SUPER talented and the last thing I want to do is just copy that!

  29. 53

    Saira says

    Thanks for the info :). I go back and forth on pre-made and made to order. I’ve tried pre-making items and people always ask if I can pretty please make this bag or this clutch w/this color ruffle or another fabric print. I think part of the problem is that I have made so much custom items that now I’m known for doing made to order. I like to please customers but the one thing about made to order is that the orders aren’t consistant at all. I feel like I will go from no orders to a bunch of orders at one time! Which is great but also hard to keep up with as I am the owner/only one that sews all the products. And then there is also all that running around for supplies, fabric, etc. And I have run into ordering a fabric someone requests and then they cancel their custom order and I’m left with a fabric I probably would have never ordered. Usually I’ll make something out of it and sell but still very dissapointing. I need to have all orders pre-paid too. Those that live in town pay when they pick up an order but again I’ve been burned by having someone change there minds or tell me they can’t afford an item after all. I am considering going back to a 9-5 job later in a few years for a more consistant salary. I need to re-think handmade and maybe go on vacay until I can stock my shop w/pre-made and say this is all I am doing right now. No more custom orders.

  30. 55

    says

    When I first started I had pre-made then I fell into the made-to-order hole. Like you said it was more expensive and time consuming and, at times, nerve wracking. I have gone back to pre-made and I usually can sell the combinations I come up with just fine (I’m no where near being able to do it full-time, but every sale helps my family) . Going pre-made has helped me purchase materials when they are on sale, so my profit can be higher and stress lower. It has helped me with production too, you really do get in a groove when you’re making x amount of the same product. Thanks for all you insight and support for all of us in the handmade world! {{{Hugs}}}

  31. 56

    says

    Hi Maggie!

    Thanks so much for sharing your wealth of knowledge!! I started my handmade business about 1 and a half years ago..about 6 months after I taught myself to sew :) I seemed to struggle with exactly what it is that defines “my” shop from other shops. Always willing to try new things…and thats when I get stuck in the made to order mode. Which I hate…it suddenly feels like homework and isn’t as fun. I always struggle with pricing too. I try to be competetive, but then I feel like I am not really making a profitable business. {So hard!! Kuddos to YOU for working it!!}

    Most of my shop is ready to ship, strictly for the reason of having 3 busy kids, and a full time job as well. So I struggle with the made to order items and turn around time isn’t what I would like.

    I do have a question for you. At what point if you have a made to order item that you really haven’t sold much of and didn’t do as well as you had anticipated, at what point do you decide to retire it?
    And if you do, if you bought a couple of yards of that fabric…what do you do with your fabric? Make a “new” item with it, or retire the fabric as well?

    Also – do you ever do craft shows in Minneapolis?? I’ve love to come see you at one somtime! We are just in Sioux Falls, ans seem to make our way over Minneapolis every 8-10 weeks for our son’s surgeries!

    Love your blog!! Always inspirational! Thank you :)

  32. 57

    says

    I do a mix of both… I’d like to do more pre-made though but am not sure I’ll have the sales to make it worth my time or if I don’t have the sales because of a lack of selection. How do you figure out how much to list when just starting? I’ll be putting made to order on hold in sept/oct anyways due to having a baby but I know my husband and I could really use a bit of income boost so I’d love to try and grow my shop and get some more sales.

  33. 58

    Kayla from Love Sparkle Pretty says

    I enjoy reading your advice on the whole handmade biz world. :) I own a handmade biz and most of my product is geared toward wedding accessories which is hard to make “pre-made” because most brides want to color coordinate or have specific detail that matches their dress, etc. I love creating pieces that can be used on one of the biggest days on someone’s life. I find myself running out of time though between nursing school, baby, husband, and my business. It doesn’t help when some brides put in an order for something that needs to be ready for their wedding that is only a few weeks away. I struggle with if I should charge more because there isn’t a whole lot of time without sacrificing studying and family time…and some “relaxing time” here and there. What should “rush order” charges cost and how soon is considered “rushed” do you think?

