The handmade goods industry is booming. In 2022, it reached a global market size of more than $752 billion. By 2028, that number is estimated to reach nearly $1.3 billion.
Unlike many industries this size, the handmade goods market is dominated by small business owners. If you are passionate about making beautiful or useful creations, starting your own craft business can allow you to share your talents and earn money doing something you love.
Your Cricut machine can be just the tool to take you there. Cricut crafts are a particularly popular type of handmade product. Learn how to start a Cricut business and how to market it so you stand out from the crowd.
What is a Cricut business?
A Cricut machine is an electronic cutting machine popular with home crafters and craft business owners. Cricut offers three machine models and a range of materials and accessories, such as heat transfer tools and Cricut-friendly inks, foils, and fabrics. The machine works in conjunction with design software and uses a small, precise blade to cut shapes or patterns.
Users can design directly in the Cricut app, or upload or purchase designs. The machine automatically reproduces the design by cutting it out of materials like paper, vinyl, fabric—even wood or leather. The Cricut machine’s versatility lets you create intricate designs, lettering, and shapes you can apply to various surfaces or materials.
A Cricut business is any business that sells Cricut crafts or other products made using a Cricut machine. This can include paper products, like greeting cards or paper crafts, and products finished with a Cricut design, such as reusable water bottles decorated with vinyl decals. You might cater to individual customers, provide services for events like weddings, or collaborate with other businesses for customized promotional products.
How to start a Cricut business
- Conduct market research
- Define your target audiences
- Decide where to sell your products
- Design your Cricut product line
- Plan your finances
- Form your business
- Purchase supplies and make products
- Set up your online store
Starting a Cricut business can be a rewarding venture. On top of making money doing what you love, you can grow your professional network and experience the satisfaction of building a company.
It can also be a big undertaking. Your business plan must include your operational strategy, business costs, market and sales outlooks, and marketing. You’ll also need to register your business and abide by applicable business and tax laws.
Here’s how to get started:
1. Conduct market research
Market research is the process of gathering information about consumers and potential competitors to better understand market conditions within a specific business sector. It is usually part of a broader market analysis. Before you spend money on your business, research to identify your target market and get to know the appetite for your products.
For a Cricut business, you might research competitors in the Cricut design space to analyze pricing, branding, marketing language, and product information. This will help you learn who these sellers target and the value they provide to their audiences. You can also browse Cricut Etsy shops, read reviews, and count the total number of sales on the platform to understand how well their businesses are performing. Reading trade journals, and browsing ecommerce platform blogs and reports are great ways to discover relevant market trends and statistics.
2. Define your target audience
Start defining your target audience by identifying how you’ll position your brand and considering the specific products you want to make and sell.
One of the biggest challenges of entering the Cricut industry is competition: There are a lot of Cricut businesses out there. Differentiating your brand and audience can help you break through. Rather than selling to every potential buyer, identify a niche based on your particular aesthetic and products. For example, if you have a whimsical aesthetic and create elegant paper goods using high-quality materials, you might decide to target people planning weddings or other high-end events. You might also conduct additional focused market research to identify the demographic and psychographic factors (personality traits and lifestyle characteristics) common to these individuals.
You can also create buyer personas—fictional representations of a business’s ideal customers. Identify your target audience’s demographics, behavior, and preferences. Then, group similar characteristics together, assign names and summarize their motivations, pain points, and buying habits. Understanding this can help you position your product to meet your customers’ needs and allow you to create marketing materials that appeal to potential buyers.
3. Decide where to sell your products
Many business owners sell handmade goods online by creating an online store using ecommerce platforms like Shopify, or joining online marketplaces, such as Etsy or Amazon Handmade. You can also sell at craft fairs or local markets, or approach local shops about carrying your items. In each case, calculate the costs and potential audience reach associated with selling in the venue.
4. Design your Cricut product line
You can use your buyer personas and competitor research to refine your initial product line. Ask yourself what kinds of products your target audience will need and identify gaps in competitor offerings. An ideal product meets a specific need unaddressed by other vendors. Next, finalize your designs, color options, and material choices. You might create mockups for review, or create a needs checklist.
Many Cricut design businesses also offer custom orders. If you’re comfortable creating bespoke items on demand—like vinyl decals or leather goods—consider including customization options for a surcharge. If you’re a skilled graphic designer, you can also sell graphics to other Cricut users in exchange for an image licensing fee.
