Originally Posted by smr91481
My wife has a little part-time thing that she does from home that only brings home around $200-$300 a month in net profit. We are looking for advice on what percentages we should be putting back into it to make it grow and what to bring home. And is there anything else she should consider setting money aside for? She wants to grow this thing slowly and without going into any debt.
I think the percentages are going to be pretty industry specific. I started my consulting biz in 2006 and you will probably have different priorities in a baking biz.
A few things to consider though...
1. Legal structure - Consider an LLC. It's cheap to set up and limits your liability if you are scrupulous about separating personal and business finances. You don't want a sick customer to come after you for your home.
2. Business Name - if you will ever be online, snag a good name and buy the web domain. Do a US trademark search to avoid problems up front. It's a pain to change names partway in.
3. Run your numbers. What is the cost of producing a cupcake? How much do they sell for? How much does it cost to acquire a customer? Good things to figure out.
4. What are your goals? Is this a hobby business or do you want to hit certain revenue targets? This will indicate your next steps.
5. Beyond those basics, prioritize your spending on activities that will bring you customers. Coupons? Email Newsletter? This will work great up to the point when you can no longer produce enough with the space/labor you have. Then you'll have a new set of challenges - kitchen rentals & employees.... If you want to go there.
Just some thoughts.... Hope they help.