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Home / Business / Small Business

Small Business: Craft businesses - Lucy Arnold, Felt

By Caitlin Sykes
NZ Herald·
21 Sep, 2015 09:10 PM3 mins to read

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Lucy Arnold, founder of Felt.

Lucy Arnold, founder of Felt.

This week, Small Business editor Caitlin Sykes talks to business owners about craft business.

Christchurch-based Lucy Arnold founded Felt, an online marketplace for handcrafted New Zealand-made goods, in 2007. Felt has around 1,700 online shops active at any one time and around 64,300 registered users.

What prompted you to set up Felt?

I'm a graphic designer, so I have a design background. At the time I'd also been reading a lot about the effects of big brands and big-box retailing and malls on our more traditional, village-type ways of life. A more direct influence was seeing Etsy getting started in the US. At that time Trade Me had gained real traction here and shown there was space for a New Zealand business to thrive alongside the likes of eBay. So I figured there could be a similar space in New Zealand for a local online craft marketplace.

What did you want to achieve with the business?

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I had a desire, which is still the same today, to promote and support small businesses that are based around designing and making products locally. I also wanted to provide pathways for people, so someone coming out of polytech with a craft degree, for example, could have an additional channel to turn their skills into a career.

There was also the marketplace aspect to it that appealed - connecting people who are making things with people who appreciate that and want to buy beautiful hand crafted goods - and generally promoting skills and disciplines that aren't necessarily widely visible in New Zealand.

What trends are you seeing in the market for handcrafted goods here?

There are definitely a lot more people wanting to get into this area. We have a lot of people selling on Felt at an entry level with their businesses, but in the last few years we've been seeing more professional craftspeople moving into this marketplace as well.

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What factors differentiate whether someone is going to build a hobby business as a craftsperson, or create a more self-sustaining small business?

Pragmatism is really important. Creative people have a tendency to be very emotionally invested in what they're making, with less focus on what people want to buy. But the people who really thrive also think about their niche and market. They're not necessarily compromising on what they want to make, but they do their market research and can find that sweet spot. Being prepared to respond to feedback from the market, increase their skills and hone products over time also helps.

The successful ones are also fairly careful about how they approach pricing, and they have staying power. Perseverance is a key quality.

There must be a delicate balance involved in building a business based on products that are handcrafted as well. How do these kinds of businesses scale?

It's a huge challenge and I'm coming to the conclusion that maybe it isn't something that's really scalable. So perhaps we need to recognise that a little more, and put greater value on the skills that craftspeople can offer, and their products that can't be produced en masse.

What are some other challenges facing operators in this area?

A huge challenge is the competitive environment we're in, up against malls and mass-produced and imported products. I think more work needs to be done to educate people and to distinguish products handmade and designed in New Zealand from those that are imported en masse from overseas and have a planned obsolescence, designed to make you spend more money down the track. The craftsperson is making something to last, but the challenge is to get the consumer to see the value of investing in that.

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