5. Plan your finances
The next step in starting a profitable Cricut business is planning your finances. First, calculate your estimated expenses, making sure to account for the following:
- Startup costs. The cost of your Cricut machine, business licensing fees, and any initial marketing and branding investments.
- Direct costs. The costs directly associated with manufacturing a product and completing an order, such as materials and shipping costs.
- Overhead costs. Ongoing costs associated with running your businesses, such as software licensing expenses, marketplace selling fees, and marketing costs.
It’s OK to not have a solid figure for every expense at this stage. Your software licensing fees depend on which platform you use to create your online store, and marketing costs can vary based on your strategies. For these figures, create a budget estimate that tallies what you can expect to spend in each category based on research. When you’ve settled on a website provider or marketing strategy, use your estimate to determine what you can afford to spend.
You can use these estimates to determine the pricing for your products. Start by calculating the direct cost of each product and incorporate ongoing overhead costs as well as startup expenses into the pricing equation.
For example, let’s say you sell mugs with Cricut designs. You spend $5 on materials per product and anticipate 100 sales a month. Your monthly overhead cost is $1,000.
Divide your monthly overhead expenses by 100 and add this figure to the direct cost of producing each mug ($5) , arriving at a cost of $15 per mug. Many businesses plan to pay down startup expenses over time, so you could add an additional $5 per mug to pay down the cost of your Cricut machine and other startup fees.
Once you’ve determined the cost of each item to your business, you can use a profit margin calculator to factor in your markup, determine item cost, and calculate your gross margin. Markups typically range from 20% to 100% of item cost.
A 25% markup on your mug, would set your sale price at $25, and give you a $4 profit per mug.
6. Form your business
With a solid plan, you’re ready to form your business. Depending on your business entity and state, along with local laws, you may also need to get a business license and register your business with the state. Visit your state’s website to determine these requirements for your business type. It’s common for the Secretary of State’s office or the Department of Revenue/Taxation to handle business licensing matters.
If you form a sole proprietorship, you must register your business name using a doing business as (or DBA) to open a business bank account.
7. Purchase supplies and make products
Now the fun part: purchasing your Cricut machine and additional materials and starting to make products. Because you’re making products yourself, you likely don’t have to worry about storing large amounts of inventory—handmade goods makers often offer made-to-order or custom products. When you maintain minimal inventory, you can focus on photographing and listing products to fulfill weekly sales estimates in each category.
8. Set up your online store
Once you’re ready to start selling, set up your online store. You can use an ecommerce platform like Shopify to design your website, list your products, and accept various payment methods. You can also list and sell your items on an online marketplace like Amazon Handmade or Etsy.
How to market and promote your Cricut business
Marketing your Cricut business is a startup step and an ongoing task. Marketing can help you raise brand awareness, reach new customers, and increase sales. You can also organize (and optimize) your marketing efforts by creating a small business marketing plan. Here are a few strategies:
Market on social media channels
Establishing a professional social media presence can help you reach a wider audience and increase visibility. You can create a business Instagram account and feature stylish pictures of your products, information about sales or promotions, and customer testimonials. If you plan to sell locally, you can join local Facebook groups to connect with local customers and other business owners.
Partner with creators
Many businesses also partner with creators to reach new audiences. Identify a creator with a following that includes your target audiences and approach them about a paid brand partnership or collaboration. A sponsored post written by a creator can help you reach a wider audience and elevate your reputation.
Leverage your online store
Your online store is more than just a place to sell products—it’s an opportunity to build customer loyalty and communicate your value. Host promotional materials, such as marketing pages and your brand story, and educational or entertaining content, such as a blog post about how to throw an epic baby shower.
As your business grows, you can expand into other marketing tactics like email marketing and paid ads.
How to start a Cricut business FAQ
Are Cricut businesses profitable?
Yes, successful Cricut business owners can earn significant profits selling Cricut designs.
How much capital do I need to start a Cricut business?
Cricut businesses have relatively low start-up expenses. Costs include your Cricut machine, materials, and business licensing fees.
Do I need prior experience in crafting or design to start a Cricut business?
No, you can purchase pre-made design files to create projects using your Cricut machine.
