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Know Your Break-Even Point

break-even point

Knowing your break-even point helps you to plan for the long-term. Plus, the more data you have, the better you can run your business. Check out the below to find out just how much it costs for you to keep your doors open.

Determining your break-even point

A break-even point tells how many sales you need to cover expenses (or where it breaks even for a given period). By knowing your break-even point, you can determine how viable your quilt shop is, and if it’s getting weaker or stronger.

The equation for calculating your break-even point (or really when your revenue equals $0 profit) is:

  • Revenue = Cost of inventory (goods) sold + Other expenses + Profit
  • For the equation:
    • Revenue = Sale price per unit x Number of units sold.
    • Cost of inventory (goods) sold = Cost of inventory per unit x Number of units sold (keywords are inventory and sold. Not what’s sitting on your shelves).
    • Other expenses = Sum of all non-variable expenses (or rent, utilities, payroll, insurance, taxes, etc.)

For break-even purposes, profit is $0. If you want a margin of safety, simply chose the number you want as a net and plug that into the equation.

Determining daily business costs

Once you figure out what your break-even point is, you can determine how much it costs to operate per day.

Most quilt shops separate this into two categories: fixed expenses per day and variable expenses per day. Some of these expenses include payroll, rent, utilities, and more. Knowing all of these equations will help you make smarter buying and selling decisions.

Inspiration for this post came from “Know Your Break-Even Point” by Jacob Curtis published in the June 2021 issue of American Quilt Retailer.


If you’re looking for more information to guide you in owning a retail business, subscribe to American Quilt Retailer today. Already a subscriber? No worries—join our Facebook group for insights and dialogue from industry specialists like you. And don’t forget, you can always purchase single issues if you prefer that instead.

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Developing New Contacts

New contacts

Has your email list remained stagnant? Check out these tips to increase your customer contacts.

Define your market

The first step to increasing your contacts is to define who you’re going after. This will not only save you time while you do outreach, but also help determine what channels you use for messaging, and what sort of content to include in your pitch.

Build your contacts list

The first step to building your contact list is easy; start with who you know! Ask for referrals and offer discounts to new clients.

Networking is also a great way to expand your customer base. Networking is difficult, but you’ll find that when you put yourself out there, people are willing to help. Attend webinars, trade shows, or join a local business organization.

Finally, pick up your website and social media game. This is where defining your market will help your outreach the most. Have a lead? Go to their website and search for emails. Want to find leads? Go to a search engine and see if you can pay for data that will provide those emails for you (and save you time as well).

Follow up

Continuing on with online outreach, follow up once, then follow up again. Include enticing calls to action or create scarcity but letting them know that time or space is running out.

This is where a CRM (customer relationship manager) really comes in handy. A CRM is a software solutions that helps to track your contact activity. Not only will you be able to track who’ve you’ve contacted, but you’ll be able to identify priority leads as well.


If you’re looking for more information to guide you in owning a retail business, subscribe to American Quilt Retailer today. Already a subscriber? No worries—join our Facebook group for insights and dialogue from industry specialists like you.

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Evaluating Bookkeeping Tools

Small Business Bookkeeping Tools

Automating your bookkeeping processes is one of the smartest moves your business can make. Check out these tips as you begin your research to find the best tool for you.

What are you looking for?

The suite of bookkeeping solutions is lengthy, so before you begin your research, identify your highest priority needs. Some platforms allow you to track inventory, others sales tax, and others receipts.

As you begin your research, determine your budget. Also determine your highest priority needs. Don’t look at solutions that aren’t within 25 percent of your budget, or solutions that don’t cross off your must-have checklist.

Ask the right questions

If you’re thrown into a sales process to determine the best solution for your needs, don’t be blinded by their bells and whistles. Ask these questions to make sure you’re getting the best solution for your business.

  • How secure is your API?
  • How do you back up your data?
  • Are there any other costs to this platform?
  • How quickly do you respond to questions?
  • What pain points do similar clients experience?

And remember, you want a solution that’s going to grow with your business. Once you go through this process, make sure you do it right.

Inspiration from this post came from Hubspot.


If you’re looking for more information to guide you in owning a retail business, subscribe to American Quilt Retailer today. Already a subscriber? No worries—join our Facebook group for insights and dialogue from industry specialists like you.

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Cybersecurity

Cybersecurity

With more time spent online, cybersecurity practices are more critical than ever. Check out this list to make sure you’ve got your business is safe.

Passwords

Train your employees to use strong passwords and require them to change their passwords every three months. Better yet, implement multi-factor authentification, or check with your bank and other vendors to see if they offer that option.

If employees use a shared laptop, create different accounts for each employee and encourage each employee to protect their account with a strong password.

Finally, make sure your business is using a secure, encrypted, and hidden WiFi network. Set up your wireless router so it does not broadcast the WiFi name and make it password protected too.

Cybersecurity

Installing a firewall on each of your computers is essential, and there are free versions online too. If employees work from home, make sure they have a firewall installed on their home computers as well.

Back up your data as frequently as possible. Per the FCC, critical data includes word processing documents, electronic spreadsheets, databases, financial files, human resources files, and accounts receivable/payable files.

Lastly, limit employee access to this data. Employees should only be given access to systems they need for their jobs, and shouldn’t be allowed to download additional software.

Hardware

Update your systems regularly and run antivirus software after each update. Also make sure you use a different computer to process payments than you use to browse the internet.

Nobody wants to be in a position where they have to pay someone because of a lack of online security. Start with these practices to protect your business from cyber attacks.


If you’re looking for more information to guide you in owning a retail business, subscribe to American Quilt Retailer today. Already a subscriber? No worries—join our Facebook group for insights and dialogue from industry specialists like you.

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Tips for Going Live on Facebook

Facebook live

If you’re like most of the world, you’ve received notifications from Facebook alerting you that one of your friends or the pages you follow are going live. Jump in on the action with these tips.

Promoting your Facebook live

Video is becoming more popular, and live videos get 3 times more interaction than other videos on social media. Promote your Facebook live event before it takes place, and post about it across all social media channels.

When you chose a date and time for your event keep in mind what works best for your followers. Looking at previous engagement data should help you make this decision.

Try a test run

Test run your Facebook live event before the scheduled date and time so you can avoid formatting problems. Try to get this right as watchers will stay on the video three times as long as they would other videos (nobody wants watchers to leave for silly reasons, such as shaky video).

Some things to consider include: lighting, production quality (will you be shooting in your store? Or in front of a blank wall to minimize distractions?), and whether or not you should shoot vertically or horizontally (vertical shooting can sometimes make you look too close to the camera).

Interact with your followers

Remember, Facebook live is to engage with your audience. This means you should be adding context constantly throughout your video so any new followers who jump on know what you’re speaking about.

Interact with followers by addressing their comments as they appear. This will make your stream feel like a two-way conversation, which may explain why live videos drive ten times the amount of comments compared to other videos.

Wrapping up the event

After the event is over, check your data. How are the results compared to other posts? Take the time to respond to any comments you may have missed, and encourage people to continue to comment if they’re catching the video after the event is over.

Interested in learning more? Use this checklist to help you get started with your first Facebook live.


If you’re looking for more information to guide you in owning a retail business, subscribe to American Quilt Retailer today. Already a subscriber? No worries—join our Facebook group for insights and dialogue from industry specialists like you.