Market Research

Big companies dump a ton of money into market research to see if their new product ideas will actually catch on in the consumer market. So what's a small company - with a very limited budget - to do? Up until now I've been mainly going by my gut but I'm beginning to wonder if that's necessarily the best course of action. As I look at the new products I'm thinking about introducing in 2008 I realize they fall into one of two catagories:
1. Products that are in line with current market trends or I've had a substational number of retailers ask for a similar type product
2. It sounds good to me

To try and offset some of the risk involved with those products that fall into catagory #2 I'm thinking about doing a little market research of my own. Of course, I'm trying to make it as cheap as possible. First of all I realized I'm going to tap into my business school's network of over-eager graduate students and have them do some of the market research for me. Business schools are actually a pretty under-utilized asset for small businesses and many business school classes require some sort of work with a real company. My bschool has a marketing research course that almost everyone takes and it requires student teams to work on a real-world problem for a real-world company. Best of all, they do the work for free. Granted, sometimes you get what you pay for but I figure it's worth a shot. Which reminds me I need to get in touch with the department head before the end of their fall quarter.

The second thing I'm thinking of doing to test the product is try to get a booth at one of the local farmer's markets and simply see how/if the product sells/what do consumers say about it, etc. I'm still not totally set on this idea and have a meeting scheduled with a friend who launched her company via one of the local farmer's markets to discuss the idea further. The benefits to this idea is that the farmer's markets in my area are very popular and get a ton of foot traffic so it could prove to be a really useful tool. The markets are also relatively cheap and there's always the chance that any revenue brought in could help offset my production space costs in the slower summer months. On the other hand, it means I have to be there week-in and week-out and if the idea totally flops then that could make for a very long summer!

Building the Operation Manual

Yesterday was my second to last day in my production space in 2007. I'm heading off for a belated honeymoon pretty soon so gave up my rental space for December since I won't really be around. Thankfully, my landlords have said they'd try to hold open my normal hours as I've been a very reliable renter. Hopefully it will hold true.

So I'm spending most of this week trying to build up the very last bit of inventory which will hopefully carry through the new year and next week when I'm home more often I'll refocus on trying to get all papers and "office" organization actually organized.

In fact, one of things I've been working on has been an Operations Manual. I started it because I realized that if I want to grow this business beyond simply little ol me, I need to have the company's procedures written down in a way that anyone could pick up the manual and continue the business without my guidance (or even without me!). As I've been putting it together I've been a little surprised by how much knowledge is saved in this head of mine. Nothing overwhelming, but - for example - the passwords to access various online programs that we use daily. Then of course there's the instructions for how to create our product, accept and process wholesale orders, invoice clients, pay commissions, etc. So there's a lot of information I'm trying to put down on paper.

My hope is to have a lot of the actual "accepting and processing orders" portion of it complete before I leave for my honeymoon as I'm leaving my mom in charge of the company (go mom!) while I'm away and want to make things as easy as possible for her. Then, if my grand plan works out, I'll finish up with a lot of the "production instructions" end of things in the first quarter prior to hopefully hiring on part-time help second quarter next year.

Interesting Article

An interesting read about a company I admire for how well they've done based on very limited initial resources. Life IS Good for these guys...

http://www.nytimes.com/2007/11/22/business/smallbusiness/22sbiz.html?_r=1&ref=smallbusiness&oref=slogin

I hope you enjoyed your Thanksgiving...

QuickBooks (yes, again)

I'm 98% of the way complete thanks to ingnoring any and all Thanksgiving cooking & cleaning today to focus on QuickBooks. The good news is that both QuickBooks and my latest bank statement indicate that there is currently money in the business account. Hooray!

I realize that I spent a truckload of money on two things this year - 1. PR (no surprise and why they're fired) and 2. Sales Generation. We attended five tradeshows this past year plus the Emmy's so it was very expensive once you take into account the actual tradeshow costs and the pre/post-tradeshow marketing. Next year that figure will come down significantly as we're only planning to attend 2 tradeshows with another one that I keep debating about adding.

We're also $883 from my financial goal for this year so I'm hoping we can get that in the next few weeks.

Ok, off to go immerse myself in the pre-Thanksgiving rush. Which brings me to my next (completely unrelated) point - will a 10.7lb turkey feed 4 people? It looks really small - more like a large chicken then a turkey?

The Pursuit of Happyness

My significant other and I rented (via Netflix) The Pursuit of Happyness this weekend. Here's a very quick synopsis in case you don't recall:

The movie is based on a true story of a single father who essentially loses all his money in a business transaction and ends up homeless. He applies for and gets a stock broker internship position (unpaid) and works for them for six months while also taking care of his son and trying to find space for the two of them at shelters on a nightly basis. At the end of the six months only one of the twenty interns is offered a posistion and, (I don't think I'm giving anything away here), it is offered to this guy. Turns out that this guy later goes on to open up his own firm and then in 200X? sold his stake in the firm for several million dollars.

Not only is the story itself impressive (and very well played by Will Smith) - but as an entrepreneur it struck me on two levels. The first was watching how his original entrepreneural desire got his family into financial straits to begin with (and eroded his marriage). It was a firm reminder that nothing is a given.

The second, and more compelling message, was how incredibly emotionally strong Chris (the main character) had to be to not only overcome everything he did but to do it with a son in tow. In talking to other small business owners, I know that many of us rely heavily on a network of friends, family, and spouse/significant other to help us emotionally when times are rough. Chris had no one as it doesn't appear that he let on to any of the other interns or his superiors at the firm what his true situation was.

I'm honestly not sure I could have done and continue to do this without that support network.

