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Aug 24

Is Cottage Industry Dead?

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graveyardIs Cottage Industry dead?

Well, it’s not dead at the moment, in fact, in this current economic climate it’s flourishing. There’s a huge move towards home based businesses at the moment, with more and more people choosing to either set up a business on the side or full-time.

“Cottage Industry” is defined as – An industry where the creation of products and services is home-based, rather than factory-based. That pretty much defines every work at home mum that I know.

Please note that in the following when I say ‘cottage industry’ I’m referring specifically to the manufacturing side, not service businesses. Those will be a topic for another day!

If you’re a cottage industry and you’re manufacturing a product, you may do well to look at the evolution of cottage industry manufacturing and how it tends to evolve into large-scale manufacture.

Since the Industrial Revolution, there have always been cottage industries. Historically it was the women working at home in their spare time to earn ‘pin money’ (see – the first work at home moms!) and over time that developed into full businesses located in the home.

I can see a trend that has happened in the past, and looks to continue in the future in regard to the manufacturing aspect of cottage industry. And that trend concerns me.

Cottage industry tends to be started by people who see a need for a product that they can’t buy commercially – for example modern cloth nappies/diapers. Apologies to all the nappy/diaper-makers who read this – I’m just using you as an example however I can see this happening in most of the cottage industry manufacturing ventures.

Case in point: In the past, cloth nappies were only available as the old-fashioned terry squares and roughly 97% of the population used disposables. The only people who still used cloth were those who were either too poor to afford disposables or the environmentalists living on the fringe. However in the last ten years, there’s been a huge move back towards more convenient, more environmental, easier to use, great looking cloth diapers.

Originally, these were made 100% by a few mums working at home in a cottage industry setup at home. Cloth nappies were unusual. People needed to be educated in their use, their care and their benefits. Over the years the demand for cloth nappies has increased to the point there are now hundreds of WAHMs making and selling them, all over the world.  Supply has caught up with, if not exceeding, demand.

Nowadays, I know of at least three brands in Australia that are now being mass-manufactured overseas. And I can practically guarantee that if it’s happening here in Australia then it’s happening in the US and other countries.

Please note that this is not necessarily a bad thing. Mass-producing something that benefits people is good, however if you’re a work at home mum and this happens in your industry, you need to be aware of it and plan for it.

Historically, cottage industry begins a trend in a new product and builds it up until it is commonly accepted by the population at large, at which point it is picked up by commercial manufacturers.

What does this mean for work at home moms who are manufacturing items for sale?

I believe there will always be a market for one of a kind, unique, handmade articles, no matter how much the article is also made commercially. For example, I can buy a bar of commercial chemical-laden soap at the supermarket. Or I can buy cold-process, natural, REAL soap made by a work at home mum.

There are a couple of things you can do here, if you’re a work at home mom in manufacturing:

- Be an early adopter and be one of those who outsource and begin commercial production of the product. (please, do us all a favour and choose somewhere that follows fair-trade practices in their manufacturing and the way they treat their workers)

- Ensure your product is unique in some way. If you produce an item that is unique and individual then there will probably continue to be a market for it.

- Diversify your business. Don’t put all your eggs in one basket, or all your faith in one product or product line. Look at expanding into new areas.

- Plan your exit strategy before you need it.

Whatever you do, don’t pretend it can’t happen in your industry.

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