You've got a skill. Maybe you pour candles, make jewelry, sew bags, carve wood, or mix soap in your kitchen. People keep telling you "you should sell these." And you're starting to think they might be right.
Starting a craft business from home is one of the most accessible ways to build income doing something you love. The startup costs are low, you can start while keeping your day job, and the demand for handmade products has never been higher — the handmade market is projected to exceed $1 trillion globally by 2027.
This guide walks you through every step, from choosing your product to making your first sale at a craft fair. No fluff, no theory — just the practical steps that actually work.
Step 1: Choose Your Product (and Validate It)
You probably already have something in mind. But before you invest hundreds of dollars in supplies, validate that people will actually pay for what you make.
The Validation Checklist
- Can you make it consistently? A one-off masterpiece is art. A business needs repeatable products you can make reliably at consistent quality.
- Is there a market? Search Etsy, Instagram, and local craft fairs for similar products. Competition is actually a good sign — it means demand exists. No competition usually means no demand.
- Can you price it profitably? More on pricing below, but roughly: can you charge at least 2.5x your material cost? If materials cost $8, you need to charge at least $20 — ideally more.
- Does it ship well? For online sales, fragile or heavy items create headaches. For craft fairs, this matters less.
Not sure what to make? Our list of 75 craft fair product ideas includes what's selling well right now.
Find Your Niche
The biggest mistake new craft business owners make is trying to sell everything. "Handmade home goods" is too broad. "Hand-poured soy candles in vintage teacups" is a niche. "Minimalist silver jewelry for everyday wear" is a niche. A clear niche helps you:
- Stand out in a crowded market
- Attract the right customers
- Create a cohesive brand
- Focus your inventory and supplies
Step 2: Set Up Your Home Workspace
You don't need a professional studio to start. Many successful craft businesses began on a kitchen table or in a spare bedroom. What you do need:
- Dedicated space: Even if it's just a corner, having a consistent workspace improves productivity and keeps your materials organized
- Storage system: Bins, shelves, or drawers for supplies and finished inventory
- Good lighting: Essential for quality control and product photography
- Ventilation: Critical for candle making, resin work, soap making, or anything with fumes
Budget tip: Start with what you have. Upgrade as revenue comes in, not before. A $50 folding table works just as well as a $500 craft desk when you're starting out.
Step 3: Handle the Legal Basics
This is the part most people skip — don't. Getting your legal foundation right from the start saves massive headaches later.
Business Structure
For most home craft businesses, start as a sole proprietorship. It's free, requires no paperwork in most states, and you report business income on your personal tax return (Schedule C). As your business grows past $30-40K in annual revenue, consider forming an LLC for liability protection.
Licenses and Permits
Requirements vary wildly by location, but commonly you'll need:
- Business license: Most cities/counties require one ($25-100/year typically)
- Sales tax permit: Required in most states to collect sales tax (usually free)
- Home occupation permit: Some municipalities require this for home-based businesses
- Cottage food license: Required if selling food products (varies by state)
Our vendor license and permits guide breaks down exactly what you need by state.
Insurance
Product liability insurance protects you if someone claims your product caused harm. Many craft fairs require proof of insurance to participate. General liability policies for small craft businesses typically run $200-500/year. Check out our craft fair insurance guide for recommendations.
Step 4: Price Your Products for Profit
Underpricing is the number one reason craft businesses fail. You're not just selling materials — you're selling skill, time, creativity, and a unique handmade product. Price accordingly.
The Pricing Formula
Wholesale Price = Materials + Labor + Overhead
Retail Price = Wholesale Price × 2 (minimum)
Let's break it down:
- Materials: Every physical component, including packaging
- Labor: Your time at a fair hourly rate ($15-25/hour minimum)
- Overhead: Utilities, tools, workspace, website fees, divided across products
Example: A handmade soap bar costs $2 in materials, takes 15 minutes of labor ($6.25 at $25/hr), and has $0.75 in overhead. Wholesale = $9. Retail = $18 minimum. If that sounds high, remember: you're competing with other artisan soaps, not Dial.
For a deeper dive with real examples, read our complete pricing strategies guide.
Step 5: Build Your Brand
Branding isn't just for big companies. Even as a one-person home business, consistent branding makes you look professional and helps customers remember you.
Brand Essentials (Start Here)
- Business name: Memorable, easy to spell, available as a domain and social media handle
- Logo: Can be simple — Canva has free tools, or hire someone on Fiverr for $20-50
- Color palette: Pick 2-3 colors and use them consistently everywhere
- Packaging: Your packaging is part of the product experience. Even simple kraft paper with a branded sticker elevates the feel
For packaging inspiration, check out our craft fair packaging ideas guide.
