The Cost of Running A Handbag Business

The Cost of Running A Handbag Business

I wanted to share an honest update today. On May 1st, we will be increasing our prices by about 5-10% across all items.

I want Freja to stand for transparency and let's talk about money.

It started with a goal: luxury handbags, handcrafted in small batches, for under $300. We had our first design, and I was so excited to select ultrafiber as our material - it checked all the boxes and was a dream come true in every way.

But the numbers...the numbers were a stretch. I had a conversation with Kevin, our materials manager at the factory. Brands reach out all the time regarding ultrafiber but most find it too pricy. I'm talking brands that price their bags at $800 and up. He showed me a list of names — I recognized 90% of them.

I thought if I was scrappy, I could make the finances work. So we forged ahead and made our first collection. And it worked for the first few months. But starting a business is not the same as growing a business.

Now entering year two, we are at a standstill. We're making enough to cover our expenses, but it's a struggle to pay for inventory, to hire creatives, to grow, to give back, to do anything beyond the bare minimum. The pandemic has made everything, including shipping, more time-intensive and expensive (our frieght shipping costs have doubled in 2021 alone). As an idealist, I want to shove our Excel sheets and QuickBooks accounts under the carpet to deal with later. But as a business owner, I need to be realistic. 

In 2021, we would love to keep growing Freja. Creating the pieces and colors you’ve been asking for. Researching and developing even more sustainable materials and practices. Providing faster shipping and a better experience for you. Building initiatives that support the community. Giving back whenever we can. But first we need to generate enough revenue to make all that happen.

Creatives hate talking about money, about running a "business". I don’t like referring to Freja as a “business,” because it sounds so corporate and impersonal — the opposite of everything we are. But successful businesses bring happiness. It brings stability and puts food on the table for every pair of hands involved in Freja — our makers, our suppliers, our shippers, our talented photographers, our UPS driver Noby who comes and picks up all your packages every morning. Even though we are a tiny business, we represent so many. I want Freja to be a positive impact for everyone involved, and continue to do so, especially during these challenging times.

I left a little thank you gift for Noby and he left this sweet note :)

Our first year was an experiment. A test to see if this little idea had legs.

Now — one year, 2 sold out collections, 124 heartfelt email threads, and 371 handwritten holiday cards later, it’s safe to say we’ve found a tight knit community of individuals who believe in our mission. Now, it’s time to see if we can run a little farther, a little better.

To everyone who made our first year possible, I am so thankful for your support. Thank you for taking a chance on us, and on me. You are my original Freja family. Our platinum level backers on Kickstarter.

Here I'd like to share a note I received from Andrea M, one of our first supporters (who also happens to own the linnea tote in every color):

"PS. When you hit it big, will you remember those of us who loved your work from the beginning??? I always say that to restaurant owners - that I expect a table when they’re a big hit (and many become big hits - and yes I still get a good table!)"

Not that we are anywhere close to hitting it big, but a loud, resounding YES. Of course! Right this way, please :)

Fun fact — Our materials factory's current clients include heritage brands — the latter of which uses the exact same microsuede lining (found in our shoulder bag and paloma totes) for some of their styles! So you can feel confident in your freja bag — they are investment pieces built to last.

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