One of the baby-blanket products handmade by Calgary-based Sun 7 Designs.
The #Takeoff series is about crowdsourcing issues important to Canadian small businesses. They tell us about their defining moments and we write about their stories, the issues, and strategies for success or how to overcome obstacles.
Tell us your business's takeoff moment: tgam.ca/takeoff
Valery Klassen was deep in her career in the corporate world when she started making handmade baby blankets for her friends.
Pretty soon, she was receiving blanket orders from friends of friends, colleagues and even strangers – finding herself sewing late into the night after she got home from her day job as a top manager at a private oil and gas company in Calgary.
"It was a very busy job … and I thought 'I can't sew as well, so something's got to give,' " she said.
That's when Ms. Klassen had to make a tough decision: to follow her passion for sewing full time, or shut the blanket operation down.
"I was getting e-mails and phone calls constantly, so I thought I've got to do something," she said.
Valery Kalssen started sewing baby blankets for her friends while working as a top manager at a Calgary oil and gas company. (Sun 7 Designs)
At that moment, Ms. Klassen quit her job at Jarrod Oils Ltd. and went full throttle with her baby blanket business, called Sun 7 Designs.
"I've never looked back," she said.
Last year, Ms Klassen's business generated $20,000 in revenue, an amount that's been doubling every year since 2010, she said. She produced about 500 blankets in 2014 at a rate of three to four a day.
"To some people that doesn't sound like a lot, but to me I'm pretty proud of that," she said.
Though it is possible to be successful in turning your passion into a career, it is important to plan ahead before making the career switch, says Karen Fischer, co-founder of the business consulting firm RK Fischer and Associates.
"You need to investigate that business and what is required for it before you quit your job," she says.
When too many people started asking for her blankets, she quit her corporate job to start the business full-time. (Sun 7 Designs)
That means doing your research and asking the crucial questions – including whether there is a market for your product or service, what the competition looks like, and how much people are willing to pay for what you are selling.
"Are you willing to learn all of the things that it takes to run your business? Because that means marketing. That means running a website and having a presence on social media. That means networking – and doing all of it on a constant basis," Ms. Fischer says.
Indeed, Ms. Klassen took some necessary steps before she launched Sun 7: She got her small business licence, registered for a GST number and took business classes downtown.
"I went through all the proper channels ... to make sure I was doing it all right business-wise," she said.
For Ms. Fischer, this kind of preparation is what makes a business successful.
"There's more to it than just having the passion," she says. "The people who just quit their job without really knowing whether this can take off or not, it could be devastating for them."
This runs especially true for those thinking of making the switch in their 40s and 50s, Ms. Fischer warns. "You've got to worry about retirement and you've got kids and people in university – you need to do a soft landing."
That means spending the money on hiring the necessary accountants and lawyers to help you get off your feet, or speaking to friends who have businesses for guidance.
For advice, Ms. Klassen goes to her husband, a long-time businessman who is the first to tell her she needs to raise her prices.
"When I first started out I was pretty much giving them away and my husband and everybody still thinks I'm giving them away," she said.
By her own admission, Ms. Klassen says she's not charging for her labour: the $65 she makes for a blanket covers the cost of materials, but not her time: She sews daily from about 9 a.m. to 5 p.m., producing three to four blankets a day – "which is really busy" – and then spends the evening maintaining her website and social media accounts.
Now, she is struggling to keep up with demand, but reluctant to hire. (Sun 7 Designs)
"That's a weekly struggle with me, thinking, 'Am I not charging enough?' " she said. "If I raise prices what's going to happen? Am I going to lose a bunch of customers?"
One way she could increase her revenue without raising prices would be to employ people for production, said Joseph Paradi, a University of Toronto professor whose research areas include entrepreneurship.
"That way she could produce more products and therefore sell more materials and keep control over quality," he said. "That would be the closest opportunity for her to increase her business."
And yet, Ms. Klassen is leery of expanding by hiring employees because she doesn't want to delegate production.
But her unwillingness to give up control could be a problem if she wants to gain new customers, Dr. Paradi says.
"There's no way to increase customer numbers without increasing the number of items you can sell. You can make more money, yes, because you can change the price, but you can't attract more people, customers," he said.
Indeed, reluctance to delegate is a classic problem for entrepreneurs. But as a business expands, Dr. Paradi says, those who can't learn to pass off tasks will eventually hit a growth ceiling.
"If you have three cows you can still milk them, but you're not going to be in the milk business, he says. "You need 100 cows."
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