Placing Proper Value on Your Stamping Business –
by John Sanpietro, Certified Professional Development Coach
My clients have a sadistic side. They know there are certain things I'm going to come down hard on them for doing. I'm happy to say that, for the most part, the people I work with usually avoid doing any of them.
However, there are many examples of these bad business practices out there for all the world to see. They're posted on blogs, forums and, sometimes, are even presented at meetings and events. My clients love sending these examples to me because they know I just get a headache when I read them. We even have a name for them – "Monday Morning Migraines."
For the last two months or so, I've been reading the posts on SUDSOL. Sometimes, I respond. Most times, I don't. I've been looking for topics to write about, and trends to address.
I actually had several ideas for this month's article, but then I would read another thread or someone would send me another "Monday Morning Migraine' and I'd come back to the topic I've chosen for this month – Placing Proper Value On Your Stamping Business.
I'm convinced that most of the challenges you've been writing about since I've been here have their roots in one core issue – the fact that many of you find it very difficult to fully see and treat yourselves like business owners – and treat SU like a real business.
Whether you realized or not when you signed the paperwork, you were buying yourselves a stamping BUSINESS. It may not have been presented to you that way, but that's how SU sees you, that's how the government sees you, that's how I see you – and that's how you should see yourselves!
Now, you can say "this is my business, and I can run it the way I want to.' And that's true. However, I do believe many of the struggles you've been writing about lately can be minimized or eliminated by seeing yourselves as owners of a viable and legitimate business and treating it the same way any business owner would treat any other business. That means placing the proper value on various aspects of your business.
Here are some examples:
PLACE PROPER VALUE ON YOUR TIME!
Too many Demos undervalue their most important commodity- time! Think about it- time is the only thing you have a finite amount of. And nothing you can do will get you a 25th hour or an 8th day. If you're not being adequately compensated for your time, then you're going to be very hard-pressed to succeed in the long-run. How much value should you place on your time? Well, at the very least, you should get paid as much for the time you put into your stamping business as you would if you went out and got a regular job. So, at least $10/hr to start- but I'd be looking for a raise real soon!
PLACE PROPER VALUE ON YOUR SERVICES AND EVENTS
This is one of the places where too many demos are giving it away. I can't tell you how many times I hear, "well, as long as they're buying product – Wrong! Their buying product does NOT compensate you for your time and expertise. When a customer spends money on product, it's not the same as spending money on YOU. Sales does not necessarily equal profit. Again, you have to see yourself as a business owner and make sure you're getting paid like one. Make sure you're getting paid at least $10/hr for your events. More if the price you would need to charge to achieve /that hourly rate doesn't meet the market value of what you're doing.
PLACE PROPER VALUE ON YOUR PRODUCT
In a nutshell, stop discounting! If the company wants to have a special and they want to pick up the tab, great! But when you continually discount or give away your product, you hurt the inherent value of the product in your customers' eyes AND you dramatically cut into your profit margins. Remember, a 10% discount on the retail price on a catalog product equals approximately a 30% reduction in your profit! Also, by always being the bargain, you attract bargain hunters. People who's priority is getting the sale, rather than spending for quality. It's very difficult to sustain a business in this industry built on bargains. If you don't believe me, just look at Recollections. Oh wait – you can't – they're going out of business!
PLACING PROPER VALUE ON THE BUSINESS OPPORTUNITY
Again, too many people giving it away, deeply discounting it, or selling it likes it's a big box of product! Doing any of these things dramatically devalues the business opportunity in the eyes of your prospects and the general public. In the short-term, you're signing up a couple of new recruits, but your hurting yourself, your fellow Demos and the Company as a whole in the long-run. Besides, why should you discount the Starter Kit? Isn't $200 or so a fantastic price to start a business? Isn't $200 or so a fantastic price for what's in the kit already? And who do you really attract by discounting the kit? People who are looking for a bargain- not a business. If you don't believe me, look at the number of demos who drop in the first qualifying quarter after SU does a recruiting special.
I know its not easy to do many of the things I'm talking about. I know some of them require changing the way your customers see you, but I also know that it's a change that has to be made.
Undervaluing all of the above aspects of your business makes your business more difficult and less fun to run. And that makes it less likely that you're going to be around five or ten years from now.
In other words, although making these adjustments can be difficult, the business you save can be your own.
Certified Professional Development Coach
Stamping Is My Business!