Business Planning for Artists: Setting Goals, Objectives, and Budgets, Slides of Business

Download Business Planning for Artists: Setting Goals, Objectives, and Budgets and more Slides Business in PDF only on Docsity! “DOUGHERTYARTSCENTER Professional Development Workshops A May 4, 2021 6:30-8pm Il Ee WHY DO I NEED A BUSINESS PLAN… I’M AN ARTIST? • Until it's written down, it's just a dream • Give yourself direction with a plan and goals • Find out realistically how much money you need to make and how you will make it • Determine your audience and how to market to them • Use it to apply to grants, loans, etc. A WELL-PREPARED BUSINESS PLAN DOES SEVERAL CRITICAL THINGS FOR YOU: • It helps determine the feasibility of your business idea • It identifies many key decisions you will have to make • It helps you identify, connect, and organize critical information • It helps you make informed decisions SOURCE: Springboard for the Arts, Art Workbook BUSINESS GOALS & OBJECTIVES FIRST, DETERMINE YOUR GOALS What are your goals for your art (and thus your business)? • Your art: What do you want to make? • Your markets: Are you trying to get your work in a gallery, multiple galleries, sell it yourself? • Your financial situation: How much money are you trying to make? • Your facilities: Do you want to open up your own studio or gallery? TIMELINE Take all of your objectives and lay them out on a timeline. Make sure your timeline is realistic and that you'll be able to accomplish your goals. Adjust as needed. Example: If you want enough money to get your studio/storefront by the end of the second year, how many paintings will you need to be selling by then to afford it? Is that a reasonable and attainable objective? You'll need to revisit your goals and objectives often to keep yourself on track, or adjust so that you don't become frustrated and give up. BUDGETING FIRST, FIGURE OUT YOUR EXPENSES What are your monthly expenses? Are you trying to cover both your business and personal expenses from your art? Personal Expenses Business Expenses • Materials • Marketing • Fees (listing, processing, application, booth, gallery) • Rent? • Employees? • Insurance? EXAMPLE: As a ceramic artist, your break-even point is $1000 per month for your business expenses (studio rent + materials + marketing + fees, etc.) You sell a mug for $50, so to reach the break-even point you would have to sell 200 mugs …or 100 mugs and do 10 private lessons at $100 each …or 100 mugs at $50 and 4 vases at $150 and 4 private lessons at $100 WHAT ABOUT YOUR PERSONAL EXPENSES? How much more do you need to pay yourself each month to cover your personal expenses? Add that to your break-even point and figure out how many more units you need to sell. Did you include adding to your savings or a retirement plan in that? HOW MUCH DO I NEED TO MAKE FOR TAXES? Know what you need for your Net Yearly Income (NYI) This is what you need to pay your expenses after paying taxes. Find your Gross Yearly Income (GYI) This is what you'll need to bring in before paying taxes in order to have enough net yearly income. Example: Let’s say you know you have to pay 30% of your income to taxes. You'll multiply what you need (NYI) by 1.3, and you'll get your gross yearly income (GYI). So if you need to make $50,000 to cover your personal and business expenses, you'll need to bring in $65,000 through sales/services to cover everything. ($50,000 x 1.3 = $65,000) THE PRODUCT/SERVICE TREE A tool for working through how your creative output might generate income and who will consume it. Trunk = your art in a broad sense (ex. - pottery) Branches = income ideas (ex. - galleries, markets, classes/lessons, etc.) Leaves = who will be your clients/consumers? DETERMINING & EXPANDING YOUR AUDIENCE FIRST, DEFINE YOUR PRODUCT Is it a good (painting, jewelry, performance, clothing, etc.)? Or, is it a service (workshop, class, lesson, fabrication, etc.)? Are you selling a solution or an experience? ON THE TOPIC OF “EXPOSURE”… "Exposure" can be a tough topic, as it's up to you how much you want to put into it for what you get out. • company using your art or asking you to perform for free • paying for an online advertisement or boost • a gallery taking a percentage of your sales • Etc. You have to determine what your effort is worth in exchange for the "exposure". RETAINING YOUR CUSTOMERS Keep track of your customers and keep them informed. Is it easy for them to find you and purchase your work? Create a plan for staying in touch with established customers. • Post regularly on social media. • Build a mailing list and send updates on offerings, events, and sales (don’t spam). WRITING & USING YOUR BUSINESS PLAN BUSINESS PLAN CONTENTS: • Cover Page with your business name and contact information • Table of Contents for quick reference to topics in your plan • Executive Summary with a quick summary of your plan including goals, objectives, and monetary amount if applying for a loan or grant • Company Description with a brief history and future plans and goals BUSINESS PLAN CONTENTS: • Industry Analysis: is it growing/changing, size of market • Products & Services: your products and their prices and your distribution channels • Market Analysis: who are your customers and why would they buy your product, how are you going to reach them, who is your competition and why will your customers come to you? • Management & Organization: who is managing the business and what experience do they have? Also list any important advisors (lawyer, accountant, insurance agent, etc.) BUSINESS PLAN CONTENTS: • Operational Plan: how will you produce and deliver your products or services, how will you sell it, will you have employees, equipment and suppliers, and an exit strategy for if the business doesn't succeed. • Financial Plan & Projections: numbers that correspond to the plan including start-up expenses, financial history (if existing), profit and loss projection, and projected balance sheet. • Financing Proposal: How do you plan to obtain the amount required for your plan (loan, existing funds, collateral, owner contribution)? • Supporting Documents: owner/management résumés, letters of reference, leases, permits, licenses, other legal documents CAN YOU DO IT? OF COURSE YOU CAN! When you're finished, your plan should clearly identify the goals and expectations you have for your art, which is your business. Review your plan regularly to keep yourself on track to meeting your goals, or to make adjustments as plans and strategies change. YOU CAN DO IT! (BECAUSE YOU MADE A PLAN) Check out other Artist Professional Development workshop topics on the Artist Resource Center webpage. WWW.AUSTINTEXAS.GOV/ARTISTRESOURCECENTER THANK YOU!