Many prospective business owners might start by coming up with a business name or jumping ahead and creating a website, but there are other important steps that you need to take to make a proper business plan.
In this guide, we’ll give a quick introduction to:
- Setting up your company
- Analyzing your market
- Creating a marketing plan
- Figuring out your operations and logistics
- Making a financial plan
- Building your website
Over the coming months, we will be writing more specific guides on each one of these topics, you can sign up for our newsletter with the form on this page to get notified when they are posted.
Setting up your company
The first step is to decide how you will be structuring your new company. Many people choose to start out on their own and then hire employees as the operation grows. This is the best strategy for retaining complete control, but you can also partner up with someone close to you who shares an interest in opening a crystal business. If you are going to go into business with another person, it is very important that you clearly define how the business will be split between the parties.
Now is the time for you to register your business with the appropriate governments. Although this process may be daunting, it will only take you a couple of hours to fill out the forms. In Canada, it will be best for you to register with your provincial government. Registering your crystal business also won’t cost you very much, creating a corporation costs less than $400. You can save some money here by registering your new company as a sole proprietorship or partnership, but this means that you and any partners are liable. On the other hand, a registered corporation protects the owner from any liability.
Analyzing your market
Before launching your business, it's important to conduct market research to identify your target audience and competitors. This will help you determine the demand for your products and set competitive prices. In-depth market research is time-consuming and costly, so it will most likely fall outside the scope of your business as you are starting up. Since your business will be online, you won’t need to focus on one region, but rather on how you can reach your target audience in many different regions.
One way to do this is by creating one or more customer profiles. As an example, let’s create a customer profile named Olivia. Olivia is a middle aged woman living in a middle class area and she recently started getting into health and wellness. She tries to eat organic food and takes workout classes like Yoga and Pilates. When you start creating your advertising campaigns, you can think of specific ways that you can target Olivia, like partnering with fitness influencers and running targeted ads on Facebook and Instagram. By analyzing your market and breaking it down into 2-4 different customer personas, you will be able to organize and focus your marketing efforts instead of just paying for social media ads and hoping for the best.
Creating a marketing plan
To create your marketing plan, you can use the "4 P's" approach where you break up your plan into product, place, price and promotion.
Product
Now that you know your competition and your customers, you can plan out your marketing strategy. Keep in mind that this is merely a compass for your marketing efforts, and the details will morph over time as you figure out what works best for your crystal store. The first decision you will make is the products that you are going to sell. When it comes to starting your crystal store, you can decide whether you will focus on expensive, high-end crystal or on less expensive, bulk crystals. Most sellers will choose to sell a mix of qualities and prices, but keep in mind that these items require different strategies. Cheaper crystals can be sold in bulk, with one listing representing a lot of your inventory. More expensive crystals are best to be sold with individual listings for each mineral, so that your customers can see the exact item that they are purchasing.
Place
The next decision will be where you sell your product. Etsy is a viable option for a lot of stores as the marketplace has millions of shoppers visit the website each month. The downside to using a marketplace like this is that they take a higher cut of your sales, and your products are shown in direct competition with other stores. This might make it easier to compete, but starting up can be slow as you build up sales and customer reviews.
Another option is to sell on live streams on Instagram or Facebook. Running live sales will put you in front of your social media followers and allow you to show off your products on video, in real time. Live sales also create an excitement level as customers race to claim the items that you are showing, driving sales up. Lastly, you will be able to create relationships with your customers as you talk to them directly and interact with them in the live chat.
The final option is to have your own online store. The website that you are on right now was built in Shopify, our preferred e-commerce platform. I recommend taking a look at different platforms and setting up sales calls with different companies so that you can learn more about each software and figure out which one is best for you. It’s important to not simply go with the cheapest option out there as you often get what you pay for. Further, more expensive platforms are often already equipped with tools that you would otherwise need to add to your store, and pay extra for, as you grow. For example, Shopify has email marketing, shipping tools, and analytics already built in, so you won’t have to worry about paying for additional software.
