The #1 Rookie Mindset That Serious Vendors Must Overcome

Share:

The purpose of this article is to share advice with creative entrepreneurs who are serious about building a sustainable business. Before we dive in, let me start by saying that this is not about me sitting on my high horse criticizing other vendors I’ve met at various festivals, conventions, markets, and other events.

If you’re familiar with my blog, you know that I write these articles from the perspective of “I made mistakes in my journey as an entrepreneur, so I’m sharing them here with you in the hope that others can learn from my errors and avoid making those same mistakes.” I’m first and foremost calling out my own rookie miscalculation that is surprisingly common.

In the spring of 2022, I lost my job and made the difficult decision to take the plunge and fully invest in my own business. I learned a LOT in my first year, but it wasn’t until fairly recently that I understood how I was making a critical miscalculation in the way I gauged whether an event was a success or failure. That ultimately impacted the way I scheduled and prioritized the events that were driving my business.

Since that revelation, I’ve noticed that many other vendors are still stuck in that same mindset I was in. It’s a defining difference between hobbyists and rookies versus serious entrepreneurs who are dedicated to running a sustainable business:

“I made back my booth fee, so I’m happy. At least I’m not in the red.”

I’ve heard this time and time again. And in the beginning, I was guilty of using this as my standard to measure success, too. If I made enough money to cover the fee that I’d paid to set up a booth at an event, I considered it a wash. Not a great event, but not a total failure.

But here’s the problem — I wasn’t accounting for other business costs beyond the vendor fee.

That seems like a no-brainer when you spell it out, but it took me a little while to put those pieces together.

I’m an indie author, which means that I’m independently published. Although I have a distributor who produces my books and makes them available for global libraries, bookstores, and retailers such as Amazon, Barnes & Noble, and Walmart, that company does not own the publishing rights. I do.

When I order boxes of my sci-fan books to sell at events, I have to pay the print cost per book as well as the cost of shipping them to my house so I can then transport them to events. I’ve broken down some of those exact costs in other posts, but since my profit margins vary depending on the format (hardcover vs. paperback), page count, and the number of books that fit in a box, I’m going to keep it simple and say that I earn 50% profit per book that I sell myself. (Obviously, that margin is much lower when a retailer like Amazon takes a big cut.) We’ll also estimate that the cost to produce and ship each novel breaks down to $10 apiece for the sake of easy math.

So, if I paid $100 to set up a booth at a market, and I made that $100 back by selling five books at $20 per book, I can’t say, “I made back my booth fee, so at least I’m not negative” because I didn’t actually break even. I had to pay for the inventory that I sold, which means that I needed to make $150 in total to cover my upfront expenses ($100 for the booth + $50 for the base cost of the five books that cost me $10 apiece).

The #1 rookie mindset mistake I’ve seen among vendors, including myself in the beginning, is believing that making back the booth fee means you’ve broken even and had a successful event. In reality, you ARE in the red because even if you’re selling handmade products, there are still material expenses, not to mention the value of your time.

That’s not even factoring the many, many other costs of doing business. If you’re satisfied earning the bare minimum to break even, how will you pay for the tent to protect yourself and your wares during all-day outdoor events? How will you pay for the business insurance that’s required to participate in certain markets? How can you invest in banners, displays, business cards, and other marketing necessities to make your booth look good so people will want to shop there? What about filling your gas tank to drive to the next event? And your personal bills just to live?

When it comes down to it, how can your business sustain itself, let alone grow, if you aren’t making any profit?

The answer is obvious. It can’t.

Breaking this mindset was a crucial step forward for me as an entrepreneur. But it actually went even further by helping me identify other vendors who could be valuable networking connections because they could provide reliable advice about entrepreneurship and regional events.

I like befriending vendors who are near me so we can exchange ideas, tips, and possibilities for future events. There are a lot of factors to consider when taking another vendor’s advice about recommended events.

As an author and artist, I fit into a very specific niche when it comes to identifying my target demographic. An event that was successful for a vendor who sells mass-market items such as home decor or baked goods isn’t necessarily going to be the right place for me to try to sell YA fantasy books and artwork. Other artisans and fiction authors, however, tend to have a consumer base whose interests overlap with my fan base, so I can put more stock in their recommendations.

Figuring out whether a fellow vendor has set a similar bar for success helps me weed out some of the low-quality leads. If, at the end of an event, I’m disappointed that I didn’t make at least 5x the booth fee but my neighbor is just happy that they made the initial fee back, then it’s clear that our businesses are at different stages, and I’d be wary about other events they recommended. I would want to do extra research and try to get opinions from other vendors.

At this stage in my career as an entrepreneur, it’s way too much time and effort to sort and pack my inventory, load it into my car, drive to an event, set up my tent, unload everything, arrange the display, spend 6-12 hours in the heat (and the time CRAWLS if there’s not much foot traffic to keep you engaged), tear everything down, pack it up, load it in the car, drive home, and unload everything back into my house, all just to break even at the end of the day.

I’m focused on networking, exposure, and GROWTH. Breaking even doesn’t cut it for me anymore.

For other vendors, setting up at events is just a hobby supported by a day job, so making back the booth fee is their measurement of success. But for the serious entrepreneurs who are determined to build their business and make valuable networking contacts, that mindset is an instant red flag that separates the rookies from the veterans.