It can be challenging to build a sustainable creative business. Every year, I see more and more businesses in the Arts struggling to remain profitable. It’s a fine line between doing what you love creatively and balancing the books. It can be done – but you’ll need to invest some time and energy into the support functions in your business. Here are 10 tips for maintaining your creativity AND your profitability.
1: Establish a clear vision for your creative business
- Artistic and creative business owners go into business to do the thing they love doing whether that’s photography, sculpture, expressive arts such as dance, music and so on. It’s a passion business which can often mean that the support tasks can get overlooked. Without a clear vision and plan, you can get caught up in the creative side of your business. You forget to give enough time to manage your numbers.
- Develop a long-term vision that incorporates both creative aspirations and financial sustainability. It’s wonderful to create stunning pieces of art or music. But if you can’t pay your bills on time, your business won’t survive no matter how talented you are.
- Regularly revisit and refine your business vision. Adapt to evolving market trends to give you the best chance to build a sustainable creative business.
2: Plan for profit in your creative business
- Profit is not a dirty word. However, I’ve encountered many business owners in creative fields who find it so difficult to talk about money that it stifles their growth and sustainability. Don’t be afraid to price for profit.
- People in creative fields get asked to work for free (or at a very reduced rate) far more often than those in other niches. You wouldn’t conceive of asking your solicitor to represent you or your accountant to do your tax return for nothing. Strangely no one thinks twice about asking for a photographer to ‘just take a few shots’ at an event. Don’t be drawn into ‘opportunities for exposure.’ Exposure won’t pay the bills.
- It’s worth spending some time on thorough market research. You can identify profitable niches within your creative sector. How can you position your product or service at the premium end of the market?
3: Manage your business operations
- The process side of things might be as dull as ditchwater but it’s a vital part of your business. If you streamline your admin, you’ll save time to do more of the stuff you enjoy.
- It’s worth investing in tools and technology to simplify tasks like diary management, invoicing and receipt management. It adds up to significant time over the year, which can be better spent with paying clients.
- Think about who is in your network that could help you create a more organised approach to your business. Collaboration opportunities could also help boost productivity.
4: Market your Arts-based business effectively
- Marketing is relentless. It’s not enough to rely on word-of-mouth recommendations. if you don’t market your business enough, eventually you’ll run out of clients. You may need help to develop a comprehensive marketing strategy to showcase your artistic identity. Hire a professional marketer, especially if you don’t enjoy social media and you don’t want to pay for online marketing such as Google, LinkedIn or Facebook Ads.
- Marketing boils down to creating a connection with your audience. It’s much easier to get closer to your audience using social media than it used to be. Exploit platforms to engage with your ideal client, creating a strong online presence.
- Influencer marketing is big. Collaborating with Instagram and TikTok influencers can catapult your brand into the limelight.
5: Collaborate with other creatives
- One of the best ways to grow your audience is to form partnerships for joint projects and exhibitions. It’s a win-win. You get in front of their audience and they get in front of yours.
- Collaborations aren’t just great for expanding your network. By pooling your resources and creativity, you can save money. Two or more brains working together can lead to innovative results.
6: Balance passion & profit
- Balance your creative desire with projects that produce recurring revenue for a sustainable creative business. Too many creative businesses fail because their owners are too focused on their passion projects and not focused enough on balancing the books.
- The trick is to identify revenue streams that complement your creative pursuits which can be challenging. An accountant or business mentor can help you work out what lies at the intersection between creativity and profitability. Strike a balance between commercial and personal artistic activities for long-term sustainability.
7: Embrace digital platforms for a sustainable creative business
- There’s money to be made online for many creative businesses. It’s time to leverage online platforms to showcase and sell your artwork, photography and even musical compositions globally.
- Stay up to date on digital marketing trends to enhance your online presence, or at the very minimum, outsource this to a social media person who understands how to market your products on e-commerce websites and socials to reach a wider audience.
8: Create limited editions
- Think about how you can broaden your appeal towards the high-end markets. Perhaps introduce exclusivity by producing limited edition pieces which can create a sense of urgency among collectors.
- This strategy can increase the perceived value of your product and attract people who become loyal fans and ambassadors of your brand without you having to spend extra to get publicity.
9: Seek new funding opportunities
- Grants and other funding in the Arts are often a little easier to find than in other sectors. Explore what is on offer from your local council, the Arts Council, the Lottery and other organisations that support smaller creative businesses.
- Grants can provide financial support for specific short-term projects or enable you to hire help over a longer period to grow your organisation into a sustainable creative business.
10: Keep a close eye on your cash flow
- Profitability is no good if you don’t also have liquidity. The creative sector is highly competitive so margins can be tight. Manage your cash flow forecast regularly so you aren’t caught out by a downturn in revenue or an increase in costs. Cash flow modelling software is straightforward to use or ask your accountant to look after this for you.
- Look for ways to improve your cash flow by negotiating longer payment terms with your suppliers. Offer shorter payment terms to your customers and optimise your stock levels so you don’t have too much cash tied up in raw materials, work in progress or unsold products.
Looking for support to grow a sustainable creative business?
We’ve worked with hundreds of creatives to help them establish a sustainable creative business through careful cash flow management – (don’t spend more than you have), sensible financial management (don’t spend more than you need to) and accurate tax planning (don’t pay more tax than you have to). Contact us for a free no-obligation chat today about how we can help you create a sustainable creative business.
You can sign up for your FREE trial of Numbers Knowhow, an easy-to-use cash flow management tool designed to empower you with the numbers you need to transform your business. Access powerful tools and features that create transparency and clarity in your business.