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| No doubt about it! There is a dramatic increase in home-based
businesses over the last decade! Why? Self-Independence? High cost of daycare?
Or, maybe we just want to truly be in charge of the direction of our lives.
Many people are trading in their corporate hats and venturing into the small home based
business world. |
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SBtrends2000.com reports "...currently about 50% of the 10 million
(primarily) self-employed are home-based; thus, there are already about 5 million home
based businesses...Home-based businesses will continue to increase...Much of the increase,
however, may be "secondary self-employment businesses rather than home-based
businesses relied upon for primary income..."
Jennifer Powell, owner of Punkin's Gift Baskets and Boxes, is no stranger to working at
home. She telecommuted for a NJ company as a government mortgage processor.
How did she end up starting her present business?
"...My partner moved his business here, from NJ & took a building with extra
space & asked me if I wanted to use the space for a business. So, I opened a gift shop
business in the fall of '99. I also started an online gift store at the same time. I don't
really know how it happened. I just kind of fell into it (mistake #1).
When interest rates were on the rise in mid-99 I was laid off, within two months of
moving. My income was immediately reduced by two-thirds. Mortgage processors in my area
make only 25 to 35% of what I earned. So I decided to take my chances & threw myself
into the gift business full-time. The name of the business is Punkin's Gift Baskets &
Boxes. (Punkin is my nickname.)"
Why a gift basket business?
"I have always liked coming up with "the right gift". Christmas is my
favorite time of year & I'm the one, of 4 sisters, who can really wrap a gift. I like
the creativity of it, combining ribbon & paper; patterns & color. I offered free
gift-wrapping in the gift shop, year-round just because I like to wrap gifts. The gift
baskets kind of grew out of that. For example: you have a friend
who likes teddy bears. So you look for a teddy bear address book & maybe a pen. I just
took that a step further & combined an address book, blank journal, pen note cards
& coordinating envelopes and a porcelain hinged box all in a teddy bear motif &
pre-wrapped it. I thought, "Hey, this is fun! I'll be up & going in no
time."
Facing challenges and obstacles in the beginning, Jennifer tells us:
"It was a "learn as you go" situation. I didn't have the time to do proper
research on the demographics of the area or the industry in general (mistake #2).
I no longer had the income to fund this adventure so each mistake, they are unavoidable,
was costly. I didn't know how to price a basket, didn't know what made them stay together,
how to shrink wrap, etc." Researching a small business idea is essential!
"The most important thing anyone who wants to start a gift basket business can do is
RESEARCH! Learn everything you can (while you still have another job). Go into stores
& look at their gift baskets not only the price & products but also the mechanics
of it. Use the web to see what's out there. Learn to make a hand-tied bow. Go to the
Library & check out books or industry periodicals.
The biggest obstacle in any gift business is competition. There are tons of places to
buy gifts: card & gift stores, online shopping, chain stores, drugstores, etc. You
need to set yourself apart somehow. Whether it is hand delivery to the local hospitals or
some specialty item or niche product. People need a reason not to just go to Wal-Mart
& get a gift."
A niche like Jennifer's "house" boxes! Realtors purchase these to give to their
clients for housewarming or thank you gifts. How did she find this market for her
business?
"The idea for the "house" boxes for Realtors came from a real estate
industry magazine article that mentioned "closing gifts." My mother has been in
real estate all my life & I asked her about it & she said that it was a fairly new
practice. I made up a few different designs & printed a brochure that I left in her
office. I received a few orders & some feedback on the designs, made some changes
& now I have a few boxes on display in her office and a link on her website."
Can you start a GB business for under $100?
"I don't think so. With a well thought out plan you could probably start out for
under $250. A quality heat gun, roll of shrink wrap, 2 rolls of wired ribbon, heavy duty
tape & a turntable are going to use up your first $100."
How do you determine the price of your baskets?
"There are different methods of pricing. Some use a mark-up percentage of the
combined cost of the basket, products & filler. Others add a flat fee for the labor to
construct the basket. I use a hybrid system depending on the client & the gift."
It takes more than a delightful product to increase and maintain sales. You must make it
convenient for people to order. Jennifer has online ordering available at
http://hometown.aol.com/punkinpro1 and www.punkinproducts.com. She accepts payment by credit cards and
PayPal. You can request a free catalog or order one of her baskets by calling her toll
free number: 1-877-483-2757 or order by fax: 1-570-226-5642. Jennifer's customers
presently include Insurance agents, Realtors, small corporations & Non-profit groups
as well as individuals.
What's the future look like for Punkin's Gift Baskets and Boxes?
"We decided to close the actual gift store, hence all the remodeling going on at my
house. It was just not profitable & took all the fun out of making the baskets. I'm
strictly referral & online business now. I do some online advertising, mostly banner
exchanges. I will be looking into more of it now that the store is closed. I'm also
looking into setting up a complete online storefront. That does require an initial
investment though, so it may have to wait a month or so."
Advice to anyone who starts a GB biz:
- Don't be shy (I am, very) Tell everyone who will listen to you about your new venture.
Don't bore them to tears with the details; keep it short & to the point. Your answer
to "Hi, how are you?" is not "Fine, how are you?" it's "I started
my own gift basket business, here's my card. If you need anything, call me!" If they
want to know more they'll ask.
- Think of the gifts in terms of what you would like to receive. What would you rather
have a large extravagant basket with only a few products in it or an inexpensive basket
overflowing with beautiful products?
Where to start:
- Festivities Publications, Inc ( www.festivities-pub.com
) publishers of Gift Basket Review Magazine & other books & videos about the
industry.
- Nowco Inc ( www.nowco.com ) they
carry all manner of supplies, baskets, boxes, heat guns & how-to videos.
- Search Gift Baskets ( www.searchgiftbaskets.com
) a site for shopping for gift baskets made up of 300 members from all over the US, Canada
& other countries, there are links to information about new business start-up. The
site received over 90,000 hits in August 2001.
- Your state Tax Division. Many wholesalers will not even send you a catalog unless you
provide them with a resale or tax exempt #."
A little creativity and a lot of hard work greatly increase the success of your home
business. Learning by making mistakes can help you make your business grow. Start slow and
invest your time into research. The more you know beforehand, the better equipped you will
be when facing your own challenges and obstacles.
ABOUT THE AUTHOR:
JoAnna Gilford manages Real Jobs Online, and is committed to real
telecommuting employment and education. Author of "Work at Home
Workshop: The Truth About Telecommuting" and editor of RJO's daily,
free newsletter: "Telecommuting Job of the Day".
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| Real-world, common sense strategies
for small and home based business success. Your issues... real answers. |
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