Ceramic Business Financing – Part 1: Money Makes the World go around

When you are in business – big or small - you will need money to operate it. To finance your business right is crucial to your survival and the more you know about it the better off you are.

You can survive, at least temporarily, with less inventory and less capital equipment, such as kilns, other equipment, furniture, and other accessories to your business. But you cannot survive with less money than what you need. So – let’s take a look at it in the next chapters. It has more complexity then what you may think.

The time when you start your ceramic business is when you need to figure out how much cash you need now and in the future.  It is a good idea to sit down with an experienced business owner at that time. Or your selected accountant. Or to ask advice from a financial institution, such as a bank or a representative of a governmental agency such as Small Business Administration. These latter institutions may provide it free within the process of negotiating a loan.

The temptation – especially for you as an entrepreneur – is to rush through it. Please, do not. Be patient as a trained financier with experience and/or a well educated business executive guides you to an accurate forecast of the funds you need.

It’s never too late to take time for this exercise

So maybe you got started thinking that the income from your business would be enough through ups and downs. Well, if that was the case, pause right here at take time to get a solid financial map drawn up.

We will return many times in this book to take second and third looks at this part of your business. Over a period of years, you will come to understand and learn from the school of hard knocks, how to gauge the financial needs of your business, from operating and controlling it. But if you wait until the situation is critical, it might be too late.

Every ceramic business, regardless of size, needs capital. But the amount varies greatly. It pays off to learn some basic concepts, such as fixed assets and working capital.


You may not need an MBA (Master of Business Administration degree) to figure the needs for your small business. But why not get help from an experienced third party right from the start, or later, whenever the need arises.

Finance is a field of study. There are many levels in this field. For many self-starters like you, it happens all too often that one overlooks or is unaware of important aspects of it. And you may live to regret that.

Your Business Plan

We have already covered your need for a business plan. No matter if your plan is scratched out on a single piece of paper or presented in more detail, the plan will dictate your need for money. It’s as simple as that. Your basic plan, your degree of ambition for growth and your need for hard assets will give a financial advisor what is needed to give you the advice you must have.

Everything takes time


Over my many years in the business of ceramics, getting to know and lecturing to hundreds of studios, I have learnt that the gathering of experience takes time. All successful, well established studios with substantial business volume have one thing in common: THEY HAVE BEEN IN BUSINESS FOR A LONG TIME.

Those that take part and have taken part, over a long time, in business seminars are, in my judgment, the ones that are and should be the ones that beginning or not-so-advanced studios have the most to learn from. They deserve respect because they have been through the wringer and successfully survived both good and bad times. This is why it pays off to listen carefully to them.

I have also experienced that they, on the whole, are more than willing to part with good advice. So, try to find experienced business owners in the ceramic field you are in or intend to join and – with note pad in hand – write down their pieces of advice and the thoughts that cross your mind. Nothing, absolutely nothing can compare in importance to what they have to say.

As the phrase goes – he/she who listens, will learn and gain. You are never alone – smart entrepreneurs want quick gratification and learning from others who already have some of the experience you are looking for, might shorten your learning curve and be part of the total make-up of your future success.

The basic difference between large and small business is just that – the size. When it comes to basic structure, they are the same. This applies to the financial, marketing, controlling and operating parts of their businesses. Consequently, seek advice from those who have demonstrated experience in your field, and learn. And do not be afraid to ask any questions.

Other sources of support

Running your own business can be a lonely experience. Any mistake you make has a direct financial impact. You tend to blame yourself and can fall into the trap of spending more time blaming yourself rather than finding the correct solution.

Industrial Associations

This is why associations within your sphere of ceramics can be of such tremendous help. If you can find one, join it! They mostly do not only focus on how to be a better decorator, potter, sculptor, porcelain artist, china painter, teaching studio or Contemporary Ceramic Studio owner,  or whatever area of ceramics they address - the technical part. They may also offer business advice or programs for business training. This “school”, on whatever level of structure, can provide a very positive support for your studio.

Books and magazines to study

Apart from organizations, there are books and magazines of all kinds. Become a reader of business advice in your area of activity or just generally. Become a student. Search the bookstores and the internet for business information that can be of direct or indirect advice to you. You will find mental – as well as physical – stimulation and tranquility. You will increase your self-confidence and sleep better at night.


In some ceramic areas there are franchises – business groups that are steered by a central source for both intangible guidance – such as regards business structure – and provide well researched base product sourcing. They normally have centralized training and control. Think McDonalds or Subway.

Consider how such an organization/business may be a solution for you. Yes, you loose independence to a degree, but you may find other facets that compensate for this and fit your business, your plans, and your personal profile. Contact them and find out.

Like ceramic techniques, business techniques should be a life-long learning

You have learnt from studying ceramic technique, how thrilling that experience is. Well, learning business fundamentals and techniques offer the same experience. Do not for a moment think that it is less so. After all, as technical competence leads to your well being and future solidity, so does business and financial savvy.

In future articles, we will discuss the language of financing, your best source for money and other important aspects of finding money in the right amount, the right credit structure and finding the right sources for you amongst the many you can choose from. .

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© 2011 by Rolf E. Ericson, Oneonta, New York, publisher. All rights reserved. Photocopying, reproduction , copying, or redistribution of any kind in printed or electronic form is strictly prohibited without written permission from the publisher.