  34. 59

    says

    I didn’t start out with a make to order shop in mind, but I listed custom nautical signal flag banners on a whim and they took off more than I ever anticipated, even getting a wholesale order from One Kings Lane. I think my pricing is set at a level to pay myself but still be reasonable to attract sales. The OKL order taught me how to set up my work process for batch sewing and I’ve been able to leverage that for the regular orders. I order materials in bulk where I can and utilize coupons to order fabrics by the bolt.

  35. 61

    says

    Thanks SO MUCH for this wonderful article! This is something I’m trying to balance in my business as well. I’ve considered made-to-order, but while I’ve been trying to figure out my goals for where I want to take Two Bobbins Later I’ve accumulated so much fabric that pre-made just makes more sense right now. (Even though the accessories – zippers, buttons, etc. – add up SO QUICKLY!) Right now my biggest struggle is setting up a REALLY solid foundation for 2BL before our second baby is due so that I can maintain the business while our family gets back on their feet after adjusting to the new baby. I feel progress and I’m working SO hard, it just feels like time is catapulting at me and my to-do list does more growing than shrinking. : / I’m afraid all of this hard work will fizzle even though I LOVE IT soooo much. :(

  36. 62

    says

    maggie thank you for this timely post. my shop has taken off and i am so grateful and excited but it’s so wearying doing made to order (especially as many single orders have been actual orders of 5+). i work full-time and then come home and sew sew sew until late in the night and am just trying to figure everything out and the pre-made/made-to-order thing is HUGE on my mind as I feel like it would free me up to better PLAN out my business. As now, I feel like I scramble to get more materials, to get everything together… i don’t know what i’m asking, as this is a stream of consciousness, but i think i need to look at my prices and my timing. how did you manage working FT and your shop when it was just you in the very beginning?

  37. 63

    says

    I am making items to re-open my shop. I am going to be selling crocheted baby items like pacifier clips and booties. I want it to be completely pre-made because I know especially with things like booties you don’t have 2-3 weeks for someone to make & ship them because the baby might have grown out of them by then. My question is if I want to do premade how many items would you have made before the shop opens? I have probably 5-7 different items that I could make and sell, but I saw on someone’s blog they said you should have 100 items ready to sale before opening. For a mother of a brand new baby, it’s taken me about 2 mnths just to finally decide on what to make and have the time to make it. 100 seems like an overwhelming amount of different items to have to sell. What’s your take on that?

  38. 64

    Nicki Davis says

    I love your blog! I have learned so much from reading your articles. Especially this one. I have the same dilemma… I have an at home business making handbags and accessories. I never know if I should be strictly custom or pre-made. So hard. You have a lot of very good points to ponder. Thank you!!
    Also, where did you get your custom made sign on the wall with all the sewing words/Gussy on it? I would love to have one made for my craft room!!

  39. 65

    says

    Excellent blog here! Also your website loads up very fast!
    What web host are you using? Can I get your affiliate link to your host?
    I wish my web site loaded up as fast as yours lol

  40. 66

    Hollie says

    Hi Gussy,

    I’m wondering if you do your own “Gussy Sews TM” labels or if you contract someone else to do it. What kind of fabric is used to do them?

    Thank you!

  41. 67

    Angie says

    Thank you thank you thank you for this post! I’m reading your Handmade Business in 31 Days, and have been taking notes. I’m learning that I need to really find the value in what i’m creating and to realize that my product is worth pricing well! I’m also learning I need to Focus and get organized, since really i’d like my business to make money and grow into something that will not only satisfy my creative side, but benefit my family.

    I do lots of made to order, I don’t really like to because it’s more expensive, but I need to figure out how to get away from the made to order and get people to buy my pre-made.

  42. 69

    says

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  43. 71

    says

    This plus the 31 days series are getting me more excited about planing my business better. Right now i do made to order products, but recently i’ve been thinking about making a line of products with my own designs, but i’m not too confident about my skills yet.
    How did you became confident about what you do, your skills and your business?

    • 72

      says

      @Nathalie, Receiving feedback is always super helpful, it lets you know what you’re doing well and what you could revise. Once you are confident with your skills and products you’ll have an easier time making bigger business decisions. Keep practicing and sharing your products with others :) And of course make sure you’re pricing your items appropriately so you’re being reimbursed for your time/materials and you can save for future projects, etc. XO

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