Saturday, January 15, 2011

Price Increases Expected next month, Feb 2011

Something we all don't like, but is a necessary part of business is raising prices, and next month, Wool2Dye4 will raise our prices. Right now we are working with our broker to establish the prices and when they are ready, I will send out a newsletter with the news.

Lots of customers have been writing to us to say that they dye yarn and sell it to local yarn shops, or to online retailers. These are their wholesale customers, and some of my customers have decided that their customers will not be able to afford to buy handdyed yarn if the prices increase. I am here to say that the yarn shop owners are already dealing with new price lists from every single one of their suppliers, and this is because they know something that not everyone seems to realize.

That is that prices for fiber have increased all over the world. All around the globe mills are raising prices just to stay in business, and they are battling the same demons that my handdyers battle. No one can afford to run a business at break even for very long. We have to raise prices as our own prices are raised on us, so if you are fearful of losing business when you raise prices, I want you to start learning more about business in general, and your business in particular.

Consider the taste for cashmere and silk and how it has ballooned in the past two years! These two fibers have become among the most expensive fibers in the world, and just in December, the cost of cashmere skyrocketed ten percent. That is huge. Now, here we are in our tiny segment of the fiber world market, handdyers very close to the source of the goods, really. We get our yarns and fiber before the commercial yarn companies get theirs and ours are a bit more raw, too. So imagine the price increases those companies are figuring. At their end of the fiber market, setting prices is an ongoing study.

One difference between commercial yarn companies and individual hand dyers is probably best thought of in terms of who has a better grasp on the true cost of getting dyed yarn into the hands of the wholesale customer. Entrepreneurs have a habit of counting up the costs of their materials and shipping and office supplies, but forgetting to calculate the value of their time, and of unsold inventory they are sitting on. They must be counted to get a picture of profit. When we know the real figures, the numbers that describe our success, or struggles, we are better able to make wise decisions.

We all need to invigorate our attitudes towards our businesses, and should seek out help before we need it. There is a wonderful free resource for entrepreneurs called the Small Business Development Center network. Each state participates in the SBA program and has counselors at the offices of their partners around the state, covering territories. Partners might be the local chamber of commerce or community college system. Google Small Business Development Centers and your state name and you will find out how to get in front of a business advisor. Reach out and learn more about business and act from the point of knowledge as you operate.

New Stock just posted on the Website

Just arrived yesterday,
late in the afternoon, Sheila's Gold, along with other yarns to boost existing stock. It was the Sheila's Gold which we were out of for the past week.

Usually, I am able to send out a newsletter, but for some reason the newsletter program is not cooperating today, so I will list the next two shipments here and hope that this info gets to lots of customers.

Later in January, these yarns are expected (skeins, unless noted) ...Angel Delight Fingering
Angel Sock Sport
Butterfly Select
Cash Aran MCN (with cones)
Cash Sock MCN (with cones)
Sheila's Aran
Ultra Merino Select Lace
W2D4 Merino Worsted

In February, incoming stock includes:Sheila's Sparkle
Angel Lace
Butterfly Lace
Crazy Eight
Platinum Sock
Sheila's Gold
Sheila's Aran
Silk Sock 50/50 (there is a question of whether this will be ready)
Tweed Sock
Ultra Merino 3Ply
W2D4 Worsted-SW (with cones)

Thursday, January 06, 2011

January Thoughts

Every January I get the urge and energy to reorganize my files. To some people, files may seem like an old fashioned collection of useless papers, but let's face it. We do not all live in a paperless environment, and some of that saved paper can actually save us some money. The trick is being able to put your hands on what you need in a few seconds, and this is just about the best reason for keeping clean files and updating them once a year.

A couple of years ago, I had sort of lapsed into a lazy period of continuing along with the same files for three years in a row. It was slowly beginning to drive me mad, so early one January I purged the files of all receipts and paperwork that seemed like something no one in their right minds would ever, ever ask me to produce. I tossed out bags and bags of old receipts and copies of orders. You name it, if it was not directly deductible on my taxes, I tossed it in the can. Then came a notice from the government that there would be a major refund on telephone taxes and surcharges, but copies of telephone bills for the preceeding year had to be attached to the application for a refund. The amount of the refund came to more than $200, and I missed it because I threw out the receipts.

That year I started a new system, and I've worked it the same way every year since then. Here's how it goes...

In December, start collecting new folders, hanging files, those neat little plastic file tabs (from Post-It), a plastic file box big enough to hold all of the previous year's essential paperwork, and some large envelopes and fresh markers. The large envelopes are great to hold an unruly stack of receipts.

Go to an office supply store and choose one of the plastic file boxes with a lid on it, one which has the little lips on either side for hanging files. This way when you open the file box, you can flip through the tax box as easily as you can flip through your filing cabinet's drawer.

On the front of the plastic file box, write the year and any other information. Use big, fat letters so that it is easy to read even if you are standing on your head with a flashlight in your mouth. Never can tell ... For instance, you might label the box 'Taxes: Business & Personal 2011.'

All through the last month of the year, as you close out activity on a category, remove that folder from the filing cabinet and place it in your tax box. Then, prepare a new hanging file for the coming year's notes, label a fresh new file folder with the category and date it, e.g., 'Utilities, 2011.' Do that when you pay the recurring December bills, or when you balance the December bank statement. From time to time, sit down at the tax box and clean out extraneous notes and papers in the folders. Don't throw away important receipts, though, as I did!

When you take your paperwork to a tax preparer, you will be a better prepared customer, and may wind up paying less than those people who come in with a shoebox filled with a mess of receipts and handwritten notes.

I will say that one of the best tax prep ideas I ever came up with was a yearly Tax Diary. It is the one go-to place where I keep receipts of deductible expenses through the year. Now, I am keeping an Excel spreadsheet on the different categories, too. I admit to never deveoping a schedule for filing, and my system is pretty primitive. I toss all unfiled receipts in a basket by my desk, and then one day when they are threatening to topple over, I go through them one by one, enter the amounts/dates/payment method on my Excel spread sheet, and once they are on that spreadsheet, I file them in a folder in the Tax Diary. My yearly Tax Diary has these folders in it: Local Taxes, Medical Expenses, Estimated personal income tax payment, and Donations. All during the year I file any paperwork that has to do with these most important folders. At the end of the year, I print out the Excel sheet and send it along with my other important tax papers to my accountant, make a copy for the folder and transfer the Tax Diary to the tax box for future reference.

January is the time for creating all sorts of new folders for the clean filing cabinet. As I pay bills, I look at that clean corner of my desk and really do not want to see a pile of receipts, so in January I create new folders and file everything right away. That's where I am in the process right now and it feels very good, but I know that by April, the pile will already be a healthy size, and I will have that little reminder going off in the back of my mind telling me it is time to do some filing. Good thing for me that I cannot go longer than a quarter with most of the filing, because there are business taxes to be paid quarterly. That is a sort of natural time to get things back into order.

This is how I keep the paperwork organized. I hope it gives you incentive to try my method, or to improve upon it, for your self.