So for those of you who follow me on Instagram, you’ve seen that I took the leap and bought a booth at Wimberley Market Days for the 2013 season! My lucky number is 392, and if you’re local, you need to stop by and say hi!
Since a lot of you were interested in the process the last time around, I’m going to do a little more “shop talk” today. I met with SCORE Austin (a non-profit for small businesses) to hash out my business plan. It was okay, but I wouldn’t recommend driving there unless you live nearby. I didn’t really get much useful advice. I did decide to start out as a sole-proprietor, which means reporting my business taxes along with my personal taxes. Why? Because my booth cost more than I expected.
When we sold our home last October, we got a sizable refund check for our windstorm insurance. It’s crazy-expensive insurance when you live in hurricane alley. I used the funds from the check to pay for the $1000 booth. The booth costs included the dues for the year ($520 I think?) and the price of the structure, which is two wooden platforms. I actually really like the setup. It’s interesting. Plus the deck is much easier to level than rocks and dirt. People weren’t too keen on wobbly furniture, even if it was sitting on pitted ground. Anyway, I had hoped to just get a dirt lot and not pay for a structure and use the remainder to file for an LLC. But now I’ll have to wait to turn a bit of profits and file a month or so down the road.
So, why an LLC? For a lot of people, sole proprietorship is enough. It was fine when I did graphic design, an intangible product. But if someone gets injured on my furniture, they could sue me for everything, including personal assets. My car, house, savings, all of it could be lost. So to me, it’s worth the $400ish to file and separate my business from my personal assets.
As of now, I have a sales tax permit for the state (it was free to file) so I can operate my booth. Once I get things in order I’ll file my LLC, business name, tax ID and open a business account for easier bookkeeping. I’ve also been building up some inventory for my first market day on March 2.
My last tidbit to share? A revamped pricing formula! As I now have overhead expenses (booth cost, filing, bookkeeping, etc) I needed change a few things up. Now my method of pricing furniture is a minimum of this formula:
Cost of Materials + (Hours worked x $20/hr) + (subtotal x 30%) = Minimum Price. If that price seems a tad low, I’ll pad it just a little bit. Since it’s a flea market, there’s a lot of haggling. I don’t want to go below my minimum, as that covers my expenses. The goal here is to not lose money my first year. So I’ll tack on a bit, and if I get it, awesome! If I don’t, then I’ll haggle until I hit the minimum. I’ll pass if they try to go lower. The good thing is that since I used a rebate to fund my booth, I’m not in the hole yet. I can only go up from here! Sorry for all the words today. I hope this helps anyone else out there thinking about starting a small business! And should you have tips and tricks to share that you picked up along the way, please leave a comment!