Long story short - I recommend the movie.

Buried Under Paper

Now that the orders are slowing down I'm starting to "take back the house." Since my house is the "corporate headquarters", in the past few weeks it's come to resemble a giant mailroom with all the orders going out the door.

In addition to trying to get the house back under control, I'm also now faced with the realization that I have four months worth of receipts that I haven't yet properly filed. I went through the paper today and now have a folder that is 4 inches thick of paper that needs to filed and inputted into QuickBooks.

The good news is that I actually have all bills, receipts, and invoices as required by the IRS. The bad news is it's going to take some time getting through and organized. I hope to get to work on it this weekend and finish it on Tuesday before my in-laws come into town for Thanksgiving. If not perhaps I'll just make the in-laws work for their turkey!

Right now, in the background, I currently have the Oprah show on and what I've picked up is that they have a woman who had literally tons of stuff in her house including 35 year old credit card statements. In comparison I don't feel so bad.

My Postman Hates Me

And here's why. This is a picture of my front door with packages waiting to be picked up (gotta love Piority Mail - the postman will come pick up the packages rather than watching time slowly tick away waiting in line at the Post Office). Every few days I end up putting out anywhere between 4-9 boxes for him to pickup. I'm sure he hates me.

But I think I'm getting to the end of it. I've got four more packages going out tomorrow morning, one that'll get dropped off in person on Thursday, and then one more going out next week. Granted, there's always a chance I'll have new orders come in but I'm oh so close to actually having ALL tradeshow orders out the door in addition to all orders that have come in since.

On another note entirely, I met with the friend with whom I'm starting the "hobby" business. She's really excited which helped get me really excited again and I think it's going to be fun. I have to drop off samples at the production space (we're having someone else do production) and I hope they turn out alright. We figure at the very worst if this doesn't look like it'll turn into a quasi-viable business then at least we'll have some fun gifts to give away this holiday season.

Good News or Bad News?

It's been one of those days. I've literally spent the entire day on my feet in my production space and I just got home relatively exhausted. I've been so busy with production because we've been getting a bunch of holiday orders including one really large order.

Only I came home today to find that the large order had been canceled because they're just now realizing that the price point doesn't work with their end consumer. On the one hand I'm doing ok because we actually already shipped them 1/3 of the order and they're willing to take that on and I've suggested a similar product with a lower price point so I may still get some sales out of them.

I'm also ok with it because it means I'll finally have a foothold in holiday orders as I've literally only been able to make enough product to fill existing orders and the orders keep coming.

But on the other hand, this obviously means that a decent sized order I had been expecting is now null and void and that's cash I'm going to wish I had come March when orders are few and far between. And I just spent all day on my feet killing myself to get enough product to fill this order.

So I'm not sure whether I'm ok with this change or not. All I know is that I'm exhausted. The good news though is that the work I was planning to do tonight now doesn't have to get done and I'm going to veg and veg and veg.

It's Official

The company name is officially a registered trademark. It's been a long process. I think we started it back in May 2006 and it's just now gone through all the hoops and obsticles. It wasn't cheap but something I'd highly recommend to any small company.

Why? Because I just found another company who is in my niche and whose name is basically simply a respelling of our name. Phonetically they pretty much sound the same (unless I'm very much mispronouncing their name). I don't think it was done on purpose but there is absolutely a possiblity that there could be confusion in the marketplace. Since I have the trademark it means I basically have the upperhand. My trademark attorney is sending me a bunch of information and after I take a look at it I'll have to decide what I want to do - but it's certainly nice to be on this side of it rather than being the company who is using the name but doesn't have the trademark.

Good Advice

1. It's sometimes amazing how small the world really is as it turns out that my husband is working with the CEO of a company I've long admired and am somewhat trying to emulate with my own little company. My husband was telling said CEO about my business and he gave me this piece of advice: This early in your company's lifespan - simply focus on doubling your revenue every single year and the rest will fall into place.

I like it - simple, succinct, and a great goal to have. So, that helps get my 2008 financial goal laid out.

2. This is a piece of advice I actually gave someone. I didn't think it was that spectacular but have since heard from two other people that they thought the advice was brillant (who knew!). The advice was that before you start X company - make sure you know what you're jumping in to. And I don't mean that you should have your business plan and proformas all laid out (which you should) - but that you need to understand the everyday day-to-day running of the business. So if you want to start that fudge store make sure you've worked in a kitchen for a fudge maker - if you want to open a coffee store go work as a barista for a time so you understand the business - and if you want to become a dog walker go work for one for awhile. Learn everything you can and make all your mistakes on their dime and then you have a wealth of knowledge and experience under your belt before venturing out on your own. You may also realize that said career is alot less "romantic" then you initially envisioned it and that your current job (with benefits and salary) is actually a pretty good deal. And if you don't - at least you have a better idea of what you're jumping into.

My very favorite story - which my husband has heard 101 times - is of someone I know who graduated a very prestigious business school and went to work as a consultant at a very prestigious firm and was making a small fortune. However, she really wanted to open up a women's fashion boutique so when she decided she was ready she quit her high-paying job and took a job as a sales associate at a women's boutique making an hourly wage. It was a HUGE step-down in many ways but she spent a year there learning absolutely every facet of the business. Then a year later she left, took all that knowledge with her, and started up a very successful boutique in another city. In a business where you have very high overheads due to the inventory you have to carry, fashion is a very fickle business and she's made it work in large part due to her experience working in that boutique for a year.

3. Don't let your accounting books get 9 months out of date. Yeah - that's a lesson I'm continuing to learn.