Most of us reading EmptyEasel would probably identify ourselves as either hobby artists or professional artists.
Hobby artists create art for the sheer joy of creation. Sales are great, if they happen, but they’re really not THAT important. Professional artists enjoy creating art just as much, but they also have the added goal of making money from their art.
For many of us (hobbyists and professionals alike) the ultimate goal is to become self-supporting. That is, to earn our entire livelihood from art or art-related activities.
If you’re an artist who dreams of becoming self-supporting, and you’re working towards that goal no matter where you are in that journey, then you need one very important tool for your art business that you won’t find in any art or craft store.
You need a business plan.
What is a business plan?
The simple answer is that it’s a written document outlining the current state and goals of a business. Anyone who is in business needs a business plan.
Business plans should be updated annually—usually at the end of the year. It’s natural to look back over the current year to see what worked and what didn’t, which goals were successful and which fell short. It’s also the perfect opportunity to define your goals and plans for the next year.
In short, a business plan will help direct your energies and efforts toward the things that have been working, as well as help you discover and focus on new opportunities.
The 4 parts of a business plan
A good business plan is split into four sections:
• Business details
• Activities details
The introduction is a one-page summary of your business as it stands right now. This section highlights long-term goals and major accomplishments for the previous year and describes in brief how well you met your goals (even those you didn’t complete).
The business details section starts with an in-depth description of financial details. How much did you earn over the past year? How did you earn it? What were your expenses?
You’ll want to break each of these areas down in detail, so, for example, if you had sales of originals and reproductions from a variety of sources (studio, website, gallery, shows, etc) then you would list each item and how much you earned from each.
Don’t skim over this part of your business plan. It can be a lot work, but it provides an annual snapshot of your business so that after a few years, you’ll know exactly how profitable each different part of your business is. This, in turn, will help you decide where you should be marketing your art the most—and maybe highlights some areas you’ll want to drop entirely.
Finish this section by looking forward, instead of back. List any major projects for the coming year, along with how much each project costs and how you plan to pay for it. This entire section (financial and forward-looking) will probably be from 2-5 pages long.
The activities details section describes the actions you took to earn your money. It’s basically an account of how you used your time over the past year. Did you paint or sculpt? How about teaching? Did you attend shows or art festivals or conduct workshops?
Every major activity should be listed and described.
One of the reasons to write or update your business plan is to determine not only how you’re using financial assets, but personal assets, too. If you’re doing so many different things that nothing is getting attention, you may want to consider where and how to cut back.
However, if you’re that one-activity artist, this may also prompt you to think up some ways that you could broaden your business base.
This section will vary in length depending on the number of activities you do. Don’t be surprised if it’s 4-6 pages long.
Lastly, your summary will wrap everything up. Take the time here to briefly list out your primary goals for the new year. Your goals should be things you can do and have control of.
Completing twelve paintings is something you can control. Selling twelve paintings is not completely within your control, so you wouldn’t write that down. Contacting a dozen galleries is within your control. Getting into twelve galleries is not. And so on.
The summary will probably no more than one or two pages long.
But I don’t even have a business yet!
Then this is the perfect time to sit down and work out a business plan! It may not “sound” or “look” exactly like a business plan for an established business, but it’ll still be invaluable.
Your introduction might be only a few paragraphs instead of a page, and that’s OK. Your business activities section might not be very long, either, but you will have something to list there. You might be painting and that’s all. Or you might be in art school. Write those things down. You have to start somewhere!
The parts of the business plan that look forward can still be quite detailed. You have big ideas or you wouldn’t be thinking about going into business as an artist, right? So what are those plans? What have you done to them come true, and what do you still need to do? How much do you think it will cost? Where will the money come from?
Why go to all this trouble?
Because your business plan serves a couple of important purposes.
The primary purpose is to help you develop a vision for your business. You’ll know where you are now, where you want to be in five years, and how you plan to get there. The old adage that says, “if you aim at nothing, you’ll hit it every time,” is absolutely true. Writing a business plan will help you “aim” your business, and make progress year after year.
A secondary purpose of writing a business plan is purely financial. When the time comes to apply for small business loans to expand or enter a new market (or for any other business reason) you will need to write a business plan. The loan officer at the bank will insist upon it, and the more comprehensive your business plan, the better.
If you can provide business plans for past years and demonstrate how your business has grown each year, that’s even better.
Again, you don’t HAVE to already be in business to write a business plan. The best time to write one is as soon as you decide you want to start earning a living from your art. Putting your thoughts down into a business plan will help you find your vision and decide whether or not starting a studio business is for you.
But even if you’ve been in business for 20 years and haven’t written a business plan, it’s never too late to begin. The important thing is that you write one—because once you do, I guarantee you’ll see your 20-year old business in an entirely new way.
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