Price
Your pricing strategy is crucial to your success as you open your crystal store. Undercutting your competition may seem like the way to go, but this will only mean that your profit margins are smaller and it may cause a price war. You want your pricing to be competitive while still leaving room for profit. When calculating your margins, it is important to take all costs into account, including shipping, packing materials, rent, labour, and the cost of the items. Be as thorough as possible when doing these calculations, underestimating your costs can mean that you won’t make money at the end of the month.
Promotion
To market the crystal store you just started, you will need a mix of earned, owned and paid media. Earned media includes reviews, comments and articles that are written about you. The best ways to earn media is to interact with your customers and to ask them to review your store and products.
Owned media is any pictures, videos or blogs that you post. By varying the type of media you create and tailoring them to the different types of social media, you will be able to reach new audiences and keep your company in front of your customers.
Paid media is any sort of advertising that you pay for. Social media influencers will post about your product in exchange for money or for free products. By partnering with them, you can harness their followers directly. Another way to pay for advertising is through social media and search ads. Platforms like Google and Facebook have great tools to create advertisements. When setting up your campaign, you will be able to choose your audience, your budget, your ad, and the length of time that the campaign will last.
Figuring Out your Logistics and Operations
The first step in figuring out your logistics is selecting where your business will be based. Many crystal entrepreneurs start out of their homes to avoid paying rent for a dedicated business space. Set up your space in a way that will make your inventory easy to find. In our own shipping area, we organize each shelf by category of item. These categories include raw crystals, polished crystals, accessories and so on. By taking the time to organize your space before you launch, you are going to save yourself a lot of time when it comes to packing orders.
Next, you will need to figure out how you are going to ship your crystals. Out of the major shipping companies in Canada, Canada Post has the cheapest prices for deliveries to residential addresses. However, there may be other solutions in your area that you can look into like ChitChats. Take the time to research alternatives in your region, you may be able to save a few dollars on each package.
You will also need to figure out what kind of packing materials you’ll use. Here is a list of some of the basics that you’ll need to get started:
- Boxes of various sizes
- Clear tape
- Kraft tape dispenser with kraft tape to close boxes
- Bubble wrap
- Starch packing peanuts
Making a Financial Plan
Budgeting and funding your business may seem like a daunting task, but taking the time to lay out a roadmap will save you future headache. You can start by calculating your costs, including cost of your products, rent, packing materials, utilities, and software. Understanding your costs is crucial to figuring out your pricing strategy and ensuring that you are actually turning a profit on your sales.
Calculating these costs will also help you figure out how much startup capital you need. Generally, you would like to have a few months worth of cash in reserve, that way you will have the time to build your sales numbers. Many entrepreneurs get loans to help them start their business. Some options for raising money are asking family, taking out lines of credit and getting business investments.
Building your website
Having your own online crystal store will both legitimize your business and allow you to own your sales channel. We recommend using a service like Shopify to build your online store. You will be able to choose your design from a variety of different templates, which you can then customize to your liking. You’ll then be able to update your website with new stock whenever you like with ease.
If you decide to go with a platform like Shopify, you will have access to a ton of resources, including their guides and forums. You're still going to need to make a lot of decisions when you're setting up your website however, including fonts, colors, menu layout and many more. The good news is that there are tools out there that can help you create color palettes and font pairings.
Splitting up your products into different categories will allow you to create different collections on your online crystal store, making it much easier for visitors to navigate. You want to create as little friction on your website as possible, so that people can easily find what they're looking for.
Product photography is a crucial part of your website. Experimenting with different backgrounds and lighting will let you find your own style and help you stand out from the competition. Here are a few style choices that you can make:
- Holding the crystal in your hand or having it lay flat on the background
- Shooting on a white background or in front of plants, flowers, etc.
- Using natural light or artificial light
- Taking photos with your phone or with a camera
You're now ready to take the first steps in building your own online crystal store! If you have any questions feel free to reach out to us at contact@gneissguy.ca. We will be writing more in-depth guides in the future on each of these topics, so sign up for our newsletter to get notified.