Online Presence
At minimum, set up:
- Instagram: The top platform for handmade products. Post your process, products, and behind-the-scenes content
- Google Business Profile: Free, and helps you show up in local searches
- Simple website: Even a one-page site with your product photos, story, and contact info establishes credibility
Step 6: Create Your Initial Inventory
How much inventory do you need? For your first craft fair, a good rule of thumb:
- Variety: 8-15 different products or variations
- Depth: 5-10 units of each popular item, 3-5 of niche items
- Price range: Include items at $5-15 (impulse buys), $15-40 (core products), and $40+ (premium pieces)
- Total value: Aim to bring 3-4x what you hope to sell
Don't go overboard on your first batch. Make enough to fill your booth, learn what sells, then adjust production based on real data.
Step 7: Start Selling at Craft Fairs
Craft fairs are the best first sales channel for a home craft business. Here's why:
- Immediate feedback: You see what people pick up, what they ask about, what they buy
- No shipping hassles: Cash and carry
- Low startup cost: A booth typically runs $25-150 for a local fair
- Customer relationships: Face-to-face selling builds a loyal customer base faster than online
- Market research: You learn more in one day at a craft fair than months of online guessing
Finding Your First Fair
Start with smaller, local events to build experience before applying to juried or competitive shows. Look for:
- Community markets and church bazaars
- Farmers market vendor days
- School or charity craft sales
- Local festival vendor opportunities
Browse craft fairs on TheCraftMap to find events near you. You can filter by date, state, booth fees, and more. Our Near Me page finds the closest events to your location.
For tips on applications, our guide on writing winning craft fair applications will help you get accepted.
Your First Booth Setup
You don't need an elaborate setup for your first fair. The essentials:
- 6-foot folding table (many fairs provide one)
- Floor-length tablecloth
- Risers or crates for height variation
- Price signs
- Business cards
- Payment method (Square reader + cash)
- Bags for purchases
- Canopy tent (for outdoor events)
See our booth display ideas and booth essentials gear guide for complete setup advice.
Step 8: Set Up Your Finances
Keep your business and personal finances separate from day one. This makes tax time infinitely easier and gives you a clear picture of profitability.
- Separate bank account: Open a free business checking account
- Track every expense: Supplies, booth fees, mileage, packaging — it's all deductible
- Track every sale: By event, by product if possible
- Set aside taxes: Put 25-30% of profit into a savings account for taxes
Our craft fair tax guide and ROI tracking guide will help you stay on top of the numbers.
Step 9: Learn, Iterate, Grow
Your first craft fair won't be perfect. That's fine. The vendors making six figures started with a folding table and a dream, just like you. The difference is they kept showing up, kept improving, and kept listening to their customers.
After Every Event, Ask Yourself:
- What sold best? What didn't sell at all?
- What questions did customers ask most?
- Was my pricing right? (Lots of "this is so cheap!" means raise prices)
- What would I change about my booth layout?
- Was this event worth the investment?
Growth Paths
Once your craft fair business is running, you can expand into:
- Online sales: Etsy, Shopify, or your own website
- Wholesale: Selling to local boutiques and gift shops
- Custom orders: Higher margins, longer lead times (custom orders guide)
- More events: Scale from 1-2 events/month to weekly or multiple per weekend
- Teaching: Workshops and classes using your craft skills
Common Mistakes to Avoid
We've seen thousands of craft vendors through TheCraftMap. Here are the pitfalls that trip up most beginners:
- Underpricing: Selling $25 products for $10 because you're scared of "too expensive"
- No business cards: Every person who visits your booth is a potential repeat customer — give them a way to find you again
- Skipping market research: Making what you like instead of what people buy
- Overinvesting before selling: Buying $2,000 in supplies before making your first sale
- Ignoring presentation: Great products in a messy booth won't sell
- Not collecting emails: Your email list is your most valuable marketing asset (email list guide)
For a deeper dive, read our full list of 13 craft fair mistakes that cost vendors money.
Your First-Year Timeline
Here's a realistic timeline for launching your craft business:
- Month 1: Choose your product, validate demand, set up workspace
- Month 2: Get your legal basics done, create branding, build initial inventory
- Month 3: Apply for and attend your first craft fair
- Months 4-6: Do 4-8 events, refine products and pricing based on feedback
- Months 7-9: Set up online presence (Etsy/website), build email list
- Months 10-12: Scale to your best events, drop underperformers, plan next year's calendar
Our complete first-year vendor guide goes into much more detail on what to expect each month.
Ready to Start?
The best time to start a craft business was last year. The second best time is today. You don't need to have everything figured out — you need to make something, price it right, and put it in front of people.
Find your first craft fair on TheCraftMap and start turning your hobby into a business. Filter by location, date, and booth fees to find beginner-friendly events near you. Your future customers are waiting.